This is absolutely insane: The US just posted a 2-month goods trade deficit of $301 BILLION as companies attempt to front-run tariffs. We have rarely ever seen a 2-month trade deficit even HALF as large, a CLEAR sign of panic.
What is happening here? https://x.com/KobeissiLetter/status/1905363961656095209
To put this into perspective: Trump Trade War 1.0 saw its worst monthly trade deficit of ~$120 billion.
February's trade deficit just came in at $147.9 billion, which was $12.4 billion ABOVE expectations.
January's trade deficit was revised up to a massive $153.3 billion. https://x.com/KobeissiLetter/status/1905363964739150138
This trade deficit surge has been highly linked to industrial supplies.
As shown below, imports of oil, LNG, gold, and steel have gone exponential. Producers are bracing for what appears to be a very long trade war. Producers are clearly panicking right now https://x.com/KobeissiLetter/status/1905363968161386897
The worst part?
This data does not account for the latest tariffs on ~$240 billion an ANNUAL auto imports. ~46% of all cars sold in the US are imported with a whopping ~2.96 MILLION coming from Mexico alone.
As auto tariffs are announced, widespread frontrunning has begun. https://x.com/KobeissiLetter/status/1905363970996699502
Take a look at physical gold buying: We are seeing depression-like physical gold buying in the US. Physical gold inventories have surged +100% year-to-date with gold hitting $3,100/oz today. Tariff uncertainty is well above levels there were seen in Trump Trade War 1.0. https://x.com/KobeissiLetter/status/1905363973920489599
Trade war abnormalities are being seen in many parts of the market. Take a look at this chart of Swiss gold exports to the US. We have never seen frontrunning of a trade war at levels that are being seen now. Not even March 2020 saw levels HALF as high as they are now. https://x.com/KobeissiLetter/status/1905363980215881775
We have also seen some extremely unusual moves in stocks as a result. Tesla, $TSLA, was up as much as +9% today on the 25% auto tariff news. While Tesla sources some parts from outside the US, the cars are 100% assembled in the US. Still, hours later, the gain was erased. https://x.com/KobeissiLetter/status/1905363982921195529
Auto tariffs have added even more complexity and economic concern. ~7.4 million cars were imported into the US in 2024. There is not a single major car brand that produces a car 100% made in the US. If imposed for an extended period of time, auto bankruptcies are coming. https://x.com/KobeissiLetter/status/1905363985047630109
As a result of the constant headlines, investor and consumer sentiment has plummeted. Markets have become increasingly emotional which is why we see so many sudden swings. 44% of Americans now expect lower stock prices, which is just 11 percentage points below the 2008 peak. https://x.com/KobeissiLetter/status/1905363987467731215
Lastly, we just saw the largest 2-month decline in stock market expectations ever recorded. Not even Trade War 1.0 or 2020 saw this metric fall by 15+ points in 2 months. Emotion and investing don't mix well. https://x.com/KobeissiLetter/status/1905363992329039984
...front running of trade means at some point after the introduction of Trump tariffs, trade volumes are going to be smashed.
...unprecedented events provoke changed behaviors, just like pandemic, just like the supply chain crisis following the Ukraine war. 'Survival' responses in all cases.
