TOTAL DISASTER! Trump Stock Market Plummets, Nintendo Pricing Backlash Getting Worse, & Today's News
PDS Published 04/03/2025
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It finally happened, “Liberation Day” came around and President Donald Trump revealed his new, sweeping tariffs. []
We quickly talked about this on the show yesterday, but considering it was announced right when we were getting ready to ship out the episode, we couldn’t spend a ton of time on it.
Now that the tariffs have had about 24 hours to cook, we're seeing a lot of reactions from people, institutions, companies, and the markets themselves.
Backing up a bit so we’re all on the same page: leading into yesterday, there was a bit of speculation about what the tariffs would actually look like.
In the end, it was a mix of the two top theories.
There’s a baseline 10% number across the board followed by "reciprocal" tariffs that can increase that number.
The reciprocal tariffs allegedly don’t just take into account the tariffs other countries place on American goods, but also “currency manipulation and trade barriers.” []
Take China:
The Trump administration claims that when accounting for everything, they tax their citizens 67% extra to buy American goods.
In return, we’re going to charge Americans a 34% tax to import Chinese goods.
Vietnam is a similar story, where they allegedly make American goods 90% more expensive, so we’re going to make their stuff 46% more expensive.
In general, it looks like we’re giving a 50% “discount” on what other countries charge us, unless they are at the baseline, in which case they get charged the 10%.
Right off the bat, there was a lot of confusion on how the administration even came up with these numbers.
The White House’s official twitter post about this got a community note which read:
“Trump’s “reciprocal” tariffs aren’t based on actual foreign tariffs but likely on the U.S. trade deficit divided by imports. See WTO data.”
Those numbers didn’t completely add up but were VERY close, leading to speculation that the formula was actually something else… and officially, it is.
We know this because yesterday evening the Office of the United States Trade Representative released this formula with an explanation.[]
[NOTE TO PHIL: This looks like a lot of math but I have a link to a graphic we can remake as you explain the numbers and letters and trust me, it’s far simpler than it seems. I think with graphics that “morph” into the common-understanding of the terms will help a lot].
That looks more complicated than it actually is, and the big thing is that it is essentially dividing the trade deficits by the imports.
The Chai symbol literally just means our total exports to a country.
The Mu represents “the total imports from a country.”
They actually set those numbers to 4 and .25
Which is notable because what is 4 times one-fourth?....... Just one. It cancels out.
Making this formula literally just trade deficit vs. total imports with more steps, as many have pointed out.
The reason the community note was off is because it was using different trade deficit data, but if you use the Census.gov 2024’s numbers it’s spot on.
So in the China example, we have a $295.4 billion deficit and import $438.95 billion… giving us 67%!
Divide that by 2 and it’s 33.5%... which is then rounded up.[]
The only time this doesn’t hold true is if we have a trade surplus or a country doesn’t tax American goods as much… in which case their goods get shafted with a 10% tariff anyways.
And regardless: IT DOESN’T ACTUALLY TAKE INTO ACCOUNT WHAT OTHER COUNTRIES ARE CHARGING US AS CLAIMED.
Like in the case of China, the WTO claims that the average tariff rate is 7.5%[]
Which is why we saw so many critiques of it.
One of the guys who managed to reverse engineer the formula got into a tiff with the Deputy White House Press Secretary.
After revealing the formula, Deputy Secretary Kush Deh-sai responded: [Sai rhymes with eye]
“No, we literally calculated tariff and non tariff barriers.”
He got a helpful community note pointing out that the official formula is “is essentially equivalent to the original post, and includes no terms for the tariff rate charged by the exporting country.” []
(Which, as we’ve seen and looked over, is true. There are no references to tariff rates, ““currency manipulation and trade barriers” in the official formula).
Others went on to say things like:
“One of the most depressing things about Trump's tariffs is that he constantly lies about them and so many of his followers believe him.
No, these tariffs are not "half of what they charge us" because Trump used a formula disconnected from tariffs and then flat out lied about it.” []
And: “Holy fuck. This is bad. Even Grok is like "The White House's tariff formula is faulty.” []
That being said, not everyone was upset with the formula, with supporters writing:
“Trump’s tariff formula is further evidence he is laser focused on reversing these imbalances.” []
(Although finding people outside of the administration defending the tariffs was a bit hard)
If you think people are worried with how these tariffs were rolled out, wait until you see the markets.
The DOW Jones opened up to a 3% crash,[]
And the S&P 500 fell almost 4%, making it 10% down from its all-time high.
Major banks and investment groups think these tariffs are “the worst case scenario for tariffs.”
UBS predicts that they will lead to slowing the US economy by 2 whole percentage points this year alone and raise inflation by 5%.
Like it’s such a bad situation that strategists at the bank almost think this is just brinkmanship because it “makes one’s rational mind regard the possibility of them sticking as low.”
Others think that the markets dropping 10% from their all time highs is just the start:
Experts from Thornburg Investment Management said:
“Markets may actually be underreacting, especially if these rates turn out to be final, given the potential knock-on effects to global consumption and trade.”
You can actually look to the bond market to see how much investors are worried.
10-year Treasury bonds fell to 4.05% from 4.2%.[](Actually as I was writing it it fell again to 4.04 and counting)
And that’s just the latest jump because in January they were sitting at almost 4.8%.
Keep in mind this is a market where jumps like this are considered a massive deal, especially when they’re made in just three months whereas normally it’d take like half a year to see these results.
It MAY be possible for the government to offset some of these challenges by lowering interest rates.
It had been doing this late last year before pausing in 2025.
That would allow companies and people to borrow way more money, which helps put cash into the economy.
The drawback with this -- as we saw during the COVID-era -- is that it can easily lead to big spikes in inflation since there is more money flowing around.
Just to avoid being a Debbie Downer, not every economic marker is bad news right now.
Joblessness is down and remaining solid… and that trend could continue IF Trump’s plans to bring manufacturing jobs back to the US pans out.
The easiest way to look at all this is that there’s widespread uncertainty… especially because tariffs like this aren’t a one-way street.
Everyone is waiting for exactly how other countries are going to respond.
The Chinese Commerce Ministry called the tariffs “unilateral bullying” and promised to retaliate. []
With a commerce ministry spokesperson accusing the US of violating international trade rules and saying the "reciprocal tariffs”, quote,
The French Prime Minister called the tariffs “a catastrophe for the economic world” and “brutal and unfounded” while a government spokesperson said that “we are also going to attack services.”
That makes up the majority of the US economy and means services from Google, Apple, Microsoft… you know all the tech giants… could be hit. []
In fact, the French Prime Minister just called for all European companies to suspend their planned investments in the US.
Which could have an impact of billions of dollars.
Hell, just one French electrical equipment supplier promised $700 million to support US energy infrastructure to power the growth of AI just last month.
The EU itself was also vague about an exact response right now, only threatening that “If you take on one of us, you take on all of us.” []
With the European Commission President promising what Bloomberg called “firm and proportionate” countermeasures though we don’t know yet what those are going to look like. []
Other leaders weren’t as confrontational.
The British Prime Minister seemed to say that negotiations for a different rate were ongoing. []
Though the government did release a 400 plus page list of US goods that could be hit by retaliatory tariffs should they decide to strike back.
Japan called the rates "regrettable" while India said it was “carefully examining the implications of the various measures.” []
However all of them dodged actually saying they would retaliate.
It’s because of all this uncertainty that we’ve seen figures like Mark Cuban suggest:
“It's not a bad idea to go to the local Walmart or big box retailer and buy lots of consumables now. From toothpaste to soap, anything you can find storage space for, buy before they have to replenish inventory.”
“Even if it's made in the USA , they will jack up the price and blame it on tariffs.” []
All of this has also led Congressional figures to be worried that Trump is going to far… even within his own party.
Senator chuck Grassley announced he was sponsoring a bill that would claw back a lot of the tariff authority that Congress has given the President.
In a statement he said:
““Congress has a constitutional role through the Commerce Clause on trade matters, and we should re-assume that role.”
And the Democratic co-sponsor of the bill, Sen. Maria Cantwell, added:
“[Arbitrary] tariffs, particularly on our allies, damage U.S. export opportunities and raise prices for American consumers and businesses.”
“As representatives of the American people, Congress has a duty to stop actions that will cause them harm.”
Without widespread Republican support such a bill is dead in the water, so getting Grassley onbarod is a good step to passing it.
And now we’re seeing reports that other leaders like Senator Thom Tillis are supporting the bill too.
So we’ll have to keep an eye on all of this because who knows what’s going to happen.
Uncertainty is now the name of the game.
In the meantime what do you think?
Do you even care that the Trump administration has a funky formula not related to tariffs in order to make its own numbers?
And what are your gameplans to try and lessen any impact this could have on you?
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People are not happy about the Nintendo Switch 2 prices.
Right, the device will be available starting on June 5, starting at $450, or you can buy it in a bundle that includes Mario Kart World starting at $500.[]
A game that, if you were to buy it on its own, would be $80.][
So some are seeing that price and thinking it will be a relatively standard game price for the Switch 2 going forward.
And every number I just said has pissed off a ton of people for being a bit too high.
With some writing things like:
People were also quick to blame Trump’s tariffs for the high prices, some thinking the tariffs could also inflate the price down the line, ]
Others pointing to corporate greed, with some thinking this could lead to the console flopping[][][]
Others concerned the game prices specifically will have industry-wide consequences, with the likes of MoistCritikal saying:[]
“It’s Nintendo. They can strong arm their way and get away with it. And what this means is $80 games, and I guess in some cases $90 physical copies, that is going to become the industry standard. All the other big players in the industry are going to follow suit. Nintendo has just busted the lid of $80 as a normal amount to charge.” (2:54-3:16)
“People are finally starting to see, this company, they don’t fucking like us. They do not really like the consumer.” (3:58-4:06)
With that actually bringing us to the next piece of backlash, because some reports have said that some Switch 2 games will only have a download key, not a physical game cartridge.
With a customer support page explaining:
“Game-key cards are different from regular game cards, because they don’t contain the full game data. Instead, the game-key card is your "key" to downloading the full game to your system via the internet. After it’s downloaded, you can play the game by inserting the game-key card into your system and starting it up like a standard physical game card.” []
And there have been some headlines suggesting that some of those $80 prices will be just for the digital version of the game, and a physical copy would be $90, though it does not look like Nintendo has officially confirmed this yet.
And some people have either mixed or fully negative thoughts on not owning the physical cartridge, right, with Polygon noting:[]
“We don’t know how often Nintendo and its publishing partners will use this “game-key card” solution, and maybe in some cases it’s the right answer.”
But also adding that it begs questions like: “what happens when companies — and maybe, specifically here, Nintendo — take their own game servers offline. Can I download what I bought? How do I play older games I care about?”
MoistCritikal also unhappy about this aspect, saying:
“You’re not actually owning if you’re buying a physical copy of a game. You’re still just getting a permission slip.” (6:19-6:25)
“You’re getting like a hall pass where you get to put your physical copy into the Switch 2 in order to download the game itself from Nintendo. You don’t own shit. You own absolutely nothing. You own the idea of being able to have this game on your console.” (6:29-6:44)
Though, some have defended it, saying it is not fully replacing physical games and not worth getting upset over, arguing:[]
“This is actually replacing what some companies have done for years - release a fake physical game that is just a download code in the box. This forces 3rd parties to make this a smidge more user friendly, as there is resale value now because you can sell the key card.”
Because like I said, this appears to only apply to some games in the first place.
Nintendo’s customer service page also says that you don’t need internet connection to start the game after it is downloaded, right, internet is only needed when launching it for the first time.[]
So I would love to know your thoughts on this, on any outrage, or if you think we won’t know people’s real thoughts on everything once the device is actually in our hands.
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If you just look at the numbers, Elon Musk’s political misadventure seems to have unambiguously backfired. [Image]
Because Tesla put out its first-quarter sales numbers yesterday, and it was a bloodbath.
With the company delivering less than 337,000 electric vehicles, a 13% drop from a year ago. [Quote, find “337,000”]
And this as 2024 already saw the first annual sales dip in a decade. [Headline]
Now as for why this quarter was so bad, Tesla’s quick to point out that it temporarily paused production of its Model Y SUVs in January while it upgraded them. [Quote, find “suspended”]
But skeptics point to more long-term, structural problems.
Namely that Tesla’s been losing EV market share to competitors, especially the Chinese firm BYD.
Which is projected by Counterpoint Research to surpass Tesla’s 15.3% share for the first time this year. [Quote, find “15.7”]
And also, there’s the claim that Musk’s political activity has alienated much of Tesla’s base, whom CNN characterized as “upwardly mobile eco-conscious lefties from the coasts.” [Image and Quote]
With that culminating in the boycotts, protests and vandalism that we’ve seen directed at the company recently. [Image]
Either way, Tesla’s poor sales performance prompted its stock to drop over 6% yesterday. [Quote, find “6.4”]
But then Politico reported that Trump had told his inner circle Musk would be stepping back from his role in the government in the coming weeks. [Headline]
And although the White House and Musk denied that claim, the news prompted the stock to rebound over 5%. [Quote, find “5%”]
But then later that afternoon, Trump revealed his “liberation day” tariffs, which are expected to disrupt Tesla’s supply chains, wiping out the stock’s momentary gains. [B roll, 55:42]
With shares dropping around 7% by Thursday morning. [Quote, find “7%”]
So that after the dust settled, Tesla had lost about 45% of its value since mid-December. [Quote, find “45%”]
Which is when it enjoyed a record high thanks to Trump’s election victory and expectations that the government would ease regulatory pressure on the company.
But despite Trump’s sales pitch on the White House lawn, the commerce secretary’s encouragement to buy shares, and the FBI’s classification of vandals as domestic terrorists, Tesla hasn’t reaped what Musk sowed.
And many critics argue that’s because whatever support it gets from the White House has been offset by the irreparable damage to its brand.
With early Tesla investor Ross Gerber [Pronounce 00:33] writing on X: [Image]
“The high end EV business has totally eroded. The cybertruck is basically not selling. The brand is broken and may not be fixable.” [Post]
With him further arguing that Tesla’s board needs to remove Elon Musk and find a new CEO.
Then, you’ve got Dan Ives, an analyst for wealth management firm Wedbush, saying:
“The brand crisis issues are clearly having a negative impact on Tesla…there is no debate.” [Quote]
And adding, “We are not going to look at these numbers with rose colored glasses... they were a disaster on every metric.” [Quote same link]
But even aside from the brand risk, it’s unclear just practically how Musk can balance so many different responsibilities, between DOGE, Tesla, SpaceX, X, and his other ventures. [B roll]
And Musk himself admitted as much during an interview recently with Larry Kudlow. [Lead B roll into clip]
[Clip, 01:11 - 01:17] Caption: [Larry Kudlow:] “I mean, how are you running your other businesses?” [Elon Musk:] “With great difficulty.”
So on Tuesday, the comptroller for New York City urged the law department to sue Tesla on behalf of the city's pension systems. [Headline]
Disclosing that they had lost more than 300 million dollars in three months thanks to the plummeting stock. [Quote same link, find “300”]
And stating: “The basis of the potential litigation are the material misstatements from Tesla claiming that CEO Elon Musk spends significant time on the company and is highly active in its management, despite his helming the Trump Administration’s DOGE initiative, spending little of his time actually managing Tesla, and promoting policies that are actively harmful to Tesla’s business.” [Quote same link]
And NYC’s not alone; right, the president of the American Federation of Teachers, wrote to dozens of public pension funds that Tesla’s sales were “shaping up to be abysmal.” [Quote]
With her urging them to take a close look at their Tesla holdings and at what their money managers are doing to "safeguard retirement assets.” [Quote same link]
So it seems like Elon’s political interests and his business interests are diverging more and more, and some investors think one will eventually have to give way.
But who knows; the future is a crazy son of a bitch, and anything could happen.
Kickstart your passion project with a free trial today: SQUARESPACE & enter offer code “Phil” to get 10% off your first purchase!
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Like a beautiful butterfly, New York City Mayor Eric Adams has metamorphosized from an allegedly corrupt Trump boot licker into a radical centrist. [Image]
With him telling Politico that he’s dropping out of the Democratic primary and instead running for reelection as an independent. [Headline and lead B roll into clip]
[Clip, 01:06 - 01:14, 02:40 - 03:01] Caption: “There isn’t a liberal or conservative way to fix New York, but there is a right way and a wrong way. … I firmly believe that this city is better served by truly independent leadership, not leaders pulled at by the extremists on the far left or the far right, but instead those rooted in the common middle, the place where the vast majority of New Yorkers are firmly planted.”
Now to be clear, he says he is still a Democrat, though The New York Times reported that for weeks he privately considered whether to run as a Republican. [Headline]
But he says he just couldn’t remain in the primary for more practical reasons.
Namely that thanks to his federal corruption indictment, there’s simply not enough time for him to recover the public support and the money necessary to have a shot in the June 24th primary.
So now he’s got seven months to build up a new electoral coalition of moderates and unengaged voters with a campaign focused on public safety.
Which means that we could see a spectacular showdown in the general between Adams and whoever the Democratic nominee is.
And right now, the front runner is former New York State Governor Andrew Cuomo, who’s been drawing away support from many of the mayor’s former allies.
Though New York has a ranked choice voting system, and some of Adams’ remaining allies reportedly hope one of the eight other Democrats, specifically the democratic socialist Zohran Mamdani [Pronounce 00:03], gets the nomination. [Quote, find “privately”]
But either way, most people with an opinion on this whose name isn’t Eric Adams seem to think that Adams’ chances of winning the general are close to zero.
This because New York is already heavily Democratic, and Adams in particular is extremely unpopular, with an approval rating of 20%. [Headline]
So the only things he has going for him are his incumbent status and a charm that rivals Clay Davis from “The Wire.”
And whether he’ll be able to distance himself from the indictment by November is an open question.
Though a new update on that story gives him a little more breathing room.
Right, you’ll remember that in February, Trump’s Justice Department dropped the corruption charges against Adams ,arguing they inhibited the mayor from addressing illegal immigration and violent crime.
And the DoJ dropped them without prejudice, meaning it could refile the charges whenever it wanted.
Which was widely seen as a tactic to keep Adams on the hook so that the White House would always have leverage over him.
And in fact, Adams cozied up to Trump, dining with him at Mar-a-Lago, refusing to say anything bad about him in public, and even slamming the Democrats on Tucker Carlson’s show.
But now, a federal judge has permanently dismissed the corruption case with prejudice, meaning they can’t refile the charges based on the same evidence. [Headline]
With him writing that “everything here smacks of a bargain,” and adding: [Quote]
“Dismissing the case without prejudice would create the unavoidable perception that the mayor's freedom depends on his ability to carry out the immigration enforcement priorities of the administration, and that he might be more beholden to the demands of the federal government than to the wishes of his own constituents.” [Quote same link]
And as for why the judge didn’t just reject the motion to dismiss the charges altogether, he said he can’t force the DoJ to prosecute a case if it doesn’t want to. [Quote same link, find “cannot order”]
So now Adams could plausibly argue that his ties to the Trump administration have been severed, and his legal troubles are in the past.
Yet on the contrary, he still seems to be leaning into his rightward turn, with him praising FBI director, Kash Patel’s book “Government Gangsters” yesterday. [Quote]
So yeah, New York politics are just getting weirder and weirder, and it looks like this year’s election is gonna be a fireworks show.
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And then, I have some bad news for my procrastinators out there: the Real ID deadline is just over a month away now.
Right, after years and years of delays, it is finally here, and starting on May 7, all travelers flying domestically must be Real ID compliant. []
Meaning, you need a Real ID to board, or you have to show your passport to get on domestic flights.
Which for some people, no sweat off your back, right, they’ve had a Real ID for years now.
The law was actually originally scheduled to be enforced way back in 2008, which is potentially before some of you could even talk or were maybe even born.[]
But it faced a lot of resistance, and it took until 2020 until all states were able to issue Real IDs, and it still got delayed repeatedly after that.
So some people thought they could continue pushing it off, but it has finally caught up to us and it is looking like that May 7 date is here to stay, which does raise some problems.
Because as of January 2024, only 56% of drivers licenses and IDs in circulation nationwide complied with Real ID, and DHS estimated that would only tick up to around 61% by the deadline.[]
So a lot of states are looking at a massive wave of people who want to update their licenses to Real IDs, which means even more lines and chaos at everyone’s favorite place: The DMV.
And some services are already feeling the crunch.
The Wall Street Journal reporting that there are DMV lines stretching city blocks in multiple states and there are Facebook groups discussing and strategizing around the madness.[]
Some states are also trying to warn residents of the mayhem and limit it where possible, with the Illinois Secretary of State’s office recently saying that:[]
“Our facilities and website have been overwhelmed with requests for Real IDs. As a result, we’re asking everyone to make sure they really need a REAL ID before booking an appointment or visiting a facility. The May 7th date is NOT a final deadline and everyone can travel with a valid U.S. Passport.”
Which, for what it is worth, May 7 is the starting date, right, unless something changes at the last minute, that is final, but because the state is so overbooked, some officials are saying if you have a passport, don’t stress too much about it.
Because in order to meet demand, Illinois has had to add over 2,000 daily DMV appointments and has even created a Real ID “supercenter.”[]
But that is the least of the mess.
According to CBS News, over in Florida, local authorities discovered scalpers grabbing up open DMV appointments and selling them for up to $250.[]
With this actually prompting Miami-Dade commissioners to pass legislation this week cracking down on DMV scalping.[]
Then there are worries about chaos at airports too, with Axios noting that in states with lower compliance, some people might end up getting turned away at security and then staffers for airports and airlines are going to be bombarded with angry people who missed the memo.[]
And it doesn’t help that summer travel season is approaching.
So, if you do not have a Real ID and have upcoming travel, it is something you might want to look into, go to your state’s DMV website to see what you need and when you need it.
If you don’t have travel plans, it is worth noting that a Real ID is not needed for driving or voting, so if you still have a non-Real ID license, you are good for those activities, Real IDs are primarily for travel and entering federal facilities. []
But just consider this a PSA and a reminder that after years and years, this is really happening, and if you’re a domestic jet setter, it especially applies to you.
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And for your Thursday dose of good news, I’d like you to meet Tyler Sowden.
Tyler here is 16 years old and lives in Cleveland, Ohio.
And recently, Tyler was in his home, playing a game when he heard screaming coming from down the block.
Turns out, one of his neighbor’s houses was on fire and a mother and her 3 children - a 12 year old, a 7 year old, and a 10 month old - were stuck on the roof. [B Roll 0:02-1:30]
In the video, you can see smoke billowing from the window behind them.
So Tyler springs into action - grabbing a ladder, hauling it to the house on fire, and setting it up against the roof over the porch.
Then he carried the baby carefully down the ladder before handing her off to some bystanders while he helped the young boy and the mother down off the roof.
The 12 year old was reportedly on the back porch and jumped off the roof themselves.
With Tyler saying in an interview,
“Tyler: I don’t even know what was going through my head, to be honest with you. I grabbed my ladder and ran. I jumped off my garage so, yeah.
Reporter: I’m gonna say this to you, you’ve probably heard it already: you know you’re a hero, right?
Tyler: I guess.” 0:57-1:08
After everyone was out and off the building, firefighters and police rolled up - with a couple officers rescuing an elderly couple and a dog from a second home impacted by the fire. [B Roll 1:51-2:00]
As of right now, we don’t know what caused the fire but we do know that it did over $170,000 in damage. []
But thankfully, there were no reported injuries and the firefighters got a handle on the blaze pretty quickly.
And the Red Cross is reportedly assisting the family that Tyler rescued since they’ve been displaced. []
But while we wait to learn exactly how this fire started, Tyler is absolutely getting the title of our BAMF of the day.
You did good, kid.
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