April 4, 2025
New Trump Tariffs and the Stock Market
Chris Boyd, Jeff Perry, and Russ Ball discuss the breaking news of the new tariffs known as “Liberation Day” imposed by President Trump. With the increased market volatility created by the Trump tariff announcement, Chris, Jeff, and Russ...
Chris Boyd, Jeff Perry, and Russ Ball
discuss the breaking news of the new tariffs known as “Liberation Day” imposed by
President Trump. With the increased market volatility created by the Trump tariff
announcement, Chris, Jeff, and Russ discuss whether it is time to reduce exposure in the
stock market or is it time to add funds while the market is in correction territory. Chris
highlights that investors might wish to review their asset allocation. Jeff reviews that the
bond market has performed well in recent months and how this is a reminder that
investors can benefit from diversification among asset classes.
For more information or to reach TEAM AMR, click the following link:
https://www.wealthenhancement.com/s/advisor-teams/amr
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Welcome to Something More with Chris Boyd.
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Chris Boyd is a Certified Financial Planner Practitioner
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and Senior Vice President and Financial Advisor at
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Wealth Enhancement Group, one of the nation's largest
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registered investment advisors.
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We call it Something More because we'd like
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to talk not only about those important dollar
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and cents issues, but also the quality of
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life issues that make the money matters matter.
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Here he is, your fulfillment facilitator, your partner
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in prosperity, advising clients on Cape Cod and
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across the country.
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Here's your host, Jay Christopher Boyd.
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Welcome to the program, Something More with Chris
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Boyd.
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I'm Chris Boyd here with Jeff Perry and
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Russ Ball, part of our team here at
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the AMR team of Wealth Enhancement Group.
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And we're glad to have you listening and
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hope you'll join us each week as we
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discuss all kinds of things relevant to your
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personal finance, your financial planning and portfolio management.
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Today, got to talk about tariffs.
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Yesterday, the president had a Rose Garden press
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conference release of his long awaited tariff plan.
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Liberation Day.
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Liberation Day, as it was dubbed.
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And the idea of trying to look at
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where we're being tariffed on our imports and
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have an effort to get a more fair
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reflection, I think is the way they would
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certainly classify that.
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So we're going to talk about that and
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we're all going to have things to say
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about it.
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Tariffs have the virtue of trying to level
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the playing field for the domestic country's companies.
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Yeah.
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But at the same time, it is something
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that is levied against the consumer or the
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buyer of goods, whether it's the manufacturer buying,
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importing supplies for the product they look to
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make or finished goods that come into the
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United States, the consumer would be paying that
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tax, the tariff.
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Indirectly.
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Directly, right?
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I mean, it's charged to the company, the
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importer, but someone's got to pay that and
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it's going to end up going to the
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consumer.
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Indirectly, I suppose.
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But it's ultimately...
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Well, the manufacturer could reduce the price to
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be more competitive.
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The retailer could reduce the price to be
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more competitive.
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But yeah, it's an increased cost of the
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product.
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How much gets passed along to the consumer?
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Most.
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Most, usually.
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But that's why I use the word indirect.
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So ultimately, an increase in the tax that
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is essentially going to, in that effort to
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try to make a domestic product more competitive.
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Historically, I think that's been the view that
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this is not an ideal way to do
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things because it doesn't always make the domestic
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product better or more competitive.
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That being said, there are inequities, government subsidies
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in other countries.
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There's all kinds of considerations that go into
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this.
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We certainly have a deficit each year on
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our budget.
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I get the clear impression that the president
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thinks this is part of the answer.
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Managing that annual deficit by having more come
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into the government by way of these tariffs.
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Additionally, I think there's a sense of fairness
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that this administration is pointing to saying, hey,
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look at all these.
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There's a great chart that they shared yesterday
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that really depicts the discrepancy and the inequity
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of tariff treatments on goods going into other
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countries from what we're charging from those countries.
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I think some of that has been historically,
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in part, for some of these smaller economies
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that we're willing to give them more flexibility
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in their development of their economy.
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That's what's under review.
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That's going to change.
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It sounds like there's been some multiple aspects
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of this.
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I heard former Secretary Gutierrez on one of
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the financial shows yesterday broke it down in
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some good ways.
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He talked about the 10% tariff base
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as something that's probably just always expected to
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stay.
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He put China in its own category.
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Let's talk about that separately.
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I think that is probably- I think
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that's right.
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I forget all of the things he said,
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but largely the rest of it sounded like,
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well, and then there's things that are negotiable
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that if countries are working with the administration,
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there may be more flexibility on how much
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of this tariff will apply.
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I don't know.
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I think there's a lot of questions about
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industry carve-outs and all this.
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Unfortunately, that is harder policy becomes a little
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less predictable and a little bit more of
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an unknown for planning.
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But that's what this ultimately comes down to
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for, I think, the economic and market considerations.
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Just as an aside, while we're recording this
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show, it is April 3rd, the day after
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the president's comments and markets are down today.
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Everyone's tariff concerns are on everyone's imagination of
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what does this mean?
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How's it going to play out?
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What's the good?
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What's the bad?
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It's the uncertainty word again, popping up.
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I think the challenge of this becomes for
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corporations to know, they don't just suddenly start
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building plants and it's productive next week.
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It's, do I want to invest?
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How many years will this take?
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How much benefit?
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How long will it take to recover that
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cost?
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This is something that takes time to measure,
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evaluate, and derive consequential change.
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Jeff, I can tell you have some things
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to say.
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Go for it.
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There's so much to say.
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I think the most enlightening part of yesterday's
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speech were these charts.
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They're all over the news right now about
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how much a given country charges us and
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how much we charge them now and before.
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You look for patterns.
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I always look for patterns, try to get
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the rationale.
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There aren't any.
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Europe, European Union, obviously a developed area, a
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developed continent.
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Australia, a developed continent.
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The amount of tariffs that they charge us
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aren't the same.
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They're not even close to the same.
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Australia does 10%.
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European, it's much higher.
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Then you mentioned third world developing countries.
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You and I spoke offline this morning about
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Vietnam.
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Vietnam charges, I think, 90 some odd percent
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tariff.
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We talked about, well, that's because they need
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the revenue.
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We understand they were developing.
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Since COVID, a lot has happened to Vietnam
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with on-shoring in Vietnam, a lot of
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manufacturing.
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Still, that tariff sticks, even though they have
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their own economic development and economic progress.
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Seeing these numbers of around the world and
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what they charge us, I was aware of
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the ones that make the news most of
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the time, China, and certainly a lot in
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the news lately about Canada and Mexico.
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But seeing how the United States is treated
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in trade across the world, I can understand
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the president's motivations of wanting to reset that
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and make it a more level playing field
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for our companies, our US companies who manufacture
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things.
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Obviously, the drive to want to bring manufacturing
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back, I think, is valid.
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We saw that even under the Biden administration
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with the CHIPS Act.
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There's a recognition for our economic security and
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our military security and our everything security that
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some things need to be made, at least
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in part, in the United States.
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CHIPS, in that case, I think one of
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the big news items this morning, which I
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didn't realize, I feel like I'm less educated
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than I maybe thought I was, but that
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most of our pharmaceuticals are actually manufactured overseas.
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I guess I hadn't seen that before.
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There's merit in that, too.
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I think the shock to the system, the
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uncertainty is, one, how we have been treated
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by other countries, and two, is doing it
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all at once rather than trying to do
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it piecemeal with one-on-one private talks
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and try to renegotiate things is causing this
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uncertainty in the market.
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I think the goal is a laudable, whether
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or not it's a prudent decision to do
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it all at once with a heavy hand
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and throw this uncertainty into the business climate,
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and the financial markets will be told over
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the weeks and months and perhaps years to
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come.
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I think some of the concern that markets
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have relates to this big change, and then,
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of course, the question of how much this
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is permanent policy, how much is positioning for
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negotiations, which I think prior to this week,
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markets largely had discounted the tariff reality on
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the basis that they thought there'd be some
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haggling, this is part of a broader negotiation
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or something.
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That still may be the case in terms
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of positioning.
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Well, we have until April 9th for a
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lot of these tariffs.
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Yeah.
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If they wanted to do it right away,
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why not do it right away?
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I feel like having a buffer before those
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tariffs kick in could be an invitation to...
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Even this morning, the Commerce Secretary was on
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CNBC on Bloomberg saying, our phone lines are
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open.
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Call us now.
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Number nine caller, you're on.
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Call us before April 9th.
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Right, right.
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Before April 10th to April 9th.
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And then I saw a post from Eric
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Trump saying, I wouldn't want to be one
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of the last people that call...
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One of the last countries that call Donald
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Trump, I guess, or implying that they're expecting
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deals to be made and who knows what
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will actually happen.
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But I did find it interesting that they
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were pushing out the start date for these.
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It could have just been, all right, we're
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announcing them and they're going into effect today
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or tomorrow, but that remains to be seen.
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So I think the concern that investors have
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is the question of, okay, will this create
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a higher inflationary environment?
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Will this drive prices higher still?
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People have been concerned about inflation as an
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issue.
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I've seen some semantics discussion around, well, is
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it really inflation if it's one time?
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That's an increased cost, but it's not necessarily
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a higher rate of inflation.
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President used the word in his press conference
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yesterday that it was kind of a discredited
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word in inflation, but transitory.
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Yeah.
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And I think there's an argument to be
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made for that, that it's not necessarily expected
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00:12:29,720 --> 00:12:35,940
to be ever increasing at a higher rate,
268
00:12:36,000 --> 00:12:39,260
but that is the assumption of, will there
269
00:12:39,260 --> 00:12:47,480
be reciprocal retaliatory response or will people respond
270
00:12:47,480 --> 00:12:49,880
in such a way as to reduce their
271
00:12:49,880 --> 00:12:52,140
tariff on US?
272
00:12:52,440 --> 00:12:54,160
That's an unknown at this point.
273
00:12:54,280 --> 00:12:55,640
And I think that's one of the things
274
00:12:55,640 --> 00:12:58,080
that drives anxiety in the market.
275
00:12:59,500 --> 00:13:04,880
But if there is inflation, how does that
276
00:13:04,880 --> 00:13:05,840
become addressed?
277
00:13:06,740 --> 00:13:15,020
Similarly, we've already seen concerns about employment as
278
00:13:15,020 --> 00:13:17,660
it relates to what's happening in Washington DC
279
00:13:17,660 --> 00:13:22,820
with the Doge efforts to trim, we'll say
280
00:13:22,820 --> 00:13:28,040
in nice terms, to trim government and try
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00:13:28,040 --> 00:13:30,140
to scale back some of the costs of
282
00:13:30,140 --> 00:13:30,660
government.
283
00:13:31,200 --> 00:13:34,940
That has also some ripple effect in terms
284
00:13:34,940 --> 00:13:42,220
of grants for research that has ripple effect
285
00:13:42,220 --> 00:13:44,780
on nonprofits, how they get funded, some of
286
00:13:44,780 --> 00:13:47,520
these that work with government agencies and so
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00:13:47,520 --> 00:13:51,240
on, that there's likely to be some escalation
288
00:13:51,240 --> 00:13:53,760
of unemployment from that.
289
00:13:54,640 --> 00:13:57,680
But then if people have, consumer sentiment, I
290
00:13:57,680 --> 00:14:00,100
think, has gotten a little bit skittish, does
291
00:14:00,100 --> 00:14:01,920
that translate to spending?
292
00:14:02,300 --> 00:14:05,300
If costs are higher, do I have less
293
00:14:05,300 --> 00:14:06,440
money to spend?
294
00:14:06,980 --> 00:14:09,980
Does that turn into an economic drag?
295
00:14:10,220 --> 00:14:12,140
Do we worry about recession?
296
00:14:12,140 --> 00:14:14,900
These are all things that you hear this
297
00:14:14,900 --> 00:14:18,020
evolution of thinking.
298
00:14:18,660 --> 00:14:22,580
And if there is a recession, what does
299
00:14:22,580 --> 00:14:23,400
the Fed do?
300
00:14:23,600 --> 00:14:27,720
Does it reduce interest rates to stimulate or
301
00:14:27,720 --> 00:14:29,760
does it raise interest rates to try to
302
00:14:29,760 --> 00:14:35,140
reduce the inflationary effects of tariff impact?
303
00:14:36,040 --> 00:14:40,460
Seems like the consensus is more leans towards
304
00:14:40,460 --> 00:14:43,380
stimulus, but that's one of these unknowns, right?
305
00:14:43,480 --> 00:14:46,160
And how does that lead an investor to
306
00:14:46,160 --> 00:14:52,000
position themselves in expectations of what will happen?
307
00:14:52,560 --> 00:14:54,460
And we don't have a similar model here
308
00:14:54,460 --> 00:14:59,560
to look back at history with all the
309
00:14:59,560 --> 00:15:01,160
changes that are being made at the same
310
00:15:01,160 --> 00:15:04,400
time in the reset of the federal bureaucracy.
311
00:15:05,220 --> 00:15:08,260
The anxiety that people have is, what was
312
00:15:08,260 --> 00:15:09,020
it, Smoot-Hawley?
313
00:15:09,120 --> 00:15:11,320
Hawley-Smoot, what's the right name for that
314
00:15:11,320 --> 00:15:13,040
tariff?
315
00:15:14,220 --> 00:15:16,660
We can refer to Ferris Buehler again.
316
00:15:16,920 --> 00:15:17,260
We could.
317
00:15:17,980 --> 00:15:20,180
We could have that prepared.
318
00:15:20,480 --> 00:15:22,680
We're only 16 minutes in before the first
319
00:15:22,680 --> 00:15:23,940
mention of Ferris Buehler.
320
00:15:24,540 --> 00:15:24,640
Yeah.
321
00:15:26,480 --> 00:15:33,620
Well, in any case, anyone, Buehler, that lecture,
322
00:15:33,620 --> 00:15:37,860
he was talking about tariffs and the idea
323
00:15:37,860 --> 00:15:40,260
that it was at the outset of the
324
00:15:40,260 --> 00:15:41,280
Great Depression.
325
00:15:42,020 --> 00:15:46,120
It was not a standalone issue, I grant
326
00:15:46,120 --> 00:15:48,240
you, which I think is where some of
327
00:15:48,240 --> 00:15:50,000
the thought is, but it was one of
328
00:15:50,000 --> 00:15:55,140
the things that led to an economic slowdown.
329
00:15:56,580 --> 00:15:58,160
I don't think that's in question.
330
00:15:58,720 --> 00:16:01,140
You don't think the imposition of the income
331
00:16:01,140 --> 00:16:05,260
tax was a greater influence in the survival?
332
00:16:06,000 --> 00:16:07,480
What year did that happen, Jeff?
333
00:16:08,500 --> 00:16:10,760
Well, it didn't create the Great Depression, but
334
00:16:10,760 --> 00:16:13,560
- It happened in the 1900, 1919 or
335
00:16:13,560 --> 00:16:15,920
something like that, 1912, the income tax.
336
00:16:17,400 --> 00:16:22,680
The tariffs were closer to the 1920s, and
337
00:16:22,680 --> 00:16:26,280
that's the period closer to the...
338
00:16:26,280 --> 00:16:26,880
Am I wrong?
339
00:16:27,460 --> 00:16:29,900
You might be- I don't have my
340
00:16:29,900 --> 00:16:31,740
historical calendar in front of me here.
341
00:16:31,860 --> 00:16:32,080
Yeah, me neither.
342
00:16:32,920 --> 00:16:35,500
But- That was my earlier point.
343
00:16:35,660 --> 00:16:39,260
We don't have a modern reference to a
344
00:16:39,260 --> 00:16:42,060
change in the way tariffs have been handled
345
00:16:42,060 --> 00:16:43,420
all at once.
346
00:16:43,760 --> 00:16:46,180
Either the imposition of the United States at
347
00:16:46,180 --> 00:16:48,440
one point where the federal government was relying
348
00:16:48,440 --> 00:16:50,120
on them, this is the date we're struggling
349
00:16:50,120 --> 00:16:52,460
with, and then the change to an income
350
00:16:52,460 --> 00:16:52,980
tax.
351
00:16:53,680 --> 00:16:56,740
We don't have a modern period of time
352
00:16:56,740 --> 00:16:59,900
or change of policy that's in this modern
353
00:16:59,900 --> 00:17:03,540
economy for us to really review and say,
354
00:17:03,619 --> 00:17:08,619
well, in 2008, during that financial crisis, this
355
00:17:08,619 --> 00:17:11,760
is what happened, or during the pandemic of
356
00:17:11,760 --> 00:17:13,839
2020, this is what happened.
357
00:17:15,359 --> 00:17:19,859
Other people are going back to 100 years
358
00:17:19,859 --> 00:17:22,740
ago to say, well, what caused what?
359
00:17:23,839 --> 00:17:25,819
And that's not really the...
360
00:17:25,819 --> 00:17:26,900
You can't make that analysis.
361
00:17:27,240 --> 00:17:29,120
So much is different in our economy.
362
00:17:29,500 --> 00:17:32,700
The lesson of that, Smoot-Hawley, was that
363
00:17:32,700 --> 00:17:35,800
tariffs went up significantly, it slowed the economy,
364
00:17:36,320 --> 00:17:39,900
and that was one of several things that
365
00:17:39,900 --> 00:17:43,500
led into the Great Depression.
366
00:17:44,420 --> 00:17:46,040
And I looked it up, it was 1930
367
00:17:46,040 --> 00:17:49,800
for that act.
368
00:17:50,220 --> 00:17:53,220
We'll look up when the income tax started
369
00:17:53,220 --> 00:17:55,060
as well, so we have that if we
370
00:17:55,060 --> 00:17:55,500
want to.
371
00:17:55,920 --> 00:17:59,820
But anyways, I think probably the bigger question
372
00:17:59,820 --> 00:18:02,760
for everybody is, I mean, I've heard people
373
00:18:02,760 --> 00:18:04,620
concerned like, oh, this is going to lead
374
00:18:04,620 --> 00:18:08,160
to product shortages and things of that sort
375
00:18:08,160 --> 00:18:11,420
if this really were to escalate as a,
376
00:18:11,800 --> 00:18:13,560
I hate to use the word trade war,
377
00:18:13,700 --> 00:18:17,340
but if it escalates in its trade challenges.
378
00:18:17,620 --> 00:18:18,240
We'll see, right?
379
00:18:18,600 --> 00:18:20,940
I think the bigger issue is how should
380
00:18:20,940 --> 00:18:25,720
a consumer, an investor think about their portfolio?
381
00:18:26,760 --> 00:18:28,600
What are the things they should do?
382
00:18:29,480 --> 00:18:32,020
I mean, I think just fundamentally, all of
383
00:18:32,020 --> 00:18:35,560
this, what we're talking about, markets back to
384
00:18:35,560 --> 00:18:37,340
this idea that there's going to be uncertainty.
385
00:18:38,020 --> 00:18:40,180
And that's just a matter of fact right
386
00:18:40,180 --> 00:18:40,440
now.
387
00:18:40,720 --> 00:18:43,220
There hasn't been, we haven't increased tariffs as
388
00:18:43,220 --> 00:18:45,500
much since the 1930s as we've just talked
389
00:18:45,500 --> 00:18:45,740
about.
390
00:18:45,880 --> 00:18:47,660
So there's just a lot of unknowns.
391
00:18:47,880 --> 00:18:50,760
So with unknowns in the market come volatility.
392
00:18:51,340 --> 00:18:54,180
So I think that's, I see that again
393
00:18:54,180 --> 00:18:57,920
and again, but just an expectation of volatility
394
00:18:57,920 --> 00:19:01,580
in the mid to near term, I think
395
00:19:01,580 --> 00:19:03,480
is probably a fair bet.
396
00:19:04,520 --> 00:19:04,620
Yeah.
397
00:19:04,660 --> 00:19:06,080
I think that that's a great start.
398
00:19:06,260 --> 00:19:08,440
Look, expect volatility.
399
00:19:08,640 --> 00:19:10,320
We're in this period of uncertainty.
400
00:19:10,620 --> 00:19:14,040
There's how the economic impact will play out,
401
00:19:14,200 --> 00:19:17,020
how the market, we're just, as we're talking
402
00:19:17,020 --> 00:19:19,180
about just amongst us, what's this mean for
403
00:19:19,180 --> 00:19:19,560
revenue?
404
00:19:19,760 --> 00:19:20,980
Well, who's going to absorb what?
405
00:19:21,160 --> 00:19:22,740
How's the consumer going to react?
406
00:19:23,260 --> 00:19:25,720
How's this going to affect spending and what's
407
00:19:25,720 --> 00:19:27,480
going to happen with prices?
408
00:19:27,800 --> 00:19:32,500
What countries will respond what way versus another?
409
00:19:33,140 --> 00:19:35,160
There's all this that remains yet to be
410
00:19:35,160 --> 00:19:36,020
determined, right?
411
00:19:36,120 --> 00:19:41,480
So in the near term, there's increased volatility
412
00:19:41,480 --> 00:19:43,920
and that's likely to be the case as
413
00:19:43,920 --> 00:19:46,560
we have until this shakes out, until there's
414
00:19:46,560 --> 00:19:48,140
a little more clarity around it.
415
00:19:48,760 --> 00:19:54,120
Now, markets historically, we know that it's not
416
00:19:54,120 --> 00:19:57,660
uncommon at all for markets to go down
417
00:19:59,100 --> 00:20:02,300
10%, 20% from their highs.
418
00:20:03,080 --> 00:20:05,020
This is normal market behavior.
419
00:20:06,460 --> 00:20:07,880
We are looking at, we looked at the
420
00:20:07,880 --> 00:20:08,780
S&P 500.
421
00:20:08,780 --> 00:20:10,860
We're a little lower than 10% off
422
00:20:10,860 --> 00:20:13,760
the highs, which were in mid-February.
423
00:20:13,900 --> 00:20:16,080
We're somewhere around 11% or 12%
424
00:20:16,080 --> 00:20:16,840
off that.
425
00:20:17,540 --> 00:20:19,620
But your date, that's not where we are
426
00:20:19,620 --> 00:20:21,620
because we went up before we went down.
427
00:20:22,700 --> 00:20:25,860
Somewhere around 7% when we're recording this.
428
00:20:26,060 --> 00:20:27,700
It'll change by the time you listen.
429
00:20:28,080 --> 00:20:29,680
Who knows what it'll be.
430
00:20:30,100 --> 00:20:31,180
But you follow my point.
431
00:20:32,020 --> 00:20:34,460
This is normal to start with.
432
00:20:34,520 --> 00:20:37,480
This is normal behavior, range of movement, not
433
00:20:37,480 --> 00:20:40,360
in itself something to get overly anxious about.
434
00:20:41,120 --> 00:20:44,860
That being said, as investors, we think about
435
00:20:44,860 --> 00:20:45,500
the what-ifs.
436
00:20:46,080 --> 00:20:48,000
How might this impact things?
437
00:20:49,060 --> 00:20:53,900
Stocks move over time by expectations of earnings
438
00:20:53,900 --> 00:20:56,480
over a prolonged period of time.
439
00:20:56,860 --> 00:21:00,520
It's a current willingness to pay for future
440
00:21:00,520 --> 00:21:01,040
earnings.
441
00:21:03,200 --> 00:21:06,260
This naturally comes into how do we envision
442
00:21:06,260 --> 00:21:11,060
the change in valuation if there is some?
443
00:21:12,560 --> 00:21:14,920
We don't know the answer to that yet.
444
00:21:15,440 --> 00:21:19,760
I think we have to be ready to
445
00:21:19,760 --> 00:21:23,320
tolerate volatility until we have better clarity around
446
00:21:23,320 --> 00:21:26,140
that and be willing to decide what action
447
00:21:26,140 --> 00:21:26,860
comes out of that.
448
00:21:27,620 --> 00:21:31,840
We've been talking about other considerations for a
449
00:21:31,840 --> 00:21:32,240
while.
450
00:21:32,760 --> 00:21:34,660
The start of the year, we talked about
451
00:21:34,660 --> 00:21:36,020
extended valuations.
452
00:21:37,280 --> 00:21:39,280
That was a good reason to scale back
453
00:21:39,280 --> 00:21:40,900
on your equity allocation.
454
00:21:42,820 --> 00:21:47,660
We've, in our strategies, made adjustments previously in
455
00:21:47,660 --> 00:21:48,320
anticipation.
456
00:21:49,420 --> 00:21:53,260
There are times we make changes responsibly to
457
00:21:53,260 --> 00:21:54,320
what's going on.
458
00:21:54,860 --> 00:21:58,620
So as an investor, I think that's reasonable
459
00:21:58,620 --> 00:22:00,320
as long as it's measured.
460
00:22:00,760 --> 00:22:02,800
We want to think about what's my tolerance
461
00:22:02,800 --> 00:22:03,700
as an investor?
462
00:22:04,160 --> 00:22:06,160
What's my willingness to endure volatility?
463
00:22:06,880 --> 00:22:09,380
What's the expectation for performance I have?
464
00:22:09,720 --> 00:22:12,080
And design the portfolio around that.
465
00:22:12,300 --> 00:22:16,160
Now, sometimes we say, I still feel like
466
00:22:16,160 --> 00:22:18,260
I'm a conservative investor, and I want to
467
00:22:18,260 --> 00:22:20,400
be invested in keeping with that or a
468
00:22:20,400 --> 00:22:22,320
moderate investor or whatever it might be.
469
00:22:22,320 --> 00:22:24,680
I want to remain in keeping with that.
470
00:22:25,040 --> 00:22:27,680
But gosh, I sense that maybe I'm not
471
00:22:27,680 --> 00:22:29,760
positioned in the best place right now.
472
00:22:30,220 --> 00:22:31,220
I want to have a little more of
473
00:22:31,220 --> 00:22:32,740
this and a little less of that.
474
00:22:33,440 --> 00:22:35,800
That's a reasonable adjustment, right?
475
00:22:36,640 --> 00:22:38,520
Or maybe you'd say, I want to have
476
00:22:38,520 --> 00:22:42,560
a little more cash for the unexpected.
477
00:22:42,920 --> 00:22:45,180
Oh, this seems like this could create some
478
00:22:45,180 --> 00:22:49,680
disruptions in availability of goods or something.
479
00:22:49,680 --> 00:22:51,200
Oh, well, maybe it's a good idea to
480
00:22:51,200 --> 00:22:52,700
have some reserve.
481
00:22:53,320 --> 00:22:55,880
We talk about that always with clients about
482
00:22:55,880 --> 00:22:58,240
having some liquidity reserve.
483
00:22:59,660 --> 00:23:01,280
But these are the times when you say,
484
00:23:01,380 --> 00:23:02,480
oh, this may be one of those reasons
485
00:23:02,480 --> 00:23:03,620
why, right?
486
00:23:04,700 --> 00:23:08,200
So one, is it too late to think
487
00:23:08,200 --> 00:23:10,040
about any kind of an adjustment in your
488
00:23:10,040 --> 00:23:10,600
portfolio?
489
00:23:11,260 --> 00:23:12,540
I would argue no.
490
00:23:12,660 --> 00:23:15,100
If you said, gee, I think I've been
491
00:23:15,100 --> 00:23:16,160
taking too much risk.
492
00:23:16,220 --> 00:23:18,460
I've had a great return, but maybe I'd
493
00:23:18,460 --> 00:23:19,640
like to scale it back.
494
00:23:20,380 --> 00:23:21,960
But is it too late because the market
495
00:23:21,960 --> 00:23:23,100
started to decline?
496
00:23:23,660 --> 00:23:25,420
When you think about the fact that you're
497
00:23:25,420 --> 00:23:27,420
in an asset allocation, even if the market's
498
00:23:27,420 --> 00:23:30,120
down 6%, 7% at a given point
499
00:23:30,120 --> 00:23:33,540
in time, that's not from the year to
500
00:23:33,540 --> 00:23:36,580
date, 10 or whatever from the high.
501
00:23:37,500 --> 00:23:39,540
That's not outrageous when you think about, we
502
00:23:39,540 --> 00:23:42,580
just went up like 45% in two
503
00:23:42,580 --> 00:23:44,240
years or whatever it is.
504
00:23:44,940 --> 00:23:48,840
So sure, maybe give up a little bit.
505
00:23:49,300 --> 00:23:50,840
But if you need to scale back the
506
00:23:50,840 --> 00:23:54,300
risk, it's not unreasonable to do that today.
507
00:23:54,400 --> 00:23:55,660
It's starting to get to the point where
508
00:23:55,660 --> 00:23:57,260
you might be better off to not think.
509
00:23:57,800 --> 00:24:00,120
It might be better off to wait to
510
00:24:00,120 --> 00:24:02,100
get to the other side because we don't
511
00:24:02,100 --> 00:24:03,540
know how long this will take and all
512
00:24:03,540 --> 00:24:03,720
that.
513
00:24:04,040 --> 00:24:07,680
But I would still say incremental adjustments is
514
00:24:07,680 --> 00:24:08,460
not unreasonable.
515
00:24:10,120 --> 00:24:13,660
But what we don't want to do is
516
00:24:13,660 --> 00:24:17,960
sell low and buy high.
517
00:24:18,140 --> 00:24:19,440
We don't want to be in a position
518
00:24:19,440 --> 00:24:23,120
where we've behaviorally done the wrong thing.
519
00:24:23,820 --> 00:24:26,020
So if we're talking about something measured in
520
00:24:26,020 --> 00:24:29,040
incremental, that can have merit.
521
00:24:29,280 --> 00:24:31,260
But let's not overreact.
522
00:24:31,380 --> 00:24:32,720
Let's not sell everything.
523
00:24:32,720 --> 00:24:34,540
Let's not run for the hills.
524
00:24:35,900 --> 00:24:40,160
Again, we're talking in generalities, your specifics, talk
525
00:24:40,160 --> 00:24:40,980
to your advisor.
526
00:24:41,360 --> 00:24:43,420
If you don't have an advisor, call us.
527
00:24:43,500 --> 00:24:45,200
We'll be happy to talk to you, see
528
00:24:45,200 --> 00:24:47,400
what your circumstances are, see how it fits
529
00:24:47,400 --> 00:24:49,720
into your financial plan, how it all fits
530
00:24:49,720 --> 00:24:50,140
together.
531
00:24:50,500 --> 00:24:51,600
Very well said, Chris.
532
00:24:51,840 --> 00:24:54,920
Asset allocation is a really, as we talk
533
00:24:54,920 --> 00:24:56,560
about all the time, such a key component
534
00:24:56,560 --> 00:24:58,160
to part of what we do.
535
00:24:58,360 --> 00:25:00,820
And what gets in our brains and what
536
00:25:00,820 --> 00:25:02,720
we think about is what's in front of
537
00:25:02,720 --> 00:25:04,660
us, in this case, tariffs and the news.
538
00:25:04,780 --> 00:25:06,180
And it can be very emotional.
539
00:25:07,220 --> 00:25:10,100
We haven't had many people calling about how
540
00:25:10,100 --> 00:25:12,100
well the bond market has been doing.
541
00:25:12,600 --> 00:25:13,160
Yeah, good point.
542
00:25:13,360 --> 00:25:13,460
Right.
543
00:25:13,640 --> 00:25:17,280
So having some diversity in your asset allocation
544
00:25:17,280 --> 00:25:21,640
for times like this can really add a
545
00:25:21,640 --> 00:25:21,980
benefit.
546
00:25:22,300 --> 00:25:27,360
And so if you're all in on stocks,
547
00:25:27,400 --> 00:25:28,960
this is a rough period of time for
548
00:25:28,960 --> 00:25:29,100
you.
549
00:25:29,280 --> 00:25:31,000
If you're all in on bonds, you've been
550
00:25:31,000 --> 00:25:34,180
having a good time for a few months
551
00:25:34,180 --> 00:25:34,440
now.
552
00:25:34,580 --> 00:25:36,620
But the answer is probably somewhere in the
553
00:25:36,620 --> 00:25:40,860
middle for most clients where adding a diversified
554
00:25:40,860 --> 00:25:43,340
portfolio can not only give you some peace
555
00:25:43,340 --> 00:25:45,000
of mind, but if you do need to
556
00:25:45,000 --> 00:25:46,920
withdraw some money, if you do have a
557
00:25:46,920 --> 00:25:49,200
liquidity need beyond what you have in reserve,
558
00:25:49,860 --> 00:25:53,900
you have the option of taking from maybe
559
00:25:53,900 --> 00:25:56,720
parts of your portfolio that have not suffered
560
00:25:56,720 --> 00:26:00,340
any downfall, if you will, from tariffs in
561
00:26:00,340 --> 00:26:00,820
this case.
562
00:26:01,100 --> 00:26:03,560
And I think your point is a good
563
00:26:03,560 --> 00:26:03,720
one.
564
00:26:03,880 --> 00:26:08,660
And I think oftentimes we dwell on things
565
00:26:08,660 --> 00:26:11,760
for good or for bad based on what
566
00:26:11,760 --> 00:26:12,560
we consume.
567
00:26:13,240 --> 00:26:18,580
So maybe turn off the TV, turn off
568
00:26:18,580 --> 00:26:21,580
the news, change the channel, get some multiple
569
00:26:21,580 --> 00:26:22,440
perspectives.
570
00:26:24,320 --> 00:26:29,320
So some people are talking about all the
571
00:26:29,320 --> 00:26:30,920
great opportunities this might generate.
572
00:26:31,140 --> 00:26:33,480
And that might be something you get more
573
00:26:33,480 --> 00:26:35,380
enthusiastic around.
574
00:26:35,480 --> 00:26:37,240
Other people might be focusing on some of
575
00:26:37,240 --> 00:26:37,760
the risks.
576
00:26:38,620 --> 00:26:41,160
When markets go down, we hear more of
577
00:26:41,160 --> 00:26:42,940
the risks that people are anxious about.
578
00:26:43,080 --> 00:26:45,520
So that's maybe why I'm speaking more to
579
00:26:45,520 --> 00:26:46,140
that, I think.
580
00:26:47,660 --> 00:26:50,640
But there's two sides to every coin, I
581
00:26:50,640 --> 00:26:50,880
guess.
582
00:26:51,120 --> 00:26:54,220
And including in this tariff debate, there are
583
00:26:54,220 --> 00:26:56,180
U.S. companies right now that are thrilled
584
00:26:56,180 --> 00:26:58,680
about what President Trump is doing.
585
00:26:58,880 --> 00:27:00,800
And there's going to be additional investments and
586
00:27:00,800 --> 00:27:05,540
employment because of what the tariff policy means
587
00:27:05,540 --> 00:27:07,200
to those individual companies.
588
00:27:07,540 --> 00:27:09,800
So I think the market movement is more
589
00:27:09,800 --> 00:27:13,180
about, as Russ said earlier, about volatility and
590
00:27:13,180 --> 00:27:16,360
uncertainty than it is about earnings.
591
00:27:18,120 --> 00:27:20,960
We're too early in this discussion to really
592
00:27:20,960 --> 00:27:23,700
understand what these tariffs are going to do
593
00:27:23,700 --> 00:27:24,940
to the S&P 500.
594
00:27:25,660 --> 00:27:26,660
You have to really look at it.
595
00:27:26,700 --> 00:27:28,700
If Brian was on, he'd be talking about
596
00:27:28,700 --> 00:27:30,620
this, our senior portfolio manager.
597
00:27:30,780 --> 00:27:32,200
You have to look at this company by
598
00:27:32,200 --> 00:27:34,540
company, industry by industry.
599
00:27:34,980 --> 00:27:37,740
And some of them will definitely benefit from
600
00:27:37,740 --> 00:27:40,820
having a more isolationist point of view of
601
00:27:40,820 --> 00:27:46,820
bringing manufacturing back or making trade more fairer.
602
00:27:47,260 --> 00:27:47,880
Yeah.
603
00:27:48,160 --> 00:27:52,560
And there are companies that are less impacted
604
00:27:52,560 --> 00:27:57,540
by the type of issues that tariffs create.
605
00:27:57,560 --> 00:28:04,400
They're not necessarily importing product or service in
606
00:28:04,400 --> 00:28:08,980
the creation of their services or their own
607
00:28:08,980 --> 00:28:09,500
products.
608
00:28:11,480 --> 00:28:14,360
I'm thinking in terms of companies that are
609
00:28:14,360 --> 00:28:18,660
more like this area of technology in some
610
00:28:18,660 --> 00:28:19,040
spaces.
611
00:28:19,500 --> 00:28:22,520
Some have lots of production that's done overseas,
612
00:28:22,700 --> 00:28:25,200
but some are doing different kind of content
613
00:28:25,200 --> 00:28:32,300
that doesn't necessarily require that tariff consequence.
614
00:28:32,300 --> 00:28:34,960
And so will that create opportunity?
615
00:28:35,220 --> 00:28:41,040
Will that create maybe some buying?
616
00:28:42,100 --> 00:28:43,240
I think it will.
617
00:28:43,660 --> 00:28:44,260
I think it will.
618
00:28:44,360 --> 00:28:46,080
And maybe some markets will open up to
619
00:28:46,080 --> 00:28:50,060
U.S. companies that were previously limited by
620
00:28:50,060 --> 00:28:51,740
super high tariffs in this.
621
00:28:52,120 --> 00:28:54,320
Hopefully, what we have is a negotiation and
622
00:28:54,320 --> 00:28:58,220
there's calmer minds than the news people.
623
00:28:58,440 --> 00:29:00,960
There's calmer individuals in the state department and
624
00:29:00,960 --> 00:29:02,820
so forth, commerce department who are going to
625
00:29:02,820 --> 00:29:04,440
make better deals for America.
626
00:29:06,020 --> 00:29:09,040
So what's the opportunity for the individual?
627
00:29:09,380 --> 00:29:11,400
I was thinking, what should we be thinking
628
00:29:11,400 --> 00:29:12,480
about as investors?
629
00:29:12,960 --> 00:29:16,120
One is make sure your allocation is positioned
630
00:29:16,120 --> 00:29:16,440
well.
631
00:29:16,560 --> 00:29:18,840
Number two, make sure you have the liquidity
632
00:29:18,840 --> 00:29:21,720
reserves that is a good...
633
00:29:21,720 --> 00:29:23,460
And again, we can offer guidance.
634
00:29:23,600 --> 00:29:25,780
Your advisor can offer guidance as to how
635
00:29:25,780 --> 00:29:28,180
to think about either one of those subjects.
636
00:29:28,820 --> 00:29:31,900
And then maybe opportunistically, there may be investment
637
00:29:31,900 --> 00:29:35,380
opportunities, but there may be tax planning opportunities.
638
00:29:35,800 --> 00:29:41,020
Maybe there's some capital loss harvesting to take
639
00:29:41,020 --> 00:29:43,040
advantage of, be able to sell something that's
640
00:29:43,040 --> 00:29:44,760
been at a game that you couldn't really
641
00:29:44,760 --> 00:29:47,540
right size without a big tax burden.
642
00:29:47,700 --> 00:29:49,200
Maybe now you can with a little bit
643
00:29:49,200 --> 00:29:50,480
of offsetting.
644
00:29:50,740 --> 00:29:56,040
Maybe there's some Roth conversion opportunities that you
645
00:29:56,040 --> 00:29:57,160
might want to think about.
646
00:29:57,760 --> 00:29:59,720
There can be a variety of things.
647
00:29:59,720 --> 00:30:01,420
You look like you had something in mind
648
00:30:01,420 --> 00:30:03,820
you were going to add in Russ as
649
00:30:03,820 --> 00:30:04,500
opportunities.
650
00:30:04,820 --> 00:30:08,240
No, I mean, I guess as I'm looking
651
00:30:08,240 --> 00:30:11,320
at my Roth IRA and thinking, wow, this
652
00:30:11,320 --> 00:30:12,260
is great.
653
00:30:12,500 --> 00:30:12,980
I haven't seen...
654
00:30:13,620 --> 00:30:16,260
Time to make an annual contribution, right?
655
00:30:16,380 --> 00:30:17,160
Right, exactly.
656
00:30:17,940 --> 00:30:20,140
So it's all, I think it depends on
657
00:30:20,140 --> 00:30:23,620
where you're at in life, but big picture,
658
00:30:23,860 --> 00:30:25,700
it's so easy to get caught in that.
659
00:30:25,740 --> 00:30:27,380
We've talked about it before in this day
660
00:30:27,380 --> 00:30:28,960
-to-day mindset, like, oh my gosh, what's
661
00:30:28,960 --> 00:30:29,540
going on today?
662
00:30:29,640 --> 00:30:31,260
Do we sell out?
663
00:30:31,320 --> 00:30:32,060
Do we go to cash?
664
00:30:33,420 --> 00:30:35,060
But when you take a big picture view,
665
00:30:36,200 --> 00:30:38,100
it could be a good time to buy
666
00:30:38,100 --> 00:30:40,840
at lower prices than it has been recently.
667
00:30:41,240 --> 00:30:44,160
So not saying that that's a general recommendation
668
00:30:44,160 --> 00:30:46,920
for everyone, but when I'm looking at my
669
00:30:46,920 --> 00:30:48,460
Roth IRA, I'm like, wow, this is a
670
00:30:48,460 --> 00:30:50,740
great chance to put some cash in.
671
00:30:51,540 --> 00:30:53,620
So we encourage you to think that way.
672
00:30:53,960 --> 00:30:57,280
And if you have concerns as you think
673
00:30:57,280 --> 00:31:01,160
about your portfolio, might be time for a
674
00:31:01,160 --> 00:31:04,720
portfolio review, get a real fresh set of
675
00:31:04,720 --> 00:31:06,300
eyes on what's happening.
676
00:31:06,980 --> 00:31:10,080
How should I be positioned given what's happening
677
00:31:10,080 --> 00:31:11,500
in the world around us today?
678
00:31:12,740 --> 00:31:14,140
Where do I have risks?
679
00:31:14,200 --> 00:31:15,200
Where do I have opportunities?
680
00:31:15,440 --> 00:31:17,180
What are some things I might want to
681
00:31:17,180 --> 00:31:17,620
adjust?
682
00:31:17,900 --> 00:31:21,240
Am I overstated in some space or not?
683
00:31:22,440 --> 00:31:24,460
These are things that we help people with.
684
00:31:24,600 --> 00:31:26,120
We often like to do it though, in
685
00:31:26,120 --> 00:31:28,780
the context of a financial plan so that
686
00:31:28,780 --> 00:31:30,920
we see, how does this forecast over time?
687
00:31:31,040 --> 00:31:32,860
That's something we've been talking about with clients
688
00:31:32,860 --> 00:31:36,700
a lot lately is, yeah, what if the
689
00:31:36,700 --> 00:31:38,620
market goes down from here?
690
00:31:39,320 --> 00:31:42,080
How does that affect stress test your plan?
691
00:31:42,400 --> 00:31:43,620
What happens then?
692
00:31:44,040 --> 00:31:47,280
And then oftentimes people are like, oh, that's
693
00:31:47,280 --> 00:31:48,240
great to know.
694
00:31:48,660 --> 00:31:50,480
You know, that does put it in perspective,
695
00:31:50,600 --> 00:31:50,860
right?
696
00:31:51,040 --> 00:31:54,180
And how that can, what should I expect?
697
00:31:54,260 --> 00:31:56,060
And is it really something that will be
698
00:31:56,060 --> 00:31:58,460
disruptive to my future?
699
00:31:58,880 --> 00:31:59,980
That kind of thing.
700
00:32:00,440 --> 00:32:02,320
So if you need help with any of
701
00:32:02,320 --> 00:32:04,000
those things, don't hesitate to reach out.
702
00:32:04,540 --> 00:32:08,520
We can be reached locally at 508-771
703
00:32:08,520 --> 00:32:13,580
-8900, toll-free 866-771-8901.
704
00:32:14,220 --> 00:32:15,480
And you can always send us an email
705
00:32:15,480 --> 00:32:19,360
with your questions about show content or to
706
00:32:19,360 --> 00:32:22,720
reach out to connect with you at amr
707
00:32:22,720 --> 00:32:26,500
-info at wealthenhancement.com.
708
00:32:27,080 --> 00:32:29,240
Hope you'll share this content with others.
709
00:32:29,740 --> 00:32:31,600
Give us a rating and a like, really
710
00:32:31,600 --> 00:32:33,660
helps others find the show.
711
00:32:34,260 --> 00:32:36,740
With that being said, thanks everybody.
712
00:32:36,960 --> 00:32:39,480
Until next time, keep striving for something more.
713
00:33:03,660 --> 00:33:07,680
Send us your questions to amr-info at
714
00:33:07,680 --> 00:33:09,260
wealthenhancement.com.
715
00:33:33,660 --> 00:33:36,180
or conduct their own due diligence before making
716
00:33:36,180 --> 00:33:37,240
any financial decisions.
00:00:00,460 --> 00:00:02,960
Welcome to Something More with Chris Boyd.
2
00:00:03,320 --> 00:00:06,280
Chris Boyd is a Certified Financial Planner Practitioner
3
00:00:06,280 --> 00:00:08,880
and Senior Vice President and Financial Advisor at
4
00:00:08,880 --> 00:00:11,180
Wealth Enhancement Group, one of the nation's largest
5
00:00:11,180 --> 00:00:12,780
registered investment advisors.
6
00:00:13,280 --> 00:00:15,219
We call it Something More because we'd like
7
00:00:15,219 --> 00:00:17,360
to talk not only about those important dollar
8
00:00:17,360 --> 00:00:19,520
and cents issues, but also the quality of
9
00:00:19,520 --> 00:00:21,980
life issues that make the money matters matter.
10
00:00:22,500 --> 00:00:25,720
Here he is, your fulfillment facilitator, your partner
11
00:00:25,720 --> 00:00:28,880
in prosperity, advising clients on Cape Cod and
12
00:00:28,880 --> 00:00:29,940
across the country.
13
00:00:30,280 --> 00:00:32,740
Here's your host, Jay Christopher Boyd.
14
00:00:33,420 --> 00:00:35,800
Welcome to the program, Something More with Chris
15
00:00:35,800 --> 00:00:36,140
Boyd.
16
00:00:36,180 --> 00:00:38,340
I'm Chris Boyd here with Jeff Perry and
17
00:00:38,340 --> 00:00:40,640
Russ Ball, part of our team here at
18
00:00:40,640 --> 00:00:43,520
the AMR team of Wealth Enhancement Group.
19
00:00:44,160 --> 00:00:46,340
And we're glad to have you listening and
20
00:00:46,340 --> 00:00:48,720
hope you'll join us each week as we
21
00:00:48,720 --> 00:00:51,500
discuss all kinds of things relevant to your
22
00:00:51,500 --> 00:00:55,620
personal finance, your financial planning and portfolio management.
23
00:00:56,300 --> 00:00:58,800
Today, got to talk about tariffs.
24
00:01:00,680 --> 00:01:05,080
Yesterday, the president had a Rose Garden press
25
00:01:05,080 --> 00:01:10,080
conference release of his long awaited tariff plan.
26
00:01:10,900 --> 00:01:11,620
Liberation Day.
27
00:01:11,960 --> 00:01:15,020
Liberation Day, as it was dubbed.
28
00:01:15,720 --> 00:01:18,560
And the idea of trying to look at
29
00:01:18,560 --> 00:01:22,320
where we're being tariffed on our imports and
30
00:01:22,320 --> 00:01:26,060
have an effort to get a more fair
31
00:01:26,060 --> 00:01:29,280
reflection, I think is the way they would
32
00:01:29,280 --> 00:01:30,520
certainly classify that.
33
00:01:30,740 --> 00:01:32,200
So we're going to talk about that and
34
00:01:32,200 --> 00:01:33,620
we're all going to have things to say
35
00:01:33,620 --> 00:01:34,000
about it.
36
00:01:34,380 --> 00:01:38,660
Tariffs have the virtue of trying to level
37
00:01:38,660 --> 00:01:44,580
the playing field for the domestic country's companies.
38
00:01:46,640 --> 00:01:46,740
Yeah.
39
00:01:46,900 --> 00:01:49,760
But at the same time, it is something
40
00:01:49,760 --> 00:01:53,380
that is levied against the consumer or the
41
00:01:53,380 --> 00:01:58,120
buyer of goods, whether it's the manufacturer buying,
42
00:01:58,400 --> 00:02:02,360
importing supplies for the product they look to
43
00:02:02,360 --> 00:02:05,120
make or finished goods that come into the
44
00:02:05,120 --> 00:02:07,479
United States, the consumer would be paying that
45
00:02:07,479 --> 00:02:10,020
tax, the tariff.
46
00:02:11,840 --> 00:02:12,340
Indirectly.
47
00:02:13,340 --> 00:02:14,100
Directly, right?
48
00:02:14,260 --> 00:02:18,280
I mean, it's charged to the company, the
49
00:02:18,280 --> 00:02:20,660
importer, but someone's got to pay that and
50
00:02:20,660 --> 00:02:21,800
it's going to end up going to the
51
00:02:21,800 --> 00:02:22,620
consumer.
52
00:02:23,280 --> 00:02:24,140
Indirectly, I suppose.
53
00:02:24,620 --> 00:02:25,320
But it's ultimately...
54
00:02:25,940 --> 00:02:28,920
Well, the manufacturer could reduce the price to
55
00:02:28,920 --> 00:02:29,680
be more competitive.
56
00:02:30,200 --> 00:02:32,960
The retailer could reduce the price to be
57
00:02:32,960 --> 00:02:33,860
more competitive.
58
00:02:35,120 --> 00:02:37,200
But yeah, it's an increased cost of the
59
00:02:37,200 --> 00:02:37,560
product.
60
00:02:37,760 --> 00:02:40,200
How much gets passed along to the consumer?
61
00:02:41,200 --> 00:02:41,300
Most.
62
00:02:41,660 --> 00:02:42,520
Most, usually.
63
00:02:42,860 --> 00:02:44,940
But that's why I use the word indirect.
64
00:02:46,540 --> 00:02:51,140
So ultimately, an increase in the tax that
65
00:02:51,140 --> 00:02:55,080
is essentially going to, in that effort to
66
00:02:55,080 --> 00:02:58,040
try to make a domestic product more competitive.
67
00:02:59,040 --> 00:03:01,580
Historically, I think that's been the view that
68
00:03:01,580 --> 00:03:03,700
this is not an ideal way to do
69
00:03:03,700 --> 00:03:07,440
things because it doesn't always make the domestic
70
00:03:07,440 --> 00:03:09,540
product better or more competitive.
71
00:03:10,020 --> 00:03:13,820
That being said, there are inequities, government subsidies
72
00:03:13,820 --> 00:03:15,220
in other countries.
73
00:03:15,540 --> 00:03:17,800
There's all kinds of considerations that go into
74
00:03:17,800 --> 00:03:18,040
this.
75
00:03:18,600 --> 00:03:22,720
We certainly have a deficit each year on
76
00:03:22,720 --> 00:03:23,200
our budget.
77
00:03:23,400 --> 00:03:26,660
I get the clear impression that the president
78
00:03:26,660 --> 00:03:28,340
thinks this is part of the answer.
79
00:03:29,120 --> 00:03:33,940
Managing that annual deficit by having more come
80
00:03:33,940 --> 00:03:36,580
into the government by way of these tariffs.
81
00:03:37,400 --> 00:03:41,040
Additionally, I think there's a sense of fairness
82
00:03:41,040 --> 00:03:44,740
that this administration is pointing to saying, hey,
83
00:03:44,800 --> 00:03:45,560
look at all these.
84
00:03:46,100 --> 00:03:49,560
There's a great chart that they shared yesterday
85
00:03:49,560 --> 00:03:56,380
that really depicts the discrepancy and the inequity
86
00:03:56,380 --> 00:04:00,980
of tariff treatments on goods going into other
87
00:04:00,980 --> 00:04:04,420
countries from what we're charging from those countries.
88
00:04:05,580 --> 00:04:08,240
I think some of that has been historically,
89
00:04:08,240 --> 00:04:11,720
in part, for some of these smaller economies
90
00:04:11,720 --> 00:04:15,120
that we're willing to give them more flexibility
91
00:04:15,120 --> 00:04:18,700
in their development of their economy.
92
00:04:19,160 --> 00:04:20,940
That's what's under review.
93
00:04:21,160 --> 00:04:22,280
That's going to change.
94
00:04:23,120 --> 00:04:26,080
It sounds like there's been some multiple aspects
95
00:04:26,080 --> 00:04:26,720
of this.
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I heard former Secretary Gutierrez on one of
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the financial shows yesterday broke it down in
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some good ways.
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He talked about the 10% tariff base
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as something that's probably just always expected to
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stay.
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He put China in its own category.
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Let's talk about that separately.
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I think that is probably- I think
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that's right.
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I forget all of the things he said,
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but largely the rest of it sounded like,
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well, and then there's things that are negotiable
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that if countries are working with the administration,
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there may be more flexibility on how much
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of this tariff will apply.
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I don't know.
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I think there's a lot of questions about
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industry carve-outs and all this.
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Unfortunately, that is harder policy becomes a little
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less predictable and a little bit more of
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an unknown for planning.
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But that's what this ultimately comes down to
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for, I think, the economic and market considerations.
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Just as an aside, while we're recording this
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show, it is April 3rd, the day after
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the president's comments and markets are down today.
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Everyone's tariff concerns are on everyone's imagination of
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what does this mean?
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How's it going to play out?
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What's the good?
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What's the bad?
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It's the uncertainty word again, popping up.
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I think the challenge of this becomes for
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corporations to know, they don't just suddenly start
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building plants and it's productive next week.
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It's, do I want to invest?
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How many years will this take?
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How much benefit?
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How long will it take to recover that
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cost?
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This is something that takes time to measure,
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evaluate, and derive consequential change.
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Jeff, I can tell you have some things
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to say.
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Go for it.
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There's so much to say.
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I think the most enlightening part of yesterday's
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speech were these charts.
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They're all over the news right now about
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how much a given country charges us and
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how much we charge them now and before.
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You look for patterns.
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I always look for patterns, try to get
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the rationale.
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There aren't any.
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Europe, European Union, obviously a developed area, a
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developed continent.
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Australia, a developed continent.
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The amount of tariffs that they charge us
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aren't the same.
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They're not even close to the same.
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Australia does 10%.
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European, it's much higher.
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Then you mentioned third world developing countries.
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You and I spoke offline this morning about
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Vietnam.
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Vietnam charges, I think, 90 some odd percent
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tariff.
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We talked about, well, that's because they need
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the revenue.
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We understand they were developing.
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Since COVID, a lot has happened to Vietnam
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with on-shoring in Vietnam, a lot of
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manufacturing.
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Still, that tariff sticks, even though they have
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their own economic development and economic progress.
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Seeing these numbers of around the world and
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what they charge us, I was aware of
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the ones that make the news most of
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the time, China, and certainly a lot in
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the news lately about Canada and Mexico.
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But seeing how the United States is treated
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in trade across the world, I can understand
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the president's motivations of wanting to reset that
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and make it a more level playing field
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for our companies, our US companies who manufacture
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things.
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Obviously, the drive to want to bring manufacturing
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back, I think, is valid.
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We saw that even under the Biden administration
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with the CHIPS Act.
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There's a recognition for our economic security and
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our military security and our everything security that
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some things need to be made, at least
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in part, in the United States.
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CHIPS, in that case, I think one of
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the big news items this morning, which I
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didn't realize, I feel like I'm less educated
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than I maybe thought I was, but that
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most of our pharmaceuticals are actually manufactured overseas.
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I guess I hadn't seen that before.
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There's merit in that, too.
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I think the shock to the system, the
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uncertainty is, one, how we have been treated
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by other countries, and two, is doing it
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all at once rather than trying to do
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it piecemeal with one-on-one private talks
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and try to renegotiate things is causing this
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uncertainty in the market.
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I think the goal is a laudable, whether
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or not it's a prudent decision to do
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it all at once with a heavy hand
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and throw this uncertainty into the business climate,
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and the financial markets will be told over
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the weeks and months and perhaps years to
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come.
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I think some of the concern that markets
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have relates to this big change, and then,
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of course, the question of how much this
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is permanent policy, how much is positioning for
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negotiations, which I think prior to this week,
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markets largely had discounted the tariff reality on
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the basis that they thought there'd be some
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haggling, this is part of a broader negotiation
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or something.
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That still may be the case in terms
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of positioning.
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Well, we have until April 9th for a
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lot of these tariffs.
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Yeah.
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If they wanted to do it right away,
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why not do it right away?
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I feel like having a buffer before those
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tariffs kick in could be an invitation to...
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Even this morning, the Commerce Secretary was on
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CNBC on Bloomberg saying, our phone lines are
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open.
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Call us now.
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Number nine caller, you're on.
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Call us before April 9th.
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Right, right.
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Before April 10th to April 9th.
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And then I saw a post from Eric
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Trump saying, I wouldn't want to be one
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of the last people that call...
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One of the last countries that call Donald
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Trump, I guess, or implying that they're expecting
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deals to be made and who knows what
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will actually happen.
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But I did find it interesting that they
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were pushing out the start date for these.
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It could have just been, all right, we're
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announcing them and they're going into effect today
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or tomorrow, but that remains to be seen.
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So I think the concern that investors have
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is the question of, okay, will this create
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a higher inflationary environment?
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Will this drive prices higher still?
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People have been concerned about inflation as an
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issue.
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I've seen some semantics discussion around, well, is
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it really inflation if it's one time?
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That's an increased cost, but it's not necessarily
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a higher rate of inflation.
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President used the word in his press conference
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yesterday that it was kind of a discredited
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word in inflation, but transitory.
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Yeah.
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And I think there's an argument to be
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made for that, that it's not necessarily expected
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to be ever increasing at a higher rate,
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but that is the assumption of, will there
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be reciprocal retaliatory response or will people respond
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in such a way as to reduce their
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tariff on US?
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That's an unknown at this point.
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And I think that's one of the things
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that drives anxiety in the market.
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But if there is inflation, how does that
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become addressed?
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Similarly, we've already seen concerns about employment as
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it relates to what's happening in Washington DC
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with the Doge efforts to trim, we'll say
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in nice terms, to trim government and try
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to scale back some of the costs of
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government.
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That has also some ripple effect in terms
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of grants for research that has ripple effect
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on nonprofits, how they get funded, some of
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these that work with government agencies and so
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on, that there's likely to be some escalation
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of unemployment from that.
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But then if people have, consumer sentiment, I
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think, has gotten a little bit skittish, does
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that translate to spending?
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If costs are higher, do I have less
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money to spend?
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Does that turn into an economic drag?
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Do we worry about recession?
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These are all things that you hear this
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evolution of thinking.
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And if there is a recession, what does
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the Fed do?
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Does it reduce interest rates to stimulate or
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does it raise interest rates to try to
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reduce the inflationary effects of tariff impact?
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Seems like the consensus is more leans towards
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stimulus, but that's one of these unknowns, right?
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And how does that lead an investor to
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position themselves in expectations of what will happen?
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And we don't have a similar model here
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to look back at history with all the
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changes that are being made at the same
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time in the reset of the federal bureaucracy.
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The anxiety that people have is, what was
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it, Smoot-Hawley?
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Hawley-Smoot, what's the right name for that
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tariff?
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We can refer to Ferris Buehler again.
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We could.
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We could have that prepared.
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We're only 16 minutes in before the first
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mention of Ferris Buehler.
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Yeah.
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Well, in any case, anyone, Buehler, that lecture,
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he was talking about tariffs and the idea
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that it was at the outset of the
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Great Depression.
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It was not a standalone issue, I grant
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you, which I think is where some of
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the thought is, but it was one of
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the things that led to an economic slowdown.
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I don't think that's in question.
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You don't think the imposition of the income
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tax was a greater influence in the survival?
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What year did that happen, Jeff?
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Well, it didn't create the Great Depression, but
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- It happened in the 1900, 1919 or
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something like that, 1912, the income tax.
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The tariffs were closer to the 1920s, and
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that's the period closer to the...
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Am I wrong?
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You might be- I don't have my
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historical calendar in front of me here.
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Yeah, me neither.
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But- That was my earlier point.
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We don't have a modern reference to a
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change in the way tariffs have been handled
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all at once.
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Either the imposition of the United States at
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one point where the federal government was relying
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on them, this is the date we're struggling
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with, and then the change to an income
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tax.
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We don't have a modern period of time
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or change of policy that's in this modern
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economy for us to really review and say,
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well, in 2008, during that financial crisis, this
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is what happened, or during the pandemic of
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2020, this is what happened.
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Other people are going back to 100 years
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ago to say, well, what caused what?
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00:17:23,839 --> 00:17:25,819
And that's not really the...
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You can't make that analysis.
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So much is different in our economy.
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The lesson of that, Smoot-Hawley, was that
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tariffs went up significantly, it slowed the economy,
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and that was one of several things that
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led into the Great Depression.
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And I looked it up, it was 1930
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for that act.
368
00:17:50,220 --> 00:17:53,220
We'll look up when the income tax started
369
00:17:53,220 --> 00:17:55,060
as well, so we have that if we
370
00:17:55,060 --> 00:17:55,500
want to.
371
00:17:55,920 --> 00:17:59,820
But anyways, I think probably the bigger question
372
00:17:59,820 --> 00:18:02,760
for everybody is, I mean, I've heard people
373
00:18:02,760 --> 00:18:04,620
concerned like, oh, this is going to lead
374
00:18:04,620 --> 00:18:08,160
to product shortages and things of that sort
375
00:18:08,160 --> 00:18:11,420
if this really were to escalate as a,
376
00:18:11,800 --> 00:18:13,560
I hate to use the word trade war,
377
00:18:13,700 --> 00:18:17,340
but if it escalates in its trade challenges.
378
00:18:17,620 --> 00:18:18,240
We'll see, right?
379
00:18:18,600 --> 00:18:20,940
I think the bigger issue is how should
380
00:18:20,940 --> 00:18:25,720
a consumer, an investor think about their portfolio?
381
00:18:26,760 --> 00:18:28,600
What are the things they should do?
382
00:18:29,480 --> 00:18:32,020
I mean, I think just fundamentally, all of
383
00:18:32,020 --> 00:18:35,560
this, what we're talking about, markets back to
384
00:18:35,560 --> 00:18:37,340
this idea that there's going to be uncertainty.
385
00:18:38,020 --> 00:18:40,180
And that's just a matter of fact right
386
00:18:40,180 --> 00:18:40,440
now.
387
00:18:40,720 --> 00:18:43,220
There hasn't been, we haven't increased tariffs as
388
00:18:43,220 --> 00:18:45,500
much since the 1930s as we've just talked
389
00:18:45,500 --> 00:18:45,740
about.
390
00:18:45,880 --> 00:18:47,660
So there's just a lot of unknowns.
391
00:18:47,880 --> 00:18:50,760
So with unknowns in the market come volatility.
392
00:18:51,340 --> 00:18:54,180
So I think that's, I see that again
393
00:18:54,180 --> 00:18:57,920
and again, but just an expectation of volatility
394
00:18:57,920 --> 00:19:01,580
in the mid to near term, I think
395
00:19:01,580 --> 00:19:03,480
is probably a fair bet.
396
00:19:04,520 --> 00:19:04,620
Yeah.
397
00:19:04,660 --> 00:19:06,080
I think that that's a great start.
398
00:19:06,260 --> 00:19:08,440
Look, expect volatility.
399
00:19:08,640 --> 00:19:10,320
We're in this period of uncertainty.
400
00:19:10,620 --> 00:19:14,040
There's how the economic impact will play out,
401
00:19:14,200 --> 00:19:17,020
how the market, we're just, as we're talking
402
00:19:17,020 --> 00:19:19,180
about just amongst us, what's this mean for
403
00:19:19,180 --> 00:19:19,560
revenue?
404
00:19:19,760 --> 00:19:20,980
Well, who's going to absorb what?
405
00:19:21,160 --> 00:19:22,740
How's the consumer going to react?
406
00:19:23,260 --> 00:19:25,720
How's this going to affect spending and what's
407
00:19:25,720 --> 00:19:27,480
going to happen with prices?
408
00:19:27,800 --> 00:19:32,500
What countries will respond what way versus another?
409
00:19:33,140 --> 00:19:35,160
There's all this that remains yet to be
410
00:19:35,160 --> 00:19:36,020
determined, right?
411
00:19:36,120 --> 00:19:41,480
So in the near term, there's increased volatility
412
00:19:41,480 --> 00:19:43,920
and that's likely to be the case as
413
00:19:43,920 --> 00:19:46,560
we have until this shakes out, until there's
414
00:19:46,560 --> 00:19:48,140
a little more clarity around it.
415
00:19:48,760 --> 00:19:54,120
Now, markets historically, we know that it's not
416
00:19:54,120 --> 00:19:57,660
uncommon at all for markets to go down
417
00:19:59,100 --> 00:20:02,300
10%, 20% from their highs.
418
00:20:03,080 --> 00:20:05,020
This is normal market behavior.
419
00:20:06,460 --> 00:20:07,880
We are looking at, we looked at the
420
00:20:07,880 --> 00:20:08,780
S&P 500.
421
00:20:08,780 --> 00:20:10,860
We're a little lower than 10% off
422
00:20:10,860 --> 00:20:13,760
the highs, which were in mid-February.
423
00:20:13,900 --> 00:20:16,080
We're somewhere around 11% or 12%
424
00:20:16,080 --> 00:20:16,840
off that.
425
00:20:17,540 --> 00:20:19,620
But your date, that's not where we are
426
00:20:19,620 --> 00:20:21,620
because we went up before we went down.
427
00:20:22,700 --> 00:20:25,860
Somewhere around 7% when we're recording this.
428
00:20:26,060 --> 00:20:27,700
It'll change by the time you listen.
429
00:20:28,080 --> 00:20:29,680
Who knows what it'll be.
430
00:20:30,100 --> 00:20:31,180
But you follow my point.
431
00:20:32,020 --> 00:20:34,460
This is normal to start with.
432
00:20:34,520 --> 00:20:37,480
This is normal behavior, range of movement, not
433
00:20:37,480 --> 00:20:40,360
in itself something to get overly anxious about.
434
00:20:41,120 --> 00:20:44,860
That being said, as investors, we think about
435
00:20:44,860 --> 00:20:45,500
the what-ifs.
436
00:20:46,080 --> 00:20:48,000
How might this impact things?
437
00:20:49,060 --> 00:20:53,900
Stocks move over time by expectations of earnings
438
00:20:53,900 --> 00:20:56,480
over a prolonged period of time.
439
00:20:56,860 --> 00:21:00,520
It's a current willingness to pay for future
440
00:21:00,520 --> 00:21:01,040
earnings.
441
00:21:03,200 --> 00:21:06,260
This naturally comes into how do we envision
442
00:21:06,260 --> 00:21:11,060
the change in valuation if there is some?
443
00:21:12,560 --> 00:21:14,920
We don't know the answer to that yet.
444
00:21:15,440 --> 00:21:19,760
I think we have to be ready to
445
00:21:19,760 --> 00:21:23,320
tolerate volatility until we have better clarity around
446
00:21:23,320 --> 00:21:26,140
that and be willing to decide what action
447
00:21:26,140 --> 00:21:26,860
comes out of that.
448
00:21:27,620 --> 00:21:31,840
We've been talking about other considerations for a
449
00:21:31,840 --> 00:21:32,240
while.
450
00:21:32,760 --> 00:21:34,660
The start of the year, we talked about
451
00:21:34,660 --> 00:21:36,020
extended valuations.
452
00:21:37,280 --> 00:21:39,280
That was a good reason to scale back
453
00:21:39,280 --> 00:21:40,900
on your equity allocation.
454
00:21:42,820 --> 00:21:47,660
We've, in our strategies, made adjustments previously in
455
00:21:47,660 --> 00:21:48,320
anticipation.
456
00:21:49,420 --> 00:21:53,260
There are times we make changes responsibly to
457
00:21:53,260 --> 00:21:54,320
what's going on.
458
00:21:54,860 --> 00:21:58,620
So as an investor, I think that's reasonable
459
00:21:58,620 --> 00:22:00,320
as long as it's measured.
460
00:22:00,760 --> 00:22:02,800
We want to think about what's my tolerance
461
00:22:02,800 --> 00:22:03,700
as an investor?
462
00:22:04,160 --> 00:22:06,160
What's my willingness to endure volatility?
463
00:22:06,880 --> 00:22:09,380
What's the expectation for performance I have?
464
00:22:09,720 --> 00:22:12,080
And design the portfolio around that.
465
00:22:12,300 --> 00:22:16,160
Now, sometimes we say, I still feel like
466
00:22:16,160 --> 00:22:18,260
I'm a conservative investor, and I want to
467
00:22:18,260 --> 00:22:20,400
be invested in keeping with that or a
468
00:22:20,400 --> 00:22:22,320
moderate investor or whatever it might be.
469
00:22:22,320 --> 00:22:24,680
I want to remain in keeping with that.
470
00:22:25,040 --> 00:22:27,680
But gosh, I sense that maybe I'm not
471
00:22:27,680 --> 00:22:29,760
positioned in the best place right now.
472
00:22:30,220 --> 00:22:31,220
I want to have a little more of
473
00:22:31,220 --> 00:22:32,740
this and a little less of that.
474
00:22:33,440 --> 00:22:35,800
That's a reasonable adjustment, right?
475
00:22:36,640 --> 00:22:38,520
Or maybe you'd say, I want to have
476
00:22:38,520 --> 00:22:42,560
a little more cash for the unexpected.
477
00:22:42,920 --> 00:22:45,180
Oh, this seems like this could create some
478
00:22:45,180 --> 00:22:49,680
disruptions in availability of goods or something.
479
00:22:49,680 --> 00:22:51,200
Oh, well, maybe it's a good idea to
480
00:22:51,200 --> 00:22:52,700
have some reserve.
481
00:22:53,320 --> 00:22:55,880
We talk about that always with clients about
482
00:22:55,880 --> 00:22:58,240
having some liquidity reserve.
483
00:22:59,660 --> 00:23:01,280
But these are the times when you say,
484
00:23:01,380 --> 00:23:02,480
oh, this may be one of those reasons
485
00:23:02,480 --> 00:23:03,620
why, right?
486
00:23:04,700 --> 00:23:08,200
So one, is it too late to think
487
00:23:08,200 --> 00:23:10,040
about any kind of an adjustment in your
488
00:23:10,040 --> 00:23:10,600
portfolio?
489
00:23:11,260 --> 00:23:12,540
I would argue no.
490
00:23:12,660 --> 00:23:15,100
If you said, gee, I think I've been
491
00:23:15,100 --> 00:23:16,160
taking too much risk.
492
00:23:16,220 --> 00:23:18,460
I've had a great return, but maybe I'd
493
00:23:18,460 --> 00:23:19,640
like to scale it back.
494
00:23:20,380 --> 00:23:21,960
But is it too late because the market
495
00:23:21,960 --> 00:23:23,100
started to decline?
496
00:23:23,660 --> 00:23:25,420
When you think about the fact that you're
497
00:23:25,420 --> 00:23:27,420
in an asset allocation, even if the market's
498
00:23:27,420 --> 00:23:30,120
down 6%, 7% at a given point
499
00:23:30,120 --> 00:23:33,540
in time, that's not from the year to
500
00:23:33,540 --> 00:23:36,580
date, 10 or whatever from the high.
501
00:23:37,500 --> 00:23:39,540
That's not outrageous when you think about, we
502
00:23:39,540 --> 00:23:42,580
just went up like 45% in two
503
00:23:42,580 --> 00:23:44,240
years or whatever it is.
504
00:23:44,940 --> 00:23:48,840
So sure, maybe give up a little bit.
505
00:23:49,300 --> 00:23:50,840
But if you need to scale back the
506
00:23:50,840 --> 00:23:54,300
risk, it's not unreasonable to do that today.
507
00:23:54,400 --> 00:23:55,660
It's starting to get to the point where
508
00:23:55,660 --> 00:23:57,260
you might be better off to not think.
509
00:23:57,800 --> 00:24:00,120
It might be better off to wait to
510
00:24:00,120 --> 00:24:02,100
get to the other side because we don't
511
00:24:02,100 --> 00:24:03,540
know how long this will take and all
512
00:24:03,540 --> 00:24:03,720
that.
513
00:24:04,040 --> 00:24:07,680
But I would still say incremental adjustments is
514
00:24:07,680 --> 00:24:08,460
not unreasonable.
515
00:24:10,120 --> 00:24:13,660
But what we don't want to do is
516
00:24:13,660 --> 00:24:17,960
sell low and buy high.
517
00:24:18,140 --> 00:24:19,440
We don't want to be in a position
518
00:24:19,440 --> 00:24:23,120
where we've behaviorally done the wrong thing.
519
00:24:23,820 --> 00:24:26,020
So if we're talking about something measured in
520
00:24:26,020 --> 00:24:29,040
incremental, that can have merit.
521
00:24:29,280 --> 00:24:31,260
But let's not overreact.
522
00:24:31,380 --> 00:24:32,720
Let's not sell everything.
523
00:24:32,720 --> 00:24:34,540
Let's not run for the hills.
524
00:24:35,900 --> 00:24:40,160
Again, we're talking in generalities, your specifics, talk
525
00:24:40,160 --> 00:24:40,980
to your advisor.
526
00:24:41,360 --> 00:24:43,420
If you don't have an advisor, call us.
527
00:24:43,500 --> 00:24:45,200
We'll be happy to talk to you, see
528
00:24:45,200 --> 00:24:47,400
what your circumstances are, see how it fits
529
00:24:47,400 --> 00:24:49,720
into your financial plan, how it all fits
530
00:24:49,720 --> 00:24:50,140
together.
531
00:24:50,500 --> 00:24:51,600
Very well said, Chris.
532
00:24:51,840 --> 00:24:54,920
Asset allocation is a really, as we talk
533
00:24:54,920 --> 00:24:56,560
about all the time, such a key component
534
00:24:56,560 --> 00:24:58,160
to part of what we do.
535
00:24:58,360 --> 00:25:00,820
And what gets in our brains and what
536
00:25:00,820 --> 00:25:02,720
we think about is what's in front of
537
00:25:02,720 --> 00:25:04,660
us, in this case, tariffs and the news.
538
00:25:04,780 --> 00:25:06,180
And it can be very emotional.
539
00:25:07,220 --> 00:25:10,100
We haven't had many people calling about how
540
00:25:10,100 --> 00:25:12,100
well the bond market has been doing.
541
00:25:12,600 --> 00:25:13,160
Yeah, good point.
542
00:25:13,360 --> 00:25:13,460
Right.
543
00:25:13,640 --> 00:25:17,280
So having some diversity in your asset allocation
544
00:25:17,280 --> 00:25:21,640
for times like this can really add a
545
00:25:21,640 --> 00:25:21,980
benefit.
546
00:25:22,300 --> 00:25:27,360
And so if you're all in on stocks,
547
00:25:27,400 --> 00:25:28,960
this is a rough period of time for
548
00:25:28,960 --> 00:25:29,100
you.
549
00:25:29,280 --> 00:25:31,000
If you're all in on bonds, you've been
550
00:25:31,000 --> 00:25:34,180
having a good time for a few months
551
00:25:34,180 --> 00:25:34,440
now.
552
00:25:34,580 --> 00:25:36,620
But the answer is probably somewhere in the
553
00:25:36,620 --> 00:25:40,860
middle for most clients where adding a diversified
554
00:25:40,860 --> 00:25:43,340
portfolio can not only give you some peace
555
00:25:43,340 --> 00:25:45,000
of mind, but if you do need to
556
00:25:45,000 --> 00:25:46,920
withdraw some money, if you do have a
557
00:25:46,920 --> 00:25:49,200
liquidity need beyond what you have in reserve,
558
00:25:49,860 --> 00:25:53,900
you have the option of taking from maybe
559
00:25:53,900 --> 00:25:56,720
parts of your portfolio that have not suffered
560
00:25:56,720 --> 00:26:00,340
any downfall, if you will, from tariffs in
561
00:26:00,340 --> 00:26:00,820
this case.
562
00:26:01,100 --> 00:26:03,560
And I think your point is a good
563
00:26:03,560 --> 00:26:03,720
one.
564
00:26:03,880 --> 00:26:08,660
And I think oftentimes we dwell on things
565
00:26:08,660 --> 00:26:11,760
for good or for bad based on what
566
00:26:11,760 --> 00:26:12,560
we consume.
567
00:26:13,240 --> 00:26:18,580
So maybe turn off the TV, turn off
568
00:26:18,580 --> 00:26:21,580
the news, change the channel, get some multiple
569
00:26:21,580 --> 00:26:22,440
perspectives.
570
00:26:24,320 --> 00:26:29,320
So some people are talking about all the
571
00:26:29,320 --> 00:26:30,920
great opportunities this might generate.
572
00:26:31,140 --> 00:26:33,480
And that might be something you get more
573
00:26:33,480 --> 00:26:35,380
enthusiastic around.
574
00:26:35,480 --> 00:26:37,240
Other people might be focusing on some of
575
00:26:37,240 --> 00:26:37,760
the risks.
576
00:26:38,620 --> 00:26:41,160
When markets go down, we hear more of
577
00:26:41,160 --> 00:26:42,940
the risks that people are anxious about.
578
00:26:43,080 --> 00:26:45,520
So that's maybe why I'm speaking more to
579
00:26:45,520 --> 00:26:46,140
that, I think.
580
00:26:47,660 --> 00:26:50,640
But there's two sides to every coin, I
581
00:26:50,640 --> 00:26:50,880
guess.
582
00:26:51,120 --> 00:26:54,220
And including in this tariff debate, there are
583
00:26:54,220 --> 00:26:56,180
U.S. companies right now that are thrilled
584
00:26:56,180 --> 00:26:58,680
about what President Trump is doing.
585
00:26:58,880 --> 00:27:00,800
And there's going to be additional investments and
586
00:27:00,800 --> 00:27:05,540
employment because of what the tariff policy means
587
00:27:05,540 --> 00:27:07,200
to those individual companies.
588
00:27:07,540 --> 00:27:09,800
So I think the market movement is more
589
00:27:09,800 --> 00:27:13,180
about, as Russ said earlier, about volatility and
590
00:27:13,180 --> 00:27:16,360
uncertainty than it is about earnings.
591
00:27:18,120 --> 00:27:20,960
We're too early in this discussion to really
592
00:27:20,960 --> 00:27:23,700
understand what these tariffs are going to do
593
00:27:23,700 --> 00:27:24,940
to the S&P 500.
594
00:27:25,660 --> 00:27:26,660
You have to really look at it.
595
00:27:26,700 --> 00:27:28,700
If Brian was on, he'd be talking about
596
00:27:28,700 --> 00:27:30,620
this, our senior portfolio manager.
597
00:27:30,780 --> 00:27:32,200
You have to look at this company by
598
00:27:32,200 --> 00:27:34,540
company, industry by industry.
599
00:27:34,980 --> 00:27:37,740
And some of them will definitely benefit from
600
00:27:37,740 --> 00:27:40,820
having a more isolationist point of view of
601
00:27:40,820 --> 00:27:46,820
bringing manufacturing back or making trade more fairer.
602
00:27:47,260 --> 00:27:47,880
Yeah.
603
00:27:48,160 --> 00:27:52,560
And there are companies that are less impacted
604
00:27:52,560 --> 00:27:57,540
by the type of issues that tariffs create.
605
00:27:57,560 --> 00:28:04,400
They're not necessarily importing product or service in
606
00:28:04,400 --> 00:28:08,980
the creation of their services or their own
607
00:28:08,980 --> 00:28:09,500
products.
608
00:28:11,480 --> 00:28:14,360
I'm thinking in terms of companies that are
609
00:28:14,360 --> 00:28:18,660
more like this area of technology in some
610
00:28:18,660 --> 00:28:19,040
spaces.
611
00:28:19,500 --> 00:28:22,520
Some have lots of production that's done overseas,
612
00:28:22,700 --> 00:28:25,200
but some are doing different kind of content
613
00:28:25,200 --> 00:28:32,300
that doesn't necessarily require that tariff consequence.
614
00:28:32,300 --> 00:28:34,960
And so will that create opportunity?
615
00:28:35,220 --> 00:28:41,040
Will that create maybe some buying?
616
00:28:42,100 --> 00:28:43,240
I think it will.
617
00:28:43,660 --> 00:28:44,260
I think it will.
618
00:28:44,360 --> 00:28:46,080
And maybe some markets will open up to
619
00:28:46,080 --> 00:28:50,060
U.S. companies that were previously limited by
620
00:28:50,060 --> 00:28:51,740
super high tariffs in this.
621
00:28:52,120 --> 00:28:54,320
Hopefully, what we have is a negotiation and
622
00:28:54,320 --> 00:28:58,220
there's calmer minds than the news people.
623
00:28:58,440 --> 00:29:00,960
There's calmer individuals in the state department and
624
00:29:00,960 --> 00:29:02,820
so forth, commerce department who are going to
625
00:29:02,820 --> 00:29:04,440
make better deals for America.
626
00:29:06,020 --> 00:29:09,040
So what's the opportunity for the individual?
627
00:29:09,380 --> 00:29:11,400
I was thinking, what should we be thinking
628
00:29:11,400 --> 00:29:12,480
about as investors?
629
00:29:12,960 --> 00:29:16,120
One is make sure your allocation is positioned
630
00:29:16,120 --> 00:29:16,440
well.
631
00:29:16,560 --> 00:29:18,840
Number two, make sure you have the liquidity
632
00:29:18,840 --> 00:29:21,720
reserves that is a good...
633
00:29:21,720 --> 00:29:23,460
And again, we can offer guidance.
634
00:29:23,600 --> 00:29:25,780
Your advisor can offer guidance as to how
635
00:29:25,780 --> 00:29:28,180
to think about either one of those subjects.
636
00:29:28,820 --> 00:29:31,900
And then maybe opportunistically, there may be investment
637
00:29:31,900 --> 00:29:35,380
opportunities, but there may be tax planning opportunities.
638
00:29:35,800 --> 00:29:41,020
Maybe there's some capital loss harvesting to take
639
00:29:41,020 --> 00:29:43,040
advantage of, be able to sell something that's
640
00:29:43,040 --> 00:29:44,760
been at a game that you couldn't really
641
00:29:44,760 --> 00:29:47,540
right size without a big tax burden.
642
00:29:47,700 --> 00:29:49,200
Maybe now you can with a little bit
643
00:29:49,200 --> 00:29:50,480
of offsetting.
644
00:29:50,740 --> 00:29:56,040
Maybe there's some Roth conversion opportunities that you
645
00:29:56,040 --> 00:29:57,160
might want to think about.
646
00:29:57,760 --> 00:29:59,720
There can be a variety of things.
647
00:29:59,720 --> 00:30:01,420
You look like you had something in mind
648
00:30:01,420 --> 00:30:03,820
you were going to add in Russ as
649
00:30:03,820 --> 00:30:04,500
opportunities.
650
00:30:04,820 --> 00:30:08,240
No, I mean, I guess as I'm looking
651
00:30:08,240 --> 00:30:11,320
at my Roth IRA and thinking, wow, this
652
00:30:11,320 --> 00:30:12,260
is great.
653
00:30:12,500 --> 00:30:12,980
I haven't seen...
654
00:30:13,620 --> 00:30:16,260
Time to make an annual contribution, right?
655
00:30:16,380 --> 00:30:17,160
Right, exactly.
656
00:30:17,940 --> 00:30:20,140
So it's all, I think it depends on
657
00:30:20,140 --> 00:30:23,620
where you're at in life, but big picture,
658
00:30:23,860 --> 00:30:25,700
it's so easy to get caught in that.
659
00:30:25,740 --> 00:30:27,380
We've talked about it before in this day
660
00:30:27,380 --> 00:30:28,960
-to-day mindset, like, oh my gosh, what's
661
00:30:28,960 --> 00:30:29,540
going on today?
662
00:30:29,640 --> 00:30:31,260
Do we sell out?
663
00:30:31,320 --> 00:30:32,060
Do we go to cash?
664
00:30:33,420 --> 00:30:35,060
But when you take a big picture view,
665
00:30:36,200 --> 00:30:38,100
it could be a good time to buy
666
00:30:38,100 --> 00:30:40,840
at lower prices than it has been recently.
667
00:30:41,240 --> 00:30:44,160
So not saying that that's a general recommendation
668
00:30:44,160 --> 00:30:46,920
for everyone, but when I'm looking at my
669
00:30:46,920 --> 00:30:48,460
Roth IRA, I'm like, wow, this is a
670
00:30:48,460 --> 00:30:50,740
great chance to put some cash in.
671
00:30:51,540 --> 00:30:53,620
So we encourage you to think that way.
672
00:30:53,960 --> 00:30:57,280
And if you have concerns as you think
673
00:30:57,280 --> 00:31:01,160
about your portfolio, might be time for a
674
00:31:01,160 --> 00:31:04,720
portfolio review, get a real fresh set of
675
00:31:04,720 --> 00:31:06,300
eyes on what's happening.
676
00:31:06,980 --> 00:31:10,080
How should I be positioned given what's happening
677
00:31:10,080 --> 00:31:11,500
in the world around us today?
678
00:31:12,740 --> 00:31:14,140
Where do I have risks?
679
00:31:14,200 --> 00:31:15,200
Where do I have opportunities?
680
00:31:15,440 --> 00:31:17,180
What are some things I might want to
681
00:31:17,180 --> 00:31:17,620
adjust?
682
00:31:17,900 --> 00:31:21,240
Am I overstated in some space or not?
683
00:31:22,440 --> 00:31:24,460
These are things that we help people with.
684
00:31:24,600 --> 00:31:26,120
We often like to do it though, in
685
00:31:26,120 --> 00:31:28,780
the context of a financial plan so that
686
00:31:28,780 --> 00:31:30,920
we see, how does this forecast over time?
687
00:31:31,040 --> 00:31:32,860
That's something we've been talking about with clients
688
00:31:32,860 --> 00:31:36,700
a lot lately is, yeah, what if the
689
00:31:36,700 --> 00:31:38,620
market goes down from here?
690
00:31:39,320 --> 00:31:42,080
How does that affect stress test your plan?
691
00:31:42,400 --> 00:31:43,620
What happens then?
692
00:31:44,040 --> 00:31:47,280
And then oftentimes people are like, oh, that's
693
00:31:47,280 --> 00:31:48,240
great to know.
694
00:31:48,660 --> 00:31:50,480
You know, that does put it in perspective,
695
00:31:50,600 --> 00:31:50,860
right?
696
00:31:51,040 --> 00:31:54,180
And how that can, what should I expect?
697
00:31:54,260 --> 00:31:56,060
And is it really something that will be
698
00:31:56,060 --> 00:31:58,460
disruptive to my future?
699
00:31:58,880 --> 00:31:59,980
That kind of thing.
700
00:32:00,440 --> 00:32:02,320
So if you need help with any of
701
00:32:02,320 --> 00:32:04,000
those things, don't hesitate to reach out.
702
00:32:04,540 --> 00:32:08,520
We can be reached locally at 508-771
703
00:32:08,520 --> 00:32:13,580
-8900, toll-free 866-771-8901.
704
00:32:14,220 --> 00:32:15,480
And you can always send us an email
705
00:32:15,480 --> 00:32:19,360
with your questions about show content or to
706
00:32:19,360 --> 00:32:22,720
reach out to connect with you at amr
707
00:32:22,720 --> 00:32:26,500
-info at wealthenhancement.com.
708
00:32:27,080 --> 00:32:29,240
Hope you'll share this content with others.
709
00:32:29,740 --> 00:32:31,600
Give us a rating and a like, really
710
00:32:31,600 --> 00:32:33,660
helps others find the show.
711
00:32:34,260 --> 00:32:36,740
With that being said, thanks everybody.
712
00:32:36,960 --> 00:32:39,480
Until next time, keep striving for something more.
713
00:33:03,660 --> 00:33:07,680
Send us your questions to amr-info at
714
00:33:07,680 --> 00:33:09,260
wealthenhancement.com.
715
00:33:33,660 --> 00:33:36,180
or conduct their own due diligence before making
716
00:33:36,180 --> 00:33:37,240
any financial decisions.
