What a time to have you on the show. Thanks for being here, Rich. Yeah, my pleasure.

Thanks for the invitation. We

got a trade war brewing. We got a trade war game of chicken, maybe a full-out war, maybe a negotiation. How has this brewing trade spat changed your process, if at all, at Richard Bernstein Advisors?

Yeah. So, you know, I think, Ricky, the first thing we have to kind of understand is that the news flow is totally out of control right now. I mean, 25 years ago, legit, 25 years ago, I wrote a book that was called Navigate the Noise, Investing in the New Age of Media and Hype. That was 25 years ago. It's clearly more applicable today than it was 25 years ago. But the point of the book was that there's always going to be this news flow. And a true investor is going to try to ignore that, that we know that there are certain rules of investing, ways to build wealth, and trying to react to the day-to you know, minute-by gyrations is really a loser's game. And I think that's, it's very important. I think if somebody tries to keep up with the news flow today, you're going to be ready for a rubber padded room. I just, I just think it's, it's insane. So that's number one. Number two is that I think what's happening in this news flow right now is not that it's good news or bad news, right? The politics tends to overwhelm everything. Everybody has to remember we're investors. We're not politicians. And so what we want is we want clear information, whether the policy we agree with or don't agree with is really immaterial. Nobody's calling us up and asking us. But we need clear and consistent information so we can make investment decisions. I think that's the big issue that's going on right now is that whether it's the trade war, whether it's employment policies, you name it, it's changing every 10 minutes. And I think that's very hurtful for the markets

overall. And I understand the fast news flow, but at the same time, you've also had a tremendous rise in algorithmic trading. So in a lot of cases, I would think it's not just human traders making decisions off these news items. It's algorithmic traders causing huge spikes, good and bad. Volatility only happens when it goes down. Otherwise, everything's good when it's going up. How much of this is also just algorithmic trading driving the market based on headlines, not just human reaction?

Oh, I think that's true. I think that's to some extent always been true, though, right? I mean, earlier in my career, it was the evil program traders that were causing things to happen. Now it's the algorithmic traders. They're always around, right? I think the thing that we all have to remember is that the fundamentals are the fundamentals. And if you take a step back and you look at the fundamentals and you assess them properly, what

happens in 10 or 15 or 20 minutes is really pretty immaterial. So then what are the storylines you're paying attention to? Because I understand the news is changing extraordinarily fast right now, but it seems we are entering a period of deglobalization. If tax cuts continue to pass, that's going to affect corporate profits. And at the same time, you're starting to see companies, including Delta Airlines, saying this macro uncertainty is leading us to cut basically our revenue and profit forecasts. So I understand the headlines create a lot of noise, but there is meaning there. How are you separating that?

Absolutely. So I think take what you just said, Ricky, and kind of put it into a little longer term lens, right? So you mentioned Delta. I'm not saying anything positive or negative about that particular company. But many companies now are having a lot of trouble forecasting their fundamentals. More uncertainty, right? I mean, what you forecasted yesterday may be completely different today. That's uncertainty. Number two, you know, if you think about trade and everything else that's going on there, I mean, trade regulation is changing within the day, right? So how, if you're an importer or an exporter or you have a supply chain, how you're keeping up with that, I have no idea. So what you have to do is you have to say, look, there are forces out there, like you mentioned, deglobalization. One of our main macroeconomic themes is deglobalization. And the combination right now of the fact that we're going through a period of deglobalization at a point in time where the United States has a massive and ever-growing trade deficit. That is a terrible combination for the U.S. economy. And what we're trying to do is we're trying to look for ways to invest to take advantage of that. In other words, we do think the capital markets are going to be smart enough to allocate capital to where it's actually needed within the economy. So you got to look at these themes, you have to kind of work out what's the symptom, maybe trade, you know, a tweet on trade, versus what's the actual

issue, which is de-globalization. So let's stay on de-globalization, because your take is that it is disastrous for US companies. The other side of that argument would say, what we're actually doing is we're encouraging these great big companies to set up shop and create jobs in the United States. And this is actually going to be wonderful for the US economy. And at the same time, these tariffs, these bills we're placing, this is like charging foreign countries a premium to access a premium market the same way that you would pay for box seats at a New York Rangers game in order to get access to those better seats. We're going to do a similar thing for access to this market. And there's going to be a period of transition, but really it's going to shake out. And over the long term, the US stock market will be fine. That may not be my personal opinion, but I'm trying to steel man the other side of your

plan. Yeah, absolutely. And as I can tell by what you just said, you can probably tell I have a Rangers jersey behind me that I am a Ranger season ticket holder. So you could argue that tariffs can be an effective way to change the economy if, and this is the big if, if there is underutilized domestic production. The problem is in the United States, and the reason we have this monster trade deficit, is we don't have production. We have bragged for decades now how we are a service-oriented economy and not a production-oriented economy. We're now feeling the other side of that, right? If you want to build a steel plant, if you want to build an aluminum plant, if you want to build a refinery, anything like that, this takes years to do. You put a tariff in, everybody has this notion, oh, well, that'll affect deployment next quarter or two quarters from now. No, it doesn't work that quickly. In the meantime, what happens when you have this massive trade deficit is that you stick it to the consumer. Here's a way to think about it, right? Is anything you are wearing right now, Ricky, is anything you

are wearing made in the United States?