Happy Tuesday everyone. I’m no betting man but I’d put money on another volatile day on Wall Street. Today we’re covering what the smart money is saying about the trade war. Was this email forwarded to you? Join 190,000 self-directed investors gaining an edge every morning. Sign up here. 

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Wall Street wants Trump’s ear

 The stock market has spoken loud and clear. 

Some of Wall Street’s biggest executives are now chiming in too.

Their message to President Trump is simple: The current plan for tariffs must change before the uncertainty swallows the economy. 

“The recent tariffs will likely increase inflation and are causing many to consider a greater probability of a recession,” JPMorgan CEO Jamie Dimon wrote in his annual shareholder letter, published Monday. He warned that tariffs threaten higher domestic prices and could weigh on an already weakening economy.

“America first is fine, as long as it doesn’t end up being America alone,” Dimon wrote.

Indeed, the numbers already tell a story of panic.

The S&P 500 has dropped roughly 18% from its recent high, and the index’s P/E ratio has tumbled from 28x to about 21x.

What’s more, trading volatility across globe stock indexes have rivaled those seen during the pandemic and financial crisis. 

On Monday, stocks briefly rallied on a rumor of a 90-day pause on tariffs. The White House quashed the report, calling it “fake news,” and stocks resumed their multi-day decline.

Pershing Square CEO Bill Ackman, who has been a vocal proponent of President Trump’s administration, warned in a lengthy post on X that markets and the country would indeed benefit from a 90-day pause on tariffs for negotiations.  

"The President has an opportunity on Monday to call a time out and have the time to execute on fixing an unfair tariff system,” Ackman wrote.

“Alternatively, we are heading for a self-induced, economic nuclear winter, and we should start hunkering down.”

On Monday, Peter Navarro, Trump’s trade advisor, shrugged off the market tumult, and said stocks will eventually bounce back.

BlackRock CEO Larry Fink echoed his fellow executives’ caution during a talk at the Economic Club of New York on Monday, Bloomberg reported. 

“Most CEOs I talk to would say we are probably in a recession right now,” Fink said. “One thing I would say for sure is the economy is weakening.”

Notably, the sudden barrage of Wall Street commentary isn’t the usual partisan sniping.

Even Stan Druckenmiller, not typically considered outspoken, wrote in a rare post on X: “I do not support tariffs exceeding 10%.” 

Meanwhile, Bridgewater’s Ray Dalio published a newsletter of his own Monday, though he called tariffs just the latest ingredient in an ongoing breakdown of major monetary and geopolitical norms.

While he sees levies as disruptive to markets and international politics, Dalio reiterated his long-held view that these developments are simply part of a classic cycle of the economic world. 

The takeaway here is that the smartest money in America sees reason for pause with Trump’s tariffs. 

Not just for markets, but for the stability of the world economic order.

Market snapshot

Elsewhere:

🇨🇳 Trump warned China could face more tariffs. But China came back and threatened to retaliate further if the US follows through with his own threat. “China will resolutely take countermeasures to safeguard its own rights and interests,” China’s Ministry of Commerce said Tuesday. (WSJ)

📈 The wild 7-minute $2.5 trillion stock turnaround. Rumors of the 90-day tariff delay lasted just moments, but benchmark US indexes seesawed aggressively in both directions. To some strategists, it signaled that markets could bounce violently higher if Trump decides to stop or pause his tariff plan after all. (Bloomberg)

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Rapid-fire:

• Broadcom stock jumps as it announces a $10 billion buyback plan (Yahoo Finance)

• The comparison between 2025 and 1987’s Black Monday looks overblown, according to data (Axios)

• Trump says the US has begun direct talks with Iran over its nuclear program (CNN)

• Stock investors shouldn’t be so scared of tariffs, argues Anthony Pompliano (Pomp Letter)

• The US dollar isn’t acting like a safe-haven like it historically does (Barron’s)

• Zooming out makes doomsday headlines seem like footnotes of history (Blog)

• Circuit breakers are regulatory safeguards that trigger when stocks fall 7% or more (Inc. Magazine)

Last thing:

About me:

📰 I’m Phil Rosen, co-founder and editor-in-chief of Opening Bell Daily. I’ve published books, lived on three continents, and won awards for my journalism, which has appeared in Business Insider, Fortune, Yahoo Finance, Bloomberg and Inc. Magazine.

I write our flagship newsletter to prepare you for each trading day, unpacking markets, economic data and Wall Street with analysis you won’t find anywhere else. Feedback? Reply to this email, ping me on X @philrosenn, or write me directly at [email protected].