Markets, Tariffs & Deals: Between Truce & Turmoil - What's Next?
Washington’s playing Let’s Make a Deal.
Washington’s playing Let’s Make a Deal.
Markets are trying to guess the ending.
China just walked off with a better hand.
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Tariffs Down, Optimism Up… Maybe
Both the U.S. and China blinked. And that’s good for now.
U.S. tariffs cut from 145% → 30%
China’s retaliation drops from 125% → 10%
The economic impact? Not bad:
China gets a GDP boost:
JPMorgan, Goldman Sachs, and Morgan Stanley revise 2025 forecasts up to 4.6–4.8%.
U.S. outlook improves too:
Goldman lifts Q4 2025 GDP forecast to 1.0% (from 0.5%).
Yardeni Research moves 2025 GDP range to 1.5–2.5%, up from 0.5–1.5%.
But don’t uncork the champagne yet.
These tariff cuts expire in 90 days unless a deal is finalized.
Ports are still congested as the final tariff-free shipments arrive.
Retailers have about 6–8 weeks of inventory before supply gaps hit.
Think of it like a traffic jam starting to clear. You might still make it home for dinner, but keep your hazards on.
Trump’s Middle East Power Plays: Big Money, Big Planes, Big Questions
Check the Middle East file if you thought the trade deals were bold.
Saudi Arabia:
Committed to investing $600B–$1T in the U.S.
Targets include energy, defense, mining, tech, infrastructure, and critical minerals
Qatar:
Just placed Boeing’s largest-ever aircraft order (160–210 planes)
Offered to gift Trump a new “Air Force One” (sort of):
It lacks full security and countermeasures
Won’t be used after Trump
Likely to end up in a presidential library, not the skies
Translation: huge optics, decent economics, mixed practicality.
Markets: Confused but Stabilizing
Volatility is fading, but conviction is still missing.
VIX has fallen below 20 for the first time since March (down from a peak of 60)
S&P 500: after a rollercoaster YTD, now basically flat
USD is rallying short-term…
But still down YTD vs GBP, JPY, and EUR
Gold & Silver are cooling—investors are back to chasing risk
Bonds remain unimpressed:
Yields are sticky
Inflation isn’t behaving
The Fed isn’t moving
Markets want resolution, not rhetoric. They’re getting… headlines.
Investor Mindset Check: Systems Beat Stories
Narratives change. Your system shouldn’t.
To keep your sanity:
Know your market regime: risk on/off, inflation, deflation, growth.
Separate news flow from market signals.
Use tools that match your time, risk tolerance, and brain bandwidth.
Investment Strategy Landscape: Who Uses What (by # of investors)?
Robo-Advisors (Wealthfront, Betterment, Empower): 8–12M.
DIY Subscriptions (Seeking Alpha, Motley Fool): 15–25M.
1% Wrap Fee Advisors: 13–15M.
Flat Fee/Retainer Advisors: ~1M.
Macro Subscriptions (42 Macro, Kobeissi, Macro Ops): 50K–250K.
Key questions to ask yourself:
Are you a trader or long-term investor?
Do you want automation or human advice?
What’s your budget? Your time horizon? Your stomach for risk?
What Keeps Me Sane:
The system I subscribe to tracks:
Market regimes by signal (growth, inflation, liquidity, volatility)
Macro factors like yields, commodities, credit spreads
Asset allocation based on regime, with overlays for momentum, price action, and volatility
It’s not flashy. But it works.
The One Big, Beautiful Bill: Will It Pass by Memorial Day?
A new tax and stimulus package is being negotiated behind closed doors. Highlights:
No tax on tips or OT pay (2025–2028, retroactive).
Auto loan interest deduction for U.S.-made vehicles.
$4,000 extra standard deduction for seniors (65+).
Child tax credit raised to $2,500 through 2028.
MAGA Investment Accounts: $5,000/year with $1,000 seed for kids.
100% depreciation for U.S. factory builds (2025–2029).
Interest deduction expansion for small biz.
R&D deduction reinstated through 2029.
Top tax rate locked at 37%, avoiding reversion to 39.6%.
Inflation Reduction Act scaled back, but not gutted.
They’re aiming for a Memorial Day vote. We’ll see if Congress can do something rare: move fast.
Market Data-Charts
Three-Ring Circus:
Gold vs Bitcoin: Volatility patterns are shifting—BTC is less volatile right now
Stocks vs Bonds: Low vol, but bonds aren’t joining the party
Stocks are clawing their way to all-time highs, but the 10-year is stubbornly close to 4.5%Currency Watch: Are policymakers quietly engineering a weaker USD?
Watch the markets for direction, not the news flow.
What’s Next, What To Follow
Sometimes, you have to ride the rollercoaster: $1 million BTC? Pomp stirs it up with BITMEX co-founder and former CEO, Arthur Hayes.
Apple is a Chinese company! FT journalist, Patrick McGee has written 400 pages about how Apple made China into a tech manufacturing behemoth—and now is trapped.
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I have seen a better breakdown of what’s going on. Excellent!