Wedbush analysts strongly criticized President Donald Trump's proposed tariffs, calling them "jaw-dropping" and "absurd."
They argued that the White House’s tariff chart was factually incorrect and misrepresented trade data. "If a 9th grader in high school presented this tariff chart to a teacher in a basic economics class the teacher would laugh and say sit down and work on the assignment," they wrote.
The firm warned that if the tariffs were enforced as announced, they would lead to a "self-inflicted Economic Armageddon" and push the US into recession. However, Wedbush suggested the announcement was likely a negotiation tactic. "We have to assume this is the start of a negotiation and these rates will not hold."
Markets reacted negatively, especially in the tech sector, as companies with exposure to China and Taiwan—such as Apple Inc (NASDAQ:AAPL, ETR:APC), Nvidia Corp (NASDAQ:NVDA, ETR:NVD), Tesla Inc (NASDAQ:TSLA), and Taiwan Semiconductor Manufacturing Co (ADR) (NYSE:TSM)—faced significant pressure. "These tariffs are the start of negotiations... If you start with that assumption then the massive sell-off today is a major buying opportunity."
Wedbush emphasized that American consumers ultimately bear the cost of tariffs. "No matter what the White House says... basic economic theory over the last 100 years tells you one person pays these tariffs... the US consumer... it's not a debate."
The firm predicted uncertainty in tech earnings, expecting some companies to withhold guidance.
Despite the turmoil, Wedbush identified tech stocks like Nvidia, Microsoft, Amazon, Apple, Tesla, and Alphabet as potential buying opportunities, assuming the tariffs do not hold in their current form.