Latest / Best of Business / Sam Dickie: Fisher Funds expert on the collective response to Donald Trump's tariffs?

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Sam Dickie: Fisher Funds expert on the collective response to Donald Trump's tariffs? · Best of Business

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  Speaker 1: You're listening to a podcast from News Talks B Follow
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  Speaker 1: this and our wide range of podcasts now on iHeartRadio.
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  Speaker 2: All Right, I'm joined now by Sam Dickey for Fisher Funds.
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  Speaker 3: Hello, Sam, good even Andrew Love a good piney coke yep, and.
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  Speaker 2: A cream donut for afters.
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  Speaker 3: Exactly. Case is square anyway.
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  Speaker 2: So tariffs they're on again, they're off again, but they're
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  Speaker 2: certainly around. What's happening with the market.
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  Speaker 3: Yeah, exceptionally fluid policy. Ryne and you guys have spoken
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  Speaker 3: a lot about that. Well, they won't their tariff journey.
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  Speaker 3: But it's not just tariff uncertainty. So there is uncertainty
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  Speaker 3: on the one hand, how potential tax cuts could stimulate
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  Speaker 3: the economy versus the DOGE or Department of Government governor
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  Speaker 3: efficiency inspired federal government cost cutting, which could be a
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  Speaker 3: drag on the economy. Then you've got uncertainty about the
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  Speaker 3: independence of the US Federal Reserve. So Chairman J. Powell
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  Speaker 3: retires it a little over twelve months, and Trump has
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  Speaker 3: made no secret he A wants interest rates lower now
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  Speaker 3: and B wants a loyalist to replace Power. Power, on
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  Speaker 3: the other hand, is trying to do his job independently,
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  Speaker 3: as it says on the tin, which is to control inflation.
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  Speaker 3: And right now he has stopped cutting rates because the
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  Speaker 3: FED is, as he said this week, close on inflation,
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  Speaker 3: but not there yet. And then of course you've got
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  Speaker 3: the US versus China computer chip war we've spoken about
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  Speaker 3: several times, which breeds its own version of uncertainty.
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  Speaker 2: He's right, the fair guy, because in fact, yesterday US
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  Speaker 2: inflation rates came in higher than expected, so it isn't
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  Speaker 2: under control.
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  Speaker 3: That's right, close on inflation, but not there yet. And
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  Speaker 3: we need independent central banks. That's why they are independent.
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  Speaker 3: So any thing that erodes and independence is a concern
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  Speaker 3: and again creates that uncertain.
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  Speaker 2: Well, and you just have to wonder, and I'm sorry
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  Speaker 2: this is not trumped arrangement syndrome in any way, shape
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  Speaker 2: or form, but you have to wonder if Donald Trump
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  Speaker 2: is demanding those interest rates when inflation is still going
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  Speaker 2: up and the figures came out yesterday, whether he knows
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  Speaker 2: what could happen.
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  Speaker 3: Yeah, well, he probably hasn't studied the nineteen seventies as
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  Speaker 3: closely as Jay Powell. I suspect when the FED declared
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  Speaker 3: victory on inflation early and inflation took off again and
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  Speaker 3: we had a horrific, great high cycle. But anyway that
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  Speaker 3: there is untcertainly out there is not just tariffs the points.
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  Speaker 2: So look what impacts is this happening on companies around
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  Speaker 2: the place and their bottom line and their projections.
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  Speaker 3: Yeah, early days on the bottom line, But imagine sitting
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  Speaker 3: in a boardroom in the US or say Southeast Asia
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  Speaker 3: or even Mexico or Canada right now today and been
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  Speaker 3: asked to sign off on a huge capital project which
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  Speaker 3: sort of spans the US, or imports product in the
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  Speaker 3: US all been asked to sign off on a three
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  Speaker 3: year strategy document with this type of extraordinary policy fluid
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  Speaker 3: in it, and it is starting to show up. So
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  Speaker 3: a small business survey in the US just released a
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  Speaker 3: couple of days ago showed the second or third highest
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  Speaker 3: uncertainty reading in the past fifty years. And the last
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  Speaker 3: thing I would say on that is steels are a
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  Speaker 3: classic case or steel is a classic case of the
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  Speaker 3: uncertain impact of tariffs. So steel stocks, for example, ripped
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  Speaker 3: higher when Trump was elected, and they ripped higher a
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  Speaker 3: few days ago when he did slap twenty five percent
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  Speaker 3: tariffs on Chinese steel imports. But what's super interesting is
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  Speaker 3: this the stocks now and now much lower than they
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  Speaker 3: were where pre Trump's election, because it reminds us these
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  Speaker 3: things don't happen in a vacuum. But the average steel
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  Speaker 3: bar on the US is not suddenly twenty five percent wealthier.
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  Speaker 3: So there's a lot going on there and the impacts
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  Speaker 3: are starting to show up.
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  Speaker 2: Has this sort of thing happened before? And if it has,
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  Speaker 2: what could we learn from it?
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  Speaker 3: Yeah? The most obvious parallel, I think is his last term.
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  Speaker 3: But the point of make there is that the starting
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  Speaker 3: points are very very different. So last time the market
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  Speaker 3: was very barius about Trump getting in, the bar was low,
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  Speaker 3: and he ended up being generally good for the economy.
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  Speaker 3: This time the bar is much much higher. People expect
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  Speaker 3: he will do very good things for the economy, and
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  Speaker 3: that is already embedded in share prices before he has
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  Speaker 3: even done anything. And the other thing, of course, is
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  Speaker 3: that this time he's got a real head of steam
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  Speaker 3: up around policy changes, and policy uncertainty is significantly higher
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  Speaker 3: than it was last time.
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  Speaker 2: Okay, so what about the people with the money, the
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  Speaker 2: investors who are trying to figure out which company they
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  Speaker 2: should invest in.
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  Speaker 3: Well, the easiest thing to say I think is what
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  Speaker 3: Howard Mark said is I don't know. No one really does,
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  Speaker 3: and I'm not sure some of his aides know from
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  Speaker 3: day to day what sort of policy is going to
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  Speaker 3: come out. But what we do know for sure is
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  Speaker 3: that this level of policy uncertainty is unprecedented and expectations
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  Speaker 3: are high, and that is one of the reasons why Europe, China,
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  Speaker 3: and even Mexican equity markets are significantly outperforming the US
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  Speaker 3: so far this year. But one thing we do know
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  Speaker 3: for sure, Andrew, is if you were sitting near Trump
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  Speaker 3: at his inauguration like the heads of Google, Meta and
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  Speaker 3: Amazon were, this uncertainty didn't stop their boards from signing
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  Speaker 3: a combined three hundred and twenty billion dollar CAPEX bill
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  Speaker 3: for this year.
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  Speaker 2: Great stuff, Sam Fisher, You are very interesting and very
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  Speaker 2: easy to listen to, and I thank you for your
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  Speaker 2: time today. And Sam is from Fisher Fans.
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