Stock Market Loses $6 Trillion in Two Days & Minecraft Movie Scores Big
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Good morning, Brew Daily Show. I'm Neil Freiman. And I'm Toby Howell. Today, stock futures are way down again as the U.S.'s global tariffs spark a market meltdown. Then a Minecraft movie put the industry on its back this weekend with a remarkable box office debut. It's Monday, April 7th. Let's rock.

Well, we hope you had a relaxing weekend because it's looking like today will be worse than the Monday after the Super Bowl, and we didn't even get the Super Bowl yesterday. Asian and European stock markets plunged overnight over fears the trade war will crush the global economy. Toby, what's the latest? 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 US. 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.

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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 ranks among the steepest two-day declines in the last 70 years, on par with Black Monday in 1987, the post-Lehman Brothers route, and the post-Lehman Brothers

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

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, JP Morgan raised their recession forecast from 40% to 60%. 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 that

quote, that a massive and disproportionate tariffs risk destroying confidence in our country as a trading partner. 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 unthinkable.

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, 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 from the people, uh, 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, uh,

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. They would lead to higher inflation than he was calculating and they would lead to lower growth than the Fed was was calculating. He still said that the Fed was going to be in that wait and see mode, see how it all plays out. But as you said, over the weekend,

the calculus may have changed a little bit. Some investors are betting there might be an even emergency rate cut in order to save the market because this three-day collapse should, you know, whatever happens today in the futures market bear out through 4 p.m. It would be, you know, another addition to the historic collapse that we've been seeing. So we'll see what the Fed does. But Powell on Friday kind of said we're still seeing it playing out.

And one fascinating thing to observe over the last two days of last week was the divergence between retail investors and hedge funds, actually. Through the first three hours of trading on Thursday, retail investors were net buyers of almost $3 billion in stock. That is the second highest level on record since JP Morgan began tracking data 10 years ago. Meanwhile, global hedge funds and ETFs dumped 4%.

more than $40 billion of stocks on Friday, which is the largest selling on a net basis in almost 15 years. So you are seeing retail investors, people like you and me, buying the dip, as you like to say, but then you have the professional side of things just dumping things left and right. So Jim Cramer was kind of on the

CNBC saying that there's a possible Black Monday level event coming today. So there's a lot of different factors where you're seeing professional investors behaving one way and then not professional investors behaving the other way. So that's going to be a fascinating tension to see play out over these next coming days as well. In the face of the uncertainty tariffs have injected into the global economy, companies around the globe are looking around like John Travolta in Pulp Fiction 2.

trying to figure out what to do, and it looks like the answer is press the pause button. Case in point, Nintendo. The tariffs landed at the worst possible time for the Japanese video game maker, ahead of its much-hyped release of the Switch 2 console. Just hours after announcing pre-order availability, the company Reverse Course announced it would be delaying the April 9th pre-launch date, though it's still planning to ship the console this summer. Nintendo had already

already shifted about half of its switch to manufacturing to Cambodia and Vietnam in anticipation of a U.S.-China trade war, but now those countries are also caught in the tariff crossfire too, hence the pause. Another unwelcome casualty of tariffs is the U.S. IPO market. Klarna and StubHub both put their public debuts on ice in a blow to what was supposed to be

a promising period for companies going public. The buy now, pay later giant Klarna was scheduled to list today with a projected $15 billion valuation, while StubHub planned to launch its roadshow pitch to investors this week. Both of those timelines are now on hold due to market turmoil. Finally, Ford and Stellantis are trying to capitalize on the Buy America push, extending employee-level discounts to all customers for the rest of April in an attempt to stave off panic orders.

rising about rising vehicle prices but across the pond jaguar land rover decided to temporarily halt shipments the u.s following trump's 25 foreign auto tariffs to give themselves some time to figure out their longer term plans so deal a lot of companies are entering wait and see mode you're right i mean they are hitting pause and one interesting development that you might see uh

more of in the coming days is companies declaring force majeure, which is a legal maneuver that says you can void certain contracts because of crazy situations that are unavoidable and unpredictable. You saw this happen during COVID a lot where they're like, we can't do this contract because there's literally a global pandemic. That's what they're saying about the tariffs. The first company that we know that did this is Helmet Aerospace, which is at

based out of Pittsburgh. They supply airplane parts for Airbus and Boeing across the $150 billion industry. They reportedly, according to Reuters, declared force majeure to void certain contracts with these companies so that could add another level of supply chain chaos on top of what we're already seeing. Yeah. And a lot of these companies are looking around saying, I thought we did what we were supposed to do here. We were supposed to diversify our supply chains. I

outside of China. And Nintendo is just the perfect example of that. It's like, we thought we laid the groundwork for, we knew the Switch 2 was coming. We'd wanted to get out of China specifically, but now their cost looks like they're going to go up. They still say they're going to release it in the summer, but they're just taking that little minute to figure out what to do. The IPO market is also just

Very frustrated, specifically venture capital firms who were kind of counting on the IPO market coming back to life under the Trump administration after a really bad couple of years for big exit. They just had CoreWeave, which was the big AI data center infrastructure company that debuted last week. It did all right, but nothing crazy. But now you are seeing these two companies

shining hopes in StubHub and Klarna pressing pause as well. And then Land Rover too is also just saying we have to enter wait in C mode because the U S is the second largest expert market for the UK's car industry. Those cars are getting a lot more expensive. Land Rover Jaguar says the,

doesn't make any of their vehicles inside the United States. So they have to take a step back and recalibrate because of these increased costs that tariffs are introducing. One corner of the market we haven't touched on yet is oil prices. And just like everything else, they are an absolute free fall. The price of U.S. crude oil plunged

14% over two days to below the key mark of $60 a barrel. They're at the lowest level since before the vaccines rolled out in COVID. The reason prices are cratering is a double whammy of lower demand and higher supply. Tariffs, if they do send the global economy into a downturn as expected, will sap demand for fuel. People will travel less. Businesses will ramp down spending. The economy will just need less energy overall.

And in some really unfortunate timing, just as tariffs spooked markets last week, OPEC plus a group of oil producing nations said they would raise output in a surprise move. So lower demand and higher supply has tanked the oil market. And while that means lower gasoline prices,

it's a bad sign overall. It would crush U.S. energy companies, and it's an omen the economy is headed toward the dumps. So filling up for cheap will not be something to celebrate because it means there are a lot bigger problems going on. Right. These two events, back-to-back, Trump's tariff and then the boost in production, have totally shifted the global energy market. Crude

is right around that $60 per barrel. And that is just basically completely cast a doubt on Trump's drill baby drill approach saying that we want to achieve energy dominance, but it's very hard to even create new drills profitably if we're,

Oil is lingering around $60 a barrel. $65 is actually the threshold that many companies need to profitably drill new wells in places like Texas and surrounding states. So you are right that even though gas will likely end up being cheaper, it does lead to a lot of kick-on effects down the road that make energy investment much harder. It just means everyone's poor if gas is super cheap because of a recession.

Let's move on. When the biggest companies in the world are shedding trillions in market cap, it stands to reason that the billionaire class is also taking a beating too. And that was certainly the case. 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 percent. Apple is down 28 percent this year and continuing 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

I don't think he foresaw this necessarily, but it just 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 by

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.

it. Unfortunately, we have to wait to see because we'll probably see an answer become clear when they 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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Now it's time for our winners of the weekend, the segment where Neil and I pick 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 mic this weekend. As a Minecraft movie shattered box office expectations and

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,

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 one point three 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 overperformance will only add fuel to adapting every video game that there is out there. And Warner Bros., which was the main studio that financed this movie, they did 75% of the financing and they did really well. They arranged this marketing partnership with McDonald's that went viral on TikTok. But also a lot of people are crediting Legendary for adding this magic producing touch. And

And Legendary jumped in to finance the extra 25% of the movie. But if you go down Legendary Entertainment's kind of hit list over the last few years, they are kind of the kingmaker when it comes to resuscitating old IP. They brought back King Kong in 2017. Now that trilogy has gone on to gross 1%.

$1.6 billion worldwide. They were also the force behind Dune Part 1 and Part 2, which took in $1.1 billion. So if you want to adapt a beloved and sometimes complicated source material, hit up Legendary because they clearly have it figured out. What video game do you want to see adapted into a movie? Oh, man, I didn't play a lot of video games growing up. Maybe...

like an iPhone game, like Doodle Jump or something like that, Fruit Ninja. I could see us going back into those era of IP and getting into the mobile genre a little bit. Cool. All right. My winner is Mega Millions because it's about to get a little easier for you to be a winner. The lottery game is rolling out its biggest makeover in years with the goal of jacking up jackpots and improving players' odds of winning at least a little something something.

Of course, there is a catch. The price of a ticket is going up for only the second time in the lottery game's 23-year history. Tickets that were $2 will now be $5. But Mega Millions said the payoffs will be worth the steep price hike because its redesigned game will lead to higher starting jackpots and faster-growing prizes. For instance, it says the average jackpot in the new game will be more than $800 million compared to around $450 million in the past, and the odds of one

winning the jackpot are getting better from a one in 302 million chance to just one in 290 million. I mean, you're practically guaranteed to win at that point. Toby, the first drawing of the new game is 11 PM Eastern this Tuesday. Are you feeling lucky? So you're saying there's a chance despite this pretty hefty price increase. I mean, it's over a hundred percent increase. Uh,

The lottery spokesperson basically said that a lot of the customers were already spending more than $5 when buying a ticket. So hopefully with the added bang for your buck you're supposedly getting here, it will not be too big of a shock to the system. 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 businesses,

jackpot. 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 on Friday, big banks like J.P. 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 of pause 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, Thursday,

the sports 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. 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. I'll mull them over a little bit. Also in sports, the Men's College Basketball Championship is tonight between Houston and Florida. In the Women's Championship yesterday, UConn destroyed South Carolina for its 12th title and their first since 2016.

On television, White Lotus may have wrapped up yesterday, but Sunday nights on HBO will remain great with the new season of The Last of Us. The zombie apocalypse thriller was a major hit with its first season in 2023, racking up more than 30 million viewers. White Lotus, on the other hand, has about 18 million. Elsewhere, The Handmaid's Tale returns for its sixth and final season on Hulu, and the new season of Black Mirror hits Netflix on Thursday.

My only commentary on the White Lotus is I'm finally that. We all finally got to use the Duke meme when Duke lost. Mike White conspired to make it happen. I am sure of it. Okay, let's wrap it up there. Thanks so much for starting your morning with us and have a great Monday, or at least as great as it could possibly be given the circumstances. For any questions, comments, or feedback, send an email to morningbrewdaily at morningbrew.com and...

Before we get into the credits, gotta wish a happy birthday to my mom. Big MBD listener. Happy birthday, mom. Okay, now here is our wonderful team behind the scenes. Emily Milliron is our executive producer. Raymond Liu is our producer. Olivia Graham and Olivia Lake are our associate producers. Uchenna Waogu is our technical director. Garrett Peck is on audio. Hair and makeup is in a bear market. Devin Emery is our chief content officer and our show's a production of Morning Brew. Great show today, Neil. Let's run it back tomorrow.

Hey, it's Jesse Tyler Ferguson, host of Dinners on Me, and I've got something very cool coming your way. I cannot wait for this. I sat down with none other than Ty Burrell, also known as my brother-in-law, on Modern Family for 11 Seasons. And let me tell you, when we get together, it's impossible to stop laughing. You're going to love this episode, and of course, you're going to love Ty because honestly, he's the best, and who doesn't love him? And I'm going to tell you, when we get together, it's impossible to stop laughing.

And thanks to Airbnb, we got to record in the coziest little Opry ski cabin in Utah, complete with takeout from one of Ty's own restaurants, Beer Bar. So picture this, two old friends, a crackling fire, some seriously good food, and a whole lot of tea spilling. Yes, I mean, meaning that we gossiped, but also we spilled our tea. Anyway, I can't wait for you to listen.