US Tariffs – This Time Could Be Different

It was my first year working as a lawyer at a firm that sometimes felt like something straight out of a John Grisham novel (but without the criminal touch, of course 😉).

I’d worked on my first major deals, attended high-profile conferences, and maybe – just maybe – started to enjoy the lifestyle that comes with the absurd sums floating around in the world of Big Law.

My now-wife and I spent New Year’s Eve at a friend’s place. I honestly can’t recall whether a mysterious virus from China came up in conversation that night.

If it did, it must have been as a passing joke – someone sneezing, another chiming in with a sarcastic “Hope it’s not that Wuhan thing.”

Little did we know.

The new year picked up right where the last one left off: a ton of work, major projects, workouts squeezed in between, and my usual stock market investments ticking along in the background.

Meanwhile, on January 21, 2020, the first case of a new viral illness was reported in Bordeaux, France. The patient had recently traveled to Wuhan.

Just days later, three more cases popped up across France, again, all linked to travel from Wuhan.

People started paying attention at home in northern Germany when, on January 27, a 33-year-old employee at the auto parts supplier Webasto tested positive. He’d been infected during a training session with a colleague who had flown in from China.

At that point, the virus still went by its code name: 2019-nCoV—short for “novel coronavirus.” That would remain until February 11, 2020.

February 20 marked the beginning of what would later be known as the COVID-19 stock market crash.

I’ve been investing since around 2014, though I can’t say exactly when because the endless switching of brokerages has scattered most of my early records to the digital abyss.

I do remember the market correction in late 2015—it was the first I experienced with real money in the game. Watching your hard-earned savings lose value overnight hurts in a very particular way.

But nothing, and I mean nothing, compared to what happened after February 20, 2020.

Global stock indices had only one direction: down. And one color: red.

For me, weirdly, it was a kind of paradise. I was earning enough at the time to put 5% to 7% of my total portfolio volume into the market each month. So I welcomed the falling prices. Instead of panic, I watched the unfolding crash with a kind of fascinated detachment.

US stock markets suffered from the greatest single-day percentage fall since the 1987 stock market crash. In the US, the Dow Jones Industrial Average closed down an additional 10%, the NASDAQ Composite closed down 9.4%, and the S&P 500 closed down 9.5%

Just four days later, on March 16, the carnage continued. The S&P 500 posted a record one-day drop of 12%.

The crash officially ended on April 7, 2020, when markets began to stabilize and the first signs of recovery emerged.

The COVID-19 stock market crash was one of the fastest and most severe sell-offs in financial history. Triggered by global uncertainty and the looming economic fallout of the pandemic, it tore through investor confidence like wildfire.

And oh boy, did I buy stocks during that time.

The Time Travel Effect

During the crash, I sat in the office, staring at the screen, completely stunned as prices tumbled.

That memory came rushing back to me in recent days, as markets worldwide plunged again in the wake of Donald Trump’s “Liberation Day.”

My initial reaction as an investor was something close to grim joy. Instead of embracing doom and gloom scenarios, my mood rises when I see my stocks losing value.

It felt like time travel.

Suddenly, I can travel back in time and get companies at a price I haven’t seen in years. And that’s a great opportunity – possibly life-changing. In the COVID-19 crash, I bought many excellent companies at a price I last saw in 2015 or 2016. Back at that time, I had much less capital on hand and was upset. The 2020 stock market crash gave me a second chance.

As if fate had handed me the chance to buy pieces of companies at prices they hadn’t seen in months, or even a year.

But with that opportunity came the familiar anxiety: that the window of discounted prices might close too quickly to deploy meaningful capital.

And here’s the thing. That worry reveals just how conditioned I’ve become by previous market recoveries. I know, in theory, that corrections can last for years, but theory and lived experience are two very different things.

This Time Could Be Different

Not once in my investing life have I seriously thought, this time it’s truly different.

Investing has always meant dealing with tangible realities.

No matter how you slice it, I’ve always needed my investments to offer real value: something I could point to, measure, and justify.

“Price is what you pay; value is what you get”

Sure, I’ve made a few speculative plays here and there, maybe caught a momentum wave for fun. But at my core, I’ve always been cashflow-driven. I invest so there’s food on the table (or new stocks in the portfolio, let’s be honest).

I don’t invest with the hope that someone else will buy from me at a higher price. That’s just a game of musical chairs, and I don’t enjoy betting on who’s left standing when the music stops.

“The only reason for putting cash into any kind of investment now is because you expect to take cash out; not by selling it to somebody else because that’s just a game of who beats who.”

I’ve tried breaking that philosophy down in more detail before, like in an older article on the TEV Blog. But at the end of the day, all the nuance circles back to Warren Buffett’s classic thinking.

For me, the foundation of investing has always been the United States. Not just as a market, but as an idea: open society, free enterprise, a fertile ground for innovation.

That’s the secret sauce behind Amazon, Meta, Tesla, and Palantir. High-risk founders, bold capital, explosive rewards. And while Europe tends to approach risk with nervous caution, America embraced it.

COVID-19 Crash and Tariffs – same same … but different

There are similarities to the COVID-19 crash. Even echoes of the 2008 financial crisis.

The markets unravel, confidence erodes. You feel the slow-boiling realization that this isn’t just volatility. It’s something deeper, a structural tremor that could rattle the economy to its core.

The sense of unease creeps in first. Then headlines start piling up. Sectors tank, rumors circulate, liquidity evaporates. Investors flinch, portfolios bleed. And at some point, you stop thinking in charts and start thinking in survival.

And back then, I simply relied on the following narrative:

“Stocks simply mirror economic progress. Anyone convinced that humanity will continue to progress economically will also be optimistic about the share performance.”

But this isn’t 2008. And it isn’t 2020, either.

Those were external events: a financial system gone toxic, a virus gone global. Nobody planned those. They happened to the world. They are devastating, and many people get hurt. Eventually, however, things are getting back in order again and stock markets recover.

However, the destruction we are experiencing now feels intentional.

A deliberate retreat. An unraveling of old ties.

The United States, once the poster child of global capitalism, is turning inward. The trade wars, the tech restrictions, the politicization of capital flows, this isn’t a glitch in the system. It is the new system.

And that’s not a political judgment. I don’t care about red or blue, left or right.

It’s just where we are now. A different world. One where the investor playbook I used to swear by may (!) need an update. Where assumptions I never thought to question are suddenly on shaky ground.

And the only thing worse than a market crash is not realizing the rules have changed.

What I do

The hardest part in moments like these is not doing what your gut tells you to do.

Emotions are terrible advisors. They scream for safety when prices are falling, just like they cheer for risk when everything is rising. But acting on those feelings isn’t rational. The market doesn’t care how I feel. And I don’t expect it to.

When fear takes over, we tend to forget that many of the most severe market crashes in history didn’t reverse in a matter of weeks. Some lasted months. Some, like the dot-com bust or the financial crisis, dragged on for years.

Our memory has been shaped by a few recent V-shaped recoveries, especially after the COVID-19 crash, which was, as mentioned earlier, an external shock that didn’t structurally break the economy. But just because it bounced back quickly doesn’t mean this one will.

So what do I do?

I stick to my plan.

I continue executing my monthly savings strategy. Because even in turbulent times, I’d still rather own a piece of a productive business than sit on depreciating cash.

Stocks represent real value, factories, patents, code, people. Cash, on the other hand, just sits there while inflation quietly eats away at its worth.

It’s not about timing the bottom. It’s about staying in the game.

And right now, staying in the game means being steady when everything else is shaky.

Still, I will make some adjustments.