The Stacking Benjamins Show
Episode: Special Episode: Tariff Fallout - What Should You Do?
Release Date: April 8, 2025
Hosts: Joe Saul-Sehy and OG
Network: Cumulus Podcast Network
Description: Awarded the 2023 Best Personal Finance Podcast by Bankrate.com, The Stacking Benjamins Show brings financial literacy to listeners with a blend of fun and functional insights. Hosts Joe Saul-Sehy and OG engage in lively discussions with experts, covering topics like personal finance, saving, investing, and current money trends.
Introduction to the Tariff Fallout Special
Doug [01:05]:
"Live from Joe's mom's basement. It's a special tariffs episode of the Stacking Benjamin Show."
In this special episode, Doug sets the stage for an in-depth discussion on the recent tariff implementations and their impact on the economy and individual investments. The hosts transition swiftly from their usual fare to focus on the pressing issue of tariffs and market volatility.
Understanding the Market Reaction to Tariffs
Joe [03:04]:
"But it's not a thing. But, you know, and it's like the struggle that I have with it is when we, when we do stuff like this or I send out an email or you're on TV or whatever, are we, yeah, that's a good point, Doug. Are we saying is this isn't a thing, but, oh, my God, we're doing a special episode."
Joe expresses the dilemma of addressing tariff issues without inadvertently validating concerns, highlighting the balance between providing information and causing alarm.
Joe [04:22]:
"I almost tweeted out, dave, how much are you down right now and today? 7 million. I'm down 7 million bucks and stocks and crypto. I think Trump's a smart guy."
Joe references David Portnoy's comment on stock losses, illustrating the immediate personal impact of tariffs on investors and the broader market sentiment.
Sector-Specific Impacts of Tariffs
OG [07:15]:
"The three sectors that went down the most, the energy sector, OG Went down the most because of fear... Second was technology... and then financial companies."
OG breaks down the sectors most affected by the tariff news, explaining the reasons behind the declines:
- Energy Sector: Reduced due to increased costs from international dependencies.
- Technology Sector: Companies like Apple suffered due to reliance on international supply chains, unlike firms with more domestic operations like Microsoft.
- Financial Sector: Wall Street firms faced downturns, although those with significant brokerage services fared slightly better.
Proactive Investment Strategies Amid Tariff Volatility
Joe [05:40]:
"I think it's important to focus on the things that are proactive from an investing standpoint that you should be doing."
Joe emphasizes maintaining a proactive investment approach despite market fluctuations caused by tariffs. He suggests viewing the situation as new information rather than unprecedented turmoil.
Joe [10:38]:
"Well, I don't think any of the days mean anything individually or in aggregate... the market going down or there being variability or volatility is already there even in those back of the envelope calculations."
Joe reassures listeners that daily market movements should be contextualized within long-term investment plans, such as the 4% rule for retirement savings.
Historical Context and Market Resilience
Doug [14:41]:
"And I was going to say you said the word context, which makes me think, zoom out... But if you just keep zooming out and look at five years, this is right on track."
Doug encourages listeners to view market downturns within a broader historical context, noting that short-term declines are typically part of longer-term growth cycles.
OG [15:54]:
"I saw our, our good friend Jill Schlesinger on CBS News this morning. Jill was talking about how in the past this has been, you know, this has been outside factors. OG this time it is self inflicted."
OG introduces a contrasting viewpoint, suggesting that the current tariff-induced market downturn is a result of deliberate policy decisions, differing from past market fluctuations caused by external factors.
Investment Advice and Actionable Steps
Joe [20:55]:
"So here's some. Here are the things that you might consider doing with the new information... If you have brokerage account money, number two, I've got tax loss harvesting..."
Joe outlines a comprehensive list of strategies listeners can adopt in response to the tariff fallout:
- Rebalance Your Portfolio: Assess and adjust asset allocations in workplace plans and brokerage accounts.
- Tax Loss Harvesting: Sell underperforming assets to realize losses that can offset future gains.
- Deploy Excess Cash: Move surplus cash into long-term investments rather than keeping it stagnant.
- Pull Forward Funding of Goals: Increase savings contributions temporarily using available cash.
- Dollar Cost Averaging: Continue regular investments to mitigate the impact of volatility.
- Review Your Plan: Reevaluate financial plans to ensure they remain aligned with long-term goals.
- Do Nothing: Sometimes, maintaining the current strategy and avoiding reactionary moves is best.
- Roth Conversions: Consider converting traditional IRA funds to Roth IRAs when market conditions are favorable.
- Debt Paydown: Aggressively reduce obligations like credit card debt to increase financial flexibility.
OG [25:22]:
"We could obviously spot this one. I mean, from, from."
OG suggests adding to the list of strategies, emphasizing the importance of personal action in response to market changes.
Focus on Budget Over Portfolio
Doug [19:01]:
"But you could have some recessionary type stuff. I'm not trying to, you know, be, you know, be Chicken Little here..."
Doug shifts the focus from portfolio management to budget management, stressing that controlling expenses is more immediate and impactful for financial well-being during uncertain times.
Joe [16:16]:
"I was going to say this is, this is, this is all internal."
Joe agrees with OG's point that the current market conditions are largely a result of internal policy decisions, reinforcing the need for listeners to take control of their financial strategies.
Conclusion: Maintaining Long-Term Perspective
OG [19:46]:
"But you're looking 10 years out or longer with your stocks. You shouldn't be in stocks if you're looking shorter than that."
OG concludes with a reassuring message for long-term investors, emphasizing that disciplined, long-term investment strategies are resilient against short-term market volatility caused by tariffs.
Joe [25:48]:
"StackingBenjamins.com OG StackingBenjamins.com we're happy to. Happy to visit with you..."
Joe wraps up by encouraging listeners to consult with financial advisors and leverage resources to avoid making impulsive investment decisions based on market noise.
Key Takeaways
- Market Volatility: Tariffs have caused significant short-term declines in specific sectors like energy, technology, and finance.
- Historical Context: Short-term market downturns are often part of long-term growth trends; maintaining perspective is crucial.
- Proactive Strategies: Rebalancing portfolios, tax loss harvesting, deploying excess cash, and maintaining disciplined investment habits can mitigate the impact of market volatility.
- Budget Focus: Prioritizing budget management and debt reduction provides immediate financial stability during uncertain economic conditions.
- Long-Term Perspective: Staying committed to long-term investment goals is essential, as markets tend to recover and grow over extended periods.
Notable Quotes
- Joe [05:40]: "I think it's important to focus on the things that are proactive from an investing standpoint that you should be doing."
- OG [07:15]: "The three sectors that went down the most, the energy sector, OG Went down the most because of fear... Second was technology... and then financial companies."
- Doug [19:01]: "I'm not trying to, you know, be, you know, be Chicken Little here..."
- OG [19:46]: "But you're looking 10 years out or longer with your stocks. You shouldn't be in stocks if you're looking shorter than that."
Final Thoughts
In this special episode, Joe Saul-Sehy and OG provide listeners with valuable insights into navigating the financial uncertainties brought about by tariff implementations. By combining historical context, sector-specific analysis, and actionable investment strategies, they empower listeners to maintain financial stability and focus on long-term goals despite short-term market fluctuations.