Tariffs Are Back. Markets Are Cracking.

Tariffs Are Back. Markets Are Cracking. 

And This Time There’s Nowhere to Hide

In 2018, a small Missouri nail factory was blindsided.

Mid Continent Nail Corp. was expanding, hiring, growing. Then U.S. steel tariffs hit. Their raw material costs jumped 25 percent overnight. Orders collapsed by 70 percent.

Within weeks, layoffs began. By Labor Day, they were warning of a full shutdown.

The tariffs were supposed to protect American factories. Instead, they almost killed one.

Now in 2025, it’s happening again. But this time the scale is global.

President Trump has launched a new wave of import taxes. And tariff rates now range from 25 percent to 40 percent across 14 countries.

Not just rivals. Allies too.

Japan and South Korea were hit with 25 percent tariffs. Thailand and Cambodia saw rates in the mid-30s. Laos and Myanmar were slapped with the maximum 40 percent.

The message was posted directly on social media. No diplomatic channels. No backroom talks.

It was clear and direct. Countries that cooperate on trade will be rewarded. Those that don’t will pay. Retaliation will bring even higher penalties.

This is not a negotiation tactic. It is a line in the sand.

Allies Are Furious And The Markets Are Reacting

Japan’s prime minister called the decision “regrettable.” South Korea launched emergency measures to protect its exporters. Canada and the UK began drawing up retaliation plans.

China, already hit with 55 percent tariffs, announced it would respond with “firm countermeasures.” Brazil and India are evaluating WTO complaints.

The backlash is real. And the impact is already moving through the markets.

• The S&P 500 fell 0.8 percent

• The Nasdaq dropped 1 percent

• Japan’s Nikkei crashed nearly 9 percent in a single day

The warning is clear. Investors are not waiting to see how this plays out. They are already repositioning.

The last time Trump escalated tariffs, it was mostly aimed at China. Today, that list includes long-time allies.

This is no longer a bilateral issue. It is a global standoff with strategic implications.

The consequences will go far beyond shipping containers and customs forms.

Every time a tariff is imposed, the cost gets passed on. Businesses raise prices. Consumers feel the squeeze. Profit margins shrink.

This is not a theory. It has already started.

• Auto prices are rising.

• Machinery and equipment costs are climbing.

• Tariffs on industrial metals are raising costs for electronics and construction.

The longer it continues, the more likely we see stagflation. Meaning low growth, high prices, and declining purchasing power.

Which in turns hits consumer demand, slows corporate earnings, weakens bonds, and finally… raises volatility.

Once that cycle begins, it is hard to break. Making it one of the worst position an investor can be in.

What Smart Investors Are Doing Now

If you wait for the market to confirm the risk, it will already be priced in. The edge comes from acting early.

Here are the five actions to take:

1. Reduce exposure to sectors tied to global trade

Automakers, semiconductors, and industrials face the highest supply chain risk.

2. Shift capital toward real assets

Commodities, infrastructure, and real estate tend to rise with inflation. They also offer some protection against currency devaluation.

3. Diversify outside the United States

Look to regions not directly in the crosshairs. Southeast Asia, India, and commodity-rich nations are seeing capital flows shift.

4. Hold more liquidity

Cash gives you flexibility. You need to be able to move when volatility creates entry points.

5. Allocate to uncorrelated assets

Gold. Bitcoin. Energy infrastructure. These assets operate on different cycles and often react to macro disruption in your favor.

This is not a short-term policy decision. It is a long-term shift in how the United States approaches global trade.

We are moving away from cooperation and toward confrontation.

That means the old assumptions are breaking. Decades of global supply chains, tariff-free trade, and diplomatic insulation are being rewritten.

And for investors, like you and I, that changes everything.

History shows that trade wars do not create winners. Instead they create new power centers. Capital moves. Supply chains are rebuilt. Entire industries migrate.

This is not about making a political call. It is about reading the landscape and positioning for what comes next.

The cost of doing nothing is higher than ever.

Volatility is not going away. The headlines will get louder. The risk will feel more unpredictable.

But you do not need to guess.

You need to prepare.

Trade wars have consequences. They shake markets but they also open up opportunities in the right corners of the world.

What you do next could define your next decade as an investor.

Stay Sharp,

Gideon Ashwood