A Quick Take on UBS ETRACS Silver Shares Covered Call ETN

Terrific yield, but be aware of the risks and there are better instruments..

The tariffs have created havoc on the markets and will create a lot of economic damage if they are maintained, which doesn’t bode well for a speedy recovery for stocks.

However, there are some encouraging signs, here is Elon Musk, speaking from Italy where he is visiting Italian Deputy Prime Minister Matteo Salvini

Both Europe and the United States should move, ideally, in my view, to a zero-tariff situation, effectively creating a free-trade zone between Europe and North America

That is an excellent suggestion and would bring instant relief to the markets if the US government takes this up. That is a big if though, given Trump’s love for tariffs. We also read that 50+ countries have already lined up for negotiations, no surprise because the calculation of the tariffs doesn’t make any sense (see here as well).

We could also argue that the government seems to pursue two different and conflicting goals:

• Entice manufacturing companies to re-shore activities in the US, for which tariffs have to be permanent (already a difficult proposition as elections in three and a half years could very well change this equation anyway, especially if, as we expect, the negative economic fallout is substantial).

• Using illogical tariffs as a ploy to get concessions from alarmed trade partners.

For now, we have to assume the tariffs stay, and given the market turbulence, investors might have increased interest in income-generating assets, here is one, the UBS ETRACS Silver Shares Covered Call ETN.