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Speaker 1: Bryant Bridge.

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Speaker 2: That would of course involve you taking financial advice from

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Speaker 2: Donald Trump. Now we're going to get some from Sam

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Speaker 2: Dickey Fisher Funds, who's been watching this all day. Sam,

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Speaker 2: good evening, good evening rite. No advice, but some perspective. Perhaps, Yeah,

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Speaker 2: I should tenper myself.

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Speaker 1: Sorry.

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Speaker 2: Now we've obviously been a undated by the newsflow. How

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Speaker 2: do you keep track of it all and decide what's

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Speaker 2: important what's not?

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Speaker 1: Yeah, whipsaw, you really do need frameworks and roadmaps. Otherwise

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Speaker 1: you are just drowning in headline bombs and you are

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Speaker 1: getting whip swords. So we think about three or four

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Speaker 1: broad framework so geopolitical, economic, equity, market and single stop frameworks.

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Speaker 1: So when we think about geopolitics, we keep it super

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Speaker 1: simple because we're not experts, but we bucket the players

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Speaker 1: into the retaliators. So that's Europe, Canada, Mexico, and then

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Speaker 1: the negotiators so importantly Japan and the Southeast Asia and

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Speaker 1: most other countries then of course China. So when you

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Speaker 1: think about the retaliators to the pores, I mean Europe,

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Speaker 1: it's probably a level playing field when it comes to

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Speaker 1: negotiating with the US, and I think Canada and Mexico

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Speaker 1: were critical crash test dummies, so the US dealt with

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Speaker 1: them in the week's leading up to Liberation Day, and positively,

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Speaker 1: there was no incremental or reciprocal tariffs on top of

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Speaker 1: the initial ones. I think the negotiators being led by

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Speaker 1: Japan is really reimportant in China. It's increasingly looking like

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Speaker 1: they will be the key focus of Trump's second term

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Speaker 1: like they were in his first. So clearly any movement

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Speaker 1: forwards or backwards with those three packets as key. On

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Speaker 1: the economic side, on growth, most economists think there'll be

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Speaker 1: a one percent hit the global growth. On inflation, we'll

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Speaker 1: see a second half spike of about one and a

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Speaker 1: half percent in US inflation. But critically, Ryan the market

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Speaker 1: is or was telling us about nine hours ago, that

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Speaker 1: the medium term growth drag from these crazy policies will

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Speaker 1: outweigh the short term inflation spike, and we know that

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Speaker 1: because the market had priced in another rate cut by

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Speaker 1: the Feed since Liberation Day. And then the final thing

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Speaker 1: on economics is the mitigant. So before we talk about

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Speaker 1: Trump's pain threshold, which we discovered overnight, the first mitigant

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Speaker 1: is easier monetary policy by the FED and the ECB

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Speaker 1: and the second one is easier fiscal policy. So in

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Speaker 1: the US we could get more tax cuts, we could

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Speaker 1: see doze backing off. And in Europe places like Germany

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Speaker 1: are ramping up infrastructure spending.

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Speaker 2: So where two from here, I think we're too from here?

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Speaker 2: What is the endgame?

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Speaker 1: Where does he blink? What's his pain threshold? So we

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Speaker 1: found that out last night, and I think he was

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Speaker 1: prepared to see more equity market paying And that's become

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Speaker 1: pretty clear. That's a sort of a self correcting mechanism.

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Speaker 1: It doesn't feed on itself, but the sort of self

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Speaker 1: reinforcing asset prices that do feed on themselves, like credit.

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Speaker 1: He did sort of score an own goal there. So

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Speaker 1: he saw spiking the spiking cost of corporate borrowing the US.

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Speaker 1: So that had been that's the spread you pay over

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Speaker 1: government bonds to borrow as a risky corporate and that

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Speaker 1: had been at sort of fifteen year lows a few

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Speaker 1: weeks ago, and as of sort of eighteen hours ago,

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Speaker 1: it had spiked to some of the worst level scenes

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Speaker 1: in twenty twenty two. So that has a direct transmission

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Speaker 1: mechanism to the average person on the street via borrowing rates.

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Speaker 1: And then we also saw him starting to lose control

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Speaker 1: of the government bond market about sort of sixteen hours ago,

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Speaker 1: and you saw sort of thirty year government bond yield spiking,

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Speaker 1: and that's quite scary. Some weere calling it his Liz

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Speaker 1: Trust moment. I think those two sort of self reinforcing

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Speaker 1: things caused them to pause. So the point here is,

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Speaker 1: I think if we see any further escalation in China

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Speaker 1: or him flip flopping on the pause with other countries,

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Speaker 1: that will be carefully checked against those the resultant moves

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Speaker 1: in the price of US credit, the price of US

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Speaker 1: government bond, and if they spike again, it seems you

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Speaker 1: will back down.

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Speaker 2: Is it hard? I mean, is this more difficult to

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Speaker 2: predict than covid Donald Trump's mind? Because you're not really

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Speaker 2: you know, you're not really. It doesn't behave in a

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Speaker 2: rational way. Not nor did a virus mind you, But

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Speaker 2: it doesn't behave in a rational way. I mean, I

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Speaker 2: suppose it has, as you say, blink today we've we've

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Speaker 2: figured out the pain threshold. But it's very it must

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Speaker 2: be very hard to get to have irrational thoughts on it.

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Speaker 1: Is I mean, it is sort of similar to COVID

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Speaker 1: in the early days, and we just didn't know how

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Speaker 1: serious this this virus was going to be and how

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Speaker 1: it was going to sort of morph from one virulent

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Speaker 1: strain to another. But it's quite apt, actually an apt

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Speaker 1: apt comparison, Ryan, But I think that that's I mean,

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Speaker 1: all these things are the same in the respect that

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Speaker 1: we don't know, and that's the point. They're hard to

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Speaker 1: precisely price or understand or even keep up with. That's

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Speaker 1: why if you don't want to drown on these headline bombs,

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Speaker 1: you have to have these sort of simple frameworks to

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Speaker 1: think about things. And the other thing is that you're

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Speaker 1: own portfolio, Ryan. You put it into four buckets. So

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Speaker 1: companies directly impacted by US tariffs, companies directly impacted by

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Speaker 1: retaliatory tariffs, and then how those companies are relatively positioned

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Speaker 1: within their sector, so that do they have a manufacturing advantage,

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Speaker 1: do they have pricing powers so they can pass on

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Speaker 1: any cost increases? And the final bucket is companies in

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Speaker 1: the way of a probable economic slowdown. So that's the

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Speaker 1: sort of four buckets you think about any investment you're making.

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Speaker 1: And as of twenty four hours ago, every bucket. So

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Speaker 1: the directly impacted, the indirectly impacted, and even the supposedly

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Speaker 1: not impacted hand be indiscriminately over sold. So that was

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Speaker 1: pretty good buying. But now we're in a more sort

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Speaker 1: of picky environment.

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Speaker 2: Yeah, so what do we do now? I mean, have

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Speaker 2: we missed our opportunity to make a bunch of money?

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Speaker 1: Look, when fear gets as elevated as it was sort

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Speaker 1: of again twenty four hours ago, you know, sentiment engages

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Speaker 1: a good barometer, and you know we were deeply in

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Speaker 1: fear to a dear territory. Some of the fair gauges

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Speaker 1: we track with the worse they've been in twenty five years.

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Speaker 1: I do think there's when there's blood on the streets,

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Speaker 1: there's opportunity around. That of course doesn't mean as a

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Speaker 1: long term investor that the opportunity's gone. It just means

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Speaker 1: you need to be a bit more picky. And I

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Speaker 1: do think, as always, companies with wide and widening economic

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Speaker 1: moats around their businesses, long growth runways run by high

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Speaker 1: quality people are a pretty good place to start.

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Speaker 2: Sam, Appreciate your time, Sam Dickey Fisher funds

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