when Trump began putting tariffs on Chinese Aluminum, which they were using NAFTA to get around directly shipping into the US market by staging shipments in Mexican warehouses then dumping it via NAFTA into the US, i bought about 8k in ALCOA. it shot up 20% not long after the tariffs hit.
Originally Posted by The_Waco_Kid
Congratulations, that was a shrewd move. Honestly, I'm not being sarcastic. My second largest position is now my fourth or fifth largest position. The company owns a factory in China that manufactures goods that will never be manufactured in the USA, regardless of what kind of tariffs are placed on Chinese goods. I lost a lot more than 8k in terms of the value of the position as a result of the proposed tariffs. Trump helped you and he fucked me.
i just sold about 7k in Ford, all of it, and put the money in Valero Energy. overall today i'm down about 700 dollars. what would your advice be? SELL SELL SELL!?!
Originally Posted by The_Waco_Kid
It would take a few weeks to come up to speed on the two companies. But based on a 30 second glance, yes, I'd sell Valero and buy back Ford. Ford is cheaper. It sells for 7X earnings and a 7% dividend yield. Valero sells for 18X earnings and pays a 2.6% dividend. I might actually take a look at Ford. HOWEVER, you may have made a shrewd move, like Alcoa. The tariffs help Alcoa. They screw Ford, who is expecting their costs will be $600 million per year higher as a result. The law of unintended consequences. Trump's tariffs will cause net job losses according to economists.
Your broker probably doesn't know jack shit about tariffs. It's in his best interest if you believe they won't hurt the economy, so don't take your money out of your account and invest it in something like gold bars. I'm exaggerating, supposedly a trade war might lower economic growth around 20% a year (maybe from 2.5% to 2%/year), not the end of the world, but still very significant, especially over many years. It makes a large difference in the standard of living of our children and grandchildren. And there's some small possibility of a Smoot Hawley Great Depression meltdown if trade wars get really out of hand.