This Week in Review | Tariff Update, Bitcoin Volatility, Private Markets

Transcript

Tim Schluter

Hello, and welcome to This Week in Review. This weekly segment is designed to highlight a few important developments you may have missed this week, what they may mean for markets, and most importantly, the potential impact for investors. To stay up to date with our latest market insights, subscribe to our YouTube channel or visit FisherInvestments.com Now, let's review what happened this week.

First, the latest tariff updates.

On Tuesday, the US began enforcing a temporary 10% global import tariff. This move comes after the Supreme Court blocked President Donald Trump from imposing tariffs under the International Emergency Economic Powers Act, or IEEPA. While the president had previously floated a 15% rate, the administration opted to implement the current 10% tariff, citing a narrower Section 122 of the Trade Act of 1974. Importantly for investors, While last year's blanket tariff announcements helped fuel a large correction, markets have displayed more normal volatility in recent days. Some days have been up, some down, but on net, markets have been fairly flat. This suggests investors have moved on from tariff fears, and this makes sense. Global trade has been shifting away from US dominance for some time, with non-US trade partnerships steadily growing. While tariffs may reduce US participation in global trade, they are unlikely to cause a decline in global trade overall. Looking ahead, whether the tariff remains at 10% or increases to 15%, or even if Congress allows the administration to extend it beyond the 150-day limit, we believe the economic impact will likely be less severe than some fear. Markets have already priced in much of the tariff risk. This limits its potential to disrupt stocks in the long term. As always, we'll continue monitoring the situation for any emerging risks.

Next, Bitcoin volatility.

Bitcoin's value has plunged nearly 50% in recent months, dropping from over $126,000 in October 2025 to under $65,000 in recent weeks. While such sharp declines are not new for the cryptocurrency, this latest drop has reignited questions about its future and its potential impact on broader markets. Historically, Bitcoin's extreme volatility has been driven by speculation rather than ties to the traditional financial system. Since 2013, it has experienced nine drops of 30% or more, with only two coinciding with global stock bear markets. And even then, the causes were unrelated to Bitcoin. Unlike stocks, bonds or commodities, Bitcoin lacks cash flow, industrial uses, or widespread adoption as a currency. This makes its price highly sentiment driven and unpredictable. Bitcoin's volatility underscores its speculative nature and limited connection to broader markets. We believe its recent drop doesn't signal broader economic risks, though investors should approach alternative assets, like Bitcoin, with caution. For long-term investors, we believe more stable long-term opportunities such as stocks and bonds are a better fit.

Finally, private markets.

Alternative investments like private equity and private credit have gained attention in recent years, with financial institutions now offering these products to everyday investors. While they may seem appealing, these investments come with significant risks, particularly poor liquidity. As highlighted last year. In MarketMinder, investing in alternative assets often means your money is locked up for months or even years, making it difficult to access funds when needed. An issue that can be especially challenging for individual investors compared to institutions like pension funds. Some investors may also wonder whether the growth of private markets creates risks for stocks or the broader economy. While a collapse in alternative asset funds could contribute to market volatility, it's unlikely to trigger a bear market on its own. However, such a scenario could force investors to sell more liquid assets to meet financial needs, amplifying market corrections or an ongoing bear market. That said, we don't see this as a likely risk in the near term, especially given our outlook that a US recession is unlikely within the next 12 to 18 months.

That's it for this week.

Thanks for tuning in to This Week in Review. If you're looking for more insights, then don't miss our other series, 3 Things You Need to Know This Week, released every Monday. You can also visit FisherInvestments.com anytime for our latest thoughts on markets. Thanks again for joining us, and don't forget to hit "Like" and "Subscribe!"