Trump's Steel Block: A Smart Move!

Ladies and Gentlemen, let me tell you something: President Trump's pushback against Nippon Steel's bid to acquire U.S. Steel is a SMART MOVE! This is not just about protecting American jobs; it's about sending a clear message to the world that we won't tolerate dumping and unfair trade practices. Let's dive into why this is a game-changer for the market and your portfolio.



First things first, let's talk about the ELEPHANT IN THE ROOM: dumping. Dumping is when a country exports products to other countries at a much lower price than in those countries' existing markets. It's a dirty trick, and it's been hurting the U.S. steel industry for decades. Nippon Steel's bid to acquire U.S. Steel was just another attempt to manipulate the market and gain an unfair advantage. But guess what? Trump said, "NOT ON MY WATCH!"

Now, let's talk about the MARKET REACTION. When Trump announced the tariffs, the market went into a tailspin. The S&P 500, the Dow Jones Industrial Average, and the Nasdaq Composite all experienced significant declines. But here's the thing: the market is a reflection of the broader economy, and the broader economy is a reflection of the market. It's a chicken-and-egg situation, and Trump's pushback against Nippon Steel is a BIG EGG in this scenario.

Let's break it down:

- Price-to-Earnings (P/E) Ratio: The current forward multiple on forward earnings (next 12 months) for the S&P 500 is just above 20, while the trailing P/E, which looks at the past four quarters of reported earnings, was closer to 25. This suggests that the market plunge is a P/E ratio lowering event, which is an opportunity for investors to buy into names that can weather a Trump tariff environment.

- Market Action: The market action has punished investors who've stayed negative, as well as short sellers and hedge funds that got greedy in the past few days. Conversely, it rewarded people who stuck with their investments even as volatility skyrocketed. Wednesday was "one of the greatest short squeezes in history," indicating that the market has a tendency to reward long-term investors who stay the course.

- Economic Indicators: The market's reaction to the tariffs is a temporary setback. Investors should not bet against good companies, even if they are vulnerable to tariffs. For example, shares of mega-cap tech corporations like Apple and Nvidia were some of the biggest losers during the market's recent slide, but these companies have achieved great success for a reason, and investors who write them off at their lows do so at their own risk.

Now, let's talk about U.S. STEEL. U.S. Steel is a GOOD COMPANY, and it's a GOOD INVESTMENT. The company has been focused on executing a strategy that has resulted in an unprecedented opportunity to partner with Nippon to secure jobs, invest capital and infuse global leading knowhow and technology into U. S. Steel. But here's the thing: U.S. Steel is "a shell of itself" because leadership didn't recognize technological innovation, changes in the industry and emerging competitors. But with Trump's pushback against Nippon Steel, U.S. Steel has a chance to REBOOT and REBUILD.

So, what's the BOTTOM LINE? Trump's pushback against Nippon Steel is a smart move, and it's a move that will benefit the U.S. steel industry and the broader economy. It's a move that will benefit investors who stay the course and don't panic. It's a move that will benefit the market in the long run. So, BUY U.S. STEEL, and BUY INTO THE FUTURE of the U.S. economy. Because, as I always say, "THE MARKET IS A REFLECTION OF THE BROADER ECONOMY, AND THE BROADER ECONOMY IS A REFLECTION OF THE MARKET."