By coinnews 
00:00 Speaker A
joins now is our name Holtzer, Easterly EAB global macro strategist. Easterly has $60 billion in assets under management. Arneem, always good to see you, sir.
00:11 Speaker A
So let let’s start with Trump and tariffs and trade because that was front and center today. President Trump says, okay, we have this limited trade deal with the UK. He also said maybe he would consider lowering tariffs, tariffs on China if those talks are in Switzerland go well. I mean we were in in rally mode today as a market pro market strategist, what did you make of those headlines?
00:30 Arneim Holzer
First of all, thanks for having me, Josh and Julie.
00:35 Arneim Holzer
We think that there’s there’s the the on the surface tariff. There’s the the worst of all possible situations being taken off the table, but there’s still this substrate of of where we’re going to end up. And I think the idea that there is there are some arrivals, you know, arrivals here with trade deals is a good thing.
00:53 Arneim Holzer
But ultimately, we’re still trying to figure out how this whole mix comes together. We had some some musings today about some tax issues around carried interest around increasing the the highest rates. We obviously are concerned around how we’re going to see um the difference between bottom-up earnings estimates and top-down estimates get reconciled. And some of those things aren’t really tariff related, they’re just whether the underlying economy and capital expenditure plans come through. Because remember, the reason we’re doing these trade deals is because we want to bring manufacturing back to this country. And so that’s part of the optimism. But part of the reality is companies have to make plans, and it does look like in the first quarter, and so far, you’re seeing some indications of companies being a little more pragmatic. We haven’t seen job shedding yet, but I think some of the recovery that we’ve seen to date in the last couple of weeks has been about the good news that the worst is off the table.
01:51 Arneim Holzer
Will these deals that we’re hearing here really connote a big upward movement, and will they bring China along? So some of this move, I think, is interesting, but it doesn’t necessarily resolve some of the deeper problems that we still see in the market.
02:09 Speaker A
Well, and if companies are trying to make decisions based on certainty,
02:16 Speaker A
I guess the question is, can they look at the deal today as a template for other deals? And if that’s the case, if there’s still a 10% baseline tariff,
02:26 Speaker A
that’s not fantastic news for them.
02:30 Arneim Holzer
Well, and there are two sides to this. One, as you said, is the corporate planning side. So treasurers have to decide, you know, boards have to decide how much are we going to onshore, how much can we onshore. And and different industries, it’s going to be a different mix. But there’s also the issue of how is the Fed going to interpret trade deals and whether or not they end up being inflationary. There’s a construct right now, we heard it yesterday with Chair Powell, that there’s an equality of potential for a growth recession, for a slowdown and inequality of inflation pressure. The numbers that we’ve seen give you a little bit of both.
03:10 Arneim Holzer
The question is, though, depending on how the trade deals get implemented and the time frames, the inflationary impact may be much less, and the growth scare may actually be a little bit quicker. And that’s where we think the Fed may be a little bit too complacent, and I understand that they’d like to see more hard data,
03:36 Arneim Holzer
but we know for a fact that they can squash inflation. The difficulty if you get into a real slowdown and a real capex kind of longer time frame to recovery, and the productivity numbers today were not encouraging,
04:00 Arneim Holzer
then you may have a little bit more, you know, wet kindling when you try to light it. And so our our concern here, and we think investors should be aware of this, is that there’s likelihood of more volatility because of some of that uncertainty than you’ve seen in the rally. Now the end of the at the end of today, you did see some of the market come off. Some of that may have been some of these musings about tax issues. Some of these some of that may have been because the market saw how much we’ve come back and wondered if it was if it was discounting the market correctly. But in either case, I think the volatility drop has been pretty dramatic, and there’s still an opportunity here, I think, for investors to make sure that they have some kind of interest in products that play volatility because I don’t think the all clear signal’s been given yet.