Markets react to Trump’s swift tariff strategy; advisors urge patience
LOS ANGELES - While many people are getting whiplash from the financial markets after President Trump's latest tariff maneuvers, many financial advisors are not surprised, even if they are spending a lot of time hand holding panicky clients.
"It's the speed of how he's doing it that's causing insecurity, not necessarily what he is doing," said the Founder and CEO of EnJoy Financial, Shelby Rothman.
Trying to put context into Trump's policy, she tells clients his tariff policy is meant to help the finances of people in this country. "There has been a basic inequality in the markets," she explained.
What they're saying:
"When you see foreign countries flooding our stores with cheap products, it has a lot to do with long-standing trade agreements, not with improving our economy," she echoes economists explaining Trump's long-standing dislike of tariffs.
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Local businesses don't get the same trade deals in other countries, but what's more, they can't even compete domestically. Think of the farmer paying minimum wage to people picking oranges in California. That orange will cost a lot more than the orange picked in another country by someone getting a lot less money, and not subject to US tariffs or any import fees, when arriving in trucks with cheap gas from Mexico, for a fraction of the cost it would take us to export an orange to another country or even state.
It's the reason a lot of manufacturing, even agriculture, is disappearing in the U.S. But changing that will take time, and Trump only has a little over three years to prove his vision will yield results - thus the fast-tracked tariff negotiations playing out in the world stage.
Will it work? That depends on who you ask. Rothman, for one, thinks that most trading partners will come around to making deals in the next 90 days, except for China. "That will take longer", she adds, "which means your $1.99 beach ball may go up in price, but I think we can live with that".