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It’s no secret that President-elect Donald Trump has a fondness for tariffs — he once called it “the most beautiful word in the dictionary.” While some experts question their effectiveness, “Shark Tank” star Kevin O’Leary sees them as a crucial tool to reshape trade relations — particularly with China.
“China’s a different issue completely to Canada or any other country. Since they came into the World Trade Organization, they have broken the rules with every country, including the U.S.,” O’Leary said in a recent interview with Fox Business.
O’Leary shared his frustration with China, rooted in his business dealings: “I’m an individual who does business there. My businesses have been absolutely screwed. I’ve said it countless times. They don’t play by the rules. There’s nothing reciprocal in our relations.”
As a result, he advocates for strong measures. O’Leary emphasized that the only way to make it work with Chinese President Xi Jinping is to “inflict massive economic pain and risk on him by imposing tariffs on sectors where many Chinese people are employed.”
“The only way to put [Xi] at risk is to say, look, if you want to mess with the largest economy you trade with, then we’re going to force a lot of people that make yoga mats or electronics or whatever else it is to be unemployed in your cities, and they’ll be rioting in the streets, they won’t have any bread, and you will be out of power. That is the only way it’s going to work — so very selected high-impact weaponry like tariffs, but you’ve got to be hardcore,” he explained.
Trump has proposed implementing 25% tariffs on Mexico and Canada on his first day in office, along with an additional 10% tariff on goods from China.
America is ‘set up to grow’
According to O’Leary, implementing tough measures is essential to leveling the playing field with China.
“[Xi] only understands the stick. That’s all he understands. Any weakness at all, he plays off and he has done so for years. So I’m hoping this is the administration that fixes the problem. I have really been hurt by China, and there are millions of other businesses in America in the same boat I’m in,” he said.
To be sure, economists generally view tariffs as a double-edged sword. On one hand, they can protect domestic industries by making imported goods more expensive, giving local manufacturers a competitive edge. On the other hand, higher tariffs may result in increased costs for consumers, as companies pass on the extra expenses. This can lead to inflation, eroding household purchasing power and raising the cost of living.
A 2019 study by economists from the Federal Reserve Bank of New York, Princeton University, and Columbia University analyzed the effects of Trump’s tariffs through late 2018. Their findings were clear: “Our results imply that the tariff revenue the U.S. is now collecting is insufficient to compensate the losses being borne by the consumers of imports.”
Tariffs can also spark retaliation from trading partners, leading to trade wars that disrupt global supply chains and hinder economic growth. Ian Sheldon, a professor and the Andersons Chair of Agricultural Marketing, Trade and Policy at Ohio State University, underscored this risk during a conversation with Business Insider: “We have this integrated market in North America, and we’re already in a trade dispute with Mexico over genetically modified corn. It seems counterproductive to me to potentially exacerbate trade relations with one of our large trading partners. It doesn’t make any sense to me.”
Still, many business leaders remain optimistic about America’s future under Trump’s presidency — and O’Leary isn’t alone in his confidence. Amazon founder Jeff Bezos recently expressed his own optimism, calling America “the luckiest country in the world” and saying it is “so set up to grow.”
With the U.S. poised for potential growth and renewed strength, those who share this optimism might see opportunities to invest in America’s future. Here are some simple ways to get started.
Invest in American businesses
One of the simplest and most accessible ways to invest in America is through the stock market. When you buy stocks, you’re purchasing a share of ownership in businesses, giving you a stake in their profits and growth potential.
Legendary investor Warren Buffett has championed this strategy for decades, maintaining steadfast confidence in its long-term rewards.
“America has been a terrific country for investors. All they have needed to do is sit quietly, listening to no one,” Buffett wrote in his latest annual letter to Berkshire Hathaway shareholders. His unwavering faith in U.S. equities has been a cornerstone of his success.
“I can’t remember a period since March 11, 1942 — the date of my first stock purchase — that I have not had a majority of my net worth in equities, U.S.-based equities,” he wrote.
For those looking to follow in Buffett’s footsteps, he has consistently advocated for a simple but effective strategy which he referred to at Berkshire’s 2020 annual meeting: “In my view, for most people, the best thing to do is own the S&P 500 index fund.”
This straightforward approach gives investors exposure to 500 of America’s largest companies across various industries, providing diversified exposure without the need for constant monitoring or active trading.
One accessible way to start investing in the S&P 500 and other diversified portfolios is through platforms like Acorns. Acorns makes it easy for anyone, even beginners, to grow their wealth by automatically investing spare change from everyday purchases.
Signing up for Acorns takes just minutes. Link your cards, and Acorns will round up each purchase to the nearest dollar, investing the difference — your spare change — into a diversified portfolio.
For those seeking a more customized experience, Acorns Gold allows for a mix of automated investments and individual stock selection, giving you the flexibility to tailor your strategy.
With Acorns, you can invest in an S&P 500 ETF with as little as $5 — and, if you sign up today, Acorns will add a $20 bonus to help you begin your investment journey.
Building wealth through American real estate
Real estate has been another cornerstone of wealth creation in America, and the current housing supply gap highlights a unique opportunity for investors. According to a June analysis by Zillow, the U.S. housing shortage reached an estimated 4.5 million homes as of 2022.
Federal Reserve Chairman Jerome Powell underscored the severity of the crisis in a September press conference, stating, “The real issue with housing is that we have had, and are on track to continue to have, not enough housing.”
While high home prices and elevated mortgage rates have made buying a home more challenging, you don’t need to purchase a property outright to invest in U.S. real estate.
Crowdfunding platforms like Arrived have simplified the process, enabling everyday investors to own shares in rental properties without the large down payments or management headaches typically associated with owning real estate.
Through Arrived, you can invest in shares of rental homes with as little as $100, all without the hassle of mowing lawns, fixing leaky faucets or handling difficult tenants. The process is simple: browse a curated selection of homes that have been vetted for their appreciation and income potential. Once you find a property you like, select the number of shares you’d like to purchase, and then sit back as you start receiving rental income deposits from your investment.
Another option is First National Realty Partners (FNRP), which targets necessity-based commercial real estate.
The platform lets accredited investors own a share of institutional-quality properties leased by national brands like Whole Foods, CVS, Kroger and Walmart. Investors can enjoy the potential to collect stable, grocery store-anchored income every quarter.
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
