"Update (10:26pm ET): Just after 10pm ET, and just under 10 hours after Trump lobbed the first shot in the first trade war of his second admin, the White House announced that Colombia had agreed to all of Trump's terms, "including the unrestricted acceptance of all illegal aliens from Colombia returned from the United States, including on U.S. military aircraft, without limitation or delay."
Imagine if your business had deals pending with Columbia today. Imagine there were millions of dollars at stake which could make or break your business. My guess is you would need a lot of coffee today!
This is what I meant when I wrote in my blog a few weeks ago, "Tariff's are coming, now what?" I mean that we're all going to be subject to sudden, unexpected disruptions in trade rules:
"Here comes the new Whack-a-Mole game of which countries are on Trump's tariff list this week and how much is he going to charge them for pissing him off?"
These wide swings reflect our new paradigm; disruption of all the things.
Last week, China unveiled it's own version of AI (DeepSeek RI) in direct competition with OpenAI which has been all the rage and has maintained America's position as the leader in AI technology contributing much in terms of investor sentiment (think, NVIDIA) and all-time stock market highs.
Until now.
China just massively dunked on the entire built-for-profit, $500 Billion boondoggle announced LAST WEEK by President Trump along with deep state ghouls Larry Edelson (Oracle) and Sam Altman (Open AI). Talk about disruption!!
“Freaking out” is probably the understatement of the century. Silicon Valley is in a full-blown emotional meltdown and the path forward is far from certain. As we will see further along, western tech mandarins are going to have to return to Square 1 and modify their approach to the new reality. In short, the agenda is being set by people with different priorities, values and beliefs who live 10,000 miles away."
The current valuation of the S&P and all "things" depends on the assumptions that hold those valuations higher are all proven true and valid. At these nose-bleed levels disruptions and uncertainties can and often do lead to disasters. I can't imagine anything more disruptive happening now than a major market crash.
If I had to find the poster child for excessive market valuation and the definition of 'bubble mentality" it would have to be "Fartcoin" which started literally as a joke meant to parody mindless investors who chase the latest "thing" but ended up with a $1.5 Billion dollar valuation in just a few months.
"Many people, once they have tied their entire identity to some thing, can't tolerate any questioning of that thing, whether it's gold, bitcoin, Nvidia, a political candidate or ideology, an NFL team - whatever. Their insecurity is painful to see."
In closing today I do want to point out a very important matter which involves all small business owners: The extension of the 20% Small Business Deduction which was part of the 2017 tax cuts under the previous Trump administration and is due to expire.
“As we get closer to critical parts of the 2017 tax cuts expiring at the end of this year, my clients lack the certainty of whether or not many of the provisions they depend upon will be extended. This includes the 20% Small Business Deduction – the centerpiece of the 2017 tax cuts – which allows for a 20% deduction of qualified business income. The tax burden on small businesses is already incredibly heavy and allowing the Small Business Deduction to lapse would not feel like a sunset, but like a tax increase.”
"The 20% Small Business Deduction was created as a part of the 2017 tax law to level the playing field between small businesses and larger corporations. If Congress fails to act, taxes will increase on over 30 million small businesses at the end of 2025. The Main Street Tax Certainty Act would make the Small Business Deduction permanent and avoid a massive tax hike on a majority of America’s small businesses."
"“We must look at the scale on the respective y-axes to understand the enormity of the problem. Federal government spending prior to Covid never reached the heights seen since on a quarterly basis.”
