Trump Tariffs Are ‘An Act Of War’ Says Warren Buffett: Warren Buffett who is a well-known figure in the investment market and the CEO of Berkshire Hathaway finally broke his silence over Trump’s tariff move. The 94-year-old legendary investor called Trump’s move to impose tariffs over countries like Canada “an act of war.” Buffett is known for his work in philanthropy and his net worth currently stands at US$149.6 billion. His statement is backed by decades of experience in the economic landscape. This article brings you all the must-know details about Warren Buffett and his statement. It also offers you a brief view of how Trump’s Tariff imposition is affecting the US markets.
Trump Tariffs Are ‘An Act Of War’ Says Warren Buffett: The Interview
Warren Buffett recently appeared in an interview with CBS News and finally broke his silence over Trump’s tariff move. He called the tariffs “an act of war, to some degree.” The Berkshire Hathaway CEO has decades of experience in the world economy. He explained how the imposition of tariffs will only end up increasing prices of goods for the end consumer.
“The Tooth Fairy doesn’t pay ‘em!” He added, referring to the shift in prices. He explained that the burden of the tariffs will ultimately fall on the consumers. His statement came after Trump imposed 25% tariffs on neighboring countries like Canada and Mexico. China is also facing 20% tariffs from the USA. Many other economists like Buffett agree with his statement as well.
Trump’s Tariff Imposition Affecting The US Markets
Trump’s tariff imposition move sent shock waves to all the financial markets of the United States of America. The Dow Jones Industrial Average faced a major drop of 1.48%. On the other hand, the S&P 500 saw a drop of 1.76% while the Nasdaq plunged 2.64%. The automobile industry took a major hit as well. General Motors saw a decline of 4% while Ford saw a 1.7%.
The Canadian Dollar as well as the Mexican Peso also saw a fall in response to the tariff imposition. The authorities from both the neighboring countries mentioned retaliation actions would be taken. Mélanie Joly who is the foreign minister of Canada openly criticized Trump’s move calling it unpredictable as well as chaotic.
Trump’s Justification For The Tariff Imposition
Trump recently appeared at a White House event and responded to the concerns. He encouraged car companies who are facing losses because of the tariffs to shift their production to the US. Howard Lutnick, who is the Commerce Secretary of the United States, also dismissed Buffett’s concerns. In an interview with CNN, Lutnick called his statement “silly.”
He also falsely claimed that the creation of the Internal Revenue Service happened when the US entered the First World War. Originally, the IRS was created during the Civil War. Lutnick claimed the tariffs could replace the need for the IRS. Despite the federal government actively defending the decision, economists still believe shifting government revenue from income tax to tariffs is impractical.
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Market Moves Of The Legendary Investor
Warren Buffett has always openly criticized Trump’s administration decision of imposing tariffs calling it a very bad idea. If we consider his decades-long experience with the global economy, his statement serves as a warning for fellow investors. Berkshire Hathaway is actively increasing its cash reserves reaching a record $334.2 billion. This happened after the company sold off shares from other major companies like Apple and Bank of America.
The stocks of his company have recorded a major surge in both Class A and Class B shares. Many market analysts who have been monitoring his market approach for years believe his conservative investment approach is a preparation for economic uncertainty.
