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Bill Gross advises caution amid US stock selloff due to tariff concerns - Bloomberg
From Investing.com, but pertains to an interview Bill Gross gave to Bloomberg today
Investing.com -- As mounting tariff worries trigger a fall in US stocks, renowned investor Bill Gross is advising potential investors to exercise caution, according to a report from Bloomberg. Gross, the co-founder and ex-chief investment officer of Pacific Investment Management Co., described Thursday’s selloff, which saw the S&P 500 drop by over 4%, as a significant market event with no immediate solution apparent.
Gross warned investors against trying to capitalize on the falling market, likening the situation to a major economic and market event similar to the end of the gold standard in 1971, but with immediate negative impacts. Gross communicated this advice in an email, urging investors not to "catch a falling knife."
On Wednesday, President Donald Trump announced broad tariffs, imposing a minimum of 10% on exporters to the US. Notably, the European Union is facing a 20% levy, Japan a 24% tariff, and China is being hit with an even higher rate. This move led to approximately $2 trillion being wiped off the S&P 500, while the yield on benchmark Treasuries briefly fell below the significant 4% level.
Economists predict that the immediate outcome of these measures will likely be higher US prices and slower growth, possibly leading to a recession. Trump has embraced tariffs as a method to assert US power, stimulate domestic manufacturing, and gain geopolitical advantages.
Gross pointed out that it’s unlikely for Trump to retreat from this stance in the near future, stating, "Trump can’t back down anytime soon. He’s too macho for that."
Gross warned investors against trying to capitalize on the falling market, likening the situation to a major economic and market event similar to the end of the gold standard in 1971, but with immediate negative impacts. Gross communicated this advice in an email, urging investors not to "catch a falling knife."
On Wednesday, President Donald Trump announced broad tariffs, imposing a minimum of 10% on exporters to the US. Notably, the European Union is facing a 20% levy, Japan a 24% tariff, and China is being hit with an even higher rate. This move led to approximately $2 trillion being wiped off the S&P 500, while the yield on benchmark Treasuries briefly fell below the significant 4% level.
Economists predict that the immediate outcome of these measures will likely be higher US prices and slower growth, possibly leading to a recession. Trump has embraced tariffs as a method to assert US power, stimulate domestic manufacturing, and gain geopolitical advantages.
Gross pointed out that it’s unlikely for Trump to retreat from this stance in the near future, stating, "Trump can’t back down anytime soon. He’s too macho for that."
Emphasis mine.
https://www.investing.com/news/stock-market-news/bill-gross-advises-caution-amid-us-stock-selloff-due-to-tariff-concerns--bloomberg-93CH-3966357
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