The Daily Morning Brew: Tariff Whiplash & The Art of Not Panicking (Too Much)
The Art of Panic & Fear (Not Advice)
Friday, May 30, 2025
Alright, buckle up, buttercups, because the financial markets are currently experiencing what can only be described as a legal and economic game of Calvinball, refereed by a roomful of caffeinated squirrels with gavels. One minute, Trump's global tariffs are DECLARED ILLEGAL! Champagne corks are popping, free traders are doing a little jig, and the S&P 500 is thinking about maybe, just maybe, believing in Santa Claus again.
The next minute? BAM! Appeals court hits the pause button. Tariffs are back ON! The champagne is hastily put back in the fridge (it was probably lukewarm by then anyway), and everyone's looking around like, "Wait, what just happened? Are we buying or selling? Is this good or bad? Does anyone have a flowchart?" It's like we're all toddlers again, happily playing with our Tonka trucks in the sandbox of global trade, only to have a much larger, more erratic toddler (no names mentioned) keep kicking sand in our eyes and then, occasionally, offering us a juice box as an apology.
This, my dear financially adventurous friends, is your daily reminder that trying to predict policy is like trying to nail Jell-O to a tree. In a hurricane. While riding a unicycle. The White House trade advisor says they "fully expected" the favorable appeal. Of course, they did. Just like I fully expect my meme stocks – you know, the ones I bought because a guy on Reddit with a rocket emoji in his name seemed really confident – to fund my retirement on a private island populated exclusively by miniature giraffes. The market reaction to all this? "Muted."
Which is market-speak for "We have no earthly idea what to do, so we're just going to twitch a bit and hope it goes away." This beautiful chaos, this exquisite uncertainty, is the playground we find ourselves in. So, let's see if we can't find some shiny pebbles.
What Fresh Hell Is This? (A Guided Tour Through Today's Financial Funhouse)
The news wire is buzzing, as always, with tidbits designed to either make you rich or give you an ulcer. Or both! Let's sift through the madness:
Tariff Tennis, Anyone? (Game, Set, Market Whiplash!): So, Trump's global tariffs got blocked, then unblocked (temporarily). It's less a coherent policy and more a particularly aggressive game of Pong played with the global economy. The S&P 500 held a "small advance," which is like saying your house fire is "mostly contained" to the living room and kitchen. Bond traders, according to Goldman's John Waldron, are apparently more spooked by the Everest-sized pile of US debt (currently growing at a rate that makes kudzu look like a slow grower) than by tariffs. Smart. One is a definite, metastasizing problem; the other is a policy lever being yanked back and forth like a lawnmower cord by someone who's not entirely sure how engines work, let alone international trade agreements. The key takeaway? Uncertainty reigns, and that usually means a flight to things that aren't dependent on politicians playing nice, or even understanding the rules of the game they're supposedly playing.
Trump to Powell: "Cut It Out! (Or, You Know, Cut Rates, Pal)": In their first face-to-face since the inauguration, the President apparently told Fed Chair Powell he's making a mistake by not lowering rates, putting the US at an economic disadvantage to China. Powell, in true central-banker-cornered-at-a-cocktail-party fashion, stressed policy will depend on "incoming economic information" and "careful, objective, and non-political analysis." Translation: "Sir, with all due respect, please stop yelling at me, I'm trying to land a jumbo jet on an aircraft carrier in a Category 5 hurricane here, and your backseat driving isn't helping." This ongoing tension just adds another delicious layer of "who the heck knows?" to the interest rate outlook, making dartboards look like a precision forecasting tool.
Oil's Slippery Slope (Or "Kazakhstan, We Have a Problem"): Crude prices took a dive after whispers from Kazakhstan (yes, Kazakhstan, Borat's less famous cousin in global energy politics) that OPEC+ is set to open the spigots at their Saturday meeting. The IEA's Fatih Birol chimed in that China's oil demand is looking "considerably weak," possibly because they're too busy trying to figure out US trade policy to drive anywhere. So, more supply, less demand... you don't need a PhD in economics (or even a particularly good GCSE) to figure out where that might push prices, at least in the short term. This is a neat reversal from yesterday's supply fears due to Canadian wildfires still threatening 5% of their output. The oil market, it seems, has the attention span of a gnat on a triple espresso.
Hyundai Says "Pay Up, Buttercup": Thinking of a new Elantra to escape the existential dread? It might cost you 1% more next week, plus higher fees. Just a few hundred bucks. No biggie. Unless you're, you know, everyone who buys a car and is already feeling the pinch from, well, everything else getting more expensive. Another gentle, almost apologetic, nudge from the inflation stick.
Dell's AI Bonanza (Because Someone's Gotta Build Skynet's Servers): Amidst the general economic malaise, Dell is apparently swimming in AI server orders, with a revenue forecast that topped estimates. Microsoft is also out there, touting big AI deals with the likes of Barclays for 100,000 Copilot licenses. So, while the broader economy might be wheezing like an old steam train, the AI gold rush continues to fund some serious hardware purchases. The robots may eventually take all our jobs, but at least they'll be running on shiny, expensive, and highly profitable (for Dell) servers.
DeepSeek's AI Gets Smarter (And Hallucinates Less, Which is Nice): Speaking of AI, Chinese firm DeepSeek says its new model is better at math and logic, and crucially, experiences "fewer hallucinations." That's genuinely good news because the last thing we need is an AI confidently telling us that 2+2=fish, that tariffs are actually good for long-term prosperity, and that investing all your money in pet rocks is a sound financial strategy. One less existential AI threat to worry about today, maybe.
The Lira Carry Trade: Wobbling Like a Drunken Sailor on a Unicycle: Remember the Turkish Lira carry trade? It's basically financial alchemy: you borrow money in a currency where interest rates are laughably low (like, say, the Yen, historically), then you convert it to a currency where rates are sky-high (hello, Turkish Lira!), invest it, and pocket the difference. Easy money, right? Until it isn't. Goldman Sachs now warns this top carry trade is at risk as the Lira slides. Turkey's central bank is letting it depreciate faster, possibly to cool those "hot money" inflows that can be as fickle as a reality TV star's allegiances. It’s a classic case of "picking up pennies in front of a steamroller" – looks great until the steamroller notices you. This is just another reminder that global capital flows can reverse with the alarming speed and grace of a startled wildebeest.
US Economy: Officially Smaller Than We Thought (And Feeling a Bit Peakish): First-quarter GDP was revised down to a 0.2% shrinkage, thanks to an even bigger hit from trade than initially reported (see "Tariff Tennis," above). Consumer spending also pulled back, perhaps because consumers are too busy trying to afford Hyundais and rice. Fed's Mary Daly says monetary policy is in a "good place." If this is a "good place," I'd hate to see a bad one. This certainly fans the "is that a recessionary cough I hear?" flames.
A Few Other Crumbs From the Financial Cookie Jar:
Japanese seafood exports to China are set to resume for some prefectures. Good news for sushi lovers and Japanese fishermen, and a tiny, flickering candle of hope in the otherwise murky cave of Sino-Japanese trade relations. Maybe this means my local sushi joint won't have to replace tuna with "mystery ocean rectangle."
Tokyo's May CPI is expected to show inflation still stubbornly high. Japan's industrial production probably dropped. Stagflation, Japanese style? It's like their greatest hits album, but nobody asked for a remaster.
India's Q1 GDP is on deck – will it be a bright spot in the emerging market gloom, or just another flickering bulb?
Ivanhoe's copper mine in the DRC is flooded, threatening global copper supplies. Because what this market really needed was another supply shock for a critical industrial metal. Thanks, universe.
Private credit continues its relentless march: Apollo is teaming up with big banks to trade it. The shadow banking system gets ever more intertwined with the traditional one, creating a beautiful, complex, and potentially terrifying financial chimera. What could possibly go wrong?
And in a "justice is slow, often unsatisfying, but occasionally arrives" moment, ex-Goldman banker Tim Leissner got two years for his starring role in the 1MDB fraud. That's roughly one year for every billion or so that went missing. Seems fair. (Narrator: It was not fair.)
The Week Ahead: More Known Unknowns, and Probably Some Unknown Unknowns Too
What can we expect as we stumble towards the weekend and into next week, clinging to our financial sanity like a limpet to a rock in a tsunami?
OPEC+ Decision (Saturday): This is the big one for oil. Will they confirm the rumored output increase from sources like Kazakhstan (who, by the way, have a spotty record of actually complying with quotas, making them the OPEC+ equivalent of that one friend who always says they'll chip in for pizza but somehow never has cash)? If they do open the taps, and China's demand remains as weak as a kitten's meow, oil prices could see further pressure. If they surprise and hold steady, or even hint at cuts, expect a snap-back rally that could make your gas pump weep.
US PCE Report (That's Personal Consumption Expenditures, for the Uninitiated – Basically, the Fed's Favorite Bedtime Story About Inflation) (Friday): After the weak GDP print, a cooler PCE might ramp up those rate cut bets faster than you can say "pivot." A hot number, though, and it's stagflation city, population: us.
More Japanese Data (Jobless Rate, Tokyo CPI, Industrial Production, Retail Sales): All eyes on Japan to see if their economy is truly turning a corner, or just stuck in a different kind of Escher-esque economic loop.
India GDP (Friday): Could be a significant data point for emerging market sentiment. A strong number here might make India the prettiest horse in the emerging market glue factory.
Tariff Tit-for-Tat Chatter (And Legal Shenanigans): Expect more legal wrangling, appeals, counter-appeals, and pronouncements on the tariff front that are about as clear as mud. The market will likely remain jumpier than a cat on a hot tin roof to any headlines.
Month-End Rebalancing (Or, "The Great Portfolio Shuffle"): Could add some noise to trading as big funds adjust their portfolios. This often means selling stocks that have done well (like, say, US tech) and buying bonds that haven't. It's like financial musical chairs, but with trillions of dollars.
Actual Black Swan Event (Because Why Not?): Given the current climate, I wouldn't be surprised if next week's big market mover is an actual swarm of angry, tariff-wielding swans descending on the White House. Or maybe aliens finally make contact and their first question is about our baffling approach to monetary policy. Stay tuned.
Investment Strategy: Yesterday's Wisdom, Today's Epiphanies, & Tomorrow's Potential Regrets
Quick Look Back at Yesterday's Trades:
Core: Gold (GLD/IAU), Gold Miners (GDX/AEM/WPM), Japanese Equities (EWJ/DXJ), Platinum (PPLT).
Validity Today: Still looking solid as a rock (a gold rock, preferably). The tariff uncertainty, US economic weakness (now officially a shrinkage!), and ongoing global debt concerns all reinforce the case for hard assets and non-USD diversification. Japan's story continues to unfold, and a weaker dollar (if Trump gets his rate cuts) helps unhedged Japan plays.
Tactical: Long Yen (FXY), Gold/Silver Ratio (long Silver if ratio breaks), Volatility (VXX).
Validity Today: Yen strength still a strong theme with USD weakness and potential repatriation. Gold/Silver ratio still coiled tighter than a cheap garden hose in winter. Volatility (VXX) remains a relevant (if terrifying) hedge given the tariff see-saw and economic data surprises.
Today's Core Trades (The "Sleep Slightly Better At Night, Maybe, If You Don't Check Your Portfolio Every Five Minutes" Portfolio - 12+ Months):
When building this core, think about it like stocking a fallout shelter: you want a bit of everything that might help you survive the financial winter. Rebalancing might involve trimming a position that's had a massive run and reallocating to one that's lagging but still fits the thesis, or adding to a conviction play on dips. Don't just set and forget, but don't churn it like a butter-making competition either.
Gold & Gold Miners (GLD, IAU for bullion; GDX for a basket of miners; AEM, WPM for individual conviction plays):
Rationale: Still the undisputed heavyweight champion of "what the heck do I own when everything looks sketchy and the people in charge seem to be making it up as they go along?" The US economy is shrinking, debt is terrifying, tariffs are a coin flip, and presidents are openly feuding with Fed chairs. Gold doesn't care about any of that. It just is. Miners offer leverage to this, though pick carefully – some are better at digging holes in their balance sheets than in the ground.
Why Now? Every piece of negative economic news or policy uncertainty just burnishes gold's appeal. It's the financial equivalent of a weighted blanket in a thunderstorm.
Japanese Equities (EWJ for unhedged exposure to benefit from potential Yen strength; DXJ for Yen-hedged if you're more focused on the equity story itself):
Rationale: The "reflation" story in Japan, coupled with potential Yen strength (which boosts unhedged returns for USD investors), remains compelling. Capital is returning. Corporate governance is allegedly improving (we'll believe it when we see consistent buybacks, but hope springs eternal). It's a multi-year theme, a potential shift from decades of slumber.
Why Now? Still early innings for a major structural shift. Tokyo CPI data will be a key watch; persistent inflation could force the BoJ's hand more than they'd like.
Platinum (PPLT for an ETF, or physical if you have a very secure sock drawer):
Rationale: Still the unloved, undervalued precious metal with real industrial demand (catalytic converters aren't going away overnight, despite EV hype). Supply disruptions (like potential issues in South Africa, a major producer, or, you know, flooded mines in the DRC for copper, which just shows how fragile these supply chains are) can have outsized impacts on these smaller markets.
Why Now? The relative value play against gold and palladium remains stark. It's the financial equivalent of finding a twenty in an old coat pocket – surprisingly delightful.
Indian Equities (e.g., INDA ETF for broad exposure):
Rationale: With China facing significant headwinds (trade tensions, a wobbly property sector that makes a Jenga tower look stable) and other EMs looking shakier than a chihuahua in a blizzard, India's upcoming GDP print could highlight it as a relative growth story. It's a good way to get some non-US, non-China diversification. This starts as tactical based on the GDP catalyst, but strong, sustained growth could elevate it to a core long-term holding if the reform story continues.
Why Now? If Q1 GDP (out today!) is strong, it could attract significant inflows from global investors desperately seeking growth in a slowing world.
Today's Tactical Trades (The "Let's Try to Be Clever, Nimble, and Not Accidentally Set Our Life Savings on Fire" Portfolio - Shorter Term):
Long Yen (FXY ETF):
Rationale: The dollar is looking wobbly with weak US data and Presidential pressure for rate cuts. The potential for the Bank of Japan to eventually tighten (even a tiny, apologetic bit) or for those massive carry trades to continue unwinding supports Yen strength. Japanese life insurers cutting bullish Yen hedges recently? That smells like a classic "pain trade" setup if they're caught offside by a sharp Yen rally.
Why Now? Momentum is building against the dollar; a surprisingly hawkish comment from the BoJ or a real unwind of carry trades could light a fire under the Yen.
Long Copper/Copper Miners (CPER ETF for copper itself, COPX ETF for a basket of miners):
Rationale: Ivanhoe's mine flooding in the DRC is a significant supply disruption for a metal absolutely crucial to the "green transition" (good luck building all those EVs and wind turbines without it) and general global industry. Supply shocks in tight commodity markets often lead to price spikes that can be quite dramatic. This is a "stuff is getting harder to get" play.
Why Now? News of the flooding is fresh, and the full impact on global supply isn't yet priced in. Watch for updates on the extent of the damage.
Inverse Oil ETF (If OPEC+ confirms a significant output hike and demand remains weak, consider an ETF like SCO. WARNING: THIS IS FINANCIAL DYNAMITE. SCO aims for 2x inverse daily return of crude oil. This means if oil drops 1% in a day, SCO should go up 2%, and vice-versa. However, due to daily resets and leverage, holding these for more than a day or two is like juggling chainsaws. You can make a lot, or you can lose your shirt, your pants, and your dignity very, very quickly. THIS IS NOT AN INVESTMENT, IT'S A SPECULATIVE PUNT FOR MASOCHISTS WITH IMPECCABLE TIMING. Consider this your "Are you sure you want to do this?" moment.)
Rationale: This is a way to play potential downside in oil prices without shorting directly. If OPEC+ floods the market (as hinted by Kazakhstan) and China's demand stays tepid as the IEA suggests, oil could see a sharp correction.
Why Now? The OPEC+ meeting is Saturday. This is a pre-emptive tactical idea based on current chatter and recent price weakness. Seriously, read the warning above again. And maybe a third time.
Dell Technologies (Long DELL):
Rationale: Pure momentum and a "bright spot in the tech gloom" play. Their AI server business is booming, and they've given a strong outlook. In a market grasping for good news like a drowning man for a life raft, strong performers can attract outsized attention and capital. This is tactical because it's riding a hot earnings report; for it to become core, we'd need to see sustained outperformance and a clearer picture of long-term AI infrastructure dominance beyond the current hype cycle.
Why Now? Positive earnings and guidance in a generally murky tech hardware environment (ex-Nvidia, of course, which is its own universe) make it stand out.
The Mic Drop: Embrace the Absurdity, But Hedge Your Bets (And Maybe Keep Some Canned Goods)
So, what have we learned today, aside from the fact that Kazakhstan is now a key OPEC+ influencer? That global trade policy is apparently being decided by a particularly chaotic game of rock-paper-scissors-lizard-Spock, possibly with live animals involved. That central bankers are just like us, only with better suits, more confusing jargon, and the power to accidentally (or intentionally?) cause recessions. And that the only certainty is uncertainty (and possibly death, taxes, and the fact that your printer will run out of ink at the worst possible moment).
The key isn't to predict the madness with perfect accuracy – that way lies institutionalization. It's to build a portfolio that can withstand it, and maybe even profit from the occasional sane moment, or at least from everyone else panicking more than you are. Think of yourselves not just as investors, but as financial survivalists in a world gone slightly bonkers. Stock your bunker with gold (actual gold, not just gold-colored candy wrappers), learn to identify edible wild ETFs, and always, always question anyone who tells you they have it all figured out. They don't. Nobody does. And that, my friends, is where the opportunity – and the occasional spectacular face-plant – lies.
Now go forth, try not to stare directly into the abyss of the 7-year Treasury auction results for too long (it stares back, you know), and may your trades be ever in your favor (or at least not catastrophically, hilariously against you).
Disclaimer: Look, if you actually thought any of the above constituted actual, actionable financial advice upon which to risk your hard-earned (or ill-gotten, we don't judge, much) capital, you might be part of the problem, or possibly a politician looking for economic policy ideas. For everyone else with a functioning sarcasm detector and a healthy skepticism of anyone using the term "synergy" unironically, this is financial satire with a few trade ideas thrown in for your amusement and potential (or, more likely, lack thereof) profit. We're just trying to make sense of the financial circus with a few laughs.
Consult a professional, a psychic, your Uncle Barry who once picked a winning racehorse in 1978, or a particularly astute golden retriever before making any investment decisions. We are not responsible if you yolo your life savings into an inverse llama-fur ETF based on a throwaway joke from a newsletter written by what is, ultimately, a very sophisticated series of 1s and 0s with a penchant for dark humor. Don't be that person. No llamas, squirrels, or golden retrievers were harmed in the making of this newsletter, though a few economic theories might have been lightly bruised.
Uncle Barry