1 00:00:00,160 --> 00:00:02,360 Welcome back everyone today on the Joseph Carlson Show. 2 00:00:02,360 --> 00:00:05,680 We have the tariff. Panic stocks are falling after 3 00:00:05,680 --> 00:00:10,680 Trump's liberation day when he unveiled his grandiose tariff 4 00:00:10,680 --> 00:00:12,840 plan. Now, whatever was being 5 00:00:12,920 --> 00:00:17,120 liberated, I'm not sure. I'm not confident of what was 6 00:00:17,120 --> 00:00:19,800 being liberated, but it certainly wasn't our portfolios. 7 00:00:20,240 --> 00:00:22,720 The Dow Jones is currently down 3%. 8 00:00:23,320 --> 00:00:29,200 As of right now, the S&P 500 is down 3.7%, the NASDAQ is down 9 00:00:29,240 --> 00:00:32,280 4.7%, and they're going down further. 10 00:00:32,400 --> 00:00:34,040 This isn't where they've gone down further in their 11 00:00:34,040 --> 00:00:36,400 backtracking. They continue to plunge. 12 00:00:36,400 --> 00:00:39,560 And the reason why I Simply put, the Trump tariff plan was far 13 00:00:39,560 --> 00:00:41,680 more extreme than anyone anticipated. 14 00:00:42,040 --> 00:00:45,040 In fact, out of the analysts expectations of the range of 15 00:00:45,040 --> 00:00:48,640 tariffs, this was on the most extreme side, in most cases more 16 00:00:48,640 --> 00:00:52,160 extreme than the most extreme side that investors expected. 17 00:00:52,560 --> 00:00:54,720 The Trump tariff plan is a. Broad set of. 18 00:00:54,720 --> 00:00:58,120 Tariffs at least 10% on virtually every trading partner 19 00:00:58,120 --> 00:00:59,040 across the. Globe. 20 00:00:59,400 --> 00:01:02,080 The tariffs are slapped on so many countries that a lot of 21 00:01:02,080 --> 00:01:04,080 people have even heard of some of the countries. 22 00:01:04,480 --> 00:01:06,160 Some of them aren't even inhabited. 23 00:01:06,160 --> 00:01:09,280 They just have apparently. Penguins living on them, but 24 00:01:09,280 --> 00:01:10,520 they're getting tariffed as well. 25 00:01:10,600 --> 00:01:14,480 The tariff plan is so broad, so indiscriminate, so extreme with 26 00:01:14,480 --> 00:01:16,360 the numbers. So steep of tariffs. 27 00:01:16,720 --> 00:01:19,040 That it's almost difficult to even comprehend how this is 28 00:01:19,040 --> 00:01:21,200 going to work out, what's going to happen. 29 00:01:21,560 --> 00:01:23,480 Investors are in full on panic mode. 30 00:01:23,800 --> 00:01:25,720 They're trying to absorb the information. 31 00:01:25,720 --> 00:01:29,000 Right now they're discounting any company that has any 32 00:01:29,000 --> 00:01:32,480 business outside of the US, which is almost every company. 33 00:01:32,480 --> 00:01:35,600 So what we're seeing here is the market's reaction to a plan that 34 00:01:35,600 --> 00:01:37,840 has an incredible amount of unpredictability. 35 00:01:38,200 --> 00:01:40,160 The market doesn't know what's going to happen. 36 00:01:40,520 --> 00:01:42,000 Investors don't know what's going to happen. 37 00:01:42,000 --> 00:01:44,320 Business leaders don't know what's going to happen. 38 00:01:44,720 --> 00:01:47,240 What's going on is literally unprecedented. 39 00:01:47,440 --> 00:01:49,600 It hasn't happened in the past 100 years. 40 00:01:49,920 --> 00:01:52,640 No one living has a memory of anything happening like this. 41 00:01:53,080 --> 00:01:55,560 So what we're living through right now is an interesting time 42 00:01:55,560 --> 00:01:58,280 where investors are trying to discount companies for their 43 00:01:58,280 --> 00:02:01,280 cash flows in the future. But we have no clue what's going 44 00:02:01,280 --> 00:02:02,720 to happen. So we'll be going through the 45 00:02:02,720 --> 00:02:05,520 announcement yesterday, breaking down what it actually means, the 46 00:02:05,520 --> 00:02:08,560 math behind it and some of the mixed messaging that the White 47 00:02:08,560 --> 00:02:10,960 House is giving. We'll also be going through what 48 00:02:10,960 --> 00:02:13,440 I believe are going to be the biggest winners and. 49 00:02:13,440 --> 00:02:16,880 Losers of this. Plan the long term implications 50 00:02:16,880 --> 00:02:19,720 of it and my game plan going through this now. 51 00:02:20,040 --> 00:02:22,960 Let's go ahead and start off by just highlighting some of the 52 00:02:22,960 --> 00:02:24,600 companies in their reactions today. 53 00:02:24,920 --> 00:02:27,360 This is how investors are reacting to Apple now. 54 00:02:27,360 --> 00:02:30,800 As of right now, Apple's down 7.85%. 55 00:02:31,240 --> 00:02:33,760 It's not everyday you see a company like Apple trade down 56 00:02:33,760 --> 00:02:36,200 above 7%. This is a huge sell. 57 00:02:36,200 --> 00:02:38,320 Off in this company. Apple has a lot of. 58 00:02:38,320 --> 00:02:41,480 Exposure to China and China was one of the places that got the 59 00:02:41,480 --> 00:02:43,960 steepest level of tariffs. In fact, they're almost 60 00:02:44,320 --> 00:02:47,800 incomprehensibly high when we look at other companies here we 61 00:02:47,800 --> 00:02:51,760 have Amazon, another company that has huge exposure to China, 62 00:02:52,200 --> 00:02:55,320 not because they're doing a lot of business in China per SE, but 63 00:02:55,320 --> 00:02:58,240 because Amazon has a lot of sellers from China selling 64 00:02:58,240 --> 00:02:59,880 Chinese products. To the US. 65 00:03:00,120 --> 00:03:03,800 It's nothing new, but Amazon is now down. 7% as a. 66 00:03:03,920 --> 00:03:05,960 Result Nike, of course. Manufacturers. 67 00:03:05,960 --> 00:03:07,960 A lot of its. Products, most of it comes from 68 00:03:07,960 --> 00:03:11,160 Indonesia, China, Vietnam, those countries all. 69 00:03:11,160 --> 00:03:14,720 Had tears put on. Them Nike has nowhere to escape. 70 00:03:14,720 --> 00:03:17,360 The tariff they're. Going to have to pay a lot of 71 00:03:17,360 --> 00:03:20,760 money additionally, which is a big input cost for this company. 72 00:03:21,160 --> 00:03:23,120 So this one's trading down big time today. 73 00:03:23,600 --> 00:03:26,800 We also have software. Vendors, even companies that 74 00:03:26,800 --> 00:03:29,560 really don't manufacture products in different countries, 75 00:03:29,920 --> 00:03:32,720 they're just simply selling software, are going down. 76 00:03:33,120 --> 00:03:35,000 Now part of this is because a company like. 77 00:03:35,000 --> 00:03:38,800 Salesforce is just high beta. Meaning anytime the market goes 78 00:03:38,800 --> 00:03:40,840 up or down. Salesforce will likely follow, 79 00:03:41,120 --> 00:03:42,120 but to a bigger. Extent. 80 00:03:42,480 --> 00:03:43,920 So it's high beta. To begin with. 81 00:03:44,360 --> 00:03:46,360 But there's also the. Argument that the. 82 00:03:46,360 --> 00:03:48,720 Tariffs will likely. Slow down the economy. 83 00:03:49,040 --> 00:03:50,720 They stop trade. They create. 84 00:03:50,720 --> 00:03:53,200 Friction. If that happens, companies will 85 00:03:53,200 --> 00:03:56,440 pull back on the amount of. People they hire Salesforce. 86 00:03:56,440 --> 00:03:59,280 Makes more money the more. Seats you have. 87 00:03:59,640 --> 00:04:03,000 They have per user license agreements for most of their 88 00:04:03,000 --> 00:04:05,320 companies. So if business slows down and 89 00:04:05,320 --> 00:04:08,520 you hire fewer employees, Salesforce makes less money. 90 00:04:08,800 --> 00:04:12,560 The stock is down 5% today after already being down quite a bit. 91 00:04:12,560 --> 00:04:17,120 It's down 22% year to date. We continue on Shopify. 92 00:04:17,720 --> 00:04:19,880 Even Canadian companies are getting hit hard. 93 00:04:20,200 --> 00:04:23,640 Shopify, the online retailer, is down 17%. 94 00:04:24,080 --> 00:04:26,360 Now again, this is normally. A very high beta stock. 95 00:04:26,360 --> 00:04:29,240 It also trades at a pretty. Hefty valuation so as a couple 96 00:04:29,240 --> 00:04:32,600 things already working against it, but this company makes money 97 00:04:32,600 --> 00:04:34,640 from small businesses that in most. 98 00:04:34,640 --> 00:04:36,040 Cases. They they. 99 00:04:36,040 --> 00:04:38,960 Get their product from. Overseas, every place they're. 100 00:04:38,960 --> 00:04:41,720 Getting their product, you name it, is being tariffed. 101 00:04:42,120 --> 00:04:45,960 So all of these companies that are selling on Shopify now have 102 00:04:45,960 --> 00:04:47,360 input. Costs that are greater. 103 00:04:47,360 --> 00:04:50,120 We have S&P Global right now. That's holding up a little bit 104 00:04:50,120 --> 00:04:52,600 better than the rest of the market now this company. 105 00:04:52,600 --> 00:04:56,240 'S obviously very strong. Really wide Moat company, but I 106 00:04:56,240 --> 00:04:59,000 think S&P Global. Probably should be lower. 107 00:04:59,000 --> 00:05:02,080 Based on this news, S&P Global is a market company. 108 00:05:02,280 --> 00:05:05,080 They specialize in markets. They do better when the stock 109 00:05:05,080 --> 00:05:08,520 market is higher, when companies are issuing debt, when economies 110 00:05:08,520 --> 00:05:10,400 are growing, when there's more momentum. 111 00:05:10,640 --> 00:05:14,080 This company overall makes more money in every line of business. 112 00:05:14,240 --> 00:05:17,720 When markets thrive and tariffs are likely to slow down markets, 113 00:05:17,960 --> 00:05:20,000 they'll slow down all different components of. 114 00:05:20,000 --> 00:05:22,680 S&P Global's business net is hit hard today. 115 00:05:22,680 --> 00:05:26,720 Investors have sold the stock down 5.6% on the day that's 116 00:05:26,720 --> 00:05:27,800 after. The stock is already. 117 00:05:27,800 --> 00:05:30,600 Down below 20%. Below its high. 118 00:05:31,000 --> 00:05:34,360 So this one really is selling down more today and investors 119 00:05:34,360 --> 00:05:38,440 are concerned because Meta. Has a lot of advertisers, lots 120 00:05:38,440 --> 00:05:40,360 of small. Businesses advertise on Meta, 121 00:05:40,560 --> 00:05:41,960 that's how they make all their money. 122 00:05:42,240 --> 00:05:44,800 If those small businesses can't survive the increased. 123 00:05:44,800 --> 00:05:46,920 Cost of tariff. The increased cost of doing 124 00:05:46,920 --> 00:05:49,320 business. Advertising demand will likely 125 00:05:49,320 --> 00:05:51,640 pull back. If advertising demand pulls 126 00:05:51,640 --> 00:05:54,360 back, that of course will impact Meta's top line. 127 00:05:54,440 --> 00:05:57,240 Now, of course, we have Google. That one's down 2.9%. 128 00:05:57,720 --> 00:06:00,120 Now Google's not trading down quite as much as Meta. 129 00:06:00,280 --> 00:06:02,040 I think that's for a couple different reasons. 130 00:06:02,280 --> 00:06:04,840 One of them is Google's already so cheap, the company's treating 131 00:06:04,840 --> 00:06:07,520 at such a low PE. Ratio that there's just a level 132 00:06:07,520 --> 00:06:08,520 of. Resistance there. 133 00:06:08,800 --> 00:06:11,760 How cheap can this company go? How much can you discount? 134 00:06:11,760 --> 00:06:13,960 It for future threats. O there's that. 135 00:06:13,960 --> 00:06:15,840 Aspect of it that it's already at such a low. 136 00:06:15,840 --> 00:06:18,160 Valuation much cheaper than meta at this point. 137 00:06:18,640 --> 00:06:20,200 But Google also is a little bit more. 138 00:06:20,200 --> 00:06:23,160 Diversified than meta, it's not solely reliant on small 139 00:06:23,160 --> 00:06:25,040 businesses. They have the cloud. 140 00:06:25,040 --> 00:06:26,360 Business. They have YouTube. 141 00:06:26,360 --> 00:06:28,360 They have all sorts of. Different diversified revenue, 142 00:06:28,680 --> 00:06:31,080 so this one is impacted to a smaller degree. 143 00:06:31,080 --> 00:06:35,560 We have SML down 4.5%. This company remains right in 144 00:06:35,560 --> 00:06:38,160 the center of this whole debate. SML sells this. 145 00:06:38,160 --> 00:06:39,760 Specialized product that everyone. 146 00:06:39,760 --> 00:06:41,960 Needs to create these. Chips if there's less. 147 00:06:41,960 --> 00:06:45,080 Demand for these chips less importing, more barriers. 148 00:06:45,360 --> 00:06:49,160 It may impact ASML business now long term, I think this company 149 00:06:49,160 --> 00:06:50,920 is better positioned than investors believe. 150 00:06:51,240 --> 00:06:53,120 But right now it's being sold. Off with the pack. 151 00:06:53,120 --> 00:06:57,040 Tesla's down 4.22%. No surprise here, you may 152 00:06:57,040 --> 00:06:58,720 believe. That the tariffs will. 153 00:06:58,720 --> 00:07:02,400 Help Tesla in relation to other car companies because Tesla 154 00:07:02,400 --> 00:07:05,240 makes most of their stuff in the US, but Tesla does a lot of 155 00:07:05,240 --> 00:07:07,560 business in China. They have manufacturing in 156 00:07:07,560 --> 00:07:10,440 Germany and right now these tariffs stand to make auto 157 00:07:10,440 --> 00:07:12,280 manufacturing far more expensive. 158 00:07:12,280 --> 00:07:15,440 NVIDIA is down 5.8%. This stock is. 159 00:07:15,440 --> 00:07:18,200 Already very high beta, so part of it is because. 160 00:07:18,200 --> 00:07:20,920 The stock simply just trades around a lot, but it's also 161 00:07:20,920 --> 00:07:22,960 being grouped in because NVIDIA is going to. 162 00:07:23,040 --> 00:07:24,920 Face these tariffs as well they do. 163 00:07:24,920 --> 00:07:27,560 Business all around the world. There's now more friction and 164 00:07:27,560 --> 00:07:29,480 more cost to doing business around the world. 165 00:07:29,560 --> 00:07:32,240 Now finally we get to Costco, which is moving up today. 166 00:07:32,400 --> 00:07:36,320 It's in the green by 1.4, 6%, defying gravity. 167 00:07:36,600 --> 00:07:39,120 Costco's a company that many people are waiting. 168 00:07:39,440 --> 00:07:42,040 They're waiting for the time where Costco finally trades 169 00:07:42,040 --> 00:07:43,840 down. To a reasonable valuation. 170 00:07:44,160 --> 00:07:45,760 It. Trades at such a lofty high 171 00:07:45,760 --> 00:07:48,640 multiple that. There must be some market crash 172 00:07:48,640 --> 00:07:52,520 or some time of panic where Costco finally goes down and 173 00:07:52,520 --> 00:07:55,760 here we have market panic. Here we have real, fair, real. 174 00:07:55,760 --> 00:07:59,000 Uncertainty, real predictions about the future and how things 175 00:07:59,000 --> 00:08:01,800 may work out in a bad way. And Costco's in the green. 176 00:08:02,280 --> 00:08:04,480 Well, why is this? For a couple reasons. 177 00:08:04,840 --> 00:08:07,840 Costco is a company that not only does well during good 178 00:08:07,840 --> 00:08:11,520 times, but it's considered a safe haven during bad times. 179 00:08:11,760 --> 00:08:14,160 Costco is a subscription. Company that sells stuff 180 00:08:14,160 --> 00:08:15,600 everyone needs, no matter. What? 181 00:08:15,960 --> 00:08:18,040 They have to buy it. They have to pay for this stuff. 182 00:08:18,640 --> 00:08:22,120 So I view Costco as a company that investors flee to during 183 00:08:22,120 --> 00:08:24,320 times of uncertainty. Like we have, right? 184 00:08:24,320 --> 00:08:26,920 Now, Costco is uniquely positioned to have better cost 185 00:08:26,920 --> 00:08:30,120 structure than other retailers because of their limited amount 186 00:08:30,120 --> 00:08:34,559 of SKUs, meaning they sell fewer unique items so they can have 187 00:08:34,760 --> 00:08:38,320 more sweetheart deals in their bulk ordering even though things 188 00:08:38,320 --> 00:08:40,640 will become more expensive. For Costco, they'll. 189 00:08:40,640 --> 00:08:43,320 Become proportionately far more expensive for competing 190 00:08:43,320 --> 00:08:46,600 retailers, increasing the value proposition of Costco. 191 00:08:46,880 --> 00:08:49,920 Relative to their competitors. So we have all of these stocks, 192 00:08:49,920 --> 00:08:51,760 the majority. Of which are deeply in the red 193 00:08:51,800 --> 00:08:54,280 and overall this is a response of the uncertainty and 194 00:08:54,280 --> 00:08:57,920 unpredictability, the increased risk that was introduced 195 00:08:57,920 --> 00:08:59,960 yesterday. Now before we go into my. 196 00:08:59,960 --> 00:09:02,320 Strategy what I. Personally plan on doing 197 00:09:02,320 --> 00:09:04,080 throughout this and how I see it working out. 198 00:09:04,480 --> 00:09:07,040 I just want to go ahead and and. Relive a little. 199 00:09:07,040 --> 00:09:10,040 Bit of what happened yesterday just kind of go through and and 200 00:09:10,040 --> 00:09:12,200 what I saw and my reaction to it. 201 00:09:12,840 --> 00:09:15,320 So this whole thing. Starts off with. 202 00:09:15,320 --> 00:09:18,840 President Trump talking about how we've been ripped off right 203 00:09:18,840 --> 00:09:21,200 as Americans, we've been ripped off by other countries. 204 00:09:21,520 --> 00:09:24,440 That's the story. Now personally, I don't. 205 00:09:24,440 --> 00:09:27,360 Believe that's the case. I think of a country somewhere 206 00:09:27,360 --> 00:09:29,960 else implements tariffs. I think that's their. 207 00:09:29,960 --> 00:09:32,440 Problem I don't think the US is being ripped off because. 208 00:09:32,440 --> 00:09:35,080 We have to pay tariffs. That's something you can argue, 209 00:09:35,080 --> 00:09:37,440 but that's very much a Milton Friedman way of looking at 210 00:09:37,440 --> 00:09:39,600 things. A free trade, easy to do. 211 00:09:39,600 --> 00:09:41,440 Business it's better for your country. 212 00:09:41,800 --> 00:09:44,960 So there's different economic arguments here and everyone's 213 00:09:44,960 --> 00:09:46,440 entitled. To their view, if you disagree 214 00:09:46,440 --> 00:09:47,560 with. It that's fine. 215 00:09:47,720 --> 00:09:49,920 So I don't personally believe as Americans that we're getting 216 00:09:49,920 --> 00:09:51,400 ripped. Off this whole time by doing 217 00:09:51,400 --> 00:09:53,000 free. Trade, but putting aside. 218 00:09:53,000 --> 00:09:54,880 Whatever your personal philosophical. 219 00:09:54,880 --> 00:09:57,960 Economic views are President Trump goes up there and he makes 220 00:09:57,960 --> 00:10:00,560 that case. He makes the argument that the 221 00:10:00,640 --> 00:10:02,800 US is being ripped off by other countries. 222 00:10:03,280 --> 00:10:05,040 They have these tariffs. We don't. 223 00:10:05,200 --> 00:10:07,320 We're paying a tax to do business with them. 224 00:10:07,520 --> 00:10:09,200 They're not paying a tax to do business. 225 00:10:09,240 --> 00:10:10,760 With us. So he's. 226 00:10:10,760 --> 00:10:13,520 Kind of gauging it, he's kind of saying this is like 227 00:10:13,520 --> 00:10:15,080 implementing. A. 228 00:10:15,080 --> 00:10:17,040 A. Fee like a membership, like it's 229 00:10:17,040 --> 00:10:20,320 like paying the Costco yearly membership to do business with 230 00:10:20,400 --> 00:10:22,840 the US consumer. He views the US consumer. 231 00:10:22,840 --> 00:10:25,680 As this very valuable thing to have access to. 232 00:10:25,680 --> 00:10:29,200 Our market and our our. Wallet to have access to. 233 00:10:29,200 --> 00:10:31,920 All of our consumers that want to spend money, they have all 234 00:10:31,920 --> 00:10:36,200 this economic spending power. You have to pay taxes to do so. 235 00:10:36,480 --> 00:10:38,360 You have to pay the membership to enter. 236 00:10:38,720 --> 00:10:40,920 That's kind of the way that he was phrasing this. 237 00:10:41,400 --> 00:10:43,360 And then he brings up. This this board. 238 00:10:43,920 --> 00:10:46,960 Now the board is comically small, you can't even see it 239 00:10:46,960 --> 00:10:49,360 even with the cameras. The the reason that they made it 240 00:10:49,360 --> 00:10:51,440 so small is because he said it was windy, so if they made a 241 00:10:51,440 --> 00:10:53,320 giant one it would. Just blow away so. 242 00:10:53,680 --> 00:10:56,680 The the reasoning behind it was kind of funny to begin with, but 243 00:10:56,680 --> 00:10:58,400 of course you can't even see what's going on here. 244 00:10:58,400 --> 00:11:01,000 He holds this up. The the line items are like. 245 00:11:01,000 --> 00:11:03,800 1212 pixel. Font and we can't see what's 246 00:11:03,800 --> 00:11:06,800 going on so we're we're trying to figure this out and then he's 247 00:11:06,800 --> 00:11:10,600 reading it off 1 by 1 now I found an HD version of the same 248 00:11:10,600 --> 00:11:11,840 image the board that. He had. 249 00:11:11,840 --> 00:11:14,520 That he was presenting. Here's an HD version of it. 250 00:11:14,960 --> 00:11:17,640 And this is what he calls the reciprocal terrace. 251 00:11:18,080 --> 00:11:20,280 Now keep in mind this is just one of the boards, so if you 252 00:11:20,280 --> 00:11:23,800 think it's only these like 50 countries, you're wrong. 253 00:11:24,280 --> 00:11:25,440 It goes on and on. There's like. 254 00:11:25,440 --> 00:11:28,160 Six of these 6. Different images of every 255 00:11:28,160 --> 00:11:31,840 country that you can think of. In fact, I guarantee you there's 256 00:11:31,840 --> 00:11:33,440 countries you've. Never heard of before. 257 00:11:33,920 --> 00:11:36,320 There's ones listed that didn't even have many people living 258 00:11:36,320 --> 00:11:38,440 there and we're tariffing them as well. 259 00:11:38,560 --> 00:11:40,360 Now looking at this. Board, there's a few columns 260 00:11:40,360 --> 00:11:41,760 here. We have the country or 261 00:11:41,760 --> 00:11:43,040 territory. Off to the left. 262 00:11:43,040 --> 00:11:46,160 Which is like China, the European Union, Vietnam, so on. 263 00:11:46,480 --> 00:11:49,240 Then we have the. Tariff charge to the USA which? 264 00:11:49,240 --> 00:11:53,080 Includes currency manipulation and trade barriers. 265 00:11:53,480 --> 00:11:55,280 So. This percentage right there 266 00:11:55,800 --> 00:11:58,080 looks like it's accumulation of all. 267 00:11:58,080 --> 00:11:59,920 Three of those type of factors you're. 268 00:11:59,920 --> 00:12:02,000 Factoring in the base. Level tariff they charge. 269 00:12:02,360 --> 00:12:05,040 You're also factoring in the fact that other countries 270 00:12:05,240 --> 00:12:08,680 manipulate their currency and. Also, there's trade barriers. 271 00:12:09,080 --> 00:12:13,160 Now trade barriers for people not familiar are non tariff ways 272 00:12:13,160 --> 00:12:14,640 that countries make it. Difficult or. 273 00:12:14,640 --> 00:12:17,120 Taxing or expensive to do business with them. 274 00:12:17,600 --> 00:12:19,200 So technically they're not charging a. 275 00:12:19,200 --> 00:12:22,040 Tariff, but they're really. Doing the same thing by making 276 00:12:22,040 --> 00:12:23,560 it. Very difficult to import your. 277 00:12:23,560 --> 00:12:26,480 Product and flood your product into their country. 278 00:12:26,840 --> 00:12:28,920 For example, China does this all the time. 279 00:12:29,360 --> 00:12:31,760 They have forced technology transfers. 280 00:12:32,000 --> 00:12:34,760 China has required foreign companies to share and transfer 281 00:12:34,760 --> 00:12:37,440 their proprietary technology to Chinese joint ventures. 282 00:12:37,800 --> 00:12:39,280 So if you want to do business in China. 283 00:12:39,720 --> 00:12:41,840 Like if I wanted. Qualtrum to do business in 284 00:12:41,840 --> 00:12:44,360 China. They may force me to give up 285 00:12:44,720 --> 00:12:46,960 proprietary information to give. Up the way. 286 00:12:46,960 --> 00:12:49,760 That I do things, the methods of doing things to other 287 00:12:49,760 --> 00:12:51,360 competitors. So you have to make these 288 00:12:51,360 --> 00:12:53,880 decisions which technically. Aren't tariffs, but they're. 289 00:12:53,880 --> 00:12:56,720 Costly and expensive, nonetheless there's a whole list 290 00:12:56,720 --> 00:12:58,160 of them there's. Quotas. 291 00:12:58,160 --> 00:13:00,560 There's licensing, there's agreements, there's red tapes, 292 00:13:00,560 --> 00:13:01,280 there's. Delays. 293 00:13:01,280 --> 00:13:04,080 There's overly. Scrutinizing inspections and so 294 00:13:04,080 --> 00:13:06,680 on and so forth. Countries can do things to 295 00:13:06,680 --> 00:13:11,320 disincentivize imports without a blanket tariff and. 296 00:13:11,360 --> 00:13:13,440 I believe that's what. Was going to be factored in 297 00:13:13,440 --> 00:13:16,240 here. So my assumption was that they 298 00:13:16,240 --> 00:13:19,440 came up with some type of algorithm or some type of way of 299 00:13:19,440 --> 00:13:23,280 calculating the inclusion of trade barriers, price 300 00:13:23,280 --> 00:13:26,440 manipulation and the base level tariff and that's how they got 301 00:13:26,440 --> 00:13:28,480 to this number. But upon further investigation, 302 00:13:28,480 --> 00:13:30,720 we found out that these numbers have nothing to do with. 303 00:13:30,720 --> 00:13:34,440 Tariffs or trade barriers? In and of themselves, they only 304 00:13:34,440 --> 00:13:35,520 have to. Do what? 305 00:13:35,520 --> 00:13:38,320 Trade imbalances, trade surpluses. 306 00:13:38,320 --> 00:13:39,800 We have an administration official. 307 00:13:39,800 --> 00:13:41,760 That gave us the. Exact calculation they used to 308 00:13:41,760 --> 00:13:44,520 quantify this reciprocal tariff number. 309 00:13:44,520 --> 00:13:46,840 Here's what the actual. Formula looks like. 310 00:13:46,880 --> 00:13:50,000 Now, it's been a while since I've done advanced algebra and I 311 00:13:50,000 --> 00:13:52,720 don't recognize a lot of these these symbols, but if you break 312 00:13:52,720 --> 00:13:54,880 it down, this is basically what it means. 313 00:13:55,080 --> 00:13:58,400 You have the exports. A country does minus the imports 314 00:13:58,800 --> 00:14:01,360 divided by the imports. So you're basically just. 315 00:14:01,360 --> 00:14:04,680 Taking the amount of exporting, dividing it by the imports, the 316 00:14:04,680 --> 00:14:06,880 United States Trade Representative detailed a. 317 00:14:06,920 --> 00:14:10,040 Formula that divides. The country's trade surplus with 318 00:14:10,040 --> 00:14:11,560 the US. By its total. 319 00:14:11,560 --> 00:14:16,080 Exports based on data from US Census Bureau in 2024 and then 320 00:14:16,080 --> 00:14:17,680 that number was. Divided by two. 321 00:14:17,880 --> 00:14:21,440 Producing the discounted rate. So basically the number right 322 00:14:21,440 --> 00:14:23,040 here. Where it says tariffs charged. 323 00:14:23,040 --> 00:14:26,160 To the US doesn't actually represent tariffs charged. 324 00:14:26,160 --> 00:14:28,840 To the US at all. For most of these countries, 325 00:14:29,280 --> 00:14:31,360 like China, you have a 7% tariff. 326 00:14:31,360 --> 00:14:34,960 It's very minor. This 67 percent is the trade 327 00:14:34,960 --> 00:14:37,080 imbalance. It's the trade imbalance in 328 00:14:37,080 --> 00:14:39,040 surplus that the US has with China. 329 00:14:39,040 --> 00:14:41,640 The USTR statement said that. While it was technically 330 00:14:41,640 --> 00:14:43,960 possible to calculate rates for the actual barriers. 331 00:14:44,200 --> 00:14:47,120 This methodology would achieve Trump's goal of driving down 332 00:14:47,280 --> 00:14:50,560 trade deficits. So this is showing the 333 00:14:50,560 --> 00:14:52,200 relationship of. Trade we have. 334 00:14:52,400 --> 00:14:54,800 With these different countries, so it's important when looking 335 00:14:54,800 --> 00:14:56,840 at this chart. To realize that these. 2 numbers 336 00:14:56,840 --> 00:15:00,680 don't represent the same thing. The implication when you compare 337 00:15:00,680 --> 00:15:02,160 them side. By side is. 338 00:15:02,160 --> 00:15:06,480 That they're the same thing that China's charging US 67% to do 339 00:15:06,480 --> 00:15:09,120 business in China and we're only responding. 340 00:15:09,160 --> 00:15:11,960 With a 34. Percent tax on them. 341 00:15:12,280 --> 00:15:14,160 Therefore we're. Taxing them less? 342 00:15:14,480 --> 00:15:18,800 That's not the case. The 67% is a trade imbalance 343 00:15:18,800 --> 00:15:22,200 calculation. It's not a tax, the 34%. 344 00:15:22,680 --> 00:15:24,600 Is a tax. So these two numbers are 345 00:15:24,600 --> 00:15:25,880 different. The amount that we're now 346 00:15:25,880 --> 00:15:28,480 charging them in tariffs is much larger than what they're 347 00:15:28,480 --> 00:15:30,560 charging us now. One of the confusing parts of 348 00:15:30,560 --> 00:15:33,480 this is President Trump mentioned that even in the cases 349 00:15:33,480 --> 00:15:36,320 where a country's doing. Specifically what we're. 350 00:15:36,320 --> 00:15:39,480 Wanting them to do what Trump is wanting them to do, which means 351 00:15:39,480 --> 00:15:42,120 that they're actually buying more from the US than they're 352 00:15:42,120 --> 00:15:45,120 selling to the US. The opposite thing that China's 353 00:15:45,120 --> 00:15:48,480 doing, even for those countries where we're selling more to them 354 00:15:48,840 --> 00:15:51,800 than what they're what they're selling to us, we're still 355 00:15:51,800 --> 00:15:53,320 slapping on a 10%. Tariff. 356 00:15:53,840 --> 00:15:55,360 So we're still. Saying you have. 357 00:15:55,360 --> 00:15:58,080 To pay a tariff. Even when you're doing exactly 358 00:15:58,080 --> 00:16:00,320 what we want you to do. So this. 359 00:16:00,320 --> 00:16:02,680 Is a head scratcher to me. I don't know what the incentive 360 00:16:02,680 --> 00:16:06,400 here is for charging countries, even when they're doing exactly 361 00:16:06,400 --> 00:16:08,800 what we're wanting them to do. So we know that the numbers. 362 00:16:08,800 --> 00:16:11,640 Off to the left. Of what they're charging us 363 00:16:11,640 --> 00:16:14,920 aren't exactly accurate, but we can only assume that the numbers 364 00:16:14,920 --> 00:16:17,920 that we're going to charge them right here on the right are 365 00:16:17,920 --> 00:16:18,560 accurate. This is. 366 00:16:18,560 --> 00:16:21,160 What we say we're going to charge these other companies in 367 00:16:21,160 --> 00:16:23,640 tariffs to do business with the US, We kick things off. 368 00:16:23,640 --> 00:16:28,160 Here with a. 34% tariff from China now, obviously. 369 00:16:28,160 --> 00:16:30,240 We get a lot. Of stuff from China, a lot of 370 00:16:30,240 --> 00:16:32,960 imports from China. US consumers really like buying 371 00:16:32,960 --> 00:16:36,200 stuff from China. But with a 34% tariff that 372 00:16:36,200 --> 00:16:37,800 becomes dramatically more expensive. 373 00:16:38,120 --> 00:16:40,440 And there is a little bit of confusion on this one. 374 00:16:40,720 --> 00:16:43,200 We don't really know if this is in addition to the already 375 00:16:43,200 --> 00:16:47,840 existing 20% tariff from China or if it's just going to be 34%. 376 00:16:48,120 --> 00:16:51,000 So it might. Actually be 50. 4%, we don't 377 00:16:51,000 --> 00:16:53,520 quite know yet. With the European Union, we now 378 00:16:53,520 --> 00:16:58,320 have a 20% tariff on them. So all of Europe now notably we 379 00:16:58,320 --> 00:17:01,120 have some big territories and countries missing like Canada 380 00:17:01,120 --> 00:17:03,080 and Mexico. So I'm still not sure of what 381 00:17:03,080 --> 00:17:05,680 we're doing there, but we have. Tariffs all across. 382 00:17:05,760 --> 00:17:10,280 Asia, Vietnam, Taiwan, Japan, India, South Korea, Thailand, 383 00:17:10,440 --> 00:17:12,880 Switzerland, Indonesia, Malaysia. 384 00:17:13,240 --> 00:17:17,760 These tariffs range anywhere from 46% for Vietnam. 385 00:17:18,240 --> 00:17:20,520 Places where Nike is manufacturing a lot of their 386 00:17:20,520 --> 00:17:23,920 goods, all of a sudden their supply chains are in trouble. 387 00:17:24,400 --> 00:17:27,400 The the cost of doing business in those countries are going to 388 00:17:27,400 --> 00:17:28,440 be. Dramatically higher. 389 00:17:28,880 --> 00:17:30,760 So that's. The reason that Nikes down big 390 00:17:30,760 --> 00:17:33,000 today, what are they going to do in this situation? 391 00:17:33,000 --> 00:17:34,360 They really have nowhere. Else to go. 392 00:17:34,720 --> 00:17:38,400 Nike sweatshirts and Nike shoes are going to be dramatically 393 00:17:38,400 --> 00:17:42,240 more expensive if this doesn't get removed and you go through 394 00:17:42,240 --> 00:17:43,040 the. List here it doesn't. 395 00:17:43,040 --> 00:17:45,960 Really get any better and the calculation overall is that this 396 00:17:45,960 --> 00:17:49,560 is around a 20% universal. Tariff, which is a. 397 00:17:49,560 --> 00:17:54,200 Staggering number when you think about a new tax of 20% to the 398 00:17:54,200 --> 00:17:56,600 entire world. Now, the argument here from many 399 00:17:56,600 --> 00:18:00,280 people still is that this is a negotiating tactic, that Trump 400 00:18:00,280 --> 00:18:04,000 is simply shocking the market, forcing other countries to take 401 00:18:04,000 --> 00:18:07,320 them seriously, forcing them to think about their relationship. 402 00:18:07,320 --> 00:18:09,280 With the US. And forcing them. 403 00:18:09,320 --> 00:18:13,640 Hopefully to lower their tariffs so that we take ours off so that 404 00:18:13,640 --> 00:18:15,360 we have free trade across the board. 405 00:18:15,440 --> 00:18:16,880 That's the. Argument that many people are 406 00:18:16,880 --> 00:18:19,200 still making, and it's an argument that I had made. 407 00:18:19,560 --> 00:18:22,160 It made sense for Trump to use tariffs as a negotiating. 408 00:18:22,160 --> 00:18:25,480 Tactic that bring other. Countries to the table to make 409 00:18:25,480 --> 00:18:28,200 deals, to make solutions, to talk business. 410 00:18:28,440 --> 00:18:31,360 That's something that I could see happening on a select basis 411 00:18:31,560 --> 00:18:33,800 in a very strategic manner. That's what he was. 412 00:18:33,800 --> 00:18:35,520 Originally doing a couple months ago. 413 00:18:35,800 --> 00:18:38,360 He would tariff. One country, bring them to the 414 00:18:38,360 --> 00:18:40,080 table and then make an agreement and. 415 00:18:40,080 --> 00:18:42,120 Usually it was resolved. Within 24 hours. 416 00:18:42,360 --> 00:18:44,640 Typically before the tariff. Even went into effect. 417 00:18:45,000 --> 00:18:48,400 So that seemed like it was more strategic negotiating tactic, 418 00:18:48,960 --> 00:18:51,360 but what we're seeing now seems like a change of tone. 419 00:18:52,320 --> 00:18:54,840 It doesn't seem like this is just a negotiating tactic. 420 00:18:55,000 --> 00:18:58,280 A lot of the commentary seems very mixed on this subject, but 421 00:18:58,280 --> 00:19:00,080 what I'm seeing. Is still. 422 00:19:00,080 --> 00:19:02,800 A response from the White House that they're not really wanting 423 00:19:02,800 --> 00:19:05,160 to negotiate. For example, listen to this 424 00:19:05,160 --> 00:19:08,680 interview here has been whether these are negotiable and what 425 00:19:08,680 --> 00:19:10,240 the White House is thinking from here. 426 00:19:10,480 --> 00:19:13,320 I can tell you as far as this morning what we're hearing from 427 00:19:13,320 --> 00:19:15,960 officials, the signal they're sending is that these are not 428 00:19:15,960 --> 00:19:18,400 negotiable. They are not looking to strike 429 00:19:18,400 --> 00:19:20,280 deals right now. White House press secretary 430 00:19:20,280 --> 00:19:23,280 Caroline Levitt was just. This is a quote from a White. 431 00:19:23,280 --> 00:19:26,760 House official quote this. Is not a negotiation. 432 00:19:27,080 --> 00:19:30,320 This is a national emergency. Any country that thinks that 433 00:19:30,320 --> 00:19:33,000 they can simply make an announcement promising to lower 434 00:19:33,000 --> 00:19:34,120 some. Tariff is. 435 00:19:34,120 --> 00:19:37,400 Ignoring the big central problem of their massive non tariff 436 00:19:37,400 --> 00:19:40,000 barriers. Just on CNN this morning saying 437 00:19:40,000 --> 00:19:42,800 the president is firm in his approach and that if countries 438 00:19:42,800 --> 00:19:45,760 had wanted to negotiate, they had 70 years to do it. 439 00:19:45,920 --> 00:19:48,800 A White House official also told reporters yesterday that this is 440 00:19:48,800 --> 00:19:51,920 not a negotiation, it's a national emergency and that 441 00:19:51,920 --> 00:19:54,240 cutting tariffs now is not enough. 442 00:19:54,240 --> 00:19:56,160 That ignores the decades of trade barriers. 443 00:19:56,440 --> 00:19:58,040 So we have the posture from the white. 444 00:19:58,040 --> 00:20:01,480 House insisting that this isn't a negotiation, this isn't simply 445 00:20:01,480 --> 00:20:04,320 a negotiating tactic, because if a country just says they're 446 00:20:04,320 --> 00:20:05,480 going to. Lower their tariffs. 447 00:20:05,800 --> 00:20:08,600 It doesn't address the trade. Barriers in the other aspects. 448 00:20:09,160 --> 00:20:12,320 So maybe they need to do more, but the attitude right now is 449 00:20:12,320 --> 00:20:15,000 that it's almost. Like it's too little too late. 450 00:20:15,080 --> 00:20:17,720 Other countries simply can't negotiate even if they want to, 451 00:20:17,720 --> 00:20:20,800 and that seems like the opposite message that doesn't 452 00:20:20,800 --> 00:20:22,160 incentivize. Bringing people to the. 453 00:20:22,160 --> 00:20:24,120 Table. For example, we have the. 454 00:20:24,440 --> 00:20:27,960 Example of Israel it. Was hit with a 17% tariff 455 00:20:27,960 --> 00:20:31,280 despite saying it would scrap levies on US goods. 456 00:20:31,280 --> 00:20:34,480 This shows that even countries that have given concessions that 457 00:20:34,480 --> 00:20:36,000 have come to the negotiating. Table. 458 00:20:36,120 --> 00:20:37,520 That said that they want to work in good. 459 00:20:37,520 --> 00:20:40,280 Faith with the US. Are still kind of being ignored. 460 00:20:40,280 --> 00:20:42,640 As of least. Right now, we don't know if 461 00:20:42,640 --> 00:20:45,080 there's going to be a deal struck in the future, but right 462 00:20:45,080 --> 00:20:47,520 now it seems like every country's being tariffed. 463 00:20:47,680 --> 00:20:50,200 So we have this continued back and forth debate of whether or 464 00:20:50,200 --> 00:20:53,640 not this is a negotiating tactic or this is just the new normal, 465 00:20:53,640 --> 00:20:56,440 a new way of doing business under the Trump administration. 466 00:20:56,800 --> 00:20:59,680 We have people like Steve Mnuchin going on to CNBC and 467 00:20:59,680 --> 00:21:02,040 he's on the side that this is a negotiating tactic. 468 00:21:02,240 --> 00:21:05,160 Still today, even after seeing what's going on, he still 469 00:21:05,160 --> 00:21:06,040 believes. That these tariffs. 470 00:21:06,040 --> 00:21:08,920 Will be taken down. I think it's the larger tariffs 471 00:21:09,120 --> 00:21:11,200 that are called the reciprocal tariffs. 472 00:21:11,200 --> 00:21:15,040 I'm hopeful that those will be negotiated down, that those are 473 00:21:15,040 --> 00:21:19,160 tariffs that will bring people to the table and we'll negotiate 474 00:21:19,160 --> 00:21:21,480 them down. Now, ultimately, we don't know 475 00:21:21,480 --> 00:21:24,040 what's going to happen in the future, whether or not a lot of 476 00:21:24,040 --> 00:21:26,320 this stuff is going to be negotiated down or whether it's 477 00:21:26,320 --> 00:21:27,480 going to stick around for a while. 478 00:21:27,760 --> 00:21:30,520 We don't know either. Way but if the tariffs do stick. 479 00:21:30,520 --> 00:21:33,800 Around like they're presented here, the market is going to go 480 00:21:33,800 --> 00:21:36,800 lower that is going to. Be a very predictable. 481 00:21:36,800 --> 00:21:39,440 Outcome of this because these tariffs are simply too steep, do 482 00:21:39,440 --> 00:21:42,720 not have major impacts on the earnings of these companies on 483 00:21:42,720 --> 00:21:44,600 their. Ability to source these products 484 00:21:44,600 --> 00:21:47,480 for the prices they have. So we'll see what happens in the 485 00:21:47,480 --> 00:21:50,200 future, but there's a tremendous amount of uncertainty now in 486 00:21:50,200 --> 00:21:54,560 terms of what I do in situations like this, knowing that we don't 487 00:21:54,560 --> 00:21:58,080 know a lot and there's a lot of uncertainty is in most cases, I 488 00:21:58,080 --> 00:22:01,280 use any type of weakness like this to buy into stocks. 489 00:22:01,320 --> 00:22:04,000 Now that may come across as glib that I'm going to be buying 490 00:22:04,000 --> 00:22:07,200 stocks during this time period, or it may come across as me not 491 00:22:07,200 --> 00:22:10,400 taking this seriously, like I'm shrugging off these concerns and 492 00:22:10,400 --> 00:22:13,240 that I don't think anything bad can happen as a result of these 493 00:22:13,240 --> 00:22:15,960 incredibly high tariffs. And I assure you that's not the 494 00:22:15,960 --> 00:22:17,720 case during time periods where this. 495 00:22:17,720 --> 00:22:19,960 Type of stuff. Happens, causing stocks to sell 496 00:22:19,960 --> 00:22:23,240 off dramatically from prices they were just months ago is a 497 00:22:23,240 --> 00:22:25,200 time period. I typically choose to buy. 498 00:22:25,800 --> 00:22:28,360 In fact, the time periods where the market sells off the most, 499 00:22:28,760 --> 00:22:31,920 like March of 2020 during a time period. 500 00:22:31,920 --> 00:22:34,160 Where there is a. Virus racing around killing 501 00:22:34,160 --> 00:22:36,640 millions of people. The entire economy was shut 502 00:22:36,640 --> 00:22:38,360 down. Logistics and supply chains were 503 00:22:38,360 --> 00:22:40,400 shut down. I continue to buy stock. 504 00:22:40,400 --> 00:22:42,800 During that time period, I didn't know what was going to 505 00:22:42,800 --> 00:22:44,400 happen. I couldn't have a. 506 00:22:44,440 --> 00:22:47,640 Crystal clear. Vision of the future, any time. 507 00:22:47,640 --> 00:22:49,720 Period where stocks. Sell down dramatically. 508 00:22:49,960 --> 00:22:52,120 There's inherently a lot of unknowns. 509 00:22:52,360 --> 00:22:53,840 That is the reason that investors. 510 00:22:53,840 --> 00:22:56,080 Get cold feet that. Is the reason that great 511 00:22:56,080 --> 00:22:59,000 companies go on sale? So even though I don't like the 512 00:22:59,000 --> 00:23:01,680 reason stocks go down, I don't like the reason they went down 513 00:23:01,680 --> 00:23:03,880 in March of 2020. I don't like the reason they're 514 00:23:03,880 --> 00:23:06,080 going down today. The fact remains that these 515 00:23:06,080 --> 00:23:07,760 companies I'm buying are not going to be around. 516 00:23:07,760 --> 00:23:09,840 For a year or two. These are companies that will be 517 00:23:09,840 --> 00:23:11,600 around for the next 20 plus years. 518 00:23:12,040 --> 00:23:14,280 So if I can get a more attractive deal on these 519 00:23:14,280 --> 00:23:19,320 companies amidst turmoil, panic, unpredictability, unpredictable 520 00:23:19,320 --> 00:23:22,120 futures, that's a time period where I'd like to increase my 521 00:23:22,120 --> 00:23:25,200 share count as much as possible during the time periods where 522 00:23:25,200 --> 00:23:26,480 investors are the most. Fearful. 523 00:23:26,720 --> 00:23:28,320 Is when we should be buying the most. 524 00:23:28,320 --> 00:23:30,480 So having said that, let's go ahead and go into my trades 525 00:23:30,480 --> 00:23:32,840 today. The first thing I did was I sold 526 00:23:32,840 --> 00:23:35,840 out of a company. All the way which was vici. 527 00:23:36,080 --> 00:23:38,280 I own no shares of VICI currently. 528 00:23:38,640 --> 00:23:41,080 Now VICI was doing just fine. In fact, if we look at the 529 00:23:41,080 --> 00:23:43,200 company here. The stock price has barely 530 00:23:43,200 --> 00:23:46,000 moved. Today only down 1.3%, year to 531 00:23:46,000 --> 00:23:49,480 date it's up 9.5%. So this company's in the green, 532 00:23:49,480 --> 00:23:51,600 it's doing well. It held up well. 533 00:23:51,800 --> 00:23:54,120 It's a very low volatility stock that has really. 534 00:23:54,120 --> 00:23:57,040 Good fundamentals. There's no panic mode with VICI. 535 00:23:57,240 --> 00:23:59,600 This company will continue to pay investors dividends. 536 00:23:59,920 --> 00:24:01,200 They'll continue to collect rent. 537 00:24:01,680 --> 00:24:05,240 I sold this company, which is a low volatility company that's in 538 00:24:05,240 --> 00:24:08,600 the green this year, to buy more into companies that have. 539 00:24:08,600 --> 00:24:11,400 Higher volatility. That are in the red by a greater 540 00:24:11,400 --> 00:24:14,160 extent now one of the. Companies that I introduced. 541 00:24:14,160 --> 00:24:16,840 New to my. Portfolio is Equifax. 542 00:24:17,200 --> 00:24:20,800 I just bought 100 of this company and I'll continue to add 543 00:24:20,800 --> 00:24:23,240 to this position. Right now, Equifax is an 544 00:24:23,240 --> 00:24:25,960 introductory position. Now I have it here in the 545 00:24:25,960 --> 00:24:28,640 financial. Category because Equifax is. 546 00:24:28,640 --> 00:24:31,440 Overall, a financial and data analytic company. 547 00:24:31,920 --> 00:24:32,680 But a? Lot of people have a 548 00:24:32,680 --> 00:24:34,880 misunderstanding of what this company actually is. 549 00:24:35,040 --> 00:24:36,840 Now with Equifax, this is a company that in the. 550 00:24:36,840 --> 00:24:39,320 Previous episode I highlighted. As being an attractive. 551 00:24:39,320 --> 00:24:42,560 Stock with the sell off today I believe it provides. 552 00:24:42,560 --> 00:24:44,520 A unique entry point. So I decided. 553 00:24:44,520 --> 00:24:47,520 To start building my position in this company now I've already. 554 00:24:47,520 --> 00:24:50,000 Talked a little bit about what? The company does, but I just 555 00:24:50,000 --> 00:24:52,560 want to mention a few things that I see in the future of this 556 00:24:52,560 --> 00:24:54,720 company. One of them is that most people 557 00:24:54,720 --> 00:24:58,160 know this company by the credit Bureau, meaning the Equifax is 558 00:24:58,160 --> 00:25:00,080 one of the three big credit companies. 559 00:25:00,360 --> 00:25:02,640 When you buy a home, you'll get your credit that ran by them 560 00:25:02,920 --> 00:25:04,760 because they know all this information about you. 561 00:25:05,440 --> 00:25:08,960 But that's only one part of the company, the more exciting part 562 00:25:08,960 --> 00:25:11,920 of the company, one that makes up around half their revenue. 563 00:25:12,200 --> 00:25:15,080 Is their workforce solution. Specifically, they have a 564 00:25:15,080 --> 00:25:17,840 product called the. Work number, which is basically 565 00:25:17,840 --> 00:25:20,920 proprietary information on verifying someone's background. 566 00:25:21,240 --> 00:25:22,800 Where they have your work history, your. 567 00:25:22,800 --> 00:25:26,080 College information. They know all about you now. 568 00:25:26,400 --> 00:25:29,000 For employers, especially government jobs or large 569 00:25:29,000 --> 00:25:30,720 organizations, they want to know. 570 00:25:30,720 --> 00:25:32,240 Who they're actually. Hiring. 571 00:25:32,520 --> 00:25:34,360 They want to know if you actually went and did. 572 00:25:34,360 --> 00:25:36,200 The things that you said that you did. 573 00:25:36,200 --> 00:25:38,440 That you went and worked for the companies you did, That you have 574 00:25:38,440 --> 00:25:41,400 the background that you do. Instead of calling up your old 575 00:25:41,400 --> 00:25:44,720 employer to verify that information, they now use the 576 00:25:44,720 --> 00:25:46,600 work number. By Equifax. 577 00:25:46,880 --> 00:25:50,240 They have the majority share in this verification market and 578 00:25:50,240 --> 00:25:51,880 this is a major. Growth path for this? 579 00:25:51,880 --> 00:25:54,120 Company, it's very. Difficult to create this. 580 00:25:54,120 --> 00:25:56,520 Record base of millions of people and. 581 00:25:56,520 --> 00:25:58,360 Verify all of this. Information. 582 00:25:58,440 --> 00:26:00,880 So they are very strategically head in this important product. 583 00:26:01,440 --> 00:26:04,000 And then the third thing is Equifax has become a little bit 584 00:26:04,000 --> 00:26:07,440 like a data analytics company, similar to how Visa, MasterCard. 585 00:26:07,440 --> 00:26:09,200 Have these value add. Services. 586 00:26:09,560 --> 00:26:12,480 Equifax has the same thing. For example, they've partnered 587 00:26:12,480 --> 00:26:16,520 with MasterCard on offering identity verification solutions. 588 00:26:16,520 --> 00:26:19,560 So they have fraud prevention and they're building out all 589 00:26:19,560 --> 00:26:21,960 these different analytic tools that they can partner with other 590 00:26:21,960 --> 00:26:23,640 businesses. This is another. 591 00:26:23,640 --> 00:26:25,920 Growth path for this? Company Now there's a lot more I 592 00:26:25,920 --> 00:26:28,960 plan on going into with Equifax when I do a full video on this 593 00:26:28,960 --> 00:26:31,240 one with their history and the database. 594 00:26:31,240 --> 00:26:32,840 Breach how they've. Moved to. 595 00:26:32,840 --> 00:26:34,920 Cloud they've re architected. The company. 596 00:26:35,160 --> 00:26:37,600 How they have major? Efficiencies and headwinds that 597 00:26:37,600 --> 00:26:39,600 are behind them. There's lots of good things 598 00:26:39,600 --> 00:26:42,640 going on with this business, but it's one that I decided right 599 00:26:42,640 --> 00:26:45,920 now, given the hysteria, given the panic, I'll likely get a lot 600 00:26:45,920 --> 00:26:48,440 more attractive of a deal today than I will any other time. 601 00:26:48,880 --> 00:26:51,760 So I'm starting the position and I'll continue to add to this 602 00:26:51,760 --> 00:26:54,360 one, especially if it dips now in the Story Fund. 603 00:26:54,360 --> 00:26:56,640 I continue to add to this portfolio. 604 00:26:56,640 --> 00:26:58,520 I'm really excited about the Story Fund. 605 00:26:58,880 --> 00:27:03,240 The gains have gone from around 130,000 to now 87,000. 606 00:27:03,640 --> 00:27:07,960 Just today specifically with Amazon, it's down $11,000 O 607 00:27:07,960 --> 00:27:11,480 Amazon has sold off big time. We're down 38. 608 00:27:11,800 --> 00:27:14,800 Luckily Netflix again is kind of holding U this portfolio. 609 00:27:14,960 --> 00:27:16,960 Netflix is really. Carrying a lot of heavyweight 610 00:27:16,960 --> 00:27:18,400 hair. While the rest of the Max Seven 611 00:27:18,400 --> 00:27:22,120 goes down and Netflix continues to do well, but Amazon is now my 612 00:27:22,120 --> 00:27:25,480 major focus. I bought another $5000 of Amazon 613 00:27:25,480 --> 00:27:28,320 stock this morning. Even though trade policies 614 00:27:28,320 --> 00:27:31,240 change, elections come and go, there's different. 615 00:27:31,440 --> 00:27:33,200 Leaders different. Policies different. 616 00:27:33,200 --> 00:27:35,760 Agreements all the time. Amazon's a company that I 617 00:27:35,760 --> 00:27:37,800 believe will be around for 20 plus years. 618 00:27:37,800 --> 00:27:39,880 I don't really care. Too much if earnings get. 619 00:27:39,880 --> 00:27:42,360 Revised lower this year or they get revised higher? 620 00:27:42,840 --> 00:27:44,440 Either way, I want to own this company. 621 00:27:44,440 --> 00:27:47,560 Because of the earnings. Power I see 20 years from now or 622 00:27:47,560 --> 00:27:50,240 40 years from now when you look at a discounted cash flow 623 00:27:50,240 --> 00:27:52,800 timeline the goes out 20 years and you look at a. 624 00:27:52,800 --> 00:27:54,680 Couple years. That don't make as much money. 625 00:27:54,880 --> 00:27:56,360 That's not such. A big deal. 626 00:27:56,680 --> 00:27:58,920 It's not that big of an intrinsic value change in the 627 00:27:58,920 --> 00:28:01,600 stock. The best investors are the ones 628 00:28:01,800 --> 00:28:05,560 that can put all the macro aside and hold on to great quality 629 00:28:05,560 --> 00:28:07,120 companies through any environment. 630 00:28:07,400 --> 00:28:10,160 Benjamin Graham, Warren Buffett made their money. 631 00:28:10,160 --> 00:28:13,600 By holding GEICO. Through decades of time, during 632 00:28:13,680 --> 00:28:15,640 all different. Types of market volatility. 633 00:28:15,640 --> 00:28:18,880 And uncertainty, they didn't look at next quarter's estimates 634 00:28:18,880 --> 00:28:19,920 and sell. Out because they got. 635 00:28:19,920 --> 00:28:21,760 Frightened. That's not the way that they 636 00:28:21,760 --> 00:28:25,160 made money in these compounders. Like GEICO the. 637 00:28:25,160 --> 00:28:27,400 Same thing can be said for many great investors. 638 00:28:27,640 --> 00:28:29,560 You look at Peter Lynch in the times that he bought. 639 00:28:29,560 --> 00:28:32,600 Aggressively was during. Macro environments when everyone 640 00:28:32,600 --> 00:28:36,040 else is panicking. So even though Amazon is going 641 00:28:36,040 --> 00:28:39,200 to be impacted heavily by tariffs, they're not going to 642 00:28:39,200 --> 00:28:42,240 avoid this somehow. I will still use. 643 00:28:42,240 --> 00:28:45,000 It as an opportunity to buy into this company because over the 644 00:28:45,000 --> 00:28:47,720 fullness of time, I still see Amazon well positioned to win 645 00:28:47,720 --> 00:28:49,120 big. So that's what I'm doing with My 646 00:28:49,120 --> 00:28:50,920 Portfolio and I'll continue to give you more. 647 00:28:50,920 --> 00:28:53,440 Updates throughout this week. And next week, so if you 648 00:28:53,440 --> 00:28:54,120 haven't. Already. 649 00:28:54,120 --> 00:28:56,320 Subscribe to the channel and I'll see you in the next one.