September 3, 2025 • 8 mins
LISTEN and SUBSCRIBE on:
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Spotify: https://open.spotify.com/show/2PtgPvJvqc2gkpGIkNMR5i
WATCH and SUBSCRIBE on:
https://www.youtube.com/@WatchdogOnWallstreet/featured
Wall Street cheers “better-than-expected” earnings, but the truth is darker: profits are driven by layoffs and cost-cutting, not real consumer strength. With debt soaring, tariffs biting, and Washington unwilling to rein in spending, the economy is whistling past the graveyard. The question isn’t if a financial reckoning comes — it’s when.
Apple Podcasts: https://podcasts.apple.com/us/podcast/watchdog-on-wall-street-with-chris-markowski/id570687608
Spotify: https://open.spotify.com/show/2PtgPvJvqc2gkpGIkNMR5i
WATCH and SUBSCRIBE on:
https://www.youtube.com/@WatchdogOnWallstreet/featured
Wall Street cheers “better-than-expected” earnings, but the truth is darker: profits are driven by layoffs and cost-cutting, not real consumer strength. With debt soaring, tariffs biting, and Washington unwilling to rein in spending, the economy is whistling past the graveyard. The question isn’t if a financial reckoning comes — it’s when.
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
The Watchdog on Wall Street podcast, explaining the news coming
out of the complex worlds of finance, economics, and politics
and the impact that we'll have on everyday American author,
investment banker, consumer advocate, analyst, and trader Chris Markowski.
Speaker 2 (00:16):
File this under Don't Doubt Me. Wall Street Journal had
an extensive piece today on earnings season and what we
can learn from earning season right now. And I know
everybody's pointing at Wow, everybody beating earnings. How are they
beating earnings? Well, we had Liberation Day, We've had the
(00:42):
high cost of goods. I've talked about the need for
us to have deflation. When it comes to consumer items.
The consumer is most certainly stretched. I've pointed out here
on the program where we're at as far as credit
card delinquency rates through the roof, one thing after that. Obviously,
(01:04):
my longtime listeners know this. As it turns out, right companies,
companies are earning more money. They're earning more money through
productivity gains. And there's nothing wrong with productivity gains. Productivity
(01:25):
gains are great. Technology, various different things and layoffs. That's
that's that's where the numbers are right now. It's not
as if mom and pop are going out there and
spending more money, unless it's again it's inflationary. This is
(01:45):
not something in regards to cash flow. They were where
you got people out there, moving and grooving and spending
tons of money. It's not a top line We're not
looking at top line gains here. That's a problem. That
is a major problem, and we've been talking about it
(02:07):
for some time. Again, we can whistle past the grave
guard all we want when it comes to the economy,
and you're gonna have a lot of people, a lot
of pundits, a lot of influencers tell you how great
everything is. Everything is awesome. We're dealing with a lot
(02:27):
people and again, just didn't happen. There's no way that
has just happened under Trump. I'm not blaming this just
on Trump. This goes way back to COVID, this goes
way back to Biden. There's a myriad of different things
that got us to where we are. My point was,
and my excitement and the business community's excitement when Donald
(02:50):
Trump came in. Is obviously reducing regulations, making it easier
for businesses to go out there and build and create
and do all of these things, getting rid of all
that red tape. That's fantastic, lowering energy costs and obviously
becoming a nation that is more fiscally prudent. They got
(03:14):
off the beaten track. We got off the beat in track.
We haven't been that successful at all when it comes
to cutting government spending. DOGE was a revelation that was
excited about it when it first came in. Not really
much of anything. Our budget deficits are ginormous. We're being
(03:37):
told that, you know, these tariffs are great for the
economy and great for the United States, and all this
revenue coming in, it's attacks. Businesses are starting to obviously
slowly but surely put it into the prices of the
goods that they have or what else they have to do.
Cut costs, fire people, you know, automate more things, get
(04:01):
rid of more cash, and whatever it may be. They're
going to do what is necessary based upon the terrain
that is placed in front of it. That's their job.
That's a job of a CEO is to act as
a fiduciary to their shareholders. So again, you know, we're
told we're entering this wondrous great stage. Listen, We're not
(04:24):
until we can finally get the government out of the way.
We're going to see what's going to happen moving forward
when it comes to these tariffs, how it's going to
continue to reflect. Continue to see more and more stories
in various different papers around the country, businesses out there
that are the CEO's writing letter. We're hurt. My business
is hurting. We're not going to be able to compete.
(04:46):
We're going to have to go under all of these things. Okay,
and again it's due to government intervention. But once again,
when you have both political parties completely unwilling to do
what's necessary, make the necessary cuts, this is the problem
that arises. Whether you want to believe it or not, people,
(05:10):
there is going to be a bit of a financial
reckoning day at some point in time for this country.
I don't know when it's going to be. I really don't.
It was interesting had Ray Dallio Bridgewater come out and
say that it's going to be within the next three years.
We're going to hit to that get to that point
in time. I don't know. I don't know. And it's global, people,
(05:39):
it really is. It's global. We saw this happen. We
covered this extensively when it was some of these Southern
European nations and several of those as well during the
European financial crisis, Greece, Italy, Portugal, Spain, Ireland, all of
them getting hit and they had to take some massive,
(06:03):
massive austerity measures that they haven't gone away. They have
gone away again, they learned to deal with them. How
are we going to deal with social security inevitably having
to be cut sooner rather than later? How much more?
(06:24):
Where are the revenues going to come from to pay
for all of this tariffs? Really you think so that's
where that's where it's going to come from. It's just
not possible. We can't tax our way out of the
hole that we've created for ourselves. One of the things
(06:44):
that they put out there was, oh, we're going to
be able to grow our way out of the hole
that we're in. No we're not. No, we're not. Maybe
a combination of things. But the easiest thing, the easiest
thing to do, is just stop the spending. Right. Well,
(07:05):
it's again the easiest thing, I guess you want It
depends on the word the word you know, how you
think about the word easy For you and I and
anybody that's fiscally prudent out there. It's easy for us,
but for the people in Washington, no, no bringing money
back to the district. Got to have more handouts and giveaways.
Oh yeah, we're gonna have some some cuts. We're gonna
(07:26):
make people actually, uh, force people to work if they
want to get certain government benefits, twenty hours a week,
and then we're told that they're all going to die.
Something has to give people, It really does. But that's
that's the overall picture. And if you don't again, we're
getting back to corporate profits and what I'm talking about this.
(07:47):
But if you don't think that this affects us, it does.
It has everything to do with all of this. It's
it's a it's paralyzing for crying out loud. Watch stalk
on Wall Street dot com.
The Watchdog on Wall Street podcast, explaining the news coming
out of the complex worlds of finance, economics, and politics
and the impact that we'll have on everyday American author,
investment banker, consumer advocate, analyst, and trader Chris Markowski.
Speaker 2 (00:16):
File this under Don't Doubt Me. Wall Street Journal had
an extensive piece today on earnings season and what we
can learn from earning season right now. And I know
everybody's pointing at Wow, everybody beating earnings. How are they
beating earnings? Well, we had Liberation Day, We've had the
(00:42):
high cost of goods. I've talked about the need for
us to have deflation. When it comes to consumer items.
The consumer is most certainly stretched. I've pointed out here
on the program where we're at as far as credit
card delinquency rates through the roof, one thing after that. Obviously,
(01:04):
my longtime listeners know this. As it turns out, right companies,
companies are earning more money. They're earning more money through
productivity gains. And there's nothing wrong with productivity gains. Productivity
(01:25):
gains are great. Technology, various different things and layoffs. That's
that's that's where the numbers are right now. It's not
as if mom and pop are going out there and
spending more money, unless it's again it's inflationary. This is
(01:45):
not something in regards to cash flow. They were where
you got people out there, moving and grooving and spending
tons of money. It's not a top line We're not
looking at top line gains here. That's a problem. That
is a major problem, and we've been talking about it
(02:07):
for some time. Again, we can whistle past the grave
guard all we want when it comes to the economy,
and you're gonna have a lot of people, a lot
of pundits, a lot of influencers tell you how great
everything is. Everything is awesome. We're dealing with a lot
(02:27):
people and again, just didn't happen. There's no way that
has just happened under Trump. I'm not blaming this just
on Trump. This goes way back to COVID, this goes
way back to Biden. There's a myriad of different things
that got us to where we are. My point was,
and my excitement and the business community's excitement when Donald
(02:50):
Trump came in. Is obviously reducing regulations, making it easier
for businesses to go out there and build and create
and do all of these things, getting rid of all
that red tape. That's fantastic, lowering energy costs and obviously
becoming a nation that is more fiscally prudent. They got
(03:14):
off the beaten track. We got off the beat in track.
We haven't been that successful at all when it comes
to cutting government spending. DOGE was a revelation that was
excited about it when it first came in. Not really
much of anything. Our budget deficits are ginormous. We're being
(03:37):
told that, you know, these tariffs are great for the
economy and great for the United States, and all this
revenue coming in, it's attacks. Businesses are starting to obviously
slowly but surely put it into the prices of the
goods that they have or what else they have to do.
Cut costs, fire people, you know, automate more things, get
(04:01):
rid of more cash, and whatever it may be. They're
going to do what is necessary based upon the terrain
that is placed in front of it. That's their job.
That's a job of a CEO is to act as
a fiduciary to their shareholders. So again, you know, we're
told we're entering this wondrous great stage. Listen, We're not
(04:24):
until we can finally get the government out of the way.
We're going to see what's going to happen moving forward
when it comes to these tariffs, how it's going to
continue to reflect. Continue to see more and more stories
in various different papers around the country, businesses out there
that are the CEO's writing letter. We're hurt. My business
is hurting. We're not going to be able to compete.
(04:46):
We're going to have to go under all of these things. Okay,
and again it's due to government intervention. But once again,
when you have both political parties completely unwilling to do
what's necessary, make the necessary cuts, this is the problem
that arises. Whether you want to believe it or not, people,
(05:10):
there is going to be a bit of a financial
reckoning day at some point in time for this country.
I don't know when it's going to be. I really don't.
It was interesting had Ray Dallio Bridgewater come out and
say that it's going to be within the next three years.
We're going to hit to that get to that point
in time. I don't know. I don't know. And it's global, people,
(05:39):
it really is. It's global. We saw this happen. We
covered this extensively when it was some of these Southern
European nations and several of those as well during the
European financial crisis, Greece, Italy, Portugal, Spain, Ireland, all of
them getting hit and they had to take some massive,
(06:03):
massive austerity measures that they haven't gone away. They have
gone away again, they learned to deal with them. How
are we going to deal with social security inevitably having
to be cut sooner rather than later? How much more?
(06:24):
Where are the revenues going to come from to pay
for all of this tariffs? Really you think so that's
where that's where it's going to come from. It's just
not possible. We can't tax our way out of the
hole that we've created for ourselves. One of the things
(06:44):
that they put out there was, oh, we're going to
be able to grow our way out of the hole
that we're in. No we're not. No, we're not. Maybe
a combination of things. But the easiest thing, the easiest
thing to do, is just stop the spending. Right. Well,
(07:05):
it's again the easiest thing, I guess you want It
depends on the word the word you know, how you
think about the word easy For you and I and
anybody that's fiscally prudent out there. It's easy for us,
but for the people in Washington, no, no bringing money
back to the district. Got to have more handouts and giveaways.
Oh yeah, we're gonna have some some cuts. We're gonna
(07:26):
make people actually, uh, force people to work if they
want to get certain government benefits, twenty hours a week,
and then we're told that they're all going to die.
Something has to give people, It really does. But that's
that's the overall picture. And if you don't again, we're
getting back to corporate profits and what I'm talking about this.
(07:47):
But if you don't think that this affects us, it does.
It has everything to do with all of this. It's
it's a it's paralyzing for crying out loud. Watch stalk
on Wall Street dot com.
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