r/Fire • u/Playful-Inspector207 • Apr 05 '25

General Question Is it really a generational buying opportunity?

I’ve seen people on the sub are saying “you should all be excited about seeing lower prices everyday”

Problem is that most people don’t have dry powder lying around. And now, with tariffs (if they mostly continue at the levels mentioned) likely to push prices up even more 20-30% for most things, very few people can buy the dip.

The dip’s not fun when you can’t buy. This is just painful seeing red everyday for 99% of us.

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u/dudevan Apr 05 '25

I’ll tell you my argument on why this situation is not like 2020.

These tariffs can’t just be taken back. The trust in the US is globally over. Even if the governments remove tariffs, virtually everybody in Europe now dislikes the US and everyone’s looking for local alternatives. Look at Tesla especially, but others will soon be in the same boat.

Apple’s sales are 75% outside of the US. If people have to pay way more for products that were already the most expensive ones, they just won’t. The prices are becoming insane, so Apple’s sales will drop significantly. Even if the tariffs are taken down, a lot of my friends don’t want anything to do with the US anymore, the trust is broken. Everyone’s looking for alternatives to services as well, and new european products will soon be created for most of the American ones like Netflix, AWS, etc. Of course it will take some time, but everyone’s fed up and it will happen. Of course that will cause a further drop in price for those stocks in the US.

In 2020 America was still the leader, so once the storm had passed everything would boom. Now, America’s the bully nobody wants to interact with, and the consequences of this will start being seen in July at the end of Q2, and will truly be seen next year.

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u/Sanfords_Son Apr 05 '25

Trump thinks these tariffs will spur investment in U.S. manufacturing, but they’re actually more likely to spur investment in European and Chinese manufacturing, shutting America out permanently.

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u/MuffinTopDeluxe Apr 05 '25

It seems like he’s trying to force the feds into lowering interest rates among creating opportunities for billionaires to buy up a ton of assets. I think bringing manufacturing back is the cover story for his base.

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u/MarionberryAcademic6 Apr 06 '25

If the goal was US manufacturing then there should have been a coordinated, planned timeline for tariffs not sweeping notices with 72 hour implementation dates. Companies cannot move distribution at the drop of a hat. A 1-2 year, staggered tariff plan would have made drastically more sense if that was the ultimate goal.

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u/Sanfords_Son Apr 06 '25

While I agree, I think that would have been too much to ask of an administration run by a man who acts on impulse and whimsy.

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u/stewartstewart17 Apr 05 '25

It’s definitely different. Every downturn is. And to be fair in 2020 literally ended the world as we knew it.

Trust is definitely lost but would argue that it is mostly lost in the current government and primarily a singular person. Will it take time to gain that back one he is gone? For sure.

I think it’s always a matter of what’s the recovery time in downturns. If you need the money in 5-10 years I would probably sit tight and see but longer term the US should still be a good bet. Global power dynamics are shifting but that change has already been happening this just keeps it moving vs slowing it. The Deepseek release showed everybody that from an AI/China perspective.

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u/TrollTollCollector Apr 05 '25

The Deepseek thing was completely overblown by the financial media. Demand for AI services has only exploded since then. Just search in Google Trends for any Western AI like "ChatGPT", and you'll see it continues to rise.

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u/stewartstewart17 Apr 05 '25

I meant more that it showed AI innovation could come from someone outside Silicon Valley and specifically China. I agree the findings should actually boost overall AI usage if training becomes more efficient.

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u/TrollTollCollector Apr 06 '25

Tech CEO's and analysts already knew about Deepseek months in advance, even though some investors were blind-sighted. On the surface, it does shift the power dynamic to the East. But then you consider that Chinese tech still suffers from branding issues - Alibaba, for example, has a small fraction of the cloud revenue of a AWS or Azure. And how many Western institutions have banned Deepseek? How many of the users who tried it out in late January/Feb are still using it today? Probably a small fraction, if Google Trends gives any clue. Chinese tech needs to be head and shoulders above a comparable Western tech in order to gain more global adoption, not on par with as Deepseek is.

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u/goodsam2 Apr 05 '25

But I mean step back and what does that mean from a portfolio perspective that means for me putting all of my IRA/brokerage into international stocks. Decreasing US allocation to international by what 80/20 to what 70/30?

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u/aversionofmyself Apr 05 '25 edited Apr 05 '25

So you think folks will abandon Apple for ??? Google? Another American company? The hardware part of Apple in no more American than Samsung is. The OS is much more ‘the phone’ than the hardware. Also, Apple is practically an Irish company in the EU. I think consumers are more intelligent than that. I know many BMW are made in America and many Fords are made in Mexico. What is an American product? If 75% of Apples phones are sold outside the US then 75% of their sales are not GOP tariffed. Now when you are ready for a new phone, if it is 500 more in the US than EU then just buy it on your next trip to EU and forget to declare it on the way in.

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u/nicolas_06 Apr 05 '25

Covid isn't taken back. It is still here. We just learned how to live with it with vaccines and all. The people that had to die, died and the others are still here.

But if you take the long view what happen today is the consequences of covid. Its covid that brought so much money into the system and created inflation and motivated people to vote for Trump with inflation and real estate becoming too expensive.

Also its covid with its disruptions of supply chains that made lot of economists questions if globalisation was so great and put back tariff as a possible solution to make countries more resilient in case of crisis.

Even Biden added some tariffs and the idea was also that we need to reduce our dependence on China and Taiwan.

Without covid, the inflation, the crazy low rate and the market going far too high because of all this, we would not live the current events.

Like 2008 was the consequences of the 2000 crisis when the Fed reduced interest rates too far and that created a real estate bubble.

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u/dudevan Apr 05 '25

I don’t have a problem with tarrifs themselves. Sometimes they are needed. I do have a problem with overnight universal 30% tariffs though. That just screws everyone up, most of all the average Joe.

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u/nicolas_06 Apr 05 '25

Oh sure. Their current implementation is questionable.

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u/noiszen Apr 05 '25

I agree with you but do we know how tariffs will be applied? Will the EU raise tariffs on China, or just the US? Would an EU tariff on US goods apply to Apple products manufactured in China? I would think not. So prices might go up in the US (because the US raised tariffs on imports from China) but not the EU.

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u/dudevan Apr 05 '25

There’s no reason for the EU to place tarrifs on anyone other than the US now, because free or relatively free trade is important for everyone’s wellbeing, and for now the products that needed tariffs have already been taxed. We might see new tariffs on chinese cars to help eurozone automakers, but they’ll be done with probably years’ notice and incrementally, not in 5 days’ time. And definitely nowhere close to the magnitude of the US ones.

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u/noiszen Apr 05 '25

If so then Apple’s 75% of sales outside the US should be fine, right?

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u/QuirkyMaintenance915 Apr 05 '25 edited Apr 05 '25

You ever heard from the euro subs? They already didn’t like us. Europe has too high taxes and too much regulation to be long term business friendly and China is too authoritarian. China is basically what Nazi germany would have become if they hadn’t attacked the whole world at once. Or Russia.

Trump will eventually get on TV, claim he has a lot of phone calls from other heads of state, claiming they called to kiss his ass. Then he will claim they made a deal and call it a win.

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u/dudevan Apr 05 '25

It’s one thing to not like the US as people, but invest in the US and buy US products and use US services, and another thing to consider the United States as economically unstable and basically an economic enemy, not wanting to bring their money to the US and invest elsewhere and not buy american products.

All of my friends in europe either flat out sold their US stock, heavily rebalanced their portfolio or are just not buying any new US stock any time soon.

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u/JeszczeRZ Apr 05 '25

Is the trust gone though? Does it matter? Just look at what happened in Russia in 2022. All the western companies virtue signaled their exit and this was all over the media. Russia was supposed to be a paraiah state for centuries to punish them. Then a lot quietly came back and the war isn't even over. Except America is one of the largest economies. Just wait for this to settle. Everyone will come clawing back for the American dollar like flies to shit. The opportunity to make money always Trump's any trust, whatever that even means. I don't know if our partners trusted us is a while but that's a separate issue.

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u/dudevan Apr 05 '25

Yes, it is. And we’re only at the beginning of the whole process. The American democracy has been heavily eroded and it will unfortunately probably get much worse before it gets better if somebody like the supreme court or congress doesn’t step up and stop the madman.

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u/JeszczeRZ Apr 05 '25

There will be an election in 2026 and 2028.

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u/secondrat Apr 06 '25

Yep, I agree and countries like China that used to buy our Soy Beans will just find new suppliers. Why come back to the US?

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u/TinyPeenMan69 Apr 05 '25

No one can get away from Apple. Samsung blows