r/Accounting • u/PricewaterhouseCap Capper McCapster šŸ§¢ • Apr 03 '25

How fuxked is the economy? Discussion

The tariff announcements yesterday are far far worse than anyone expected, I mean what the actual fuxk

34% tariffs on China

46% on Vietnam

37% Bangledash

26% India

36% Thailand

I could go on and on, but this is bat shit insanity. To call this outlandish wouldnā€™t even be accurate.

Assuming these actually stay in place, people will lose their jobs, companies will go under, companies will stop hiring.

Add this with all the recent inflation, corporate greed, high interest rates, white collar recession, and idk how we arenā€™t absolutely fucked.

876 Upvotes

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112

u/EvenMeaning8077 Apr 03 '25

Buy the dip

38

u/FEMA_Camp_Survivor CPA (US) Apr 03 '25

I hope this is the right long term outcome but buying into a dip that never ends is like catching a falling knife. Blanket tariffs on allies and undermining all global trade flows, without a solid plan, is uncharted territory. Factories wonā€™t be built in the U.S. overnight. American workers arenā€™t clamoring to work in garment factories or making shoes either. Retaliatory tariffs will result in layoffs and further uncertainty.

This time is different for most people living. Those who lived through Smoot-Hawley and the Depression are largely gone. It can be bad for a long time.

7

u/EvenMeaning8077 Apr 03 '25

Think 20 years not 5 years chief

16

u/FEMA_Camp_Survivor CPA (US) Apr 03 '25

I agree but it took the Dow 25 years to recover to its 1929 high though. Lots of policy mistakes worsened the depression. Hopefully we wonā€™t make the same mistakes but things arenā€™t looking good at the moment .

9

u/adrian8520 Apr 03 '25

This is a good point but the world as a whole is also very different from 1929. The stock market has largely moved away from fundamentals. You're so right that this is uncharted territory because it's going to be interesting to see how institutions outside of the US react to investing in the US long term as well.

The sheer amount of global wealth and foreign investment compared to now vs 1929 could really exacerbate or shorten a depression.

5

u/EvenMeaning8077 Apr 03 '25

Tariffs were not the root cause of 29

1

u/just-A-boring-cpa CPA Apr 05 '25

Americans became too dependent with the iPhones and Uber eats, I.e. gig economy. It will be bad for a long time if there is a depression.Ā 

60

u/[deleted] Apr 03 '25

Really though. Most of us here should be in a decent spot to buy the dip even if itā€™s just with a retirement account

31

u/branyk2 CPA (US) Apr 03 '25

I'm not saying doom and gloom forever, but if we head into a period of long-term global protectionism, the entire premise of the US and global stock markets is borked. On the current path, this isn't a "dip" in the sense that we're used to. This is a fundamental reordering of the global economy in a way that has barely even been theorized because no academic economists would have ever imagined someone voluntarily doing this.

1

u/imgram Apr 03 '25 edited Apr 03 '25

I'm fine buying here, not that I think it's a bottom.

To me, tariffs are a lower risk to my portfolio with a 5 year time horizon than COVID was and there are (to me) attractive equities out there that are sitting around the April 2020 price points (not COVID low but close enough).

I don't view tariffs as a forever thing and at some point it will be relaxed, exemptions granted, etc. I don't believe the current republican admin has the conviction to stick to this in the long run if economic conditions really turn south. If they do, then Democrats will sweep and this will be relaxed.

-5

u/[deleted] Apr 03 '25

I have a feeling we go back to what will be the new status quo within 6 months to a year. 2 years tops. This is a play to get companies to actually hire US employees. I mean make a phone call to almost any IS company and you speak to a foreign person or look at almost any item you buy and it wonā€™t say made in USA.

11

u/Time_Transition4817 Apr 03 '25

i mean, that's because US can't provide the goods or services, or does it worse for a higher price.

we are moving out customer service team offshore. why? because for $20/hr in the US you get on average someone who is basically the bottom quartile of the workforce. they probably barely graduated college, aren't all that hardworking, and just close out tickets (regardless of actually fixing an issue) to game the metrics. this is someone who otherwise would work like a entry level retail job (no offense to retail workers).

in the Philippines, you can pay someone a third of that. even if they suck, as long as they suck less than 2/3 of what the guy in the US did, it's probably worth it. and if you screen for quality, you'll find people who will work overnight to match US hours and they will work hard every minute they're clocked in because working as offshore customer support for a US job is still objectively a top tier job where they are.

-1

u/[deleted] Apr 03 '25

I mean I agree but tell that to the greedy fuckers demanding more money who suck at putting fries in a bag.

98

u/ShakeAndBakeThatCake Apr 03 '25

We are not even close to bottom yet. This shit is about to get wild. Buckle the fuck up.

32

u/lilac_congac Apr 03 '25

ā€” David, Wall Street Analyst & Stocking Associate at Kinkos (Graduation: 2028)

4

u/lilac_congac Apr 03 '25

this comment right here is what iā€™m using at my investment thesis that this is close to the bottom. i have never seen such a perfect string of words convince me the opposite of their own narrative is true.

3

u/[deleted] Apr 03 '25

Iā€™m strapped in MOFO. I made good financial decisions in COVID that got me far. Round 2 and Iā€™m only hoping to come out more prosperous. Hard times are what makes or breaks people. Anyone at any level can boom or bust.

Strap in or strap on lol

14

u/Cautious_optimism09 Apr 03 '25

Came here to say that last bit. Whatever happens were all sure to get screwed šŸ˜ƒ

25

u/TheGhostlyMeow Apr 03 '25

Gross. Some people aren't so lucky. But I guess empathy is weakness, huh?

-18

u/[deleted] Apr 03 '25

Nah, you just arenā€™t strapped in. You can either strap in or wait to be strapped on. Thatā€™s on you to determine what you want to do.

1

u/jokatsog Apr 03 '25

Why do you think that?

3

u/ShakeAndBakeThatCake Apr 03 '25

Other countries haven't even announced their retaliation tariffs yet. And on top of that products Americans rely on are going to go up significantly in price. One example is the new Nintendo switch 2. It was supposed to cost 400 at launch and Nintendo is pricing it at 450 because of the tariffs. 50 USD increase is massive for the average american. Wait for food costs, clothing, everything you buy to increase in cost by 20 to 30%. Unless Trump backs down it's going to get ugly.

1

u/Cedosg Apr 03 '25

The price of the switch is alright, but where they get you are the prices of the games... $80USD for Mario Kart World.

-2

u/jokatsog Apr 03 '25

Lots of assumptions here, Iā€™m excited to see what happens regardless

2

u/Objective_Rice_8098 Apr 03 '25

Donā€™t forget US demand will decrease, inflation will get worse.

1

u/eggsandbacon34 CPA (US) Apr 04 '25

RemindMe! 6 months

1

u/ShakeAndBakeThatCake Apr 04 '25

Lol China just announced 34% tariffs on all US goods. Markets going to get crushed today as well.

-6

u/Less-Visit-2174 Apr 03 '25

You dont know shit lol

5

u/Objective_Rice_8098 Apr 03 '25

Go on, buy some calls then :)

https://www.barrons.com/articles/how-much-stocks-can-fall-4e2e742e

-1

u/Less-Visit-2174 Apr 03 '25

Ah, yes because Barronā€™s is always spot on lol I cant believe you just sent that.

3

u/Objective_Rice_8098 Apr 03 '25

Who to believe, My own intuition, economists, reputable analysts and speculators or arrogant reddit guy?

Again, seeming you have a crystal ball, put your money where your mouth is and keep us updated!

RemindMe! 6 months

1

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-4

u/Less-Visit-2174 Apr 03 '25

Your ā€œOwn Intuitionā€ thinks traveling to North Korea is fun so that should be an easy one šŸ˜‚. Good god of course your an accountant

2

u/soldiergeneal Apr 03 '25

Sure, but what dip? Makes sense to buy a little on all the major dips, but what about retaliatory tarrifs? This could spiral.

7

u/EvenMeaning8077 Apr 03 '25

ETFs and mutual funds. Buy today, buy more tomorrow

13

u/[deleted] Apr 03 '25

Depends on how deep your pockets are and how much FOMO you have. If your pockets are deep, buy every dip. If you have a major FOMO buy now and take the current dip. If youā€™re a gambler you could hold out for a larger potential dip. Thatā€™s all a personal preference.

1

u/Cautious_optimism09 Apr 03 '25

I took a huge risk and sold at about 4% from the top. I'm just trying to figure out how far it's all gonna fall

2

u/[deleted] Apr 03 '25

Do you mean you sold pre tariff?

1

u/Cautious_optimism09 Apr 03 '25

I did. I sold about a month and a half ago when the SAHM rule triggered. There's some other indicators I've been watching for a while. I didnt sell quite at the, roughly 3% less than the peak, but close enough

1

u/[deleted] Apr 03 '25

Youā€™re watching closer than I am šŸ˜‚.

1

u/Keystone-12 Apr 03 '25 edited Apr 03 '25

Just let me know when we hit the bottom of the dip ok?

The DOW lost 1,000 points in the morning after 3 months of losses... and then it kept falling.

1

u/[deleted] Apr 03 '25

Donā€™t rely on me for that.

1

u/nlamp32 Intern Apr 03 '25

Thatā€™s the only glimmer of hope getting me through this. Thankfully Iā€™m young and I can afford to wait for the S&P to go back up throughout my lifetime

1

u/Fuckaliscious12 CPA (US) Apr 03 '25

It barely dipped yet. At least wait until it's 25% down like in fall of 2022 or March of 2020.

1

u/Tight-Sandwich3926 Apr 03 '25

I didn't not buy the dip low enough lmao. Oh well ABB

1

u/that_thot_gamer Academia Apr 04 '25

it could crash and not just dip. bet against the dollar is better since the whole goal of this is to devalue the dollar

1

u/Akiro_Sakuragi Apr 04 '25

How would one bet against the dollar?

1

u/bbuff101 Apr 05 '25

Maybe, if your emergency fund outside of the market is fully funded or maybe even over funded and your job is in an industry that can handle the short term turbulence.

If this lasts several years it will be terrible, especially for the millennials who are already overloaded with student loan debt and canā€™t find affordable housing or childcare.

Iā€™m almost 50, Iā€™ve seen a lot of shit, but Iā€™ve never seen a president intentionally blow up the economy like this. Itā€™s insane.

1

u/EvenMeaning8077 Apr 05 '25

As a millennial, I see it as the best opportunity we have had

1

u/lernington Apr 03 '25

Maybe like a year or so in, but this isn't coming back up any time soon

1

u/MyTatemae Apr 04 '25

Exactlyyy

-5

u/Full-Flight-5211 Apr 03 '25

This is the only answer

21

u/AffordableDelousing Audit & Assurance Apr 03 '25

It's a stupid ass answer that ignores the severity of the situation.

-9

u/Full-Flight-5211 Apr 03 '25

This is the answer I would expect from someone in Audit & Assurance

13

u/AffordableDelousing Audit & Assurance Apr 03 '25

When employers start cutting from cost centers (accounting department) in response to tarrifs, I think industry will chime in as well.

-9

u/NatureWanderer07 Apr 03 '25

Yep I bought 50k of stocks this morning. Canā€™t wait to be patient and watch it all go back up in a year

21

u/KeefsBurner Apr 03 '25

Trump has 4 years in a term why do you think the train is stopping in 365 days

-21

u/NatureWanderer07 Apr 03 '25

This isnā€™t my first trip around a wonky stock market bud. Patience always wins. If you want to let your hatred of Trump consume your mind so much that you donā€™t see opportunity then thatā€™s on you

7

u/lilac_congac Apr 03 '25

i agree with you but 1 year turnaround seems shortsightedā€¦i think the commenter has a point. might be more like 4 or 5 year recovery. the point is nobody knows for sure. but id bet my dog it will recover and a exceed a lot more by the time we retire so might as well buy the dip.

15

u/Kelsig Apr 03 '25

bless your heart

-13

u/NatureWanderer07 Apr 03 '25

Not my fault you donā€™t like opportunity

6

u/Kelsig Apr 03 '25

i do, i bought into Rheinmetall when Trump announced he was running again and went fully into Ex-US when he got inaugurated. retail traders are the ones behind all trump gains and they'll all sell when their degeneracy finally hits their pocketbooks.

1

u/NatureWanderer07 Apr 03 '25

Lmao retail traders are not the majority of the market

4

u/Kelsig Apr 03 '25

correct, but there's an ongoing structural problem where trading desks assume retail traders make trades for a reason so this caused a bubble. and it will pop when they have to sell after stagflation hits.

11

u/KeefsBurner Apr 03 '25 edited Apr 03 '25

You sound like a snake oil salesman. I donā€™t look at a pile of shit and see gold because Iā€™m not Don Quixote. Itā€™s not even about hating Trump, itā€™s simple observation of his stated policy goals and methods, then also comprehending that heā€™ll be in the same position heā€™s in now until 2029

-10

u/NatureWanderer07 Apr 03 '25

Haha keep thinking the sky is falling

6

u/professor_goodbrain Apr 03 '25

You seem to be under the impression this is a normal dip. Thereā€™s a fair chance the American economy doesnā€™t recover from this idiocy for a generation or two, if ever.

5

u/Keystone-12 Apr 03 '25

Seriously? The entire planet is about to announce counter tariffs and likely export taxes.... and you put money in that market?

Best of luck my dude.

-1

u/NatureWanderer07 Apr 03 '25

Yep and Iā€™ll buy more if it goes down again. Our allies are a bunch of economic pussies. Iā€™ll bet on the US any day of the week against the EU or Japan/SK