Ah, S--t

The stock market experienced a violent sell-off due to the tariffs announced last week

Summary: The Trump administration announced its tariffs last week, and the stock market experienced a violent sell-off. It's too soon to tell what the real impact of the tariffs will be, but there are strong arguments to be made for both positive and negative outcomes for the US. The knee-jerk reaction is that this is the end of the free trade era, but the administration is signaling it wants to negotiate. Either way, the US economy's soft landing is in jeopardy. Still, Jerome Powell will not be hurried.

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Macro

Ahhhh, S--t
"I mean, I guess the stock went down based on some of the numbers we reported and then it got killed because of a -- really, shit, okay. I just looked at the screen. I hadn't looked at it." — RH (RH 0.00%↑) CEO Gary Friedman

It's going to take some time to process what's happened
"So what I would say is we're watching the tariff evolution as closely as everyone else. And it will take us a minute to kind of process all what that implications of all that has been shared over the last day or so." — Ulta Beauty (ULTA 0.00%↑) CFO Paula Oyibo

It's possible that the game has changed
"So look, I think basically that the game has changed and now it's -- it kind of doesn't matter where you go, I mean, except America." — RH (RH 0.00%↑) CEO Gary Friedman

"Liberation Day" marked a seismic shift
"The recent Liberation Day announcement by the US leaves no room for doubt. It marks a seismic change in the global order. We are entering a new phase—one that is more arbitrary, protectionist, and dangerous. For decades, the US was the bedrock for the free market economies of the world, and led efforts to build a multilateral trading system." — Singapore Prime Minister Lawrence Wong

We’ve left the best economic period in history
"This is the biggest change in the environment that I've seen probably in my career. You know, we’ve gone from free trade and world trade and globalization to this system, which implies significant restrictions on trade in every direction and a step toward isolation for the United States... I believe that the last 80 years since World War Two have been the best economic period in the history of mankind. And one of the major reasons was the growth of trade." — Oaktree Capital (OAK-B) Co-Chairman Howard Marks

This could be a really bad thing for the world
"The likelihood of a full-blown global trade war is growing—the impact of the higher tariffs, plus the uncertainty of what other countries may do next, will weigh heavily on the global economy. Singapore will take a bigger hit than others because of our heavy reliance on trade... The last time the world experienced something like this was in the 1930s. Trade wars escalated into armed conflict and eventually the Second World War." — Singapore Prime Minister Lawrence Wong

And a pretty bad thing for America too
"It's probably still the best place, but it's less best than it used to be... One of the things that made it the best place was the rule of law. That may be less the fact today. Another was the predictability of outcomes—that may be less today." — Oaktree Capital (OAK-B) Co-Chairman Howard Marks

But the administration is signaling it wants to negotiate
"I would advise none of the countries to panic. I wouldn't try to retaliate, because as long as you don't retaliate, this is the high end of the number...Right now, my advice to every country is not to retaliate. Let’s see how things unfold, because if you retaliate, things will escalate." — US Treasury Secretary Scott Bessent

Trump: Drop your barriers
"Likewise to all of the foreign presidents, prime ministers, kings, queens, ambassadors & everyone else who will soon be calling to ask for exemptions from these tariffs, I say terminate your own tariffs, drop your barriers.." — President Donald Trump

The US does have some leverage
"If you're the current administration, if you're Trump, if you read the art of the deal, I mean, look, he knows how to use leverage and he has leverage... It was devastating for people that invested big tons of money to relocate, but again, the U.S. has leverage today." — RH (RH 0.00%↑) CEO Gary Friedman

Many countries depend on trade with the US
"I don't think these tariffs are going to completely stick... You're either going to implode as an economy in these countries or you're going to balance the trade economics. And I think that's what the administration wants." — RH (RH 0.00%↑) CEO Gary Friedman

The tariffs could be a good thing for America long term
"Forget what anybody else's personal views are on form—I'd just say look at the content for America. The content of the decision for America is a really good thing long-term... Is it going to be messy? Yeah, but it's messy for everybody." — RH (RH 0.00%↑) CEO Gary Friedman

But in the near term, the soft landing may have just ended badly
"So the economy's still in that soft landing thing, but a lot of turbulence out there... I think this turbulence could force this [soft landing] in a completely different direction. So I'm a little cautious about that." — JPMorgan (JPM 0.00%↑) CEO Jamie Dimon

Consumers are weakening
"The dynamic macro environment has contributed to a more cautious consumer...Consumers are spending less due to increased concerns about inflation and the economy. This is manifesting itself into slower traffic across the industry in the U.S. in quarter 1, which we are experiencing in our business as well." — Lululemon Athletica (LULU 0.00%↑) CEO Calvin R. McDonald

"I think the U.S. consumer is weak... We anticipate that market dynamics in HHC will remain challenging and variable for the remainder of 2025 due to weak consumer demand." — H.B. Fuller (FUL 0.00%↑) CEO Celeste Mastin

"In today's more challenging economic and consumer environment, we recognize the consumer remains discerning." — Petco Health and Wellness (WOOF 0.00%↑) Joel D. Anderson

"Consumers, especially lower income consumers, are more cautious, exhibiting more value-seeking behavior and tightening their budgets. As many are worried about the future, job security and rising costs, we are seeing this not just in the U.S. but across our key markets." — McCormick (MKV.C) COO Brendan M. Foley

Investors are anxious
"I hear it from nearly every client, nearly every leader—nearly every person—I talk to: They’re more anxious about the economy than any time in recent memory. I understand why." — BlackRock (BLK 0.00%↑) CEO Larry Fink

There's a lot of new inflationary forces
"I think people make a mistake to look at inflation in the last report. Everything I see is inflationary. The re-militarization of the world. The unbelievable fiscal spending around the world—not just the US but we are the worst, okay, by far... The long-term trend might be higher rates, more inflation, a lot of demand for capital." — JPMorgan (JPM 0.00%↑) CEO Jamie Dimon

Powell is still looking at backward data
"While uncertainty is high and downside risks have risen, the economy is still in a good place... At the same time, surveys of households and businesses report dimming expectations and higher uncertainty about the outlook... We are closely watching this tension between the hard and soft data." — Federal Reserve Chair Jerome Powell

He's not a man in a hurry
"We are well positioned to wait for greater clarity before considering any adjustments to our policy stance. It is too soon to say what will be the appropriate path for monetary policy... It feels like we don’t need to be in a hurry." — Federal Reserve Chair Jerome Powell

Trump is starting to apply soft pressure
"This would be a PERFECT time for Fed Chairman Jerome Powell to cut Interest Rates. He is always ‘late,’ but he could now change his image, and quickly." — President Donald Trump

In some ways, what Trump has done is impressive
"I think it's just a little shocking because we've never seen an administration and the leader like Trump. I mean, it's impressive, quite frankly. Usually, governments move like glaciers and he is quite the opposite." — RH (RH 0.00%↑) CEO Gary Friedman

Somehow things will probably turn out ok
"But we have lived through moments like this before. And somehow, in the long run, we figure things out." — BlackRock (BLK 0.00%↑) CEO Larry Fink

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