Tariff Scorecard: Keeping Score in the Latest Wave of Tariffs
Tariffs are once again front and centre in investors’ minds. Since returning to office, President Trump has hit several major trading partners with new levies and rolled out a wave of new threats. The list is growing fast, with entire countries and key sectors in the crosshairs, making it tough to keep track of what’s actually in effect and what’s still just a warning shot.
So, here’s a quick recap.
What’s BRICS, and Why Is It Back in the Headlines?
I first heard the term BRIC – referring to Brazil, Russia, India, and China – back in the late 1990s when I was researching high-growth mutual funds. The pitch was that these were fast-growing economies, and investing in a BRIC-focused fund would add a boost to a long-term portfolio. I ended up passing on the fund… and promptly forgot about BRIC.
Fast forward to today, and the term is back in the spotlight – this time with an “S” on the end, as South Africa officially joined the group in 2010. With BRICS now grabbing headlines again, I thought it was a good time to revisit what the group is and why it’s suddenly become a target of President Trump’s latest trade threats.
Sell in May or Stay and Invest?
I originally intended to talk about this lighter topic – an old investing phrase that tends to pop up around this time of year: “Sell in May and go away” the previous week, but Warren Buffet stepping down from Chief Executive Officer of Berkshire Hathaway (NYSE: BRK.B) after 60 years at the helm kind of stole the lead. So this week, let’s talk a look at the story behind this phrase.
US markets took another body blow at the start of this past week, once again set off by a tweet from President Trump. He renewed his public attacks on Federal Reserve (Fed) Chair Jerome Powell, calling him a “major loser” and demanding immediate rate cuts to juice the economy. Trump even floated the idea of firing Powell – a move that, while legally difficult, has rattled investor confidence.
The sell-off at the start of the week wiped out the past 12 months of gains, with stocks edging closer to bear market territory. Since the previous Thursday, US markets saw their steepest three-day decline since 1987 – and before that, not since World War II. Meanwhile, Canada’s TSX Composite Index (TSX) experienced its sharpest drop since the early days of the COVID-19 pandemic. This time, though, the damage was self-inflicted—and, frankly, far from fun. ☹
Economists and analysts have been bringing up the word ‘stagflation’ lately – and that’s not a good thing. It’s an economic scenario no one wants, where growth stalls while prices keep rising. The term might sound complicated but understanding it now can help you avoid surprises later. So this week, I thought I’d go over what stagflation is and explain it in a way that’s easy to understand.
What is Stagflation?
Imagine you’re driving in bumper-to-bumper traffic – moving painfully slow – but at the same time, your car’s engine is overheating. That’s basically stagflation in economic terms: the economy isn’t growing much (or at all), but prices keep rising. Normally, inflation happens when the economy is booming, and a slowdown helps cool things down. But stagflation flips the script, combining slow growth with rising costs – something that can leave consumers squeezed and businesses struggling.