Gold Hits New Record as Tariff Fears Make Investors Jittery and Global Stocks Tumble
Uncertainty about the Trump administration’s plan with tariffs has seen the American stock market experience shocks since the start of last week, with many waiting to see how economic growth and inflation are impacted. April 2nd, dubbed the Liberation Day by President Trump, shall see reciprocal tariffs being imposed on imports from other countries.
Trump argues that this will free America from reliance on foreign goods and bring manufacturing jobs back to the country. In particular, he revealed that he planned to place a 25% tariff on car imports, with tariffs on auto parts being applied by next month.
In its statement, the White House explained that it expected to raise $100 billion in annual revenue from these new taxes.
Experts disagree with the approach though, with many economists stressing that imposing the tariffs at the proposed rates may backfire. Economists at Goldman Sachs have even reduced their forecast for America’s economic growth for the year and increased their inflation forecast. David Mericle, an economist at the firm, revealed that there’s a 35% chance of a recession occurring in the next year.
This may explain why many investors are also flocking to safe haven assets like gold, which has seen its price per ounce shoot to $3,160, a new all-time high. Treasury bond prices have also risen as yields dropped, with figures showing that the yield on 10-year bonds dropped to 4.2%, which is quite a decrease from the 4.8% recorded at the start of the year.
Experts argue though that if the tariffs don’t end up being too burdensome, stocks could rally. On the other hand, if the opposite happens, stocks could drop much further with uncertainty prompting businesses to begin reducing their workforces.
Even if the tariffs aren’t as onerous as many feared, some theorize that the uncertainty brought about by them could cause businesses and households in America to suspend their spending, which could greatly impact the economy.
At the start of the week, big tech stocks continued to record declines, with Nvidia dropping another 1.2%. Tesla also saw its price drop by 1.7%, bringing its total loss thus far into the year to 35.8%. The automaker’s stock has performed dismally in the S&P 500 for a while now, primarily because its brand has become too entwined with its CEO.
Musk, Tesla’s CEO, has been at the forefront of the federal government’s efforts to reduce spending. Others on Wall Street have recorded positives though, with Berkshire Hathaway increasing by 1.2% while Mr. Cooper surged 14.5% after announcing that it would be bought by Rocket.
As the price of gold climbs even higher, entities like GEMXX Corp. (OTC: GEMZ) that engage in gold mining and make finished products, such as jewelry, from this gold could see their margins improve significantly under these market conditions.
NOTE TO INVESTORS: The latest news and updates relating to GEMXX Corp. (OTC: GEMZ) are available in the company’s newsroom at https://ibn.fm/GEMZ
Please see full terms of use and disclaimers on the MiningNewsWire website applicable to all content provided by MNW, wherever published or re-published: https://www.MiningNewsWire.com/Disclaimer
Uncertainty about the Trump administration’s plan with tariffs has seen the American stock market experience shocks since the start of last week, with many waiting to see how economic growth and inflation are impacted. April 2nd, dubbed the Liberation Day by President Trump, shall see reciprocal tariffs being imposed on imports from other countries.
Trump argues that this will free America from reliance on foreign goods and bring manufacturing jobs back to the country. In particular, he revealed that he planned to place a 25% tariff on car imports, with tariffs on auto parts being applied by next month.
In its statement, the White House explained that it expected to raise $100 billion in annual revenue from these new taxes.
Experts disagree with the approach though, with many economists stressing that imposing the tariffs at the proposed rates may backfire. Economists at Goldman Sachs have even reduced their forecast for America’s economic growth for the year and increased their inflation forecast. David Mericle, an economist at the firm, revealed that there’s a 35% chance of a recession occurring in the next year.
This may explain why many investors are also flocking to safe haven assets like gold, which has seen its price per ounce shoot to $3,160, a new all-time high. Treasury bond prices have also risen as yields dropped, with figures showing that the yield on 10-year bonds dropped to 4.2%, which is quite a decrease from the 4.8% recorded at the start of the year.
Experts argue though that if the tariffs don’t end up being too burdensome, stocks could rally. On the other hand, if the opposite happens, stocks could drop much further with uncertainty prompting businesses to begin reducing their workforces.
Even if the tariffs aren’t as onerous as many feared, some theorize that the uncertainty brought about by them could cause businesses and households in America to suspend their spending, which could greatly impact the economy.
At the start of the week, big tech stocks continued to record declines, with Nvidia dropping another 1.2%. Tesla also saw its price drop by 1.7%, bringing its total loss thus far into the year to 35.8%. The automaker’s stock has performed dismally in the S&P 500 for a while now, primarily because its brand has become too entwined with its CEO.
Musk, Tesla’s CEO, has been at the forefront of the federal government’s efforts to reduce spending. Others on Wall Street have recorded positives though, with Berkshire Hathaway increasing by 1.2% while Mr. Cooper surged 14.5% after announcing that it would be bought by Rocket.
As the price of gold climbs even higher, entities like GEMXX Corp. (OTC: GEMZ) that engage in gold mining and make finished products, such as jewelry, from this gold could see their margins improve significantly under these market conditions.
NOTE TO INVESTORS: The latest news and updates relating to GEMXX Corp. (OTC: GEMZ) are available in the company’s newsroom at https://ibn.fm/GEMZ
Please see full terms of use and disclaimers on the MiningNewsWire website applicable to all content provided by MNW, wherever published or re-published: https://www.MiningNewsWire.com/Disclaimer
