Consumer Spending Under Tariffs: Pimco Manager on What Investors Can Watch For

14 snips

Apr 13, 2025

Joining the discussion is Kris Kraus, a seasoned managing director and portfolio manager at Pimco, specializing in consumer debt investments. He provides insight into how tariffs are affecting consumer spending and debt, from mortgages to auto loans. Kraus highlights the resilience of consumers amidst inflation and the potential warning signs in upcoming earnings from credit card companies. The conversation also delves into the disconnect between stock market performance and real economic conditions, providing a nuanced look at consumer financial health in turbulent times.

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INSIGHT

Market Volatility and Uncertainty

The stock market saw its best day since 2008 after President Trump announced a 90-day tariff pause.
However, uncertainty remains, making investors hesitant to "buy the dip."

INSIGHT

Market Crash and Economic Impact

A stock market crash can indirectly impact the broader economy.
Declining portfolio values can decrease consumer spending and confidence.

INSIGHT

Consumer Impact of Tariffs

Consumers will be impacted differently by tariffs, depending on their financial situations.
Wealthier consumers are better able to absorb price increases than those living paycheck to paycheck.

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On WSJ’s Take On the Week, co-hosts Gunjan Banerji and Telis Demos talk about the markets' reaction to the latest developments in President Trump’s tariffs policies. They talk about the “buy the dip” trade and weigh in on “the stock market isn’t the economy” debate. The hosts also discuss what’s going on with Treasurys.

Later on the show, Kris Kraus, a managing director and portfolio manager at one of the world’s largest bond managers, Pimco, joins the podcast to give us a pulse check on the health of consumers, including their debt, from mortgages to auto loans. He shares what we should—and shouldn’t—be worried about as tariffs start to hit our pocketbooks and portfolios. Kraus also talks about what he’ll be looking out for in upcoming earnings from credit card companies, like American Express and Capital One, for clues on where consumers are headed.

This is WSJ’s Take On the Week where co-hosts Gunjan Banerji, lead writer for Live Markets, and Telis Demos, Heard on the Street’s banking and money columnist, cut through the noise and dive into markets, the economy and finance—the big trades, key players and business news ahead.

Have an idea for a future guest or episode? How can we better help you take on the week? We’d love to hear from you. Email the show at takeontheweek@wsj.com.

To watch the video version of this episode, visit our WSJ Podcasts YouTube channel or the video page of WSJ.com