When you wake up, rub the crust out of your eyes, and see your portfolio down 10%, it’s tempting to think the sky is falling. You start pointing fingers… tariffs, boomers panic-selling, Jerome Powell blinking too hard during a press conference. But let’s not kid ourselves. The market didn’t suddenly implode because your Uncle Earl in Boca Raton decided to trim his Apple position. No, friend. This is a trader’s market now. And Wall Street’s wolves have been eating.

Last week, President Trump announced a 50% tariff hike on Chinese imports… a move that would raise U.S. tariffs to levels not seen since before the Great Depression. Within hours, markets flipped. The Dow dropped over 900 points in two days. The S&P 500 suffered its worst week in nearly two years. And volatility, measured by the VIX, surged 42%... its sharpest move since Russia invaded Ukraine.

And while most of America was still reading hot takes on X, traders at JPMorgan, Goldman, Citi, Morgan Stanley, and BofA were already positioned.

Case in point, this quarter, the big banks are expected to bring in $34.5 billion in trading revenues. That’s up 10% from a year ago and the highest tally since 2014. So, don’t get it twisted, not everyone’s fuming mad about Trump’s latest decisions.

This isn’t new, by the way. It’s the same game they’ve been running for years. Remember 2008? Millions of Americans lost their jobs and homes, and Goldman was out here shorting subprime mortgage junk like it was a clearance sale at Best Buy. Then there was March 2020… the world shuts down, the market tanks, and JPMorgan’s trading desk pulls in a record $9.7 billion in three months. Go back to 2022… war in Ukraine, inflation out of control, and somehow Morgan Stanley has its best trading quarter in years. Funny how that works. I guess John D. Rockefeller was right when he said “the best way to make money is to buy when blood is running in the streets.”

On the other hand, the investment banking side of the house looks like it’s been hit with a tranquilizer dart. IPOs are dead. M&A activity is slower than a sloth. Sure, revenue might tick up 3% to $7.65 billion, but most of that’s from deals that were already baked into the pipeline months ago. New deals are basically nonexistent.

And now, even Morgan Stanley’s analysts are throwing in the towel, pushing the return to “normal” investment banking activity back to 2028. Not exactly around the corner.

And just in case things weren’t murky enough, don’t expect much clarity from companies during earnings season. According to FactSet, the number of S&P 500 companies giving forward guidance is about to fall off a cliff…  again. In case you’re wondering, the last time this happened was in Q1 2020, when COVID turned corporate forecasting into a game of blindfolded darts. This time, it’s tariffs and recession fears doing the damage. Perfect. So it might be worth sitting out on this next earnings cycle.

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Stock.News has positions in Apple.