The Fog Of Tariffs

2025-04-14 14:55:00 ET

Summary

• The hard economic data is still strong, and the inflation data is too high for pre-emptive rate cuts to occur.
• Even though tariffs virtually guarantee that a recession will happen sooner rather than later, they also push prices significantly higher. Inflation is projected to rise even faster than the current 3% pace.
• The stock market plunged. But are stocks cheap now after this retreat? The S&P 500 is trading at 20x next year’s 7 percent projected earnings growth. That is a rich multiple on an earnings growth rate that will most likely never happen.
• Tariffs are taxes. When you combine the tax hike with a falling labor force, the end of government stimulus, reduced liquidity, and a reverse wealth effect, you get an expedited and intensifying economic contraction.

There was a near-record number of job layoff announcements during the month of March, according to the labor research firm Challenger, Gray & Christmas. There was a total of 275,240 layoff announcements last month. The level of layoffs was eclipsed once before in history when the nation was shutting down during the COVID pandemic outbreak in March of 2020....

Read the full article on Seeking Alpha

For further details see: