rogermunibond

USTR fee on non-US shipping seems to be a net big benefit to railroads connecting the largest US ports. Rather than make multiple calls on West coast or Gulf or East, shipping makes one port call and offloads all cargo. Rail will then move to other ports/hubs or into interior. Should be good for BNSF and UNP and CP.

MAGA has created a large schism on the free markets part. While MAGA is for less business regulation same as GOP, but more intrusion in civil society unlike GOP.

Military hardware requires analog chips, transistors, diodes, integrated circuit boards etc. which are excluded from tariffs

US/China trade deficit will widen even further since China’s tariffs on US goods remains.

@Spekulatius it's more like 29% when you only count the debt held by the public. intergovernmental debt doesn't trade. 10 yr and 30 yr yields keep moving up. which is likely Japanese insurance companies/asset managers. 1-5 yr yields are coming down as they should if we have a recession and the Fed cuts.

Friday starts q1 earnings so we will have lots of new datapoints shortly and 2025 forecasts. I predict “tariff” will be the most mentioned word in cc. Thank god we don’t have to talk about LLMs, AI, and GPUs anymore.

Blinked

In this environment there are much better companies to buy than OXY. Buffett was buying OXY when the opportunity set was very limited.

I'm convinced that Orange Man only wants Greenland because the Mercator projection makes the island look so big. In reality. https://thetruesize.com/

It all depends on the company's pricing power. And BTW in the @mcliu store example, margins are already coming down. $2 cost and $10 retail is a higher gross margin than $3 cost and $11 retail. To preserve your gross margin you'd have to raise prices to $15.

TDUP and WINA

Goods inflation is poised to increase, but you also have demand falling for sure. And as others have pointed out, energy cost is falling, OER/Rent is declining as well. Services inflation likely falls from lower GDP, layoffs, UE rises, all help mitigate the labor cost of services. So the net effect on inflation could be mixed.

Likely coming down and likewise overall market P/E 1 year from now

+1 @Dalal.Holdings This is not a GFC 2009-2010 or even a COVID 2020 market.

You guys are missing the point with a NKE or LULU and the tariffs. It's not passing on the 46-75-104% tariff cost on the imported value. It's the gross margin compression, operating margin compression that happens if they just pass on the tariff increase alone. They have to pass on the increase plus preserve their margins. Margin compression means their multiples come down.

Yesterday, the 10 Year went from 3.89% to 4.2% and finished 4.14%. Today it's up to 4.26% and bouncing in the 4.2s. That's a huge move. You sent from a stagflation scenario to an inflation scenario. Cuts to no cuts. The Admin wanted a lower ten year but they're not going to get it. This puts their tax cuts at risk imo.

+1 on Dark Winds. Tony HIllerman novels adaptation.

Biopharma processing TMO, DHR, and RGEN

Cruz added to the list of Grassley, McConnell, Rand, Murkowski, Collins and now French Hill House financial services chair. Plus no rate cuts from Powell. The pressure rises.

@thepupil US agricultural products to top five export markets face tariffs 12 to 21% US non-agricultural products to top fix export markets face tariffs 2.5 to 6% The claim of 60% is not a tariff. It's the undervaluation of the RMB based on the Fx peg that PBOC. It's somewhat dubious IMO. *************** Keynes back in Bretton Woods released that having one currency be the dominant reserve would create imbalances. He promoted something called the bancor that would substitute for any one nation's currency. The US negotiator, Harry Dexter White, was vehemently opposed to this and he convinced the US officials and FDR that having the USD as the reserve currency would be advantageous.

@thepupil

Whether tariffs are a bluff or a real policy change (at least 4 years) is not knowable. Admin people like Navarro, Lutnick, Trump seem to want manufacturing reshoring, tariffs as new revenue source. So what are you negotiating? Lowering foreign tariffs doesn't really help either of those goals. Committing to buy US goods might but most of the US goods people would purchase are commodities (agricultural) or Boeing planes. Are they going to buy US made autos? Probably not. Bessent and USTR Greer seem like they are completely out of the loop. Bessent is running around telling countries not to retaliate like some scarred toddler watching daddy beat up mommy.