Monetary Matters with Jack Farley

Joseph Wang: Tariffs Are Coming & They Will Be Bad For Stocks (But Good for America)

Jan 31, 2025

Joseph Wang, author of "Central Banking 101" and former senior trader at the New York Federal Reserve, shares insights into the economic impacts of impending tariffs. He discusses how financial markets are underestimating the consequences, particularly for key companies like Apple and Nvidia. Wang expresses a bearish outlook on stocks while being bullish on bonds and gold. He also critiques traditional economic models in light of these changes and analyzes the complexities of U.S. monetary policy, especially regarding potential shifts in the Federal Reserve's stance.

51:20

Episode guests

Joseph Wang

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Episode notes

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Quick takeaways

Joseph Wang emphasizes that Trump's impending tariffs aim to reshape the global economy by prioritizing U.S. domestic manufacturing and reducing foreign dependency.

The podcast discusses the potential negative impacts of tariffs on stock prices while also highlighting their necessity to counter China's unfair trade practices.

Joseph notes that the Federal Reserve may prioritize long-term growth signals over inflation concerns, potentially resulting in rate cuts amidst economic uncertainty.

Deep dives

Understanding Trump's Tariff Strategy

The discussion centers on the clarity of Trump's plan to implement higher tariffs as part of an intention to reshape the global economic landscape. This strategy hinges on the belief that the U.S. should prioritize domestic manufacturing to reduce dependency on foreign goods for both employment and national security reasons. Observations from Trump's previous term support this notion, as he previously enacted tariffs on China, signaling that his plan is not mere negotiation bluster but a consistent belief held over decades. The market's skepticism about the potential impact of these tariffs may overlook significant underlying economic objectives related to sourcing and revenue generation.

Intro

2min

Tariffs: Tools of Negotiation and Economic Impact

17min

Challenging Economic Orthodoxy in a Changing Energy Landscape

3min

Impending Tariffs and Market Complacency

2min

Navigating Monetary Policy and Global Trade Dynamics

20min

Federal Employment Challenges

6min

Economic Outlook: The Impact of Tariffs on Growth and Financial Markets

2min

This Monetary Matters episode is brought to you by VanEck.

Learn more about VanEck Uranium & Nuclear ETF: http://vaneck.com/NLRJack

Joseph Wang of FedGuy.com returns to Monetary Matters to share his view that markets are insufficiently discounting the large and significant tariffs that the Trump Administration will implement shortly. Joseph and Jack also review the January Fed meeting, with Joseph noting that Fed chair Powell might be significantly more dovish than the FOMC committee. Joseph explains why he is bearish on stocks and bullish on bonds and gold (and short-term interest rates). Recorded on January 30, 2025.

Follow Jack Farley on Twitter https://x.com/JackFarley96

Follow Joseph Wang on Twitter https://x.com/FedGuy12

Joseph’s website: https://fedguy.com/

Pieces discussed:

“The Plan”: https://fedguy.com/the-plan/

“It is a Good Day to Tariff”: https://fedguy.com/it-is-a-good-day-to-tariff/

“Shifting Flows”: https://fedguy.com/shifting-flows/

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