Morning Brew Daily
Stock Market Loses $6 Trillion in Two Days & Minecraft Movie Scores Big
Mon, 07 Apr 2025
Episode 555: Neal and Toby continue to breakdown the fallout from Trump’s major tariff announcement last week and how businesses all over are managing. Then, oil prices take a plunge and what it means for consumers. Also, Billionaires suffer massive losses from the market rout. Meanwhile, the Minecraft movie provides a much-needed sigh of relief for Hollywood. Plus, Mega Millions is increasing its ticket prices even more in hopes to balloon its jackpot. Finally, what to expect in the week ahead. Subscribe to Morning Brew Daily for more of the news you need to start your day. Share the show with a friend, and leave us a review on your favorite podcast app. Checkout TaxAct for more! Listen to Morning Brew Daily Here: https://link.chtbl.com/MBD Watch Morning Brew Daily Here: https://www.youtube.com/@MorningBrewDailyShow 00:00 - What is a circuit breaker? 2:30 - Markets Have Historic Two Days 7:00 - Businesses Feel Tariff Impacts 10:45 - Oil Prices Plunge 12:30 - Billionaires Lose Their Bag 15:30 - Minecraft Movie Wows 18:40 - Mega Million change-up 20:00 - Week Ahead Learn more about your ad choices. Visit megaphone.fm/adchoices
Chapter 1: What is a circuit breaker in stock markets?
Well, Neil, have you ever heard of a circuit breaker? But seriously, circuit breakers have levels that end up getting triggered when markets go down by a certain amount. For the S&P 500, trading would be halted after a 7% drop or a 13% drop. And if the worldwide market performance while you're sleeping is any indication, a lot of those levels are going to be tested today.
Hong Kong's Hang Seng market is down 13%. Japan's Nikkei index is down 8%. Singapore down 7%. China is down 7%. India is down 4%. And over in Europe, things are not much better. The pan-European stocks 600 index was down 5.2% in morning trading. And then a little sneak peek at the U.S. S&P 500 futures down 4%. NASDAQ 100 futures down 4.3%. Futures on the Dow are up. Just kidding.
They're also down a 4%. So yeah, go ahead and put an extra shot in your espresso. Now a word from our sponsor, TaxAct. Neil, do you think Batman ever did his own taxes? Definitely not. That's what Alfred is for. Actually, maybe Robin was a CPA. The point is every hero needs a sidekick.
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Weekends are awesome because you don't have to work. You can eat cold pizza for breakfast and the stock market isn't open. And we're all grateful it wasn't because Thursday and Friday's wipeout will go down in the history books. The S&P 500's 10% plunge on Thursday and Friday after President Trump announced massive tariffs.
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Chapter 2: How did Trump's tariffs impact the global economy?
ranks among the steepest two-day declines in the last 70 years, on par with Black Monday in 1987, the post-Lehman Brothers route in 2008, and the COVID plunge in March 2020. More than $6 trillion was erased from stocks over two days, the Dow shed more than 3,000 points, and the Nasdaq entered a bear market down 20% from a previous high.
It was carnage on Wall Street and reflects the investor panic over President Trump's Liberation Day tariff announcement last when he raised tariff levels to their highest point in more than a century. Trump and his team believe these tariffs are necessary in order to restore America's manufacturing base and use them as a point for leverage with other countries.
While virtually all economists say they're a recipe for slower growth and higher inflation, especially at these astronomic levels. On Thursday, J.P. Morgan raised their recession forecast from 40 percent to 60 percent. Toby, trading starts at 9.30 a.m. this morning in what may be the least exciting opening bell ever. What is the word on the street?
The word on the street is not great, Neil. Bill Ackman, the billionaire hedge fund manager who is also a very vocal backer of Trump, has been on a posting spree on X over the last few hours saying, quote, that a massive and disproportionate tariffs risk destroying confidence in our country as a trading partner is
He urged Trump to call a timeout on Monday today or else he wrote, we are heading for a self-induced economic nuclear winter and we should start hunkering down. He also posted last night that he strongly believes launching tariffs on April 9th against the entire world is a mistake.
So you are seeing a lot of anxiety coming from even the people who are some of the more vocal backers of this administration. And suddenly Trump, A lot of the calculus has changed when it comes to what the Fed is doing as well.
Even though Jerome Powell kind of said we are still in wait-and-see mode, even though that two-headed beast of stagflation is potentially creeping up on us, suddenly the market is now pricing in the Fed cutting rates five times by year-end now. Previously, it was only looking like three times. So you are seeing a lot of things changing very rapidly now.
From the people, the billionaire class who was supporting Trump all the way down to Jerome Powell and the Fed saying suddenly the calculus is changing.
Yeah, on Friday into this maelstrom walks Jerome Powell, who just so happened to have an event scheduled on Friday as the markets were melting down. So everyone was very curious to see what he was going to say about the impact of tariffs. And he kind of sounded a worrying note. He said the tariffs are much larger than expected.
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Chapter 3: Why are oil prices plunging?
The world's 10 richest people lost a collective $74 billion after last week's market rout, the worst single-day loss in five years, while the world's 500 most affluent people lost $536 billion for the biggest two-day drop in the history of the Bloomberg Billionaires Index. Elon Musk took the biggest hit, losing $31 billion. Mark Zuckerberg shaved off $27 billion. Jeff Bezos lost $23 billion.
Even Warren Buffett wasn't immune, losing over $2.5 billion on paper. Still, the Oracle of Omaha is living up to his name, if you zoom out a little. Berkshire's stock price is up about 9% this year, far outperforming the S&P 500's nearly 14% decline.
And a big reason for that is Wall Street is looking kindly on Buffett's gargantuan cash pile, which has swelled from $110 billion in September of 2022 to $321 billion at the end of last year, bigger than Coca-Cola's market cap. It's a lot easier to be greedy when others are fearful, when you have the dry powder to deploy when things go south.
And as the most famous value investor, many expect Buffett might be on the hunt for deals soon now that the market has taken a haircut. Neil Buffett is actually the only billionaire in the top 10 richest people list to see his net worth expand this year as his patient approach and hefty cash pile look especially prescient in these uncertain times.
We are learning why he is the GOAT. And you said that he is greedy when others are fearful. He was also fearful when others were greedy. Last year, as the stock market soared to record highs, he cut his Apple stake by two-thirds. He dumped Bank of America and Citigroup. Both of those stocks are down 22%. Apple is down 28% this year and continuing to... today.
So he was cutting last week or last year and everyone was like, why are you dumping stocks? Aren't they doing well? And then, uh, you know, I don't think he foresaw this necessarily, but it's just shows goes to show why he's such an incredible investor.
I think a lot of people are looking to him and saying that if he starts buying relatively soon, that might mean that he believes that Trump's tariffs are more of an economic blip or an annoyance created, um, and actually create these big buying opportunities.
Or if he holds off, it might suggest that he's looking at these tariffs more in line with the Smoot-Hawley tariffs of 1930, where it's just a persistent economic force that ends up kind of breaking the market a little bit. Unfortunately, we have to wait to see because we'll probably see an answer become clear when Berkshire's next shareholder meeting.
We won't know necessarily what his moves are until a few more months down the line. Up next, let's talk about some winners of the weekend.
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Chapter 4: What happened to billionaires during the market rout?
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Now it's time for our winners of the weekend, the segment where Neil and I picked two stories that had a better weekend than Duke Haters. Neil, I won the pre-show game of Pin the Tail on the Donkey, so I'm up first. And my winner of the weekend is Minecraft. All those kids tugging on their parents' shirt sleeve combined to create some serious spending Mike this weekend.
As a Minecraft movie shattered box office expectations and brought in $157 million domestically in the biggest opening weekend of the year. The movie, that is an adaptation of the ultra-popular video game title, was initially expected to only bring in $60 million, but that severely underestimated the fact that it had Jack Black going very hard in the paint.
Part of the reason for the movie's overperformance is kids freaking love it. Reaction videos posted this weekend on social media saw theaters erupting to particular fan service moments. One person posted on social media that, quote, when Jack Black said chicken jockey, I bleep you not, the entire row in front of me gave a standing ovation.
Chicken jockey is of course referring to a rare instance in which a character rides a cuboid chicken in the game. You may roll your eyes or even ask for a translation from your 12-year-old nephew, but the movie industry is happy to be rolling in the dough again. After a brutal march absent of any big releases, industry earnings are down just 5% in 2025
after previously staring down a 13% gap pre-release of a Minecraft movie. Neil, seeing the jokes that were getting thunderous applause in this movie, it was the first time I truly felt a little old.
Welcome to the club, Toby. This wasn't just the best debut of the year at the box office. It was the best in the history of a video game adaptation. So this is becoming...
maybe the marvel of the 2020s adapting video games it's been a recipe for success we had the super mario brothers movie which was the biggest movie of the year last year brought in 1.3 billion dollars five night at freddy's sonic the hedgehog has had three movies now tom holland in uncharted they all did really well at the box office and i think the minecraft success incredible over performance will only add fuel to adapting every video game that there is out there
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Chapter 5: How did the Minecraft movie perform at the box office?
They kind of compared it to a subway fare hike where you don't really get anything more. You're paying more money for the same ride. In this case, they're saying the price increase is leading to improved odds, a better chance of winning money, faster growing jackpots. So technically you're getting something in return for this rather sizable price hike.
OK, let's move on to the week ahead. The major events you need to know about. It sure is going to be another tumultuous week on Wall Street. On Wednesday, President Trump's reciprocal tariffs go into effect on virtually every region of the world, even those without any human inhabitants.
On Thursday, the Consumer Price Index will show inflation rates for March, setting a baseline before whatever happens to prices with the trade war and And on Friday, big banks like JP Morgan kick off earnings season, which will be closely watched for what CEOs say about the tariff impacts on their businesses.
I mean, technically, this thing hasn't even really started yet because April 9th is the big day when these reciprocal tariffs kick in. It also is a big day where we start to see some inflation data that may be influenced by some of these tariffs as well, although likely we're going to have to wait for next month on that as well. So still in the first inning of this very long stretch to come here.
Yeah, and the key question is whether the Trump administration will take Bill Ackman's advice and say something in order to stem the bloodbath in the market. So we'll see whether that happens in the next few days before those go into effect on Wednesday.
For golf fans, this is without a doubt the best week of the year, practically a religious experience because the Masters tees off in Georgia on Thursday, the sport's first major of the year. Known as a tradition unlike any other, the Masters is certainly unlike any other sporting event in the cheapness of its concession menu.
For the 23rd consecutive year, the pimento cheese sandwich will cost you just $1.50. Compare that to like $23 for whatever drink you're going to get at the U.S. Open in tennis.
It is a steal, although I was seeing some chatter this weekend that it tastes about as good as what you pay for it, which I would like to push back on as someone who's been in the Masters one single day. It's pretty good, I think. $1.50, you know what you're getting, so the $1.50 pimento cheese sandwich is good enough. Do you want my Masters picks now, or should we wait a little bit?
Let's wait until Thursday. I'll sit on them.
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