Daily Commentary

MarketMinder’s View: Japanese exports to the US bounced back in a big way last month, boosting overall exports in November—another sign of the global economy’s resilience amid President Donald Trump’s tariffs this year. Before getting into the takeaways, we must point out some important distinctions. The article reports November shipments to the US rose 8.8% y/y in value terms, their first rise since March. However, currency skew (tied to a weak yen) and inflation can distort values, so we think Japanese export volumes can better reflect how much trade is occurring. The article actually provides an illustrative example: “The value of car shipments to America increased 1.5% while the number of exported units jumped by 7.7%. That difference has been an ongoing pattern that suggests Japanese automakers are still sacrificing profits by cutting prices to preserve market share.” Besides US tariffs, some worry a recent geopolitical controversy between Japan and its largest trading partner China may knock commerce (November exports to China fell -2.4% y/y in value terms and -14.0% in volume terms, driven by contractions in chip-making machinery). The economists interviewed here don’t think the kerfuffle will derail trade, instead worrying slowing Chinese demand may be a larger factor. That is worth keeping an eye on, though doubts about China’s economic resilience indicate pockets of skepticism persist.

MarketMinder’s View: Our collective answer to the titular question: It depends! What matters more than the medium is the actual information. For more context, a recent Financial Industry Regulatory Authority (FINRA) poll “found that young adults are increasingly turning to social media for investment advice. A quarter of people surveyed said they use recommendations from social media finfluencers in making investment decisions; among those 35 and younger, it’s 61 percent.” We admire young folks educating themselves and learning how to build wealth, but getting lessons from social media can have some unique challenges. For instance, consider how content in general gets distributed on social media. “The influencer’s primary goal is often to produce viral content to boost views and expand their follower count. This encourages them to use sensational claims and manipulate your emotions. For instance, they make people feel like fools if they aren’t investing in cryptocurrency. But the volatility of cryptocurrency makes it unsuitable for many investors. It has also become a favorite for fraudsters because it’s so hyped online and attracts investors, especially young adults, who fear they will miss out on the next great investing opportunity.” Fear of missing out (FOMO) can arise among any demographic, but social media can amplify the feeling. The Internet has many resources, but good ol’ fashioned due diligence and research go a long way to ensuring the information you consume is actually beneficial.

MarketMinder’s View: This long-ish piece includes discussion around potential policy here, so please note MarketMinder is nonpartisan. We favor no party, politician nor policy, assessing political developments solely for their potential market and/or economic effects. President Donald Trump is supposedly weighing the idea of sending one-time $2,000 rebate checks to many American households, funded via tariff revenues. The aim is to help out families feeling financial stress (and likely to boost sagging poll numbers as well). Yet, as the article aptly notes, rebate checks probably wouldn’t have the effect the Trump administration intends. “Even if Americans were to delight in a series of new government-issued checks, the payments would hardly address the reasons that prices remain so high — including a shortage in housing that has driven up rents and mortgages and the global tariffs that have made imports more expensive.” And that presumes checks even happen, which is awfully presumptive. As the article details, the political debate is far from settled. Some in the administration couched the OBBBA’s tax cuts as fulfilling the tariff rebate pledge. Another wrinkle is that tariff revenue remains much lower than projected, hardly sufficient to fund all the things politicians claim it will go to (e.g., farmer assistance, deficit reduction, so-called rebates). Now, one point we do disagree with is that potential rebate checks would cause inflation to take off again. No. Government checks don’t increase money supply. They simply move money from A to B. That can change the velocity of money, but even that isn’t ironclad. Some households may spend the unexpected windfall, but others may choose to save it. But take a step back, and to us, this chatter is mostly political noise for now. For more, see our November commentary, “For Investors, Public Political Brainstorming Is Noise, Not News.”