Wall Street took a major hit on Thursday after President Trump announced new tariffs on imports. Local experts on what this means for community members.
“What is most important is that people not panic," Ryan Caldwell Regional Director of EP Wealth Advisors said. "We invest in order for our money to grow beyond inflation. That's been really difficult to do these last couple of years because inflation has been so high.”
Caldwell says these momentary shocks cause people to act on fear.
“If someone has a solid financial plan, perhaps they're planning on taking about 4% or 3% from their 401k a year to live off of in retirement... then an event like today shouldn't really rattle your strategy," Caldwell added.
While he says there’s no need for long term investors to panic, these tariffs have a larger impact that our country hasn’t seen in over 100 years.
“The increased cost of these goods is actually going to slow demand," the regional director said. "It's going to cause companies to make less money. They're gonna have to lay off employees. “
While Caldwell says unemployment and the cost of goods will rise, how long these tariffs stay in place and what global trade partners decide to respond with could result in a potential recession.
“The stock market and the economy don't move together," Dr. Daniel Seiver international trade and stock market expert said.
"Usually what happens is the stock market falls well before the economy gets sick. But if you're a stock investor, that's very painful right away."
Seiver, a published author in the subject, tells me if you’re looking to buy stock right away, hold off.
“The worst thing would be if somebody decide to jump into the market today and then in another week, they lost 10% of what they put in and then panicked and then sold at the bottom," Seiver said. "A lot of individual investors, when they try and trade like that, they make those mistakes.”
Community members in downtown San Luis Obispo were tense about the situation, but long term investors are waiting for this to pass.
“I'd rather it go up than down," Craig Minus a Santa Ynez local said. "But, I realize that the stock market's kind of a long haul. I'm also a few years away from retirement, so I think I can weather that.”
“He's kind of helped me," Tate Minus said of his father. "I kind of have some mutual funds, stuff like that. But, I'm still kind of learning,”
