Growth investors have enjoyed back-to-back years of excellent market returns. To begin 2025, the market has been shaky. A 10-15% correction would not surprise me in the slightest. As President Trump adjusts to being the second president in history to be reelected for a non-consecutive term, he has been making some noise on the tariff front. We are all reminded of how polarizing a figure he is as social media warriors clash in an attempt to prove their point. Trump announced in early February that he was imposing a 25% additional tariff on imports from Mexico and Canada and a 10% additional tariff on imports from China. This move gave the market a bit of a shakeup as investors reacted negatively to the news. Trump promised in November that he would impose tariffs to pressure other countries into addressing illegal immigration and halting fentanyl. Along with the tariff turmoil, there is also the elephant in the room which is the Federal Reserve. Recently they elected to pause on the rate cuts and sit it out for a while. Several economists are calling for two rate cuts in 2025. To add to the flame, artificial intelligence, the market darling, has been hit hard after the reports of a more efficient and cheaper alternative to OpenAI. What does all of this mean for the market? What sectors are attractive right now?
Tariff Breakdown
In layman terms, a tariff is basically a tax or fee a government pays on imports from another country. This is often done to incentivize buying local products rather than foreign. In what seemed like only a few hours after the tariffs were imposed by President Trump, Mexico and Canada both struck a deal with the U.S. to pause tariffs for one month. Canada implemented their $1.3 billion border package which will reinforce the border with new technology, choppers, and increased resources to stop fentanyl from flowing. Mexico also publicly announced that they will be sending 10,000 National Guard troops to the border. By the time this article is published, the month-long pause with Canada and Mexico will have ended. I believe there is serious motivation to come to a conclusion before the tariffs are officially put in place. China will likely be harder to deal with. While the details of recent tariff talk have taken the media by storm, I prefer to…



