Winners and Losers Under Trump’s Second Term
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Welcome to property markets today were discussing winters and losers in the markets under a second trump term. But first here with the news is property analysis ed as and ed.

how are you? I'm doing very well. So I Scott, on is shining.

It's a new day. I'm pretty good how you feel. So I did.

I know if I told you I tell about my peony, an anzani s prescription packs.

I did hear about that, but I didn't hear. I didn't hear how the bet fully shake out. I know you bet on the election so you're feeling a little more upset than the othe wise, whatever.

right? Well, no, it's Better to be lucky than good. So what happened was I went to poly market thinking I had great inside.

I was trading IT about sixty, forty report to to to have box on what I thought was a coin flip. I was going to go on Polly market. I started registering and I said, or you're not in the us, or you're in london, you can do IT in my F.

I. And so I went to the single of bet three, sixty five. And as you can imagine, I am really good and have a lot of patients with registering at site.

So I didn't end up doing. I thought, what I will, I still want to do this. So I did a coloured option strategy. And that is, I sold in donal tra media a bunch of calls at the strike Price of thinking I could crash to twenty if he got elected.

But because I was worried about one hundred, two hundred, I bought some calls at sixty way out of the money sort of a what I think is refer to as a color strategy. I got twenty one dollars in premium for selling the calls, and the cost me six box with the insurance on the back and its sixty box, so a net proceeds of fifteen dollars. And I also thought that even if you wins, that stock has become a bit of a mean stock or a prediction vessel for the election.

But once the prediction is over, in a SHE wins where life was a shooting company. And so I thought there was a decent chance. I knew I would go down if SHE won, and I thought there was a decent chance that still microsoft one anyway, as we set her today.

I think the stock is falling up dramatically. I think it's trading IT about twenty eight bucks right now. So i've actually made money on this trade.

See above, it's Better to be lucky than good, but they hear the astro t here. I am self conscious. I like to be transparent about money, because I know I think people should talk about money. This is not investing. This is gambling.

I want to be clear, I know i'm gambling and whenever you write an option, especially if you write calls, I would say be very careful and think about buying calls that are very upon such that you don't get hurt too badly and also um don't ever gamble more money than you can afford to lose. My personal metric is I can lose enough money that would ruin my morning on my afternoon, but I couldn't ruin my day. So because be clear, when you are playing with options, you know what is the eighty or ninety percent expire worthless.

So this is a highly risky strategy. This is not a investing, this is gambling. But I was so confident that here is was going to win, that I wanted to play this.

And I got lucky by doing this option strategy and the fact that Donald trump media is no larger seen as a bell weather that he's gna win. He's won. Now it's just a shady company that's got three million revenues in its hammering ging money. But we'll see it's their still time.

Here they are IT on OK. So just quick message to our listen, please do not short squeeze boss. Please don't do IT don't we don't want to go to sixty. And with that will start with the weekly a few of market vitals.

The M P five hundred climbed, the dollar strengthened, bitcoin hit a new record on the yield on ten year, treasury's Spiked, shifting to the headlines. The boone strike is over after work has voted to accept an offer that includes a forty three percent compounded rates over four years. However, the deal does not restore the pension plan, which was a sticking point for many union members.

Plexi CEO arab, in shrine of us, has offered to provide technical infrastructure support to the new york times made the tech killed strike. That offer comes less than a month of the time, sent a season assist to complexity, demanding the start up stop using its content to train A I models. And finally, shares of data analytics firm polenta rose twenty three percent to a record high after its earnings beat anos expectations.

The strong earnings were primarily driven by robust U. S. Government spending on its products with the company securing a one hundred million million military contract.

Shares are more than two hundred and eighteen percent so far this year. Scot, let's start with boy, and i'll just quickly go over the agreement here. So they're getting an immediate thirteen percent bump followed by three more bumps over the next three years.

So ultimately, over four years, when you touch your compounding, they are going to get a forty three point six five percent increase from their current wage. They're also going to get a twelve thousand dollar ratification bonus. They are not getting that traditional pensions plan that many of them wanted.

They're going to get the defined contribution plan. If they invest eight percent of their salary into their foo N K, boeing will go invest that same amount into the four o one cake. So this kind of turned out the way that we expected.

The workers got that pay rise that we they were looking for. We predicted that. We said IT was a reasonable request.

They got IT. They didn't get that pension plan. We also predicted that got your reactions to the end of the baLance strike.

I think you summer is that this feels right as rain. They clearly, they hadn't had a raise. And I think five years when inflation was substantially forty three percent as real cabbage, a little bit misleading because my understanding is this over over four years. So it's more like either nine percent a year. I think if IT compounds .

like thirteen percent, nine percent, nine percent, nine percent specifically, there go.

So it's a real race that's gonna hopefully much faster than inflation. So they are purchasing power go up. But yeah, this was an easy call around the pension companies can't subject shareholders to a pension plan that might end up becoming I cannot explode device within the company where they have all these obligations after the asset has left the company.

So good for boeing, good for boeing employees, good for the planet complexity. This is a pure publicity stunt and it's smart because we're talking about IT and he's not going on a lot of favors with you know N Y T. employees.

But it's a little bit misleading or requires you not what you're saying and doing. Everybody, there's using their content. They're not specifically going after um I mean, they going after all, all of them, right? They're saying they're trying to build a IP and they're trying to infer their content, which is smart.

If they were smart or they'd be binding together creating a consortium such that they can be with a lot of voice because even as strong as all the N. Y, T. Or valuables as all the N.

T. Content is, it's still not strong enough to go to guys. Any thoughts from you and perplexity? I think .

you're exactly right that this is a publicity stunt, and we should just confirm IT worked. This was covered by thirteen different news publications. Just the simple act of the CEO going to the new york times and saying, hey you, anna, use R.

A, I. In the midst of your strike. Those publications include the new york post. They include tech crunch, several others.

And he is the most important statistics, which is that in the past seven days, google search volume for the C. E O arabin thrilla has increased seventy percent. So as far as publicity stunts go, this was sort of a smashing success.

yep. And then palante. Er so I got to give IT to them. I was very skeptical this company, I thought I was very opake and creating this kind of clock the field to create differences or deep dark technology, whether wasn't either clearly continue to perform, continue to beat expectations. The C O understand storytelling.

So nothing like a company that's kind of got this deep, cool, innovative, A I spirto spy fiel, combined with beating earnings consistently, combined with the sea, who goes on bill marr, and is really greater messaging. So a this company of my mind is still incredibly overvalued, but good for them. Stock is tripled in the last year.

Second best perform in the S M P right now. S P five hundred of this and electricity provider that has benefit from the AI power bone is number one, but the government revenue was up forty percent year on year to three hundred and twenty million, making up about two thirds of the company's total revenue. They traded A P, E of one hundred and thirty, which is more than three times the valuation on A P E basis of NVIDIA.

The video is growing four times faster than plentier and has fifty percent of profit margin, a pair to plentier twenty percent. So one of two things is true here. Either talent here is dramatically overvalued or in video is dramatically undervalued.

Ah IT has a tony short interest more than its competitors as a percentage of its float. Volunteers up around five per snow, flix at four percent and IBM is IT about two and a half percent. And then people are very bullish on polenta because of the incoming administration thinking the defense spending typically goes up under republican ministrations.

And in the first two and half years of the travel administration, polenta revenue from the us. Government contracts are passed its total under president obama's entire second term. So this is a government contractor, but it's a good business to be in.

The defense spending point is interesting because, yes, exactly. They still heavily rely on government revenue, makes up sixty four percent of their overall revenue. Most of that is analytics for the military and for the department defense.

And what the market is telling us is, you know, when they had a great quarter, but at the same time, they're also bullish on the fact that we have a republican in charge, that we have the trump is now in charge and theoretically ally, that means that defense spending will go up. But then there's the other side, which is no trump. His whole campaign has been that it's gonna an isolationist foreign policy.

His whole stick is that we're going to be pulling back from all of our military exploits that at least the argument that i've been hearing from my republican friends. And so if he feels like we're a bit of across roads is not really clear what we think is going to happen in terms of defense. He said he's going to a cut spending, but the market is telling us know that we actually think that trumps going to increase the amount that we spend on the military, which yes would benefit plentier if he cuts back IT would be harmful plentier.

So I think that's just an interesting dilemma right now, but I think it's something to keep an eye. I think palette is going to be a good tracking stock for trying to understand where we headed. In terms of our defence spending.

I think the markets got a right. I can see first time is not a food deficit. He loves being able to beat his chest.

I just can't see the whole affinity, testosterone driven, mocho bullshit resulting in him ever cutting spending on the military. I think he I just not think all the incentives are lined up for to either keep at bast military spending flat. I would be surprised if I didn't go up. It's just the kind of guy, as he wants to be able to is say, you know go to put and and go to tim jungle and say, yeah, our military continues to spend more than the next ten nine bigger spends combined.

We will be right back after the break with a look at the markets, winners and losers under a second trump administration. And quick reminder, profit markets has its own feed. Now there you'll get two episodes every week. So if you're still listening on the proof je pod, move over typing profit markets, whatever you get a pod cost and hit follow will be right back.

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With back with profit markets, dont trump has laid out a broad economic plan for the U. S. That includes tax cuts, tariff s. Deportations, a reduction in energy Prices and much more over the next four years. This plan will affect the economy in a variety of ways.

So Scott, we're just going to look at the markets reaction to trumps win and will go through some of the winners and some of the losers under this new administration. So we'll start with the winners. Our first winner is the U.

S. Stock market overall. So the S, M, P, five hundred surge, so did the door. And this is all in broad expectation of corporate tax cuts.

Trump plans to bring down the corporate tax rate from twenty one percent to fifteen percent. In addition, volatility is down as investors finally know the results of the election. So that has been to help for the stock market too, going to more specific companies and more specific sectors.

Our second winner is tesla. So tesla rose fourteen percent after the election result. Investors believe the tests that will benefit from this administration lodged due to likely his relationship, elon musk relationship with don't trump, but there are some other more concrete economic explanations.

So for example, trumps china tarra. As we know, tram is planning to increase tires on china, which will keep chinese competitions out of the us. As we've discuss before, one of texas greatest threats is byd, a chinese vehicle maker.

In addition, trump plans to remove subsidies for electric vehicles. You would think that would hurt text learn. Maybe IT will, but more likely is that IT will hurt small E, V makers in the U.

S, the less established and less profitable EV makers. In other words, IT is going to solidify test position as the market leader. And the final implication, which i'd like to get your reaction to, is that must might be able to advise on autonomous driving regulations.

That's one of the biggest hurdles for tesla and the robot taxi mission. So if elon mosque has one foot in the White house and the other tesler IT could be that he'll be able to false his vision of the robot taxi fleet. And that is certainly what investors are pricing in right now. So Scott, let's get your reactions to tesla as a winner of this trumpet administration.

Well, first is in terms of the broader market, stocks represent essentially how corporations and management and the wealthy are doing who control our own ninety percent of stocks. And essentially, the reason the stock market is ring is there's an anticipation of a taxi t or an extension of the corporate tax cutts, which will increase earnings and thereby logically increase the value of the shares.

Now what the horse our campaigns unable to do, which seems fairly obvious to me, is that all this happening is the following. The stock market has gone up. The credit markets have actually gone down in the sense of the ten year the yield has got, and the bonds on the ten year have gone down.

why? Because the credit markets look long term and say, okay, we think that Donald trumps is can be inflationary. And the dots that I don't think people are connected as the following. This market rally is essentially a transfers alth from you to me because all the happening here is trump is signaled and the market believes him, he's going to cut taxes on corporations. He is not going to fund that.

Uh, my prediction will be it'll be deficit funded, meaning the stocks iron are up substantially the last two days that on anticipation of a bigger deficit, which will increase your interest rates and lower your stock returns when you're my age and own stocks. So all the market is saying right now, in doing right now is transfer wealth from people you're age to people my age. And the credit markets recognize this and yields have gone to so I I think that the Harris campaign was totally incapable of connecting the dots and saying, we need to stop the transfer of wealth from Young to old.

And terms of tesla, my understanding is he spent about a hundred and twenty million dollars on the trump campaign, and his wealth increased, I think, something like fifteen billion dollars, the best investment, the best trade this year was elon mask, uh, participating, going all in and giving one hundred and thing was nineteen million dollars to the thumb campaign. He's order to get fifteen billion back because people assume that he's all in uh, trump of sm trump is a kept crat and trump will give tesla government contracts and this will just be really good for elan. Who's going to get to say I like this regulation because IT hurts.

B, Y, D. I don't like this one because I would hurt me. You know, this is basically the market says tesla is about to become a recipe on the good end of a collect crat here known as the trumpet administration.

I'm just waiting for all the comments to say that you have trumped rangement syndrome. No, please. If you GTA make an argument against that, I just hope that people ground IT in like an actual argument that's based in fact um because I think what you've said is, is completely fair and like that's exactly what the market is pricing in right now.

And I had just me added that in the last the last year trading days I have made a fuck ton of money .

yeah and by the way, everyone says why you complaining you're going to get Richards like, yeah, I know we're onna get rich a finale if we own a bunch of stocks.

i'm getting rich on your credit card yes, nothing is fundamentally changed about the R N D, or the education or innovation, or anything that's actually fucking sustainable in this country. Yeah, we're gonna produce smarter kids or fewer depressed Young adults or create R N. D for our universe.

None of that is here. This is some. He's going to run up your credit card to reduce the taxes on company's iron shares. And presently, great. And then and then if I live long enough and I probably won't people enough to be the taxes on poverty, increased incarceration in exceptional interest rates from the chinese, don't show up or do show up and say we want ten, fifteen, twenty percent yellow if you want us to continue buying your treasuries, which is gone to crowd out all investments and ford lane investments, technology, R N D education.

Because basically our entire budget at the time, you are my age and have any real money, is going to go to places to seniors or unproductive through entitlements or to pack the interest on our debt. This is nothing but pulling prosperity forward from Younger people to me. So yeah, IT feels good. I'm going to enjoy IT. IT is bad for america.

exactly. Let's move on to another winner of this new trump administration, which is the bank stocks. So shares of J. P.

Morgan, bank of amErica city group, golbin sax and Morgan stanly or so on the election news, common size and Morgan standing rose as much as thirteen percent. In addition, private equity firms rose such as K, K, R and blackstone. Blackstone hit a record high.

So in otherwise, this was a big win for banks and for financial services. why? Because, again, the expectation is that trump will significantly roll back financial regulations. And as we have discussed, m na has been down over the past few years.

There are likely a lot of factors contributing to that, but many believe that the biggest one is because of regulation from people like lindon at the ftc. Many believe that lacon who we had on this pod cost will be out of a job in this administration. So in some loser regulation leading to more M N A, leading to larger investment banking fees and so more revenue for the big banks. I assume going to have a similar date to what we just said, but what's your reaction to the storing market values of the bank stocks?

A move of twelve and thirteen percent among jp Morgana well far ago is much more dramatic than a twenty or thirty percent woman a tax stock. These companies volatile er the sharpers are much lower. These are huge moves for these companies because it's the perfect storm for them.

One less regulation, we can go buy small banks and become even bigger and bigger and become way too fucked and big to fail, which is bad for the economy. So less regulation, I probably won't have the same stress task that that Elizabeth n and and armin oxford might will go back some of that shit so I can make more loans with less scrutiny. I can start acquiring more companies and with interest rates going up because of an inflationary president seva, Donald trump, the anticipated deficit spending such as I get richer or the incomes get richer, the spread s on loans will go up.

So if you're learning our money on eight percent mortgages, you get to borrow'd five and a half spread of two hundred fifty basis points, where as three years ago, when you were taking out loans to two and three eights ebara rowing money at one and a half percent for them, you're only getting eighty four BBS of spread. So this is the perfect storm. Less regulation, we get bigger and bigger, too big to fail. More spread on our loan. This is I mean, this is nitrox glistering for banks.

Yeah, I know i'll final. When in here, we have small cap stocks. So these are public companies with smaller market caps.

Generally speaking, a market cap below two billion dollars, these stocks ripped off the election result. The rustle two thousand, which includes many of those smaller companies, rose six percent to its highest, nearly three years. So what is the market expecting here? Well one, trump is reducing the corporate tax rates.

So that benefits all american corporations, at least in the short term. As for small caps in particular, many of these companies are very U. S.

centric. So their supply chains are not as global as some of these logical corporations. They're not multinational in the same way that a company like amazon is. They do the majority of their business in the us. And the expectation is that with trump and his more isolation is policies in addition to these global terrorists that we talked about, we're going to see more investment in companies who do their business in amErica and amErica alone. So that, generally speaking, should benefit small cap is got your reaction to the increase in small cap stocks?

It's a really interest point. I I had I understood that, okay, lower tax is good for these companies. Tax cut puts more money in people's pocket.

So stimulus, early short term stimulus, I had I hadn't seen what you just decide. It's absolutely correct. And that is small cap companies tend to probably get the disproportion from all of the revenue domestically, their last hurt by turfs.

Because what happens in a tariff if we put sixty percent tax on consumer gets coming in from china, they respond. And if i'm selling a lot into china, I get really hurt. But if i'm just a domestic producer, i'm not installation from terrify. But i'm not as badly heard by a multi national in terms of a trade war.

yeah. I'm just to be clear on my opinion here. This is an outcome that I actually like. I think this is, generally speaking, good thing.

The amount of concentration of capital and power to the top few companies as reflected in the mock cap, I don't think has been a good thing. Let's just do one more when I here um is probably worth mentioning, which is cypher currencies. So bitcoin hit a record high. The expectation is that trump is going to have a lot looser, a millenia or kinda regulation two, crypt of currencies. Scott, your reaction to that final, when a particular bit coin I wouldn't .

have been surprised with the following conversation took place, he said to crypt of brothers and and recent horrible ds, like you guys figure out way to raise me a billion dollars i'm going to fire gangster or and i'm going to announce um now we would be less regulation but on the on the demand side i'm going to announce a trillion dollar I don't know, one hundred million dollar fund that invest in, you know, going to do something that puts not only limits regulation but creates more demand for this for for crypto currencies so I I can just see him saying, guys, you raise me a million dollars.

I'll take bit point to a million and this is how i'm going to do IT. I'm going to fire that pain in the ass. They have be down or gangs ler.

And would you like IT if all the sun bitcoin became one of the defauts currencies? Are we try to give you some sort of dollar back or I don't know something that makes IT. I'm sure the crypt to community is thought of all kinds of things that would be great to legitimize this market.

So what are you going to see? I think you're going to see bitcoin go up substantially. You're going to see nata capital firm start start to point in capital against blockchain and crypto companies.

And unfortunately, the downside will be a lot of tears in an unregulated market that attracts a lot of magic cowboys, which is has a fair share of grifters in IT. And the the rifts is going to be gifting with a lack of oversight from the S. C.

C. You know, there will be some novation here. There is a lot that can be done.

And a lot of intelligent people said that was overregulated. And we needed kind of let these horses run a little bit more. I think that's a valuable argument or legitimate argument. But you're just going to see with the total absence regulation, which is what I think you're going to see here. You're just going to see, you know the miami coin again, are the ed elson coin or there's just going to .

be all kinds of ship to good idea actually.

like which is a good story of cyp. You can also trade on IT. I would imagine the value of that company went up thirty percent the last two days, even with a private company. So this is a big win for that community gara.

Gsa, do you think he's around in twelve months?

He's absolutely on he's on the Green mile. The more interesting question is whether a on services because SHE actually has fans on both sides of the other. And my prediction is SHE .

actually survived yeah I think jd .

vans quite like her so much and now she's an any trust she's a trust buster. But I think this issue is so complex that I think trump's going to a get bored of IT and to say of fuck liver in place and also having I just don't think as the patients to deal with this and everybody advise trump or everybody who was close to him, when someone would come in and talk to trump, they would say the following, fewer words, more pictures.

You literally told on some of the most complex issues he likes pictures in very few words that the guide literally doesn't read was supposedly his reputation. And I imagine talking about the complexity of an any trust case or the monopoly maintenance case of google. And what would if they didn't do IT? What would you mean? He's also himself, uh, president electrum does not like these companies.

He has been very aggressive and very upset with meta and alphabet. So if he can saw in his image and keep the Young woman in that position who's going after them, I think SHE survives and she's one of the few people that has something resembling by partisan support. So I think it's going to be chairperson con for a while.

I'll be right back. And if you're enjoying the show so far, hit, follow and leave us a review on property markets.

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With back with profit markets, let's move on to the losers. So our first loser on the list here is clean energy stocks. So solar stocks plumaged, wind energy stocks plumaged easily.

All the renewable stocks tanked out to this result. why? Pretty expected.

Trump wants to put these renewable energy projects on hold. He wants to leave the paris climate agreement. He wants to repeal the inflation reduction that.

He wants to scrap our offshore wind projects. Obviously, homes, the revenues of clean energy companies, IT helps fossil fuel companies. So we've seen stocks like x on mobile up, uh, natural gas companies like E Q T and then tero.

They also rose pretty sharply. I think most people understand this. So let's not dwell on IT, but perhaps you have a brief thought on the fact that clean energy is getting a little bit taken to the word shot right now.

I woke up on november the fifth and I thought, let me get this. Two really qualified women have been beaten by a man who is convicted felon in spite an interaction has been found guilty of rape. I feel like there's no getting around IT the the massage ous tendencies and I don't use that word lightly uh in the U S.

Still runs pretty deep. And strAngely enough, I think it's affected here. And that is anything associated with air gen, anything that seen as feminine and its energy quality when solar, oh, those that you put the ass, bitch, i'm not interested.

And wind and solar, however, I actually think in a strange way, this can be really good for nuclear. Because nuclear, for whatever reason, is seen as bad as we did not fry a bunch of russians in that hold nobel. For some reason, nuclear has a mocho field to IT.

And that I realized how ridiculous this election was. One on a very manual here impression of masculine ity. Um when I look at the results, who who showed up, who didn't, no one gave a shit about bodily.

Tony Y, I know that's hard to say, but they didn't believe president trump was that pro life. Five of the seven referendums on bodily autonomy passed. So people think the states are handling IT.

They just didn't care. More fewer women voted for Harris, then voted for biden. Bottling autonomy, played, played no role.

What showed up was Young man fears about how Young people are doing in an embrace of the manufacture that you democrat are too. Fuck insensitive. Stop lecturing us. Stop acting so high and mighty, stopping such, stopping such snowflakes and so offended IT everything for us.

Stop being so feminine. It's like this giant fear and an upset that will, like our society, is becoming feminist. I think that's a really good point, especially when IT comes to certain companies and people.

Like the thing that elon must cracks was that he figured out a way to make electric vehicles feel that show and masculine. And as soon as he did that, suddenly the people like trump were on board. And it's definitely true of nuclear IT. I'd love to somehow create like a rubrics of which companies and which products are more feminine versus masculine. And I bet we could figure out a perfect line between democrat and republican support for those initiatives.

right? Like yeah, my next pod, casters is gonna called gilla Simon.

That'll win them over suddenly will stop being batest snowflakes as soon as .

we call that that the new government contract .

pog as good. Simon, I really like that. Take this move on to our second loser, which is companies that are exposed to this new tariff policy.

So these are companies whose businesses are reliant on importing goods into the U. S. So that's a very broad category.

There are many types of companies who fall into that category. So in retail, you ve got companies like Williams 和 oma。 You ve got best buy, nike.

These are companies that have highly international supply, Jones. And so when the tf come about or if the tariff come about, it'll just make everything they do more expensive. Also, people said we were gonna see IT in tech.

So there was some concern that these tech companies that import their chips from abroad would be affected. That was a big concern. We actually haven't really seen that yet.

Some tech companies drop a little bit on the elections result, but broadly speaking, the bouncing ing back. So the jury is still out on whether this administration on the tariff policies will benefit or harm tech. What is clear though, is that if you are an american company and you rely heavily on an international supply chain, you are very nice.

This right now, you are trying to bring all of your supply chain, you trying to bring everything back to to the U. S. So scot, your reaction to tariff exposed companies being a loser in the trumpet administration.

Republicans are, well, you know, the more physical minded or Better on this is right. And I can see you at least a handful of republican senators and or representative saying, you know, eighty eight percent of our gift, some of the Christmas tree, the good consumers work all year to be able to ford come from china and we don't need to raise cow. I think is there will be terrifying.

The ones in place will either stay or get increased. I don't think you mean anything near what proposing, because anyone who can do math is, is going to be able to find five or seven republicans to say this is a really bad idea. And the way for you to look really smart is to say this would hurt the good people of obama and raise their cost, you know, their costs for whatever tires or tractors by twenty two percent.

And the farmers and I oi would raise the cost of whatever is feed imported from, you know, named in at equitable by fifteen. As soon as people actually do the math and see what's onna happen in terms of impact at a ground level, you're going to see all sorts of constitutions pop up and say basically what the fuck and it's a it's going to stick in the backbone of sum republicans to say, I am not down in the margins even if they get a control of all three branches. The margins are are going to be so narrow that on a topic like this, I think that craters will be able to find a few defectors to to kind of cross their arms and and hold firm on terrace. I don't think terms you're going to be nearly at the scale that he's threatening some .

companies that are being hit a little harder. A related to this type issue, foreign stocks, emerging market stocks, are companies in europe, in mexico, in china, there down? Um many of these companies rely on selling stuff to americans.

So let's just focus on germany as an example. Bmw is down. Portions is down.

The cities is down. Volt working is down. Thirteen percent of germany's cause are exported to the us.

So this is not great news for foreign college kers. If we look at europe as a whole, the U. S.

Accounts for one fifth of their exports. They shipped half a trillion euros worth of goods to amErica last year. That number should come down under trump. So you just sort of think of every foreign staple that we enjoy america, whether it's beer from mexico or computers and and smart phones from japan or even G, L, P one drugs from denmark uh, if you're in that business and you need to ship IT over to america, you are hurting at least a little bit right now based on the markets reaction, Scott, your reaction to what's happening to foreign stocks right now?

Well, I think there's there's you have to design the difference between kind of foregone suppliers if you are foreign suppliers and then foreign petitjean, that is I think there will be he'll see a political win in showing up to michigan and detroit and saying we're going to increase demand for for ford because we the trade relationship with germany as asia metro ics.

I'm announcing a fifty percent tax on all cars coming from germany, whereas if he were to announce new troops on metal coming in from canada that just can increase the cost for forward. I think that will be more politically um unpalatable despite the fact they both kind end up in the same place. And that is an increase costs on us consumers. But I I can I don't know if be much easier for me to put a terrible on a product, whether is an american substitute, at least in the short run, not recognizing over time all that, that means is that american companies have less competition, take advances of that in increased their Prices, thereby raising Prices and creating inflation on american consumers. But I think in the short run, it's just much easier to tax a competitive product that IT is, you know, feed coming in from mar that raises the Price, uh, raises the cost of goods for farmers.

IT sort of a question. IT feels very similar. IT is very similar to what happened with brags that where the UK was like, we can do this all on our own. So that's just cut off ties and we're going to be fine. And the question here is that it's like, okay, i'm down with the idea of bringing everything to america.

And the question that we're asking right now is can we do everything truly on our own? Can we just sort of put a giant tax on everything that comes from abroad? Or do we actually need these countries and do we rely on them to sustain our society? And I think it's a more IT certainly was not a valid question to be asking in the UK.

The U. K. Was completely dependent on the rest of europe, and that's why it's struggling so much right now.

And I think IT is a more valid question when IT comes to the U. S. But that is certainly the direction we're moving in here.

We're basically saying we don't need all you guys. We can do IT on around. I think what we're about to find out is whether that is indeed through i'll final loser that i've got here.

This is the most interesting, in my opinion, the housing market generally and specifically. So real estate stocks. So you've got real estate brokers like redfin, like zillow compass, therefore, in the red right now, they all reacted quite badly to the election result.

You got real estate services companies like cbr e and cushman en and wakefield, they all fell. You've got home building stocks. So companies like deal horton, which constructs houses, the largest american construction construction company and company like lena, all of the home builders all down right now.

And this is the most interesting to me, because basically what the market is saying, the expectation, despite trumps promise to bring down housing costs, is that buying house is about to get even more expensive. So we've seen yields rise in expectation of higher inflation as a result of the terrorist that we've just discussed. And when yields rise, that means that rates rise.

And when rates rise, that means you're paying A A larger mortgage payment. So that sort of an accepted principle in the markets right now, we're going to see higher mortality rates. So the council act that trump needs to figure out a way to significantly reduce housing Prices.

He's laid out some plans, you know he wants to a make IT easier to build, which I think we both agree with, is a good thing. However, the tariffs are expected to increase the cost of goods needed to build houses, that's one problem. And the deportation and immigration crackdowns are expected to make the construction labour market even title, which means it'll be even more expensive to build a home. So what the molecule telling us right now is that mortgage rates are onna go up and housing Prices are gonna go up, which is just a total nightmare for someone like me who one wants to buy a house and two who believes that the cost of housing is basically one of the one of the biggest issues, at least in the country right now. So Scott, your thoughts on what this new administration could do to the housing market?

Well, as we said, this is the perfect summer. Good things for bank socks is the perfect storm of bad. Thanks for housing.

Because his fiscal policy, what we know about IT is that could be inflationary. The credit markets have already already predicted the interest strato are going to go up the ten years ready going out. So one of the things that is made housing increasingly unaffordable is a massive increase in interest rates, right? A Morgan rate.

And then if you I remember during kova, I was building a house and the guy said we can't kit garage doors, he said, and he looked at the pully on the automatic you know, when you press IT and there's an engine and and a chain, the pully between the chain and the door is that things made in checked sea and it's all close because a covered, if that thing, i'm your washing machine, so many parts, even the number, so many things in your house come from foreign entities. That the idea that he's going to do anything resembling this level of tiffs. So let me get this.

My mortgage, my right on my marriage is going to go up and the cost of build is going to go up. Something is going to give here because this is one place you're going to see a pretty significant ant get reflex from the U. S.

population. If all of the sudden IT becomes obvious that and already vastly unaffordable housing market were just in last five years, it's gone from two thirds of americans can afford to home to just one third. If that goes down any further because of trumps terf policy or because inflation start to send mood rates up, I think he's going to a get a very swift message back from american people that look boss housing as a crisis.

You need, we need all hands on deck, more permits, more housing. And again, in addition to supply, the cost of building and the mortgage rate are really important. So this is the perfect stone of bad things for housing.

Uh, I don't believe a lot of this. If you look at the markets, the markets have sorted said it's gonna be a divided government that he's not going to be able to push through other than maybe extending the tax cuts is how I read IT. They will continue to favour rich people on corporations, but a lot of the stuff is not going to happen at nearly the scale that he's threatened. duck.

That's all you've got for the winners and losers here. I also just do want to point out that what we have said about this has been based on the markets reaction. So what we're explaining right now, like your take on on on the idea that mortgage rates and housing Prices are onna go up, that's not like our hot take.

That's what the market is telling us right now. We don't know what's gonna happen. Like I hope and I would be really happy if trump figures out a way to get this the the cost of housing down.

And i'm so for IT, like i'm I mean a one hundred percent in support of that happening, in support of him bringing inflation down. I mean, I want things to work out. You have any final thoughts or takeaway from this? When is a loser session?

You know what I what I would say across a lot of the stuff as I think IT modulate, nothing's ever good or as bad as it's names. I think the market tends to you know, the pendulum is never kind of the bottom. I think it's probably overreacting one way or the other. So I would think the stock that have been hammer the most are probably buying opportunity is and I think the stock that are up the most, you know, I don't know, I be careful, uh, going into them.

I just I think we're going to find that the change, the entrances, the multiple branch of government, the slow grinding gears of our unin color or democracy, but our capable system, in the fact that you're going to have a president that i'm not sure is going to have the attention span to an act. A lot of this, I mean, to a certain thing with strangers kind of a month, then he's a lame dog president. So I don't think the winners are going to win as much here, and I don't think the losers are going to lose much.

As we take a look at the week ahead.

we'll see the .

consumer Price and producer Price in disease for october will also see earnings from disney ababa and home depos. Scott, you have any predictions for us now?

My prediction is that intel, a leader, be acquired or go private in the next, I know, six months. I think this is such A A storage firm, the few firms that have fAllen further faster than an intel and this sector is added a tuna market capitation, except the leader, the market leader, the dominant player, the one was held up as the icon of grade management has consistently thrown up on itself for the last twenty eight years.

And I think the socks out to the point where there's so much I P, so many supply relationships, so few companies that can produce this this type of very complex capital times of product, heavy design product and its trading. I think one thirty of the value of NVIDIA that if this thing shows any polls, IT will triple. Except I think the changes and investments that needs to make would be more easily done outside of the preview of the public markets. So if it's not acquired, I think that somebody shows up and takes a private .

this episode was produced by car Miller and engineer by Benjamin Spencer. Are associated produce real and vice maslen ario is our research just a is our research associate. True birds is our technical director and Kathy dalan is our executive producer.

Thank you for listening to profit markets from the vox media podcast network. Join us on thursday for our conversation with josh Brown. He's back only on profit markets.

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