Episode Transcript
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Speaker 1 (00:00):
Welcome to the hidden world of wealth, where secrets of
the affluent become accessible to you. You are listening to
Your Money Matters, the most provocative financial radio show on
the airwaves. You are about to start your educational journey
here on Your Money Matters with your host, Drew Prescott,
(00:22):
President of Prescott Private Wealth and Chartered Retirement Planning Counselor.
Drew will unlock the complexities of the financial landscape with straightforward,
powerful insights. Whether you're planning for retirement, managing in a state,
or looking to grow your wealth. Consider this your exclusive invitation.
Turn up the volume, lean in closer. Let's navigate the
(00:45):
hidden paths of prosperity together. Your financial enlightenment begins now.
Securities all Produce a Terror Financial Specialists LLC member FEN
the SIPC reservices of Produce A Terror Investment Advisors LLC.
SO terror firms are under separate ownership from any other
named entity. Four five one two sixth Street, Troy, New
(01:07):
York one two one eight zero.
Speaker 2 (01:16):
Twolve Revelation April third, Don't Talk Analysis.
Speaker 3 (01:22):
Liberation. My dad met we were going to be liberated
terror in the last fifty years, and it was going
to operate.
Speaker 2 (01:31):
And it's called Golden Age, a phrase parody, and yet
the world seemed to erupt an anger. It was very strange,
which winds up the territory.
Speaker 3 (01:41):
Terrible art is China has to be? How much more depression,
how big a trade deficit and my loss of Josh
and the American work, and how much more dangerous.
Speaker 1 (01:52):
Proliferation has to exist? Before members of this House of Representatives,
you will say, I will.
Speaker 2 (01:59):
Not enjoy at the status club.
Speaker 3 (02:05):
In terms of tariffs, it's.
Speaker 2 (02:06):
Like it's interesting to note is that the.
Speaker 3 (02:08):
Average US MSN tart on Chinese.
Speaker 1 (02:11):
Goods coming into the United States is two percent, whereas
the average Chinese tariff.
Speaker 3 (02:16):
On US goods going into China is thirty five percent.
Speaker 1 (02:20):
Is that reciprocal?
Speaker 3 (02:22):
Good morning, everybody, and welcome back to your money matters.
I'm your host, Drew Prescott, chartered retirement planning counselor and
accredited wealth management advisor at Prescott Private Wealth, located on
Who's Ex Street in Troy, New York. The phone number
here is five one eight two zero three one nine
eighty three and PRESCOTTPW dot com. If you want to
have a look around on our website. So good morning
(02:44):
to you. Good Sunday morning to you. Well, I am
currently on a flight to Hawaii, and so I recorded
this show ahead of time and hoping to have a
nice time out there with the family. And it's just
(03:07):
the girls and I on this trip, but really looking
forward to it, especially after last week and Lord willing
we start to catch some footing in the markets. And
so for those of you who have gone to Hawaii,
(03:27):
we are going about twenty minutes north of Kona, up
in a Hawaiia Koloa village, and very excited about this.
Last time we went to Hawaii was back as a
matter of fact, when we got home from Hawaii the
last time it was. We landed and the following day
(03:48):
they said the first case of COVID was found in Hawaii.
So we're sitting here thinking, oh my goodness, Wow, we're
gonna get We're gonna get hit with this thing. Well,
by the grace of God, we didn't and everything turned
out well. But this time looking to do a lot
of snorkeling and looking to bury the worries about the
(04:14):
market in the crystal blue water in Hawaii. So anyways,
unfortunately I will be tethered to my computer a bit,
as you can imagine, but my assistant will be we'll
be here holding it down until my return, and the
(04:38):
rest of the team will be working on some financial plans.
So anyways, what a week? Huh? So the markets are
really bleeding here, the headlines are screaming, and the internet
has officially lost its mind. But here's the real quick question.
(05:01):
Is this financial chaos just noise or is this the
opening move of a master strategy. Well that's what we're all.
We're all hanging in here to find out. Because on Tuesday,
April second, President Trump walked to the podium and declared
what he called Liberation Day, effective immediately, all imports would
(05:24):
face a ten percent tariff. But it didn't just stop there.
He even raised the stakes and he said that countries
with massive trade deficits they're getting slammed with a forty
nine percent tariff starting April ninth. Well, Wall Street didn't blink.
(05:46):
It actually panicked, as you saw, and stocks started to crash,
Investors ran, and financial media started throwing around words like
catastrophe and crisis. But I want you to stop and think,
what if this isn't economic madness? What if this is methodical?
(06:10):
What if this is a legacy play. Now, some may
believe that Trump has had these conversations with his team
first and other countries in his first term, and I
believe that's why he actually lost the last time. Well
(06:35):
was because he wasn't ready to play this card. But
now he has one term, he's out of patience and
he's all in, and he's willing to let the current
generation here potentially take a hit so that future generations
(06:57):
can have a chance. And that's not political theater. This
is a man that's thinking in centuries, not election cycles.
That's a man that's aiming for Mount Rushmore, not reelection.
And here's something that you won't hear on CNN. No
tariffs on Russia. Why well, maybe Trump sees Russia not
(07:24):
necessarily as an enemy, but as a resource, literally a
land mass that's loaded with rare earth minerals that could
help us break china stronghold. Maybe he offers protection in
exchange for access. Maybe Ukraine doesn't need to be in
(07:47):
NATO if it keeps America off the battlefield. So short
term pain, long term leverage. He's not here to drop bond,
He's here to cripple China's economy. Without firing a single shot. Now,
(08:08):
this isn't chaos, this is strategy. This is economic warfare.
And Trump just went nuclear. Now, for those of you
who are longtime listeners of the show, you know this
is a financial show, and in the last couple of
(08:29):
weeks it may have started to feel a little bit political.
But let me tell you something. What I think that
you need. Correct me if I'm wrong, Tell if I'm
wrong right in, please send a call. I want to know.
I do this for you. I don't do this for me, Okay,
I'm just sharing my thoughts. You know, as I'm sitting here,
(08:55):
you know, every morning, and I'm getting prepared, and I'm thinking,
what is it, What is it that I need to
be aware of? What is it that clients need to
be aware of that will help the future of this individual.
And as I'm sitting here and I'm listening to you know,
(09:15):
I listen to all kinds of different broadcasts and Wall
Street Journal, And as a matter of fact, I actually
cancel my subscription to Wall Street Journal. I find that
to be just boy, just really really a waste of time.
To be frank, I have yet to find any tremendous
(09:38):
value in that periodical any longer and I cancel my membership.
So that's new. That's new for me. It seems like
everything that is printed is with a really a slight
against the current administration. Well, you know what, folks, that's
(09:58):
where we are, so embrace it. All right. We've all
lived through different administrations and have seen how things have happened. Well,
we've had great things that happened under Clinton, great things
that happened under Reagan. We saw some things that looked
like they were going to be absolutely awful. Under Obama,
(10:21):
we saw things. You know, we just came through what
feels like a four year nap. But let that be
a testament to the fact that the stock market thrived
under just having predictability. What was the predictability. The predictability
(10:43):
was that we were doing nothing and that nothing major
was going to happen. So we were on smooth sailing. Okay,
Now that can't always go on because if you fall
asleep at the wheel, eventually you're going to get into
an accident. Well, now our eyes are wide open, and
(11:03):
we have a leader that is really shaping the future
of this country and the economy. So don't give up
on them just yet. I want to use this show
as a way to bring an awareness of what I see.
(11:26):
That doesn't mean it's right, but let me just share
with you what I see and what I think is
potentially at play here, and what this could mean for
you and your money in the future, what it means
for your children, for your grandchildren, for this nation. So
(11:48):
bear with me as we get through this, this volatile ride,
if you would, And I want to continue to create
an awareness here about these tariffs. Now Trump's tariffs. The
announcement when it first came out didn't just ripple through
the markets as you saw. It was like a Category
(12:12):
five hurricane. And by Thursday morning, just forty eight hours
after his speech, the Dow Jones Industrial average created nearly
four percent, shedding more than fifteen hundred points in a
single trading session. You already know this stuff. You know
this unless you've been under a rock, and if you were,
you wouldn't be listening to this show today. But we have,
(12:36):
we have volatility, and we have a lot of it.
Two days in a row, you know. I'll tell you
when when we saw what happened on Thursday, I started
to look into it and I thought, you know something
(12:57):
here's an issue. We wake up in the morning and
these markets are down in such a huge way. Right,
That is not that is not you and I that's
making that move. That's the institutional money. And when that move,
(13:22):
it was pretty amazing to learn that when the market
dropped down like that, what you didn't see is the
underbelly of what was happening. And I want to share
that with you because that is something that is not
talked about, that needs to be talked about, and it
(13:45):
will give you more fuel to hold the front line,
because we are the front line in this battle. And
I want to share this with you because this is
incredibly important for you to understand. And I have not
seen anyone else cover this, So let me share this
with you. Okay, ready, What we have here was that
(14:08):
individual investors made net purchases of four point seven billion
in stocks and exchange traded funds. Now, is that a
big number. I always say to everybody, nothing is good
or bad until you compare it to something else. So
(14:28):
let's compare it. Well, this is how good it was.
Four point seven billion in net purchases was the highest
daily inflow over the past decade. Over the past decade,
so what happened. What happened was institutional money bailed on
(14:58):
us and that left the mark. And as individuals, we're
looking at what makes sense right. We're not driven by
political agendas agendas. We're driven by the fundamentals and our
(15:22):
families and these institutions through the baby out with the
bath water on us two days in a row. That's
not good. Now, everybody that I saw on Friday, they
(15:44):
each said to me, I'm not concerned. I'm putting new
money into the market. I believe that this is a
great opportunity for my children and my grandchildren, and others
even wanted to say, I'm willing to take the licks
for this country. It is what it is. But I
(16:08):
think we're gonna come out stronger, and I agree. I
agree with that. Now, listen that we can't overlook the
fact that big names took big hits, like Apple down
eight percent, that's two hundred billion dollars in market cap.
Go On just vanished. Tesla, with its gigafactories deeply tied
(16:31):
to China, fell seven percent. Amazon, the everything store with
a global supply chain, slid six percent. Meanwhile, companies with
strong domestic roots like Walmart only dipped two percent, showing
just how much exposure to global trade has suddenly become
(16:55):
a liability. And the fear, oh, the fear was thick.
The vics Wall Street's fear gauge it's spiked to thirty five.
That's panic territory. So think about this. It's like someone
yelled fire in a packed theater and the exits got
(17:16):
jammed up. But the real question is what fell. It's
who sold, Okay, So let's look into that a little
bit again. The answer is clear. It's institutional giants, it's
hedge funds, it's pension funds, endowments. They were the first
(17:38):
out the door, and you can tell because the big
cap names dropped hard and fast. JP Morgan, Blackrock, and
Vanguard shifted tens of millions from equities to safe havens
like bonds and cash. Treasury yields fell gold Sword to
twenty five hundred dollars an ounce. The Japanese yend gained strength,
(18:02):
and it was a classic flight to safety. But here's
the twist. While the giants panicked, Main Street leaned in
retail investors. Regular people like you and I with apps
and instincts started scooping up shares now, they said that
Robinhood saw a by order spike three hundred percent on
(18:25):
Thursday alone. Apple, Amazon, and in Video were among the
top picks. It looked like a digital Black Friday. Institutions
were dumping and retail was buying the dip. Some call
it reckless, others called it bold. But here's what's really fascinating.
The retail crowd may understand something that Wall Street doesn't.
(18:49):
Maybe they believe that this tariff storm is temporary, or
maybe just maybe they think Trump has a strategy one
that might actually work. Even more to the Russell two
thousand index that's filled with small cap, mostly domestic stocks,
well they fell less than the SMP and the Nasdaq,
(19:10):
and that's a sign that America first portfolios, those not
tethered to Beijing or Berlin, are becoming havens. It's this
kind of volatility you find out who believes. And right now,
average Americans are betting on the bounce. They're not listening
to CNBC, They're watching movies, not moods, and they're making
(19:36):
plays with more conviction than the suits are. And this
isn't just a market story, this is a psychology story.
The elites are scrambling but the people, they're standing their ground.
The old guard is trying to protect the system. The
new money is betting on change. And every investor watching
(19:59):
this is making a choice fear the future or shape it.
And this is the line in the sand, the moment
where ideology meets economy and conviction separates winners from the
fearful masses. So let's just stop pretending that this is
(20:22):
just about tariffs. This isn't a rash decision. It's not
a tweet storm or an angry reaction to bad trade numbers.
This feels orchestrated, like a move that's been sitting in
the drawer, waiting for the right moment to strike. Because
behind the chaos there's a theory one that more Americans
(20:45):
are starting to believe, and it is this that President
Trump is playing a long game. So think about it.
Trump didn't just slap tariffs on China. He went broad.
He went big, a ten percent baseline across the board,
and a crushing forty nine percent for trade deficit offenders. Now,
(21:09):
it's not targeted policy, it's total economic warfare. And that
tells us something. This isn't about fixing one issue, It's
about forcing a complete rewrite of the global trade order.
And here's the heart of the theory. Trump doesn't want
(21:31):
to just win because of a next election, as you know,
he does not have that. He wants to reshape America's
economic destiny. He wants to be remembered not for his
tweets or scandals, but as the president who put the
US economy on a new sovereign path. And to do that,
(21:56):
he's willing to break a few bones, especially on Wall Street.
A great line. I can't take credit for it. Michael
Savage said it, and he said that President Trump has
two tools at his disposal, the feather and the hammer.
(22:17):
And the feather comes out to tickle the person that
he's negotiated with, to get them to loosen up and
laugh and they're gonna have a little bit of fun
with one another. But if he can't get them to
cave with that, then he brings out the hammer. And
that makes a lot of sense to me. And this
(22:38):
isn't new for him. Insiders say that Trump floated these
aggressive trade shifts during his first term, but he was
advised to hold off because they said it'll spook the markets.
They said, you're gonna lose swing states, in your re election,
they warned, Well, maybe that's exactly what happened. Now he
(23:01):
has no reason to hold back. Trump's not playing for
four more years. He's now playing for history books. And
what's his bet that Americans are ready ready to take
short term pain for long term gain, so ready to
stop being dependent on a global system that pushes the
(23:23):
American worker while propping up foreign economies that hate us. Well,
I am because I don't come from a white collar family.
I come from a blue collar family. And these jobs
(23:45):
are incredibly important to us. They're incredibly important to the
next generation and for the livelihood of even those that
are graduating high school right now, for those that realize
that they they may not want a profession they enjoy
doing things with their hands. They want to work in
a manufacturing plant. They want to have dirty hands and
(24:11):
a clean heart. Well, he hasn't touched Russia. Why, Well,
think beyond geopolitics for a second, think about minerals. We've
talked about this two weeks ago. I gave my best
overview on rare earth minerals and why they are needed,
(24:32):
and how they are of tremendous value and they are
the key to us moving forward in technology and in
military defense, and Russia has some of the richest rare
(24:54):
earth deposits on the planet, and the US needs those
to survive the next fifty years of technological advancements. So
if you want to break China's stronghold on semiconductors, on
defense systems and EV batteries, then you need to build
new supply lines, and those might run through Siberia, not
(25:17):
Silicon Valley. And Trump may be thinking like a builder again.
He's mapping supply chains, realigning alliances. And Ukraine doesn't get
into NATO, not because he's pro Russia, but because he
wants leverage in exchange. Maybe Russia opens the gate to
(25:39):
rare earth mining deals. Maybe the US becomes less dependent
on China and more invested in balancing two powers against
each other. Sound crazy, not if you follow the pattern.
Because Trump doesn't see trade as a transaction. He sees
(26:01):
it as leverage, and he's using America's consumption power, our
three trillion dollar import appetite as a weapon. Tariffs are
not just taxes, they're pressure points. Every percent that he
raises shifts global supply chains, It alters diplomatic ties, and
(26:23):
it forces corporations to rethink everything. So when Trump talks
about Liberation Day, he's not talking about freeing America from
bad trade deals. He's talking about liberating our future from dependence,
from foreign influence and from the slow bleed of outsourced power.
(26:48):
So this isn't just economic nationalism. It's strategic realignment. It's
the boldest geopolitical pivot since Reagan faced off against the
Soviet Union. In addition to Japan, we'll talk about that
later on. And if this works, it will go down
(27:09):
as one of the most audacious, risky, and brilliant plays
in modern American history. Now, on the flip side, if
it fails, he knows what the consequences are. But for Trump,
this isn't about applause. It's about generational change. This is
a legacy move, one final play for the soul of
(27:34):
the American economy. Because in Trump's mind, the cost of
inaction is far greater than the cost of disruption. And
he's not just testing the system, he's daring it to
collapse and rebuild stronger. Now, this isn't policy. This is
war by other means. It's bold, it's relentless, and it's unapologetic. Now,
(28:01):
let's talk about the elephant in the global room, which
is China. Tariff's. Trump's tariffs here, this is a blitz.
It isn't just about protecting American jobs. It's about confronting
the nation that he's called the biggest threat to American
(28:23):
power since the Cold War. And this time he's not bluffing.
China is America's largest trading partner, the biggest holder of
US debt outside of the country, and the supplier of
everything from your smartphone to your kid's Halloween costume. But
(28:45):
it's also our fiercest rival technologically, economically, and ideologically. And
Trump knows it, and he's treating China like an adversary,
not a business partner. So what's the play. Well, Trump's
tariffs hit Chinese exports hard, the tech components, consumer electronics,
(29:10):
steal pharmaceuticals, you name it. He's choked the pipeline and
daring China to blink and they might. Unlike pass trade spats,
this one is of nuclear scale. If China retaliates, it
risks sparking inflation, shortage and even internal dissent. Now they
(29:35):
have come out and said that they're they're going to
kind of try to one up us here. But this
is this is all planned for. This is a strategic
game of chess, and the entire world is watching now.
As you know, I'm not going to go into the
(29:56):
difference between chess and other games, but you have have
to have tremendous foresight and we're seeing some of this
play out now. I don't know about you, but as
I see China make their retaliatory threat here, that was
certainly someone that was very scared. They got put on
(30:21):
their heels and they thought they should just swing. And
all bad decisions are made in an instant. Quality decisions
are those that you noodle on. You think about the
impact of these, and I'll tell you this, No good
decision is made in twenty four hours. And that's what
(30:42):
China just did, which shows a sign of their weakness,
and it shows that we are going to win this.
And already China factories are reporting order cancellations and investor
confidence in Shanghai is now shaking. But here's the twist.
(31:04):
Trump may not want to destroy China. He wants to
isolate it. He wants to paralyze it. He wants to
cut off its oxygen without lighting the fuse of a
hot war, and that's why you're not seeing missiles, You're
seeing market moves. And this is silent warfare, and it
(31:26):
is brutal, and it's strategic because China dominates rare earth minerals,
seventeen elements that are critical to semiconductors, evs, aerospace, and
tech for defense systems. Trump knows that we're addicted. But
(31:47):
instead of begging China, he's looking elsewhere, so Q Russia, Q, Greenland,
Q domestic mining. He's rebuilding the supply chain, even if
it means pain in the short term, and that pain
it's real. Companies like Apple, Tesla, and Nvidia rely on
(32:08):
Chinese manufacturing and tariffs hit their margins. Consumers will feel
it with higher prices fewer options. But Trump is banking
on a core idea that Americans would rather pay more
for freedom than less for dependence, and the data it's
(32:30):
leaning in his favor. A recent pupole showed that sixty
three percent of Americans view China as a critical threat.
Now that's up from thirty two percent just five years ago.
Just five years ago is thirty two percent, and the
current results are sixty three percent of Americans view China
(32:54):
as a critical threat. Now the mood is shifting, and
Trump is riding that. It's not just policy, it's psychology,
and he's telling the people this will hurt, but it's
the only way to break free, and people are listening. Meanwhile,
(33:18):
China is cornered. It's real estate market is wobbling. Look
this up. Go on YouTube and look up. Look up
the the real estate problems in China. You're gonna see
these unbelievable I'm simply remarkable apartment complexes that have been
(33:42):
built by the government there that are completely empty. The
youth unemployment there is exploding, and foreign capital is fleeing
the country. And Trump's tariffs they aren't just economic punishment.
They're pouring salt directly into an already open wound. And globally,
(34:06):
allies are watching Japan, India, Australia. They're quietly recalibrating supply
lines too. Why no one wants to be left holding
the China bag if it collapses, and I believe it
is going to. Trump's moves may trigger a domino effect
(34:30):
and one that shifts global power for decades. I'll tell
you something, just talking about this stuff, I really hope
I actually have goosebumps. I've got goosebumps telling you guys this,
and I hope that I'm conveying to you a story
of hope and resilience in this great nation. You may
(34:52):
not like how this is all being unfolded, you may
not like Donald Trump, but this has been an issue
for a long time. At the start of the show,
you heard Nancy Pelosi addressing this in nineteen ninety six.
And for those of you who are just tuning in,
this is Drew Prescott, chartered retirement planning counselor and accredited
(35:16):
wealth management advisor at Prescott Private Wealth. Check us out
online PRESCOTTPW dot com. The phone over here is five
one eight two zero three one nine eighty three. And
typically we talk about, you know, some planning ideas, the market,
different financial things. And you may say, wow, this is
(35:37):
awfully political. Well it is, but it's one hundred percent
financial too. This is what is going on in the market.
Speaker 2 (35:45):
Now.
Speaker 3 (35:45):
You're not going to hear this from the last few hours,
and I apologize that you wasted your time listening to that,
but that's okay. Here you are little fresh, fresh initiative,
some good listening, some ed educational listening because you know what,
you don't need me to get on here and say
(36:06):
the same exact stuff that everybody else has said. You
don't need regurgitated notes from emails that I receive all
week long. Right, if you needed that, you could just
get one healthy dose of Bloomberg, CNBC, Fox Business, pick
(36:28):
your poison. I don't want to be like them. I
want to give you fresh material. I want to give
you stuff that you can benefit from. Okay, So again,
hopefully when you get done listening to this, you don't
say that's an hour of my life. I'd like to
get back. My goal is to give you information to
(36:53):
help you understand what's going on, to feel better about
what's going on, and to have a little bit of
an understanding so that you can have a conviction about it.
So thank you for listening.
Speaker 2 (37:07):
Hey.
Speaker 3 (37:07):
By the way, by the way, it's my sister Rachel's birthday,
so i'd like to say happy birthday to her. Happy birthday, Rachel.
I love you, I'm proud of you. You're doing a
great job raising the three boys, and you're a wonderful mother, sister,
and wife, and I thank you for who you are.
(37:27):
So glad to have another day with you here, and
so let's let me get back, let me get back here.
Just cross my mind. I wanted to get get that off.
Otherwise I would have felt bad for not saying something.
So where were we? I think I was on a rant?
Wasn't I a little bit? But that's okay. Let's see.
So like I was saying, you know, we've got Japan,
(37:52):
India or Australia, they're all starting to quietly recalibrate their
supply lines, and you know, has positioned themselves to be
in a bad spot. Russia and China very poor countries.
And this isn't This isn't trade policy that we're looking
at here. This is containment strategy, and it is working.
(38:16):
You know, we see the you know, we're seeing the
quaking of what's going on. But this strategy is working.
And the question here isn't if China will respond, it's
how hard and whether they can endure the economic siege
(38:38):
that Trump just launched. Because make no mistake about it,
this is not a battle over goods. This is a
battle over the future of our nation. And Trump's betting
that economic independence is the hill that is worth dying on.
(38:59):
And this isn't just economic policy, it's ideological warfare wrapped
in financial terms. And when Trump's tariffs hit, not everyone
got crushed. In fact, while the headlines focused on panic,
a quieter story was unfolding, and some companies didn't just survive,
(39:22):
they thrived. So let's start with some of the winners here.
Consumer staples led the way. Companies like Procter and Gamble,
maker of Tide, Gillette, Pampers, they barely flinched. Why why
is that? Because people still brush their teeth, they still
(39:42):
washed their clothes, and they still care for their kids,
no matter what is happening in Beijing now. Procter and
Gamble dipped just one percent while the SMP tumbled five percent.
That's not just resilience, that's dominance. Then came companies like
(40:03):
Duke Energy, for example, They actually ticked up one point
two percent. In chaos, people craved stability. Lights still turn on,
bill still get paid. Utilities with their steady domestic revenue
are the tortoise in this race and they're winning. But
(40:26):
the surprise hero Nucor, the steel giant. So while tech
stocks crashed, Newcore rose two percent. So why because tariffs
make imported steel more expensive, which boost domestic producers. So
it's not just protectionism, it's profit. Trump's America First policy
(40:53):
is fueled with an old school industrial.
Speaker 1 (41:00):
Rival.
Speaker 3 (41:01):
Now the losers, and it's brutal. Tech was ground zero.
Apple lost eight percent in a day, two hundred billion gone.
Why supply chains. Apple relies heavily on China for assembly.
Same for Tesla down seven percent, and in Nvidia, which
(41:26):
took six percent hit. These companies are global by design. End.
When borders harden, margins bleed, so retailers with overseas dependence
also got hammered. Amazon dropped six percent as investors braced
for rising product costs and slower fulfillment. Global logistics is
(41:49):
their lifeblood and tariffs are their tourniquit. So even bond
focused ETFs like a twenty year plus I show share
treasury bond absorb billions in capital, proof that investors were
rushing towards safety. Meanwhile, as I said earlier, Robinhood traders
(42:12):
doubled down on domestic names. It's like the investing world
is splitting in two, those who believe in globalism and
those who believe in the American comeback. But here's the catch.
These aren't just financial wins and losses. They're political signs.
(42:35):
The companies that won most are rooted in American soil,
focused on domestic production and less exposure to geopolitical wins.
The ones that lost global sprawling and deeply entangled with China.
Trump didn't just trigger a tariff wave. He triggered a
(43:00):
loyalty test for corporate America. And investors are no longer
just asking what's profitable, they're asking what's patriotic. CEOs are
adjusting fast. Letters now mention resilience, not just returns. Wall
(43:21):
Street's language is shifting, and it's all because Trump redrew
the financial battlefield and amid all of the market noise,
one report stood out like a beacon, and that's jobs
on April fourth. This number, when it came out, it
(43:42):
was kind of poo pooed, and I was disappointed to
see across every major media outlet they poopooed this number.
They said, they just glossed over the number, not showing
you how incredible it was. The March unemployment numbers dropped
(44:03):
and they were strong, and the US added two hundred
and twenty eight thousand jobs, which smashed Wall Street's estimate.
Of one hundred and forty thousand an unemployment it ticked
up slightly to four point two, but let's be honest,
that's still near historical lows. So in a sea of red,
(44:27):
that job's report was a bright, glowing green, and that
matters because tariffs may shake the market, but jobs they
ground the economy. If people are working, they're spending. If
they're spending, the economy stays alive. It's that simple. And
(44:48):
these numbers weren't a fluke. Healthcare, construction, and leisure led
the hiring surge, and these aren't speculative tech jobs. These
are boots on the ground, real world, pay your rent jobs.
So compare it to March twenty and twenty four when
(45:10):
we added two hundred thousand, March and twenty three just
one hundred and seventy five thousand, and this year is stronger,
and it's not just quantity, but it's quality. Wages are
up four and a half percent year over year, outpacing inflation.
(45:31):
That means that purchasing power is rising. For all the
doom and gloom, Americans are bringing home more money and
that can buffer the impact of rising prices. But the
key word is can, because the flip side of tariffs
(45:52):
is inflation prices go up, so that three dollars cup
of coffee may become five dollars. Speaking of coffee, I
can't wait to have coffee and Kona, I hear. It's amazing,
very excited about that. So but anyways, so your cup
of coffee is probably gonna go up. Electronics they're gonna rise, Apparel, tools, toys,
(46:18):
anything imported could cost more. And the big risk if
wages can't keep up, consumer spending slows and the engine
starts to sputter. But right now inflation's running low. Well,
I don't want to don't don't send me, let don't
(46:39):
send me any messages on that. All right, let me
I'll walk that back. How's that sound? But right now
inflation's running around two point eight percent. That's manageable. But
if it ticks past four percent, the Fed might react
rate hikes, credit tightening again, and suddenly that vibrant job
(47:05):
market could cool down. And that there is the balancing
act that Trump is dancing on. So stimulate domestic production
without overheating inflation, boost wages without igniting a firestorm of
price hikes. But there's a deeper argument here. And it's
(47:27):
one that Trump is quietly making. He's saying it's better
to take short term pain now and rebuild an economy
that's resilient, self sufficient, and strong instead of counting on
cheap Chinese goods and fragile trade reliances. That he wants
(47:49):
to force the US to stand on its own two
feet here. And that's a key thing, right. Cheap Chinese
goods not just financial, but they're just cheap their garbage,
aren't they. Oh my goodness, they used to We used
to always joke around about that that must be Chinese.
But the quality hasn't changed. It's just become acceptable. We
(48:13):
live in a world where you know, costume jewelry even right,
like a real diamond. You know, a lady could have
a beautiful, real diamond that's smaller than some of this
costume jewelry that we see these influencers and people wear,
(48:35):
and the fake gets more recognition than the real. And
that's going to be a good thing for us to
come back to quality over quantity. And the jobs data, well,
it suggests that this strategy might be working because more
(48:58):
Americans are working, more money is circulating domestically, more production
is happening inside of our borders. So let's take Tom,
a small manufacturer in Ohio. Two years ago, he was
sourcing machine parts from Shenzen. Now he's buying from Indiana.
(49:19):
Why his costs are up, but his supply is stable
and he's hiring. And that story is playing out across
the rust belt and it's changing the character of the
recovery because this isn't just about economics. It's about values, independence, grit,
long term strength over short term gain. And we are
(49:45):
betting that Americans are ready to trade instant gratification for
future security. And if the job market holds its proof
that the pain has purpose and the re it's not
just possible, it's already started. And here's what's wild. Most
(50:07):
economists didn't see this coming. They expected that tariffs would
kill momentum. Instead we're seeing resilience. It's early, yes, but
if the numbers hold, Trump may have cracked the code
a way to revive industry and still keep main street moving.
(50:32):
What are the stakes here? Everything? Everything is at stake.
So where does this all lead? Well, we've seen the chaos,
the strategy, and the political fault lines, but now comes
the trillion dollar question, how does this play out. We
(50:56):
can either see failure success or the muddy middle where
we are right now. So the hope here is that
factories will start to reopen in Michigan, new chip plants
(51:17):
in Texas, steel mills roaring in Pennsylvania, and the country
chanting we build again. The S and P five hundred
hits fifty four hundred. By twenty and twenty six, wages
(51:38):
are up, consumer confidence is back. History books credit the
move as risky but brilliant. That's what the wind looks like. Now,
if it's a flop, we're going to see mortgage costs rise,
(51:59):
consumer confidence tank. By twenty twenty six, we're in a
shallow recession, much deeper, job losses mount. GDP shrinks to
one point five percent. Politically, it's a feeding frenzy, and
Trump critics call it proof of economic suicide. Swing states wobble,
(52:21):
and global partners distance themselves. And it's a cautionary tale. Now,
what about the muddy middle? Right well, Inflation if it
drifts up to three and a half percent, tech stock
(52:41):
will struggle, while consumer staples hold steady. China retaliates lightly,
the trade deficit improves, but not dramatically. GDP bumps up
one percent. The economy avoids recession, but it feels sluggish,
and Trump's support holds, but critics remain vocal. Well, you
(53:03):
see in this middle ground Ford see sales rise, Tesla
struggles with their battery costs, Apple rethinks its supply chain
but takes years to shifts. So here's the truth. Even
in the middle or failure scenario, a long term benefit
(53:25):
may still emerge. Let's look into a historical event that
was similar to what we're dealing with now.
Speaker 2 (53:32):
Recent disagreements between our two countries on the issue of
trade will also be high on our agenda. As perhaps
you've heard, last week, I placed new duties on some
Japanese products in response to Japan's inability to enforce their
trade agreement with US on electronic devices called semiconductors. Now,
(53:53):
imposing such tariffs or trade barriers and restrictions of any
kind are steps that I am loath to take.
Speaker 3 (54:01):
So you see, history isn't just a warning, it's a blueprint.
And as we stand in April of twenty twenty five,
staring into volatility and uncertainty, we've seen this movie before,
and if you know where to look, the past doesn't
just explain the present, it reveals the opportunities within it.
So if we rewind to October of nineteen eighty seven,
(54:24):
the market was flying high after years of a bull run.
Valuations were stretched and price to earnings ratios reached unsustainable levels.
Then came the crash, twenty two percent in a single day.
The world panicked. Does that sound familiar? Now? Look at
twenty and twenty five. The sm P five hundreds priced
(54:46):
earnings is twenty one point eighty five high, but down
from twenty four point three six last year, and not
nearly as bloated as nineteen eighty seven. So the setup
is different, but the tension is the same. Trade fears,
policy risk, and global uncertainty are converging again. In nineteen
(55:08):
eighty seven, it was the dollar, deficits and rising rates.
Today it's tariffs, trade wars and a cautious fed, same tremors,
different decade. But here's what matters. Nineteen eighty seven wasn't
the end. It was the shakeup before a new beginning.
Reagan faced off with Japan. He didn't fold. He realigned trade,
(55:31):
protected American jobs, and laid the foundation for the nineteen
nineties growth. Today, Trump's not playing nice. He's going full frontal,
full on. The object here is to defend, I should say,
the objective here is to defend domestic production, rebalance power,
(55:52):
and reset the rules of engagement. And that's where we are.
I hope this was encouraging. Thank you for listening. You're
listening to your money matters. I'm your host, Drew Prescott,
chartered Retirement Planning Counselor, Accredited Wealth Management Advisor and President
Prescott Private Wealth reach Out five one eight two zero three,
one nine eight three five one eight two zero three
one nine eight three or Prescott PW dot com. Thank
(56:14):
you so much for listening, and until next week, May
God bless you and God bless your family
Welcome to the hidden world of wealth, where secrets of
the affluent become accessible to you. You are listening to
Your Money Matters, the most provocative financial radio show on
the airwaves. You are about to start your educational journey
here on Your Money Matters with your host, Drew Prescott,
(00:22):
President of Prescott Private Wealth and Chartered Retirement Planning Counselor.
Drew will unlock the complexities of the financial landscape with straightforward,
powerful insights. Whether you're planning for retirement, managing in a state,
or looking to grow your wealth. Consider this your exclusive invitation.
Turn up the volume, lean in closer. Let's navigate the
(00:45):
hidden paths of prosperity together. Your financial enlightenment begins now.
Securities all Produce a Terror Financial Specialists LLC member FEN
the SIPC reservices of Produce A Terror Investment Advisors LLC.
SO terror firms are under separate ownership from any other
named entity. Four five one two sixth Street, Troy, New
(01:07):
York one two one eight zero.
Speaker 2 (01:16):
Twolve Revelation April third, Don't Talk Analysis.
Speaker 3 (01:22):
Liberation. My dad met we were going to be liberated
terror in the last fifty years, and it was going
to operate.
Speaker 2 (01:31):
And it's called Golden Age, a phrase parody, and yet
the world seemed to erupt an anger. It was very strange,
which winds up the territory.
Speaker 3 (01:41):
Terrible art is China has to be? How much more depression,
how big a trade deficit and my loss of Josh
and the American work, and how much more dangerous.
Speaker 1 (01:52):
Proliferation has to exist? Before members of this House of Representatives,
you will say, I will.
Speaker 2 (01:59):
Not enjoy at the status club.
Speaker 3 (02:05):
In terms of tariffs, it's.
Speaker 2 (02:06):
Like it's interesting to note is that the.
Speaker 3 (02:08):
Average US MSN tart on Chinese.
Speaker 1 (02:11):
Goods coming into the United States is two percent, whereas
the average Chinese tariff.
Speaker 3 (02:16):
On US goods going into China is thirty five percent.
Speaker 1 (02:20):
Is that reciprocal?
Speaker 3 (02:22):
Good morning, everybody, and welcome back to your money matters.
I'm your host, Drew Prescott, chartered retirement planning counselor and
accredited wealth management advisor at Prescott Private Wealth, located on
Who's Ex Street in Troy, New York. The phone number
here is five one eight two zero three one nine
eighty three and PRESCOTTPW dot com. If you want to
have a look around on our website. So good morning
(02:44):
to you. Good Sunday morning to you. Well, I am
currently on a flight to Hawaii, and so I recorded
this show ahead of time and hoping to have a
nice time out there with the family. And it's just
(03:07):
the girls and I on this trip, but really looking
forward to it, especially after last week and Lord willing
we start to catch some footing in the markets. And
so for those of you who have gone to Hawaii,
(03:27):
we are going about twenty minutes north of Kona, up
in a Hawaiia Koloa village, and very excited about this.
Last time we went to Hawaii was back as a
matter of fact, when we got home from Hawaii the
last time it was. We landed and the following day
(03:48):
they said the first case of COVID was found in Hawaii.
So we're sitting here thinking, oh my goodness, Wow, we're
gonna get We're gonna get hit with this thing. Well,
by the grace of God, we didn't and everything turned
out well. But this time looking to do a lot
of snorkeling and looking to bury the worries about the
(04:14):
market in the crystal blue water in Hawaii. So anyways,
unfortunately I will be tethered to my computer a bit,
as you can imagine, but my assistant will be we'll
be here holding it down until my return, and the
(04:38):
rest of the team will be working on some financial plans.
So anyways, what a week? Huh? So the markets are
really bleeding here, the headlines are screaming, and the internet
has officially lost its mind. But here's the real quick question.
(05:01):
Is this financial chaos just noise or is this the
opening move of a master strategy. Well that's what we're all.
We're all hanging in here to find out. Because on Tuesday,
April second, President Trump walked to the podium and declared
what he called Liberation Day, effective immediately, all imports would
(05:24):
face a ten percent tariff. But it didn't just stop there.
He even raised the stakes and he said that countries
with massive trade deficits they're getting slammed with a forty
nine percent tariff starting April ninth. Well, Wall Street didn't blink.
(05:46):
It actually panicked, as you saw, and stocks started to crash,
Investors ran, and financial media started throwing around words like
catastrophe and crisis. But I want you to stop and think,
what if this isn't economic madness? What if this is methodical?
(06:10):
What if this is a legacy play. Now, some may
believe that Trump has had these conversations with his team
first and other countries in his first term, and I
believe that's why he actually lost the last time. Well
(06:35):
was because he wasn't ready to play this card. But
now he has one term, he's out of patience and
he's all in, and he's willing to let the current
generation here potentially take a hit so that future generations
(06:57):
can have a chance. And that's not political theater. This
is a man that's thinking in centuries, not election cycles.
That's a man that's aiming for Mount Rushmore, not reelection.
And here's something that you won't hear on CNN. No
tariffs on Russia. Why well, maybe Trump sees Russia not
(07:24):
necessarily as an enemy, but as a resource, literally a
land mass that's loaded with rare earth minerals that could
help us break china stronghold. Maybe he offers protection in
exchange for access. Maybe Ukraine doesn't need to be in
(07:47):
NATO if it keeps America off the battlefield. So short
term pain, long term leverage. He's not here to drop bond,
He's here to cripple China's economy. Without firing a single shot. Now,
(08:08):
this isn't chaos, this is strategy. This is economic warfare.
And Trump just went nuclear. Now, for those of you
who are longtime listeners of the show, you know this
is a financial show, and in the last couple of
(08:29):
weeks it may have started to feel a little bit political.
But let me tell you something. What I think that
you need. Correct me if I'm wrong, Tell if I'm
wrong right in, please send a call. I want to know.
I do this for you. I don't do this for me, Okay,
I'm just sharing my thoughts. You know, as I'm sitting here,
(08:55):
you know, every morning, and I'm getting prepared, and I'm thinking,
what is it, What is it that I need to
be aware of? What is it that clients need to
be aware of that will help the future of this individual.
And as I'm sitting here and I'm listening to you know,
(09:15):
I listen to all kinds of different broadcasts and Wall
Street Journal, And as a matter of fact, I actually
cancel my subscription to Wall Street Journal. I find that
to be just boy, just really really a waste of time.
To be frank, I have yet to find any tremendous
(09:38):
value in that periodical any longer and I cancel my membership.
So that's new. That's new for me. It seems like
everything that is printed is with a really a slight
against the current administration. Well, you know what, folks, that's
(09:58):
where we are, so embrace it. All right. We've all
lived through different administrations and have seen how things have happened. Well,
we've had great things that happened under Clinton, great things
that happened under Reagan. We saw some things that looked
like they were going to be absolutely awful. Under Obama,
(10:21):
we saw things. You know, we just came through what
feels like a four year nap. But let that be
a testament to the fact that the stock market thrived
under just having predictability. What was the predictability. The predictability
(10:43):
was that we were doing nothing and that nothing major
was going to happen. So we were on smooth sailing. Okay,
Now that can't always go on because if you fall
asleep at the wheel, eventually you're going to get into
an accident. Well, now our eyes are wide open, and
(11:03):
we have a leader that is really shaping the future
of this country and the economy. So don't give up
on them just yet. I want to use this show
as a way to bring an awareness of what I see.
(11:26):
That doesn't mean it's right, but let me just share
with you what I see and what I think is
potentially at play here, and what this could mean for
you and your money in the future, what it means
for your children, for your grandchildren, for this nation. So
(11:48):
bear with me as we get through this, this volatile ride,
if you would, And I want to continue to create
an awareness here about these tariffs. Now Trump's tariffs. The
announcement when it first came out didn't just ripple through
the markets as you saw. It was like a Category
(12:12):
five hurricane. And by Thursday morning, just forty eight hours
after his speech, the Dow Jones Industrial average created nearly
four percent, shedding more than fifteen hundred points in a
single trading session. You already know this stuff. You know
this unless you've been under a rock, and if you were,
you wouldn't be listening to this show today. But we have,
(12:36):
we have volatility, and we have a lot of it.
Two days in a row, you know. I'll tell you
when when we saw what happened on Thursday, I started
to look into it and I thought, you know something
(12:57):
here's an issue. We wake up in the morning and
these markets are down in such a huge way. Right,
That is not that is not you and I that's
making that move. That's the institutional money. And when that move,
(13:22):
it was pretty amazing to learn that when the market
dropped down like that, what you didn't see is the
underbelly of what was happening. And I want to share
that with you because that is something that is not
talked about, that needs to be talked about, and it
(13:45):
will give you more fuel to hold the front line,
because we are the front line in this battle. And
I want to share this with you because this is
incredibly important for you to understand. And I have not
seen anyone else cover this, So let me share this
with you. Okay, ready, What we have here was that
(14:08):
individual investors made net purchases of four point seven billion
in stocks and exchange traded funds. Now, is that a
big number. I always say to everybody, nothing is good
or bad until you compare it to something else. So
(14:28):
let's compare it. Well, this is how good it was.
Four point seven billion in net purchases was the highest
daily inflow over the past decade. Over the past decade,
so what happened. What happened was institutional money bailed on
(14:58):
us and that left the mark. And as individuals, we're
looking at what makes sense right. We're not driven by
political agendas agendas. We're driven by the fundamentals and our
(15:22):
families and these institutions through the baby out with the
bath water on us two days in a row. That's
not good. Now, everybody that I saw on Friday, they
(15:44):
each said to me, I'm not concerned. I'm putting new
money into the market. I believe that this is a
great opportunity for my children and my grandchildren, and others
even wanted to say, I'm willing to take the licks
for this country. It is what it is. But I
(16:08):
think we're gonna come out stronger, and I agree. I
agree with that. Now, listen that we can't overlook the
fact that big names took big hits, like Apple down
eight percent, that's two hundred billion dollars in market cap.
Go On just vanished. Tesla, with its gigafactories deeply tied
(16:31):
to China, fell seven percent. Amazon, the everything store with
a global supply chain, slid six percent. Meanwhile, companies with
strong domestic roots like Walmart only dipped two percent, showing
just how much exposure to global trade has suddenly become
(16:55):
a liability. And the fear, oh, the fear was thick.
The vics Wall Street's fear gauge it's spiked to thirty five.
That's panic territory. So think about this. It's like someone
yelled fire in a packed theater and the exits got
(17:16):
jammed up. But the real question is what fell. It's
who sold, Okay, So let's look into that a little
bit again. The answer is clear. It's institutional giants, it's
hedge funds, it's pension funds, endowments. They were the first
(17:38):
out the door, and you can tell because the big
cap names dropped hard and fast. JP Morgan, Blackrock, and
Vanguard shifted tens of millions from equities to safe havens
like bonds and cash. Treasury yields fell gold Sword to
twenty five hundred dollars an ounce. The Japanese yend gained strength,
(18:02):
and it was a classic flight to safety. But here's
the twist. While the giants panicked, Main Street leaned in
retail investors. Regular people like you and I with apps
and instincts started scooping up shares now, they said that
Robinhood saw a by order spike three hundred percent on
(18:25):
Thursday alone. Apple, Amazon, and in Video were among the
top picks. It looked like a digital Black Friday. Institutions
were dumping and retail was buying the dip. Some call
it reckless, others called it bold. But here's what's really fascinating.
The retail crowd may understand something that Wall Street doesn't.
(18:49):
Maybe they believe that this tariff storm is temporary, or
maybe just maybe they think Trump has a strategy one
that might actually work. Even more to the Russell two
thousand index that's filled with small cap, mostly domestic stocks,
well they fell less than the SMP and the Nasdaq,
(19:10):
and that's a sign that America first portfolios, those not
tethered to Beijing or Berlin, are becoming havens. It's this
kind of volatility you find out who believes. And right now,
average Americans are betting on the bounce. They're not listening
to CNBC, They're watching movies, not moods, and they're making
(19:36):
plays with more conviction than the suits are. And this
isn't just a market story, this is a psychology story.
The elites are scrambling but the people, they're standing their ground.
The old guard is trying to protect the system. The
new money is betting on change. And every investor watching
(19:59):
this is making a choice fear the future or shape it.
And this is the line in the sand, the moment
where ideology meets economy and conviction separates winners from the
fearful masses. So let's just stop pretending that this is
(20:22):
just about tariffs. This isn't a rash decision. It's not
a tweet storm or an angry reaction to bad trade numbers.
This feels orchestrated, like a move that's been sitting in
the drawer, waiting for the right moment to strike. Because
behind the chaos there's a theory one that more Americans
(20:45):
are starting to believe, and it is this that President
Trump is playing a long game. So think about it.
Trump didn't just slap tariffs on China. He went broad.
He went big, a ten percent baseline across the board,
and a crushing forty nine percent for trade deficit offenders. Now,
(21:09):
it's not targeted policy, it's total economic warfare. And that
tells us something. This isn't about fixing one issue, It's
about forcing a complete rewrite of the global trade order.
And here's the heart of the theory. Trump doesn't want
(21:31):
to just win because of a next election, as you know,
he does not have that. He wants to reshape America's
economic destiny. He wants to be remembered not for his
tweets or scandals, but as the president who put the
US economy on a new sovereign path. And to do that,
(21:56):
he's willing to break a few bones, especially on Wall Street.
A great line. I can't take credit for it. Michael
Savage said it, and he said that President Trump has
two tools at his disposal, the feather and the hammer.
(22:17):
And the feather comes out to tickle the person that
he's negotiated with, to get them to loosen up and
laugh and they're gonna have a little bit of fun
with one another. But if he can't get them to
cave with that, then he brings out the hammer. And
that makes a lot of sense to me. And this
(22:38):
isn't new for him. Insiders say that Trump floated these
aggressive trade shifts during his first term, but he was
advised to hold off because they said it'll spook the markets.
They said, you're gonna lose swing states, in your re election,
they warned, Well, maybe that's exactly what happened. Now he
(23:01):
has no reason to hold back. Trump's not playing for
four more years. He's now playing for history books. And
what's his bet that Americans are ready ready to take
short term pain for long term gain, so ready to
stop being dependent on a global system that pushes the
(23:23):
American worker while propping up foreign economies that hate us. Well,
I am because I don't come from a white collar family.
I come from a blue collar family. And these jobs
(23:45):
are incredibly important to us. They're incredibly important to the
next generation and for the livelihood of even those that
are graduating high school right now, for those that realize
that they they may not want a profession they enjoy
doing things with their hands. They want to work in
a manufacturing plant. They want to have dirty hands and
(24:11):
a clean heart. Well, he hasn't touched Russia. Why, Well,
think beyond geopolitics for a second, think about minerals. We've
talked about this two weeks ago. I gave my best
overview on rare earth minerals and why they are needed,
(24:32):
and how they are of tremendous value and they are
the key to us moving forward in technology and in
military defense, and Russia has some of the richest rare
(24:54):
earth deposits on the planet, and the US needs those
to survive the next fifty years of technological advancements. So
if you want to break China's stronghold on semiconductors, on
defense systems and EV batteries, then you need to build
new supply lines, and those might run through Siberia, not
(25:17):
Silicon Valley. And Trump may be thinking like a builder again.
He's mapping supply chains, realigning alliances. And Ukraine doesn't get
into NATO, not because he's pro Russia, but because he
wants leverage in exchange. Maybe Russia opens the gate to
(25:39):
rare earth mining deals. Maybe the US becomes less dependent
on China and more invested in balancing two powers against
each other. Sound crazy, not if you follow the pattern.
Because Trump doesn't see trade as a transaction. He sees
(26:01):
it as leverage, and he's using America's consumption power, our
three trillion dollar import appetite as a weapon. Tariffs are
not just taxes, they're pressure points. Every percent that he
raises shifts global supply chains, It alters diplomatic ties, and
(26:23):
it forces corporations to rethink everything. So when Trump talks
about Liberation Day, he's not talking about freeing America from
bad trade deals. He's talking about liberating our future from dependence,
from foreign influence and from the slow bleed of outsourced power.
(26:48):
So this isn't just economic nationalism. It's strategic realignment. It's
the boldest geopolitical pivot since Reagan faced off against the
Soviet Union. In addition to Japan, we'll talk about that
later on. And if this works, it will go down
(27:09):
as one of the most audacious, risky, and brilliant plays
in modern American history. Now, on the flip side, if
it fails, he knows what the consequences are. But for Trump,
this isn't about applause. It's about generational change. This is
a legacy move, one final play for the soul of
(27:34):
the American economy. Because in Trump's mind, the cost of
inaction is far greater than the cost of disruption. And
he's not just testing the system, he's daring it to
collapse and rebuild stronger. Now, this isn't policy. This is
war by other means. It's bold, it's relentless, and it's unapologetic. Now,
(28:01):
let's talk about the elephant in the global room, which
is China. Tariff's. Trump's tariffs here, this is a blitz.
It isn't just about protecting American jobs. It's about confronting
the nation that he's called the biggest threat to American
(28:23):
power since the Cold War. And this time he's not bluffing.
China is America's largest trading partner, the biggest holder of
US debt outside of the country, and the supplier of
everything from your smartphone to your kid's Halloween costume. But
(28:45):
it's also our fiercest rival technologically, economically, and ideologically. And
Trump knows it, and he's treating China like an adversary,
not a business partner. So what's the play. Well, Trump's
tariffs hit Chinese exports hard, the tech components, consumer electronics,
(29:10):
steal pharmaceuticals, you name it. He's choked the pipeline and
daring China to blink and they might. Unlike pass trade spats,
this one is of nuclear scale. If China retaliates, it
risks sparking inflation, shortage and even internal dissent. Now they
(29:35):
have come out and said that they're they're going to
kind of try to one up us here. But this
is this is all planned for. This is a strategic
game of chess, and the entire world is watching now.
As you know, I'm not going to go into the
(29:56):
difference between chess and other games, but you have have
to have tremendous foresight and we're seeing some of this
play out now. I don't know about you, but as
I see China make their retaliatory threat here, that was
certainly someone that was very scared. They got put on
(30:21):
their heels and they thought they should just swing. And
all bad decisions are made in an instant. Quality decisions
are those that you noodle on. You think about the
impact of these, and I'll tell you this, No good
decision is made in twenty four hours. And that's what
(30:42):
China just did, which shows a sign of their weakness,
and it shows that we are going to win this.
And already China factories are reporting order cancellations and investor
confidence in Shanghai is now shaking. But here's the twist.
(31:04):
Trump may not want to destroy China. He wants to
isolate it. He wants to paralyze it. He wants to
cut off its oxygen without lighting the fuse of a
hot war, and that's why you're not seeing missiles, You're
seeing market moves. And this is silent warfare, and it
(31:26):
is brutal, and it's strategic because China dominates rare earth minerals,
seventeen elements that are critical to semiconductors, evs, aerospace, and
tech for defense systems. Trump knows that we're addicted. But
(31:47):
instead of begging China, he's looking elsewhere, so Q Russia, Q, Greenland,
Q domestic mining. He's rebuilding the supply chain, even if
it means pain in the short term, and that pain
it's real. Companies like Apple, Tesla, and Nvidia rely on
(32:08):
Chinese manufacturing and tariffs hit their margins. Consumers will feel
it with higher prices fewer options. But Trump is banking
on a core idea that Americans would rather pay more
for freedom than less for dependence, and the data it's
(32:30):
leaning in his favor. A recent pupole showed that sixty
three percent of Americans view China as a critical threat.
Now that's up from thirty two percent just five years ago.
Just five years ago is thirty two percent, and the
current results are sixty three percent of Americans view China
(32:54):
as a critical threat. Now the mood is shifting, and
Trump is riding that. It's not just policy, it's psychology,
and he's telling the people this will hurt, but it's
the only way to break free, and people are listening. Meanwhile,
(33:18):
China is cornered. It's real estate market is wobbling. Look
this up. Go on YouTube and look up. Look up
the the real estate problems in China. You're gonna see
these unbelievable I'm simply remarkable apartment complexes that have been
(33:42):
built by the government there that are completely empty. The
youth unemployment there is exploding, and foreign capital is fleeing
the country. And Trump's tariffs they aren't just economic punishment.
They're pouring salt directly into an already open wound. And globally,
(34:06):
allies are watching Japan, India, Australia. They're quietly recalibrating supply
lines too. Why no one wants to be left holding
the China bag if it collapses, and I believe it
is going to. Trump's moves may trigger a domino effect
(34:30):
and one that shifts global power for decades. I'll tell
you something, just talking about this stuff, I really hope
I actually have goosebumps. I've got goosebumps telling you guys this,
and I hope that I'm conveying to you a story
of hope and resilience in this great nation. You may
(34:52):
not like how this is all being unfolded, you may
not like Donald Trump, but this has been an issue
for a long time. At the start of the show,
you heard Nancy Pelosi addressing this in nineteen ninety six.
And for those of you who are just tuning in,
this is Drew Prescott, chartered retirement planning counselor and accredited
(35:16):
wealth management advisor at Prescott Private Wealth. Check us out
online PRESCOTTPW dot com. The phone over here is five
one eight two zero three one nine eighty three. And
typically we talk about, you know, some planning ideas, the market,
different financial things. And you may say, wow, this is
(35:37):
awfully political. Well it is, but it's one hundred percent
financial too. This is what is going on in the market.
Speaker 2 (35:45):
Now.
Speaker 3 (35:45):
You're not going to hear this from the last few hours,
and I apologize that you wasted your time listening to that,
but that's okay. Here you are little fresh, fresh initiative,
some good listening, some ed educational listening because you know what,
you don't need me to get on here and say
(36:06):
the same exact stuff that everybody else has said. You
don't need regurgitated notes from emails that I receive all
week long. Right, if you needed that, you could just
get one healthy dose of Bloomberg, CNBC, Fox Business, pick
(36:28):
your poison. I don't want to be like them. I
want to give you fresh material. I want to give
you stuff that you can benefit from. Okay, So again,
hopefully when you get done listening to this, you don't
say that's an hour of my life. I'd like to
get back. My goal is to give you information to
(36:53):
help you understand what's going on, to feel better about
what's going on, and to have a little bit of
an understanding so that you can have a conviction about it.
So thank you for listening.
Speaker 2 (37:07):
Hey.
Speaker 3 (37:07):
By the way, by the way, it's my sister Rachel's birthday,
so i'd like to say happy birthday to her. Happy birthday, Rachel.
I love you, I'm proud of you. You're doing a
great job raising the three boys, and you're a wonderful mother, sister,
and wife, and I thank you for who you are.
(37:27):
So glad to have another day with you here, and
so let's let me get back, let me get back here.
Just cross my mind. I wanted to get get that off.
Otherwise I would have felt bad for not saying something.
So where were we? I think I was on a rant?
Wasn't I a little bit? But that's okay. Let's see.
So like I was saying, you know, we've got Japan,
(37:52):
India or Australia, they're all starting to quietly recalibrate their
supply lines, and you know, has positioned themselves to be
in a bad spot. Russia and China very poor countries.
And this isn't This isn't trade policy that we're looking
at here. This is containment strategy, and it is working.
(38:16):
You know, we see the you know, we're seeing the
quaking of what's going on. But this strategy is working.
And the question here isn't if China will respond, it's
how hard and whether they can endure the economic siege
(38:38):
that Trump just launched. Because make no mistake about it,
this is not a battle over goods. This is a
battle over the future of our nation. And Trump's betting
that economic independence is the hill that is worth dying on.
(38:59):
And this isn't just economic policy, it's ideological warfare wrapped
in financial terms. And when Trump's tariffs hit, not everyone
got crushed. In fact, while the headlines focused on panic,
a quieter story was unfolding, and some companies didn't just survive,
(39:22):
they thrived. So let's start with some of the winners here.
Consumer staples led the way. Companies like Procter and Gamble,
maker of Tide, Gillette, Pampers, they barely flinched. Why why
is that? Because people still brush their teeth, they still
(39:42):
washed their clothes, and they still care for their kids,
no matter what is happening in Beijing now. Procter and
Gamble dipped just one percent while the SMP tumbled five percent.
That's not just resilience, that's dominance. Then came companies like
(40:03):
Duke Energy, for example, They actually ticked up one point
two percent. In chaos, people craved stability. Lights still turn on,
bill still get paid. Utilities with their steady domestic revenue
are the tortoise in this race and they're winning. But
(40:26):
the surprise hero Nucor, the steel giant. So while tech
stocks crashed, Newcore rose two percent. So why because tariffs
make imported steel more expensive, which boost domestic producers. So
it's not just protectionism, it's profit. Trump's America First policy
(40:53):
is fueled with an old school industrial.
Speaker 1 (41:00):
Rival.
Speaker 3 (41:01):
Now the losers, and it's brutal. Tech was ground zero.
Apple lost eight percent in a day, two hundred billion gone.
Why supply chains. Apple relies heavily on China for assembly.
Same for Tesla down seven percent, and in Nvidia, which
(41:26):
took six percent hit. These companies are global by design. End.
When borders harden, margins bleed, so retailers with overseas dependence
also got hammered. Amazon dropped six percent as investors braced
for rising product costs and slower fulfillment. Global logistics is
(41:49):
their lifeblood and tariffs are their tourniquit. So even bond
focused ETFs like a twenty year plus I show share
treasury bond absorb billions in capital, proof that investors were
rushing towards safety. Meanwhile, as I said earlier, Robinhood traders
(42:12):
doubled down on domestic names. It's like the investing world
is splitting in two, those who believe in globalism and
those who believe in the American comeback. But here's the catch.
These aren't just financial wins and losses. They're political signs.
(42:35):
The companies that won most are rooted in American soil,
focused on domestic production and less exposure to geopolitical wins.
The ones that lost global sprawling and deeply entangled with China.
Trump didn't just trigger a tariff wave. He triggered a
(43:00):
loyalty test for corporate America. And investors are no longer
just asking what's profitable, they're asking what's patriotic. CEOs are
adjusting fast. Letters now mention resilience, not just returns. Wall
(43:21):
Street's language is shifting, and it's all because Trump redrew
the financial battlefield and amid all of the market noise,
one report stood out like a beacon, and that's jobs
on April fourth. This number, when it came out, it
(43:42):
was kind of poo pooed, and I was disappointed to
see across every major media outlet they poopooed this number.
They said, they just glossed over the number, not showing
you how incredible it was. The March unemployment numbers dropped
(44:03):
and they were strong, and the US added two hundred
and twenty eight thousand jobs, which smashed Wall Street's estimate.
Of one hundred and forty thousand an unemployment it ticked
up slightly to four point two, but let's be honest,
that's still near historical lows. So in a sea of red,
(44:27):
that job's report was a bright, glowing green, and that
matters because tariffs may shake the market, but jobs they
ground the economy. If people are working, they're spending. If
they're spending, the economy stays alive. It's that simple. And
(44:48):
these numbers weren't a fluke. Healthcare, construction, and leisure led
the hiring surge, and these aren't speculative tech jobs. These
are boots on the ground, real world, pay your rent jobs.
So compare it to March twenty and twenty four when
(45:10):
we added two hundred thousand, March and twenty three just
one hundred and seventy five thousand, and this year is stronger,
and it's not just quantity, but it's quality. Wages are
up four and a half percent year over year, outpacing inflation.
(45:31):
That means that purchasing power is rising. For all the
doom and gloom, Americans are bringing home more money and
that can buffer the impact of rising prices. But the
key word is can, because the flip side of tariffs
(45:52):
is inflation prices go up, so that three dollars cup
of coffee may become five dollars. Speaking of coffee, I
can't wait to have coffee and Kona, I hear. It's amazing,
very excited about that. So but anyways, so your cup
of coffee is probably gonna go up. Electronics they're gonna rise, Apparel, tools, toys,
(46:18):
anything imported could cost more. And the big risk if
wages can't keep up, consumer spending slows and the engine
starts to sputter. But right now inflation's running low. Well,
I don't want to don't don't send me, let don't
(46:39):
send me any messages on that. All right, let me
I'll walk that back. How's that sound? But right now
inflation's running around two point eight percent. That's manageable. But
if it ticks past four percent, the Fed might react
rate hikes, credit tightening again, and suddenly that vibrant job
(47:05):
market could cool down. And that there is the balancing
act that Trump is dancing on. So stimulate domestic production
without overheating inflation, boost wages without igniting a firestorm of
price hikes. But there's a deeper argument here. And it's
(47:27):
one that Trump is quietly making. He's saying it's better
to take short term pain now and rebuild an economy
that's resilient, self sufficient, and strong instead of counting on
cheap Chinese goods and fragile trade reliances. That he wants
(47:49):
to force the US to stand on its own two
feet here. And that's a key thing, right. Cheap Chinese
goods not just financial, but they're just cheap their garbage,
aren't they. Oh my goodness, they used to We used
to always joke around about that that must be Chinese.
But the quality hasn't changed. It's just become acceptable. We
(48:13):
live in a world where you know, costume jewelry even right,
like a real diamond. You know, a lady could have
a beautiful, real diamond that's smaller than some of this
costume jewelry that we see these influencers and people wear,
(48:35):
and the fake gets more recognition than the real. And
that's going to be a good thing for us to
come back to quality over quantity. And the jobs data, well,
it suggests that this strategy might be working because more
(48:58):
Americans are working, more money is circulating domestically, more production
is happening inside of our borders. So let's take Tom,
a small manufacturer in Ohio. Two years ago, he was
sourcing machine parts from Shenzen. Now he's buying from Indiana.
(49:19):
Why his costs are up, but his supply is stable
and he's hiring. And that story is playing out across
the rust belt and it's changing the character of the
recovery because this isn't just about economics. It's about values, independence, grit,
long term strength over short term gain. And we are
(49:45):
betting that Americans are ready to trade instant gratification for
future security. And if the job market holds its proof
that the pain has purpose and the re it's not
just possible, it's already started. And here's what's wild. Most
(50:07):
economists didn't see this coming. They expected that tariffs would
kill momentum. Instead we're seeing resilience. It's early, yes, but
if the numbers hold, Trump may have cracked the code
a way to revive industry and still keep main street moving.
(50:32):
What are the stakes here? Everything? Everything is at stake.
So where does this all lead? Well, we've seen the chaos,
the strategy, and the political fault lines, but now comes
the trillion dollar question, how does this play out. We
(50:56):
can either see failure success or the muddy middle where
we are right now. So the hope here is that
factories will start to reopen in Michigan, new chip plants
(51:17):
in Texas, steel mills roaring in Pennsylvania, and the country
chanting we build again. The S and P five hundred
hits fifty four hundred. By twenty and twenty six, wages
(51:38):
are up, consumer confidence is back. History books credit the
move as risky but brilliant. That's what the wind looks like. Now,
if it's a flop, we're going to see mortgage costs rise,
(51:59):
consumer confidence tank. By twenty twenty six, we're in a
shallow recession, much deeper, job losses mount. GDP shrinks to
one point five percent. Politically, it's a feeding frenzy, and
Trump critics call it proof of economic suicide. Swing states wobble,
(52:21):
and global partners distance themselves. And it's a cautionary tale. Now,
what about the muddy middle? Right well, Inflation if it
drifts up to three and a half percent, tech stock
(52:41):
will struggle, while consumer staples hold steady. China retaliates lightly,
the trade deficit improves, but not dramatically. GDP bumps up
one percent. The economy avoids recession, but it feels sluggish,
and Trump's support holds, but critics remain vocal. Well, you
(53:03):
see in this middle ground Ford see sales rise, Tesla
struggles with their battery costs, Apple rethinks its supply chain
but takes years to shifts. So here's the truth. Even
in the middle or failure scenario, a long term benefit
(53:25):
may still emerge. Let's look into a historical event that
was similar to what we're dealing with now.
Speaker 2 (53:32):
Recent disagreements between our two countries on the issue of
trade will also be high on our agenda. As perhaps
you've heard, last week, I placed new duties on some
Japanese products in response to Japan's inability to enforce their
trade agreement with US on electronic devices called semiconductors. Now,
(53:53):
imposing such tariffs or trade barriers and restrictions of any
kind are steps that I am loath to take.
Speaker 3 (54:01):
So you see, history isn't just a warning, it's a blueprint.
And as we stand in April of twenty twenty five,
staring into volatility and uncertainty, we've seen this movie before,
and if you know where to look, the past doesn't
just explain the present, it reveals the opportunities within it.
So if we rewind to October of nineteen eighty seven,
(54:24):
the market was flying high after years of a bull run.
Valuations were stretched and price to earnings ratios reached unsustainable levels.
Then came the crash, twenty two percent in a single day.
The world panicked. Does that sound familiar? Now? Look at
twenty and twenty five. The sm P five hundreds priced
(54:46):
earnings is twenty one point eighty five high, but down
from twenty four point three six last year, and not
nearly as bloated as nineteen eighty seven. So the setup
is different, but the tension is the same. Trade fears,
policy risk, and global uncertainty are converging again. In nineteen
(55:08):
eighty seven, it was the dollar, deficits and rising rates.
Today it's tariffs, trade wars and a cautious fed, same tremors,
different decade. But here's what matters. Nineteen eighty seven wasn't
the end. It was the shakeup before a new beginning.
Reagan faced off with Japan. He didn't fold. He realigned trade,
(55:31):
protected American jobs, and laid the foundation for the nineteen
nineties growth. Today, Trump's not playing nice. He's going full frontal,
full on. The object here is to defend, I should say,
the objective here is to defend domestic production, rebalance power,
(55:52):
and reset the rules of engagement. And that's where we are.
I hope this was encouraging. Thank you for listening. You're
listening to your money matters. I'm your host, Drew Prescott,
chartered Retirement Planning Counselor, Accredited Wealth Management Advisor and President
Prescott Private Wealth reach Out five one eight two zero three,
one nine eight three five one eight two zero three
one nine eight three or Prescott PW dot com. Thank
(56:14):
you so much for listening, and until next week, May
God bless you and God bless your family
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