Still Waiting on the Tariff Impact

Retail investors are “all in” on the stock market despite recent volatility. We have all been conditioned to buy the dip over the last 16 years. However, there are real questions about the direction of the economy over the coming months. It is not just that the stuff Americans buy might cost more. There is a possibility that we will not even be able to find everything we want.

Chart of the Week

Barrons may be correct about new highs in the stock market coming soon. This would require a sudden announcement that a trade deal has been struck with what Treasury Secretary Scott Bessent calls the 18 most important U.S. trade partners. In the same interview on Tuesday, May 6th, Bessent let it slip that there have been no negotiation discussions with China; however, there was information after the market closed that officials from China and the United States would meet in Switzerland this weekend.

Regardless of the rhetoric coming from the two world superpowers, trade is declining fast. Imports from China have fallen by a staggering 50%. I am watching to see if other countries can pick up the slack. What I see is manufacturing slowing in Mexico, Brazil, and Vietnam while shipping is increasing out of South Korea and Taiwan (TheDailyShot).

Please go back and read last week’s MarketPoint for more information. Little has changed since then. American ports are unloading fewer ships from China.