Trade Talks Lift Markets

🌏 What effects will the ongoing trade war have on the U.S dollar, and how will that impact the U.S economy?

Author

Ankit Sinha
June 10, 2025

Silver banana goes to





In this issue of the peel:

  • 📉 The S&P 500 and the NASDAQ were both up 0.09% and 0.31% respectively as officials hint at progress between U.S & China trade talks.

  • 🌏 What effects will the ongoing trade war have on the U.S dollar, and how will that impact the U.S economy?

  • 🌐 Companies are using cr*ptocurrencies to boost their stock price, but is this a disaster waiting to happen?

Market Snapshot

The Daily Poll

Firms buying b*tcoin to boost stock is:

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Previous Poll:

May’s expected slowdown in job growth means:

Economy cooling: 43.6% // Seasonal pause: 12.9% // Cautious businesses: 36.6% // Market still strong: 6.9%

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Macro Monkey Says

Will Export Drama Drag Down the Dollar?

The current trade war between the U.S and China has caused significant macroeconomic uncertainty in the U.S, in both the debt and equity markets. Bonds have seen a noticeable uptick in yields, and while equities are up YTD, the future remains extremely uncertain. 

Above all else, the U.S dollar has seen significant declines as many foreign countries echo the “sell America” trope. 

While the trade deficit was cut in half, this was primarily because companies manufacturing in countries like China stocked up ahead of the tariffs on liberation day in March to avoid extra costs. 

Regardless, the 19.9% decline in imports still exceeded the expectations of economists, potentially echoing the tariffs’ effect on the trade deficit. 

Another thing to consider is that the dollar could be declining not because of the imposed tariffs, but rather because of the unpredictable actions of the Trump Administration. 

Since Donald Trump is, for lack of a better term, a wild card, foreign investors of U.S assets and reserves are likely uncertain regarding the continued dominance of the U.S dollar. Furthermore, if that is the case, foreign investors may have no choice but to sell U.S assets, causing the dollar to depreciate. 

Yet another risk associated with U.S assets is the fiscal irresponsibility of the U.S government. 

While the Trump Administration’s efforts to cut government spending reflect somewhat of a dedication to fiscal responsibility, the new tax bill says otherwise. Over the next decade, The Trump Administration's tax bill (if passed), will add about $2.4 trillion to the budget deficit, which is not exactly soothing to hear for foreign investors in U.S assets. 

The Takeaway?

The dollar is currently rapidly retreating in comparison to other currencies, and it may continue to be that way, especially if the trade war cannot be resolved between the U.S and China. 

Moreover, the “sell America” expression also embodies the current mindset of foreign investors, which is looking to be in the direction of a selloff of U.S assets. Even still, if the Trump Administration is able to reignite faith in foreign investors, the dollar will likely be fine. 

Career Corner

Question

How to be memorable at a networking event?

Answer

Try to find something personal to connect on. Networking does not equal just pitching yourself hard and only seeming to care about yourself. Networking also means connecting with everyone; don’t ignore those you don’t find relevant. The industry is as you work into it over time, and skill set mix, and people end up in multiple places.

Head Mentor, WSO Academy

What's Ripe

AST Space Mobile Inc. (ASTS) 11.6% 

  • AST Space Mobile, a satellite communications company, witnessed large gains today after rumored acquisition talks between ASTS and Amazon. 

  • ASTS currently has an extremely bullish sentiment with extremely high overall volatility, but it is still rated as a buy/strong buy among Wall Street Analysts. 

Cameco Corporation (CCJ) 10.7% 

  • Cameco Corporation, a uranium producer and supplier, saw massive gains today after Westinghouse, a company in which they have a 49% stake, is expected to improve its EBITDA by $170 million. The success of this acquisition will help Cameco diversify its revenue streams and vertically integrate into the uranium supply chain.

What's Rotten

Argan Inc. (AGX) 10.3%

  • The share price of Argan plummeted today after several Wall Street analysts downgraded their price targets and overall projections for 2025. This downgrade was attributed to the fact that their valuation reflected their entire earnings growth, leaving little upside potential, as well as general apprehension surrounding their optimistic leverage targets set by Argan.

Avidity Biosciences Inc. (RNA) 9.9%

  • The share price of Avidity crashed today due to a general bearish sentiment surrounding the company, coupled with lackluster earnings. About a month ago, Avidity significantly missed earnings, with revenue decreasing by 56% year-over-year. 

  • Additionally, Avidity is an extremely volatile stock, given its relatively early-stage biotech company status.

Thought Banana

Can Firms Keep Betting Big on B*tcoin?

A concerning trend is growing among companies in order to inflate their stock prices. Pioneered by Michael Saylor,  former CEO of MicroStrategy, many companies are buying b*tcoin and other cr*ptocurrencies as a strategy to artificially raise their stock price. 

This list of about 60 companies that have no previous affiliation to cr*pto services in any regard are pursuing what is known as a “b*tcoin treasury strategy.” 

In said strategy, the company uses a significant portion of their cash to essentially buy and hold cr*ptocurrencies. The goal of companies utilizing this strategy is to profit from B*tcoin’s long-term returns and its perceived hedge against monetary policy.

This strategy causes the company’s stock price to increase because of speculative demand from investors as well as perceived asset appreciation. 

As an example, K Wave Media (KWM), a K-pop media company, saw its shares surge over 130% after it announced that it would sell around $500 million worth of shares to acquire b*tcoin. Given this information, the big question is, why is this strategy problematic?

Many argue that the companies using this “b*tcoin treasury strategy” are not only playing with fire, but also the foundations of cr*pto. Not only will a sharp selloff of a cr*pto likely deflate these companies’ stock prices, but it might also prompt these companies to sell their shares in b*tcoin or other cr*ptocurrencies. 

Many veterans in the financial industry argue that the cr*ptocurrency decline is likely to be historical, resulting from the activity of these companies. 

The activity of these companies is also supported by the Trump Administration's open endorsement of cr*ptocurrencies. Furthermore, Trump Media and Technology Group (DJT) sold over $1.4 billion worth of shares in order to finance its plans to invest in b*tcoin. 

The Takeaway?

Although many bankers and analysts are projecting B*tcoin and other cr*ptocurrencies to continue upwards, we would personally urge caution towards B*tcoin and cr*pto investors. 

Cr*ptocurrencies are historically volatile, and if the U.S economy propels itself into a recession, it wouldn’t surprise us if these companies and cr*ptocurrencies experience a crash in share price. 

Nevertheless, we should only really be raising the red flags if banks and other large financial institutions start utilizing this strategy, and if that happens, we might see history repeat itself.

The Big Question: What happens when the hype fades? Can these firms survive without the b*tcoin sugar rush?

Banana Brain Teaser

Previous

In order to complete a reading assignment on time, Terry planned to read 90 pages per day. However, she read only 75 pages per day at first, leaving 690 pages to be read during the last 6 days before the assignment was to be completed. How many days in all did Terry have to complete the assignment on time?

Answer: 16 days

Today

For the positive numbers, n, n + 1, n + 2, n + 4, and n + 8, the mean is how much greater than the median?

Send your guesses to [email protected]

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Warren Buffett

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Chris, Vyom, Ankit, Mithun, Colin & Patrick