Trump’s tariffs and DOGE pose double threat for investors

Investors need to brace for seismic changes as President-elect Donald Trump prepares to introduce sweeping tariffs and launch the Department of Government Efficiency (DOGE) says Nigel Green

 
This is the call-to-action warning from the CEO of deVere Group, s President-elect Trump now promises an additional 10% tariff on China, and 25% tariffs on Canada and Mexico.

This aggressive trade stance, designed to address illegal immigration and drug trafficking, marks a clear escalation from his campaign rhetoric.

Simultaneously, the newly announced DOGE will target $500 billion in federal spending cuts, threatening sectors heavily reliant on government contracts.

Nigel Green warns: “These dual measures—protectionist tariffs and sharp government spending cuts—create a perfect storm of volatility for investors. The risks are significant and far-reaching, making this a pivotal moment for portfolio reassessment.”

Trump’s tariff agenda signals major disruptions in global trade dynamics, with key trading partners already signaling potential retaliation. The economic consequences could ripple across industries, particularly those dependent on international supply chains and exports.

“Investors should prepare for immediate volatility in sectors such as automotive, technology, and agriculture—industries deeply intertwined with trade agreements and foreign markets,” says the deVere CEO.

“These tariffs will not only drive-up costs for companies but also fuel inflation, which could lead to further tightening of monetary policy.”

China, a frequent target of Trump’s trade policies, faces an additional 10% tariff on its exports to the US. During his campaign, Trump hinted at tariffs as high as 60%, suggesting the potential for further escalation.

“Markets hate uncertainty, and the prospect of a full-blown trade war will send investors scrambling to reassess their exposure,” adds Nigel Green.

While tariffs dominate the headlines, DOGE’s sweeping cost-cutting mandate could quietly deliver equally profound impacts. Trump’s administration plans to identify and eliminate $500 billion in what it deems “unauthorized or misallocated” federal expenditures.

Industries reliant on federal funding are at the highest risk. Defense contractors, pharmaceutical companies, and IT providers—sectors that have historically relied on robust government spending—are particularly vulnerable.

“Defense contractors are staring down the barrel of potential budget cuts to the Department of Defense, while pharmaceutical firms relying on federal health initiatives could see a sharp drop in revenues,” continues the deVere chief executive.

“Even sectors like clean energy, which benefit from subsidies and incentives, may find themselves in the crosshairs of DOGE’s reforms.”

With uncertainty looming, investors must act swiftly to protect their portfolios. Nigel Green emphasizes the importance of diversification as a critical defense against the twin threats of tariffs and spending cuts.

“Concentrated exposure to government-linked industries or trade-sensitive sectors could prove costly in the months ahead,” he advises.

“Now is the time to diversify holdings, ensuring resilience against market shocks. Investors should also consider increasing exposure to sectors less affected by government policy, such as technology innovators or global consumer goods.”

Additionally, currency markets are expected to face turbulence. Tariffs and fiscal tightening could strengthen the dollar temporarily, but prolonged trade disputes may weaken it, creating opportunities for investors to reposition in favor of risk-sensitive currencies.

Despite the uncertainty, opportunities will emerge for those who act decisively.

“Periods of volatility often provide fertile ground for strategic investments,” says Nigel Green. “The key is preparation and agility. Investors who proactively adjust their strategies now will be better positioned to capitalize as the landscape evolves.”

He concludes: “This is not a time for complacency. The combination of Trump’s aggressive trade policies and DOGE’s fiscal overhaul could reshape the investment landscape in profound ways.”