$2.4 Trillion in Stock Valuation Wiped Out

[mystery-ak]

$2.4 Trillion in Stock Valuation Wiped Out

Friday, 04 April 2025 07:09 AM EDT

U.S. companies had $2.4 trillion of valuation wiped out Thursday after President Donald Trump slapped sweeping tariffs on foreign imports.

Virtually every sector suffered big losses as U.S. financial markets closed with their biggest one-day drop since COVID-19 flattened the global economy five years ago.

Banks, retailers, clothing, airlines and technology companies were among the hardest hit, with consumers expected to cut spending if tariffs lead to higher prices for goods and services.

Many economists called the tariffs much worse than expected, and investors dumped shares in companies they predict will suffer most from what is effectively a business tax.

In many cases that tax will be passed on to consumers. If consumers pull back their spending because of higher prices, businesses will produce fewer goods and economic growth could stall or contract. Consumer spending makes up about 70% of economic activity in the U.S.

more
https://www.newsmax.com/streettalk/financial-markets-tariffs/2025/04/04/id/1205633/

[mountaineer]

As I understand it, the market is back to where it was a few months ago.

[Hoodat]

Dang, and I thought all of you wanted Trump to bring prices back down.  Why complain?  He did exactly what you asked.

MAKE STOCKS AFFORDABLE AGAIN !!!

[IsailedawayfromFR]

Fallacy is rampant here on making stock valuation a real value.  It is not, it is a potential value only

It only becomes real value when the stock is sold.

This is not like a savings account.

Those who do not know the difference are stupid speculators.

[Fishrrman]

"U.S. companies had $2.4 trillion of valuation wiped out Thursday after President Donald Trump slapped sweeping tariffs on foreign imports."

Like the line under my username says, I'm dumb.

But it seems to me that if "$2.4 trillion of 'valuation'" can be "wiped out" by merely selling "numbers on paper" in a single day, then that so-called "valuation" never really existed in the first place.

It was all hokum, "made up".
Nuthin' more.

[roamer_1]

If they had quit printing money, I would look on this as a favorable correction, good for fighting inflation.

I don't like it, but many, many Benjamins just evaporated, and I would much rather take ot out of the top as take it out of the bottom.

It ought to be taken out of government funds, but Wall street (as a government collaborator) can better handle it than Main street. Although the tariffs are going to take it out of Main street too.

And I doubt very much that they have quit printing more.

[IsailedawayfromFR]

If they had quit printing money, I would look on this as a favorable correction, good for fighting inflation.

I don't like it, but many, many Benjamins just evaporated, and I would much rather take ot out of the top as take it out of the bottom.

It ought to be taken out of government funds, but Wall street (as a government collaborator) can better handle it than Main street. Although the tariffs are going to take it out of Main street too.

And I doubt very much that they have quit printing more.

nothing of real value evaporated.

It was potential value only.

One must understand the difference.

[Smokin Joe]

nothing of real value evaporated.

It was potential value only.

One must understand the difference.

Yep. "Unrealized gains".

[kevindavis007]

'Winning'

[IsailedawayfromFR]

Yep. "Unrealized gains".

And what the Dems want to tax instead of real gains.

[catfish1957]

Another 20-30% drop?  I'll call that a buying opportunity.

aka "B" Day....   where the Bond and High yield Money Markets to equity preferability ratio for me shifts.   Nice, and almost excessive  cap gains on the bonds, plus (FINALLY) buying low on equities.  Works for me.

1987, 2000, 2008, and 2020.   All great times for investing, once you feel the bottom, or near bottom.

[IsailedawayfromFR]

Another 20-30% drop?  I'll call that a buying opportunity.

aka "B" Day....   where the Bond and High yield Money Markets to equity preferability ratio for me shifts.   Nice, and almost excessive  cap gains on the bonds, plus (FINALLY) buying low on equities.  Works for me.

1987, 2000, 2008, and 2020.   All great times for investing, once you feel the bottom, or near bottom.

will be concentrating on defense stocks during these down times.

My gut tells me a lot of the negotiations between Trump and the affected tariff countries will result in commitments from those countries to purchase US weaponry to balance the respective trade deficits.  Will be a windfall for the arms manufacturers.

[Weird Tolkienish Figure]

2026 is a lost cause IMO. Maybe we can salvage 2028.

[IsailedawayfromFR]

1987, 2000, 2008, and 2020.   All great times for investing, once you feel the bottom, or near bottom.

Or simply staying put and enjoying the subsequent runups.

Not as robust a return, but a solid one.

[Timber Rattler]

2026 is a lost cause IMO. Maybe we can salvage 2028.

I wouldn't count on it.

 

[Kamaji]

2026 is a lost cause IMO. Maybe we can salvage 2028.

Doubt it.  DeSantis was smart choosing to sit this shitshow out.

[Free Vulcan]

Welcome to the consequences of monetizaion.

[catfish1957]

Gonna be a rough day again tomorrow.

Japan just invoked circuit breakers and halted trading after an almost 9% drop.  DJT needs to infuse some moderating comments to calm the market.  As much as I want to see the markets drop for some buying opportunities, a crash is not what the doctor ordered.

He needs to proactively

(1)  Commend those nations who forgo tariffs
(2) Highly praise those that have brought counters to the negotiation tables
(3) Reiterate that that those Proposed tariffs are up for negotiation, and the US does not want to venture into a trade war.  And that those who continue to push inequitable tariff parameters are more guilty of rattling world markets than the ones the US is trying to impose.

[Hoodat]

Gonna be a rough day again tomorrow.

Then I'll wait until Tuesday to buy.

[catfish1957]

Then I'll wait until Tuesday to buy.

Do you think that is the bottom?  I don't.  Some conjecture, but I can seriously see this DOW getting down in the 20's K, and going sideways for a decade or two, like we saw the 1960's

When you look at the long term graphs, you really don't see any sustained  periods of stagnation and sustained corrections since 1980. Even with the short term  '87. '00, and '08 bumps.... That's a 45 year run.  And unfortunately the investing public sees the bull as an entitlement. 

Back in those lean years, investors looked for good companies, not as much as for growth, but strong dividend plays.    Problem Trump may have now, is that if the correction accelerates, he'll be inheriting a set of falling knives, with few levers to deal with it.  Even in the stag-'60's we had an industrial base that helped temper the effect.  Now?  Not so much   I might and hope I am wrong, but I've read enough to know economics is cyclical, and bad times will with 100% certainty  return at some point.

[Hoodat]

Do you think that is the bottom?  I don't.  Some conjecture, but I can seriously see this DOW getting down in the 20's K, and going sideways for a decade or two, like we saw the 1960's

No, there's too many dollars in circulation.  Stocks are valued under the same rules of supply-and-demand as everything else.  People have dollars.  They need a place to invest these dollars.  If the US cuts its budget deficit and interest rates fall, the opportunity to invest dollars leans toward US equities.

[cato potatoe]

Hang Seng index is off 10%, and flatlining.  Geez Louise. 

[Free Vulcan]

No, there's too many dollars in circulation.  Stocks are valued under the same rules of supply-and-demand as everything else.  People have dollars.  They need a place to invest these dollars.  If the US cuts its budget deficit and interest rates fall, the opportunity to invest dollars leans toward US equities.

I tend to agree with that assessment. The reality is right now we have seen a near 50% rise since the late '22 dip. That's still around 20% year-on-year, which is pushing it for a mature equity market.

We are simply canceling all that money printing right now.

[Smokin Joe]

Dunno. I checked my meager portfolio, and it went up in value (mostly mining concerns). 

[catfish1957]

Overnight and here up to the minute US market numbers......

Pac Rim (closed)

Hong Kong- down 13.2%
China- Down 7.34%
Japan- Down 7.83%
Korea- Down 5.57%
Taiwan- Down 9.70%

Europe (mid day)

England- Down 3.27%
France- Down 4.26%
Germany- Down 4.34%
Italy- Down 4.87%
Europe Composite- Down 4.36%

US/commodity-

VIX- 47.32 Up 4.44%
Oil- $60.52/bbl- Down- 2.39%
Gold- $3050/oz Up- 0.74%
Crypto Index-- Down 10.75%
Currency markets- generally neutral
DJIA Pre-Market- Down1.0.60%
NASDAQ Pre-Market- Down 2.02%

Another dive expected today.  What I am watching today:

1) Ripple effect....  markets are 3 length pronged pool.  Europ-Asia-Americas. They ebb and flow on each other's sentiments in boom or bust.  Fundementals are out the window, until some feel of the bottom (or top) is felt.  We aren't there yet obviously, but will be watching closely....  and it will be in the form with small loses, or outright gains.  The speculative faction will at some point go bargain hunting, or what is a bargain in their formulas and algorthyms.

2) Gold- I've already mentioned here for weeks about this quick  run up in gold. I knew it would be harbringer of somethiing bad.  It has felt the gravity the past few days of the vacuum effect, but if we start seeing some significant upward movement again, this will be bad...   The olde flight to safety on 'roids.

3) Still watching consumables-  Friday's action was inconclusive.  If we see these equity bases start mimicing the general market, it will tell us this correction has legs.

4) US policy...  I mentioned earlier, and  or another thread that DJT can and should do some things that calm markets, while going forward with his strategy.  One item, I'd like to add to that earlier list....   Trump/GOP.....  Get that budget passed.  Nothing would help the world markets than demonstrating that we are taking some serious steps in getting our own financial house in order....   And a good start is passing that budget

5). I always like to pull silver linings out of the storm.  One, if others have not noticed is that oil is down to $60/bbl.  We sure don't like what is going on right now, but do you know who is pooping in their pants more?Putin and Mullahs in Iran.  Break point profitability at last glance for Russia is $50/bbl, and Iran Upper 40's.
Putin could easily be put in a situation where he strands his army in Ukraine, if $50/bbl oil can be sustained for a few quarters.

6). General sentiment...  At the time the DOW hit about 45K, I stated I thought the market was 100% oversold.  I still think a mid 20's scenario is plausible.  And that def, would be at or near the bottom IMO.  Problem is the genera investing population got addicted to the Bulls and got complacent enough about it, to the point of entitlement. Gravity can be a nasty thing, and it is inevitable.