“Musk Broke With Trump” – Trump’s MASSIVE China Tariff Threat Ignites EXPLOSIVE Trade War
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Summary
The Dow and S&P 500 hit new all-time lows on Friday, marking the worst day of the year for Wall Street s main averages since December 2019. On today's episode of the Stock Market Movers podcast, we talk about why the market is heading into a bear market, the impact of China's retaliatory tariffs on the U.S. on the global economy, and the growing wealth gap between the poor and the rich.
Transcript
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The Dow Jones industry ever plummeted more than 2200 points on Friday following 1679
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previous drop, marking its worst session since the start of COVID 2020 as Wall Street's blood
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bat erased $6.4 trillion in market value just in two days due to China's retaliatory 34%
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levy on U.S. imports starting April 10th in response to Trump's reciprocal tariff plan
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imposing a 54% tax effective April 9th, the tech-heavy Nasdaq fell 962, 5.8% entering
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bear market territory with a drop exceeding 20% from its December peak while S&P 500 declined
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322 points or 5.97 amid global stock market descent driven by fears that Trump's 10% baseline
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tariff would harsher rates for many nations could stoke inflation and trigger a recession
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as noted by Federal Reserve Jerome Powell who warned of a potential persistent risk in
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So, I mean, first and foremost, I'm super happy that the market's starting to go down.
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I think, honestly, you know, people are going to hate this, but I think the best case scenario
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for the most people would be if the market goes down by something like 50% because...
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Yeah, because, I mean, 10% of people own 90% of the stock market.
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So, like, the vast majority of people who own the stock market are, you know, the top
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So, like, what would you guys imagine it took for an amount of hours worked to buy a
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share of the S&P 500, say 1970, what would you guess?
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You need to work 170 hours today to buy one share of the S&P 500, but you have to
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work 20 hours 50 years ago to buy a share of S&P 500.
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Like, you know, so when we got off the gold standard, when we started offshoring our jobs
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to China, that's where the wealth gap really widened between the working class of America
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and, you know, the people who run companies in America, like, because profit margins got bigger
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and then wages didn't keep up with the stock market growth.
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So, we've essentially, like, decimated our middle class.
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And, you know, for young people, too, like, I've been waiting to buy the dip for 15 years
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You know, some people might say, like, COVID, but that, we just pumped money into the economy
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Some people might say 2008, but we did quantity of easing right away after that.
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Yeah, but waiting to, like, really feel like I could buy the dip for 15 years, and, you
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At 15 years old, you were looking at investing.
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So, okay, so, a part of what you're saying is, the gap between the poor, middle, upper,
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and the rich keeps getting wider and wider and wider, okay?
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And you wanted to see a massive market crash taking place, maybe a correction, for you
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And keep in mind, too, the market is way higher than it should be.
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Yeah, the boomers and Gen X have essentially stolen the future from the millennials and
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Gen Z by pulling wealth forward to themselves that belong to the future.
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So, you know, it's $36 trillion, and, like, all the deficit spending we do, that's been
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pulled from the future away from people who haven't even been born yet and put into the
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Well, I think whenever you have an equation like this, and thank you for doing the research,
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So, the number of hours was 50 years ago, right, was 20 hours to buy one share of S&P.
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Today, with S&P at, what, 520 or 490 or wherever you are floating around right now, takes 170
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What was the P.E. ratio of the S&P going back then?
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It's usually in the ballpark of, what, 20 to 30?
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Well, actually, under Jimmy Carter, it was 7 to 9, and under Ronald Reagan, it was 10
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That was the P.E. ratio, if we want to go back that same time.
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In January, the P.E. was 29, and right now the P.E., and I'm saying of the S&P, is 24.
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So, wages is the problem, because it's 8.5x in the number of hours, but the P.E. ratio is
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barely 3x, and actually 2x, if you just go from Reagan, from, like, 10 to 13, that would
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Well, right now, it's 24, and it was 29 beginning of this year.
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You go back to 2016, it was 22, 24, 25, the three years going into COVID.
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So, I think you make a point, but it's not that the market is too expensive.
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It's that over all that time, wage growth for the middle class did not keep up, and as
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a result, an 8.5 difference in the middle number of hours, when the P.E. ratio is really
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Yeah, because that revenue has gone to corporations that have offshored their jobs and saved a ton
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of money on production costs instead of going to, you know, decent-paying jobs.
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So, I think, like, that the tariffs are going to solve two problems at once.
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It's going to bring the market down to a reasonable level, and it's going to bring better jobs back
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to America and pull some money away from corporations, because, you know, they've essentially,
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like, taken money from the workers to themselves by offshoring these jobs.
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Let me ask you, when you did 50 years ago, was it 20 hours?
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1970, and then it eventually goes to 40 hours worked, and then by the 90s, it gets to 66
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So, okay, if we go in 1970, obviously, a couple major events took place.
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And gradually, the whole ping-pong, you know, and then, you know, World Trade Organization,
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And then, for us right now, like, the supplies that we have, if you go on Trump's store, all
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You see, made in China, made in Singapore, made in this, made in that.
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Labor has to compete for us to bring a lot of the stuff here.
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Because, you know, America's not known for a lot of the products to manufacture.
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So, somebody needs to sit there and say, how do I make that competitive in America?
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And at the same time, the one thing, once we went off of the gold standard, what happened?
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So, people could raise debt and take a business and grow it.
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And then, so, if somebody has access to debt, somebody leverages debt, somebody risks with
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debt, the other person doesn't, the disparity of the wealth is going to get wider and wider
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The part that they haven't yet figured out is what to do with the median income, because
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And that should be a concern, because some of these guys cannot afford houses.
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So, either income needs to go up, correction needs to happen, or people need to go and
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live in a rural, you know, in a place that no one knows about and turn it into a next
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Frisco, turn it into a next Palmdale, turn it into a next whatever city that may be.
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Do you think that we have to compete with labor, though?
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Because I almost think that tariffs have to protect us against this cheap slave labor from
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other countries, because, you know, we could compete with other countries in terms of putting
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tariffs on them when they have tariffs against us, but labor, how are we ever going to compete
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Because they could, you know, essentially make people work at slave wages, but we're not
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Well, once you open, in my opinion, once we opened that up and we went into that space,
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So think about it this way, when everybody says Trump's for the rich, okay, you said
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something earlier, you said 90% of the, what, equities is owned by what?
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So the rich are being, the rich are the ones, even, even Musk is a little bit like, hey,
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you know, I don't know if you have that clip, Rob.
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Yeah, he isn't like, you know, I, you know, let me read this and then, you know, Musk breaks
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with Trump on tariffs as he distances from the White House.
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Now, whether there's truth on this or not, who knows, but Rob, can you play this clip?
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I hope that, um, I hope that the United States and Europe, uh, can establish a very close
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Uh, we obviously are, there's an alliance already, but I'm hopeful that there can be
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a very close relationship with America and Europe.
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Um, and, uh, I'm hopeful, for example, with the tariffs that, that, uh, at the end of the
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day, uh, I hope it is agreed that both Europe and the United States should move ideally, in
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my view, to a zero tariff situation, effectively creating a free trade zone between Europe and
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Um, and, uh, that, that would be my, that's what I hope, I hope occurs.
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Um, and also, uh, more, more freedom of people to move between Europe and North America.
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If they wish, if they wish to work in Europe, wish to work in America, they should be allowed
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Go online, type in Tesla sales by different markets, Tesla sales by different regions,
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and then just go to news, go to Tesla sales by different, go to news, go to the third story.
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Tesla sold 45% fewer cars in Europe last month compared to January of last year.
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So that's, he's, you understand what 45% fewer and what that's not 4% fewer.
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So let's just say the stock does bad, but your sales are high.
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It's the sales are down 45% fewer in Europe than last month.
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That's like a $9,000 car reaching a market share of 16.7%.
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And self-charging hybrids are Europe's favorite powertrain type with a 34.9%.
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So this is affecting a lot of people that are actual big businesses.
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They're concerned about what this is going to do with the tariffs.
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Elon Musk publicly diverged from President Trump's on tariff power, advocating at a virtual rally
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for Italy's Deputy Prime Minister Matteo Salvini.
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I hope that the United States and Europe can establish a very close relationship.
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Both Europe and the US should move ideally, in my view, to a zero tariff situation, which
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And then he continues talking about possibility of, you know, Peter Navarro on X writing a
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PhD in e-com from Harvard is a bad thing, not a good thing.
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And he aimed to build shit after Navarro defended tariffs on CNN saying, we're trying to do under
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the principle that the president wants to charge those countries what they charge us.
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So there's a little bit of a rift here with this situation.
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So we're going to see what's going to happen there.
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I just want to get back to one point that Brandon made, because you're a young guy.
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I was sort of a little bit younger than you when I really started investing in the stock
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So are you saying that you have not started investing yet because you're just waiting
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So I mostly have done day trading type of stuff for the last 15 years.
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And I have small investments here and there, but just straight up putting money in the
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No, I'm the biggest benefit from it is I've learned a lot.
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Like, I can't say that I've done like insanely well day trading.
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So I think you're a sharp guy, but here's where I'll tell you that more is caught than
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So what you're doing is sort of acting on hypotheticals.
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What I've been able to do and what Pat and Tom is able to do is actually invest in the
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So actually experience the ins and outs, the ups and downs, the reds and greens.
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If you're sitting around and just waiting to buy the dip, waiting to buy the dip, you've
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You could have done it in, you said you started investing in 2009 to 15 years ago.
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You said 2010 market was down then you could have done it in 2020.
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So if you're trying to time the market, you're going to be waiting for the perfect time forever.
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So, you know, you said something pretty shocking.
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Like you're, you're, you're praying for a 50% downturn in the market or there's going to
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be older people out there that are like, are you kidding me, bro?
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Well, you sound like a victim and I've heard that before on this show.
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But at what point are you going to just buckle down and just say, I'm a smart guy.
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Let me play the long game and just start investing because I've seen so many people do what you're
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doing and like, I'm going to wait for the perfect time.
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I'm going to wait for the, there's no perfect time.
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If you generally started investing 15 years ago and gave up the day trade nonsense and just
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decade trade, you'd probably have tens, if not hundreds of thousands of dollars
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So for someone like you buy the dip now and let's see where it is in 10 years.
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If you pan out America, the American economy, S&P 500 always wins.
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If you follow day to day, here's what I guarantee, just because I've seen this a thousand times.
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I guarantee you that today is going to be green.
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I used to look at the market every day and when it's actually your money and not hypothetical
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woozies and floozies and woozies, you actually notice, oh my God, I made 20 grand today.
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And you actually learn how to invest in the marketplace.
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Without that, you're just talking about what ifs, what ifs, what ifs.
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So my advice to you is put some money where your mouth is.
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Put some money in the market and watch it grow.
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Would you agree that we've prevented ourselves from having a legitimate recession or even
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Everyone, you're trying to solve for what the American economy should do.
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You know what's the economy you should worry about?
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Well, I mean, realistically, I should have like, yeah, got in during COVID, but yeah, I
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I mean, the way you're going is going to take you a minute.
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So I guess maybe like 10 years is better to say.
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The whole time, though, we're pumping QE into the market.
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So like, sorry for being skeptical when we're just propping it up through quantity of easing.
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Just to be clear, I'm not trying to rip you one.
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Just put your damn money in it and figure it out.
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I think the market was maybe at $25,000, $20,000.
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Six months later, I'm in the beautiful city of Addison, Texas, talking about Dow just reached all-time highs, $30,000.
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So it's going to bounce back if you play the long game.
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Go back to the—and I'm going to make the point here with Brandon for him to consider.
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Go back to the tweet you had with Peter Navarro and Musk, which I was reading earlier, if you can go to that.
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Here's Peter Navarro explaining the tariffs and contrary to the fake experts class that is usually on corporate media.
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Peter Navarro has a Ph.D. in economics from Harvard.
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He also is not going to lie to you about what is happening to globalist agenda.
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Notice how he uses specific details instead of blank statements like chaos, agent, and destroying America.
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And then watch Elon Musk's response on the bottom.
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And this kind of ties into what you're saying, Brandon.
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The economist tools, because it's based on concepts like export and import demand elasticities, currency adjustments, and things like that.
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But here's the analytical issue we're trying to do under the principle that the president wants to charge those countries what they charge us.
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As you pointed out, Vietnam has an applied tariff rate that's much larger than ours, but doesn't come near the tariff we've charged them.
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So the question is, how do you value the following, Phil?
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You've got to value the VAT tax distortions, dumping, export subsidies, technical barriers to trade, agricultural barriers to trade, quotas, bans, counterfeiting, intellectual property theft, and all of that.
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If you look at the trade deficit, which every country runs from us, the first thing economists should tell you, ask the next one you have on your show, should the UNS have chronic and sustained trade deficits?
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So what the trade deficit does for any given country, it's the sum of all cheating.
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And in a national emergency where the trade deficit itself is the national emergency and security threat because it takes our factories, our jobs, and transfers wealth abroad, the reciprocal tariff is that which...
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He says a Ph.D. in econ from Harvard is a bad thing, not a good thing.
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Result in the ego brains versus one problem, right?
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So now who's right, who's wrong when you see this here?
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Sometimes to get like, for example, you and I talk regularly every day and I know who the guys are that you admire, the economists and all these other guys that are in that space.
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Sometimes when you are so, so, so, so, so, so well read, what ends up happening is, what is that phrase?
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That you eventually just don't take any action and you're arrested.
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You don't even want to know, like, for some it's marriage because you have so much experience.
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Because we have so much information here that we're worried about taking action.
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I thought that was a great exchange and I think, Brandon, probably a lot of people feel like the way you're doing.
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This is my number one therapist for the last 16 years next month.
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He's got a future looks bright shirt back here.
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And because it is, what is it, the National Pet Day, Rob?
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We got this gear for you that our merch team thought it was a good idea.
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So if you guys, honestly, if this sells out, I'm going to personally give credit to the merch team to come up with these ideas.
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And I will say, this is their idea if it goes lights out.
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A few different things for you to pick from with future looks bright.
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This is the biting, you know, the dog toy and what the leash is that we got with future looks bright on it and vital timing on it.
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This is the gangster if you're from L.A., New York, maybe a million in Baltimore picked this up.
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And on top of that, if you go, by the way, look at that Yeti one.
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Yeah, look how sick that is with future looks bright.
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I saw Vinny drinking out of one of those this morning.
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Every day your dog will be excited when he's going through this.
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So let's place an order on one of the things so they can kind of see.
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Then it says here, are you team wolf or team meow?
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So you're going to get a value tainment mug that says meow or wolf, depending on if you're
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Obviously, Adam goes with meow and Vinny would go with wolf.
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But anyways, if you got animals, if you got dogs, go place an order for National Pet Day,
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I never forget one of the shows I watch, cartoons, that it said all dogs go to heaven
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