EP 54: What Trump’s Game of Tariff Chicken Could Mean

EP 54: What Trump’s Game of Tariff Chicken Could Mean

 


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During this week’s Cocktail Investing episode, Tematica’s mixologists Lenore Hawkins and Chris Versace take the bull by the horns discussing the topic that has gripped headlines and jacked stock market volatility this – President Trump’s proposed steel and aluminum tariffs. While there is much being said over these proposed tariffs, Lenore and Chris explain why they think Trump is using the negotiating tactics he laid out in his 1987 book, Art of the Deal.

Drawing on what we are seeing in the heavy truck market and the pain homebuilders are poised to face given the current lumber shortage, Chris and Lenore game out what is likely to happen if those tariffs move past the proposal stage.

Shortages. Price Increases. Inflation concerns. Consumer spending pressures. Economic growth risks. And then there is how the Fed will see it all as it gets ready for this Mar. 20-21 monetary policy meeting. You know, the one where new Fed Chair Jerome Powell will have his first formal press conference as chairman and share the Fed’s latest economic and policy forecast.

The bottom line is Trump is playing a dangerous game of trade war chicken. Like most games, there tends to be a winner and a loser, and while it’s possible that Trump comes out ahead on this, the risk he runs will impact the American consumer, the domestic economy and at least certain stocks if not the overall market.

Thematic Signals shared during this episode

 

Companies

  • AK Steel (AKS)
  • AMC Theater (AMC)
  • Anheuser Busch (BUD)
  • Apple (AAPL)
  • Arconic (ARNC)
  • Boeing (BA)
  • Caterpillar (CAT)
  • Century Aluminum (CENX)
  • Coca-Cola (KO)
  • Cummins (CMI)
  • R. Horton (DHI)
  • Deere (DE)
  • Dell
  • Ford (F)
  • Gap (GPS)
  • General Motors (GM)
  • M. Smucker (SJM)
  • Lennar Corp. (LEN)
  • McDonald’s (MCD)
  • Molson Coors (TAP)
  • Navistar (NAV)
  • Paccar (PCAR)
  • PepsiCo (PEP)
  • Ross Stores (ROST).
  • Steel Dynamics (STLD)
  • Toll Brothers (TOL)
  • Tyson Foods (TSN)
  • Whirlpool (WHR)

 

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About the Author

Lenore Hawkins & Chris Versace
Lenore Hawkins serves as the Chief Macro Strategist for Tematica Research. With over 20 years of experience in finance, strategic planning, risk management, asset valuation and operations optimization, her focus is primarily on macroeconomic influences and identification of those long-term themes that create investing headwinds or tailwinds. Chris Versace is Tematica's Chief Investment Officer and editor of Tematica Investing newsletter. All of that capitalizes on his near 20 years in the investment industry, nearly all of it breaking down industries and recommending stocks.

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