In this week’s edition of Wealthion’s Weekly Market Recap, Andrew Brill highlights key insights from our expert guests:
Chris Casey discusses the impact of tariffs and economic policy in light of Donald Trump’s victory in this week’s election, explaining how tariffs act as a tax that often raises prices for U.S. consumers and the risks of retaliatory tariffs. David Lin highlights recent anomalies in the yield curve and the shifting correlations among traditionally uncorrelated assets, which could affect investor diversification strategies. John Ciampaglia discusses renewed interest in precious metals, especially silver and gold, and explores uranium’s growing potential amid a nuclear energy resurgence driven by Big Tech’s massive AI ambitions. Finally, Anthony Scaramucci, who joined us on election day, examines the tax rate disparity between corporations and individuals, warning of the economic risks from rising national debt.
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Andrew Brill 0:00
Country has elected a new president, and the Fed continued cutting rates this time, only a quarter of a point. If you need help navigating all of this, you can head to wealthion.com/free for a free no obligation, portfolio review. I’m your host. Andrew brill, with all that going on, let’s get to the recap and see what our experts had to say this week.
Andrew Brill 0:25
Chris Casey, of our partner, Ria, wind, rock wealth management, joined us after we knew who the next President will be. He explained the difference between tariffs and taxes. He also touched on other countries reciprocating if the President Elect imposes tariffs and they will negatively affect prices. Chris believes the country will move in the right direction financially over the next four years. He also feels that the Fed cannot so easily be reshaped. So, Chris, you mentioned tariffs. Explain to me tariffs and explain to our viewers, tariffs versus taxes. You know, a tariff is, in essence, a tax. And I know that Donald Trump said, Oh, China pay the tariffs. China isn’t really paying the tariffs. Are they? It’s the importers into United States are going to pay the tariffs.
Chris Casey 1:16
Yeah, in I think I said this last time, and no tax is neutral and doesn’t have create misallocations, doesn’t cause distortions, doesn’t cause, frankly, a reduction in the standard of living, all things being equal, but I would say tarp, so a little bit more benign than compared to a lot of different taxes out there. In fact, I believe for last year’s budget, for the fiscal year for the federal government, which ended september 30, I believe the tariff income revenue was around $80 billion and that’s just a drop the bucket compared to when you have 5 trillion in revenue, right? It’s fairly small, so there’s a lot of room for that to grow going forward,
Andrew Brill 1:58
and these tariffs do you expect countries to any country that’s imposed a tariff upon say, you know, imports coming in from China, imports coming in from Germany, imports coming in from anywhere. Trump is promising a tariff. Do you expect those countries to reciprocate and say, Okay, you want to, you want to put a tariff on our goods, we’re going to do the same to you.
Chris Casey 2:23
That’s quite likely. I mean, we’ve seen that recently with China and European Union. I can’t recall what the European Union put some tariffs or quotas on, but China immediately retaliated on. So I believe some luxury goods. So it’s not even necessarily the same industry or same good that’s affected, you know, they retaliate in different ways. So that, I think that is likely. Now, I think there would be a poor decision on the part of any country doing that, because, I mean, I strongly believe in free markets and free trade, so theoretically, I’m against tariffs. However, not every country feels that way, and so I think they would view it as, you know, quid pro quo. It’s their way of potentially reducing tariffs in the future, but in reality, that their country would be better off if they did not retaliate. And just Yes, it’s bad that there’s tariffs being placed on exported goods from the foreign country, but retaliating would just make things worse. But
Andrew Brill 3:26
that tariff is really going to be passed on to the American people in the form of a higher price, because the tariff is going to have to be paid by whoever’s importing that good. So ultimately, it’s the American people paying that tariff.
Chris Casey 3:44
Yeah, any consumer, ultimate consumer. We’re not always talking obviously, about retail goods, so there’s companies that are buying imported items as well. Yes, the consumers in general, tariffs do have a negative impact now, whether that eats in the profits or there’s increased prices, or there’s, you know, less capital expenditures by these companies, there’s, there’s a whole different ways it could play out, but they’re all negative to a degree.
Andrew Brill 4:10
Can you, I know you’ve looked over Trump’s economic plan. Are there? Can you go enlighten us a little bit on on how you think that he’s going to help the country?
Chris Casey 4:24
Well, I think even better than looking at any kind of proposed plans, because there’s a lot of things you know, he’s promised and said over the campaign, would be to look at what he did before. So one of the first things he did back in 16 by, I believe, December of that year, you had what passed, is the the tax cuts and Jobs Act, which massively reduce taxes, especially on the corporate level. And I think we’ll see something akin to that. Again, that’s, that’s one of the major benefits I could see coming out of this administration the other and I thought he did a great job of this last time. It’s probably one of, I’d say. The top three things, I thought the current that former administration did under Trump. But the other item is just deregulation. And you may recall he had that policy in the first term of for every regular regulation we have, we’re going to rip, I believe it was three out of the books, right? We’re we’re reducing regulation for every new one that’s introduced. I love that idea. And now that Elon’s on board, and he clearly whether he’s looking to cut wasteful spending or whether he’s looking at just cutting regulation, I think if anything, they’ll be more pronounced at this go around.
Andrew Brill 5:31
Obviously new president comes, comes in January, 20. Interestingly enough, that’s Martin Luther King Day. So you have Donald Trump being inaugurated on Martin Luther King Day. And so the Fed will have another decision to make. I guess they’ll, they’ll see what President Trump does in his first few days and act in kind, or do you expect more cuts going down the road? I know that they talked about, you know, maybe bringing rates down to 3% or three and a half percent right now they’re hovering around four and three quarters. That would be another point, point and a quarter. But if we’re talking about another 50 basis points, we’re down to about four and a quarter. Do you think the Fed will say, You know what, let’s pump the brakes and see what we’re going to do now.
Chris Casey 6:22
Well, as the Fed always says they’re data dependent, right? They, they say that each time. And we believe that or not? Well, I believe it, because the way I interpret that is that they’re extremely reactive, right? Because they really are. They’re just constantly reacting to new stimuli that’s put before them. That’s that’s really what they’re doing. There’s no, I don’t think there’s an overall game plan. There’s certainly no philosophy underneath it. I guarantee that as far as what they do next year, I think it’s highly dependent on the markets. So let’s just see if there’s a financial downturn. Let’s say the first quarter, if the economy, which I do think will happen if we if we start to experience weakness or recession, they’ll go right back to the same playbook, and all bets are often they could cut quite a bit. What I do know, though, is that Trump has very limited, limited ability to reshape the Federal Reserve Board. There’s seven governors, right that voting governors, and there’s only two that have terms expiring during Trump’s term, and they expire fairly late in the term. I think one’s even like towards the end of four years now, Powell does have his chairmanship come up, I believe, in May of 26 and Trump has already been on record that he won’t post, will be on the board. He just wouldn’t be Fed chair. He’s not going to renominate him, so we’ll see what happens. But, but again, the the point being, is that the Federal Reserve policy, I think, will continue intact. I don’t want to call it policy, let’s call their reactions or remain intact for the foreseeable future, because that board is not going to change. Are you concerned
Andrew Brill 7:58
about your financial future or think your investments could be doing better. I’m Andrew brill, one of the hosts here on wealthion, and I’ve been there not sure my money was in the right places. It’s why I’ve gotten help from a financial advisor. Maybe it’s time you think more about your financial future or get a second opinion about your investments. We’ve made that process easy. Simply go to wealthion.com/free to speak with one of wealthions registered investment advisors for a free, no obligation, portfolio review. Again, that’s wealthion.com/free I’m now less anxious and confident I can achieve the financial goals I’ve set for me and my family. Speak up. Welcome back. David Lynn, this week, he touched on the steepening of the yield curve and the concern about the rising debt. He also explained why he thinks defi is a thing of the past, but crypto and Bitcoin have a lot of room for mass adoption. So you’ve interviewed, and like I said, on your channel, you get phenomenal guest. You’ve interviewed many influential figures in finance. Are there recurring themes or trends from these conversations that stand out as essential to investors, that they should consider? Yeah,
David Lin 9:12
I think the trends change depending on when we’re having this conversation, right so right now, I think two interesting trends come to mind. One is that you have the steepening of the yield curve at a time when the Fed just cut rates by 50 basis points. The 10 year yield is rising faster than the two year and it’s not common that we have the long end of the curve rising this much immediately after a Fed cut. Actually, I think it was Jim Bianco who tweeted this recently. I’ve had Jim on this on the show a couple times. He’s great Bianco research, but he’s tweeted this recently, and he said that never before have we seen the 10 year yield rise this much after a Fed cut. The 10 year yields also been following, well, I don’t know which following the one or the other, but coincidentally, rise. Increasing, along with the atangier break even inflation rate, which is the expectation for the inflation rate going up. Now that’s unusual, because the inflation rate, as you know, has been going down. The latest reading was 2.4% down from the previous month, and that’s just been on a continuous down, downward trend ever since its peak at nine point at about 9.1% and so with the actual CPI inflation rate going down, inflation expectations are going back up, which is something of an irregularity, the inflation break even typically has a lead over the actual inflation rate. So it wouldn’t be surprising to see inflation rate stabilized around here, if you if you assume that the expectations are going to be correct, also, if you overlay the US dollar with the 10 year yield, it’s been a perfect correlation all year round. Now, all these forces have meant that, if you look at some of the class, asset classes that traditionally have not been correlated with each other for a significant amount of time, they have so the dollar has moved in tandem with gold in the second half of the year. It’s also gold has also moved in tandem with stock markets all year round, and and Bitcoin has had a great year as well. The last time we saw major asset classes that typically don’t move together, move together was back in 2020 when the Fed launched unlimited QE and so there was monetary stimulus, money injection. And so all asset classes moved together. Monetary stimulus from the Federal Reserve was the was the tide that lifted all boats. We’re not seeing stimulus on the same level again right now, but we are seeing rates starting to fall, and it’s just interesting how asset classes have been rising together all year round in anticipation of this, so that I think that was one of the irregular trends. What this means for investors is that we have to be aware that not all asset classes that have historically moved in opposite directions are going to stay moving in opposite directions, likely into 2025 for example, if you assume that gold typically hedges against equities. Uh, well, that hasn’t happened all year round, and so that may not happen again in 2025
Andrew Brill 12:08
I in doing what you do and doing over your interviews, you’ve heard what polder tutor Jones has said about the debt. You’ve heard what Stanley Druckenmiller has said about the debt, that they’re very concerned about the debt load. Yeah, you know where, other than cutting spending, I and it’s interesting that I interview people probably like you do this out it’s not a concern, like you’ve done already, not a concern, but it is a concern, isn’t it?
David Lin 12:37
Well, I think Paul Tudor Jones and Druckenmiller know a lot about the debt levels and and the economy than I do. So if they think it’s a concern, it’s probably more of a concern. They’re probably concerned about it in other ways. I mean, to the extent that the country is going to default on their debt and roll the markets right away. No, that’s not a concern for me. Again, long term sustainability wise, it’s a concern to the extent that the government will have to reallocate their budgets to be able to afford that. How it impacts markets is a question I ask many experts, because I don’t really know the answer to that. Certainly, the debt to GDP level has been rising, the deficit has been widening, yet the stock market continued to go up. There is no direct correlation between stock market performance in the deficit level rising, at least not in modern times. The only time in the last 70 years, I believe, in which the government actually balanced their budget was during the Clinton era. And you know, that was early 90s. So the stock market did fine. Then it’s doing fine now, when the deficit level is at the widest since World War Two. So there is no direct correlation between the deficit level and the stock market. Whether or not there’s a correlation between debt and and and the markets, I think the missing link here is inflation, if you believe that the Federal Reserve is going to monetize some of this debt, which is to say they’re going to buy up some of the debt and issue money to do so there might be an expansion in the money supply. And if you’re monetarist, you might believe that this expansion in the money supply will lead to inflation. Inflation is related to markets, as we know, markets don’t like very high inflation and and certain asset classes will respond in kind of this inflation. So, yes, higher debt levels could have indirect effects on the markets through the transmission of inflation of certain assets. How to
Andrew Brill 14:38
get into some of your interviews you’ve done about crypto and defy and I know that you know you have spoken about this a bunch you’ve covered it, the influence of it all in blockchain. How do you envision these, these technologies, crypto, Blockchain, how do you envision them? Envision them changing the landscape of tradition. Finance, you know, in the near future, decade or so,
David Lin 15:04
I don’t know, is my short answer. I don’t know what defy is gonna look like in the next because, look, I’ll tell you, defi was, you know, the hot buzzword in 2021 and most of these projects just died. So back then, people were promising the entire world to be revolutionized by defy and maybe it still will be. But like 90% of the industry is just dead because there was a huge bust in the crypto markets. As you know, 99% of nfts fell to zero, and a lot of these crypto projects just didn’t survive. How will defy change finance? Well, it’s really up to I think a catalyst for mass adoption could be one day if traditional banks start to issue cryptos, either as a payment rail, or as or as just accepting it as a transaction, or if you could invest in Bitcoin with your local JP, Morgan Chase, or something that could really open up adoption, because it would make it easier For people to adopt cryptos. So if the regulatory landscape were to change such that big bank could start offering that, I think that could really open up a lot of doors for for crypto as for defy, which is really the antithesis of traditional banking. So the opposite of what I just said, that’s more of a B to B issue. So if companies want to transact B to B using some sort of crypto, there’s always going to be a need for intermediate, intermediary merchant that can help facilitate that. It’s interesting how the defy world is kind of evolving into tradfi, except using cryptos, you have all these intermediaries doing payment systems B to B. Well, that’s just a bank, isn’t it? So I think, I think defy, you know, is becoming more of a misnomer, because it’s really just blockchain finance, and there’s nothing really decentralized about a lot of these products, but Bitcoin, I think could still be, still has a lot of room for mass adoption. Johnson
Andrew Brill 17:25
Paglia, the CEO of Sprott, joined wealthion this week and explain what the driving force is behind gold. He’s also seeing an influx into silver. And uranium has been a popular investment despite only two major producers of it in the world. John also touched on big tech and how they are getting into Uranium.
James Connor 17:48
And of all those different metals that you just mentioned, which one has had the best performance this year and maybe the most flows from investors?
John Ciampaglia 17:56
Yeah, so I you know, obviously it’s been a year for precious metals. They they were clearly in the doldrums last year. They seemed to wake up late. About 12 months ago, actually, in October of 2023 gold, kind of hit $1,800 an ounce, and we’ve obviously had a really great rally up to 2700 and change per ounce. So gold has been this the attention grabber for sure, in the last 12 months, silver, technically, is outperformed it a little bit, but I think gold has really been part of the conversation because of a number of really interesting developments. One, central banks are increasingly shifting their foreign exchange reserves away from us, dollars and other currencies and treasuries to to gold. That’s a very interesting dynamic that we think will play out for many decades. It’s, it’s not just it’s not just China, it’s India, it’s Singapore, it’s Turkey, Poland, they’re all adding to their gold reserves, and that’s, I think, provided a lot of durable buying support. But we also see institutional investors coming back to gold in the last two months after largely ignoring it for the previous 10 months. So that’s a very bullish sign. And then finally, I would say Chinese retail investors, which obviously provide an enormous amount of collective savings. They’ve been coming back to gold. And the reasons, we think are their economy is sputtering, their real estate market has clearly been in a bubble for some time and has popped. And their equity market has performed very poorly. And so when you have very limited options to invest in China, gold is kind of reasserting itself, as you know, kind of a tried and true asset. So we’re seeing a lot of retail investors in China starting to buy little, little quantities of gold. Again, I think all these things are are really helping propel gold to new highs of late.
James Connor 19:58
And I do want to ask. Ask you about some of those other metals associated with electrification. But before I do that, I want to stick with the precious metals. And silver is also having a very good year. It’s up around 35% on the year. Maybe you can just speak to the flows you’re seeing in those products. Yeah, we’ve
John Ciampaglia 20:16
definitely seen some inflows into silver products, including our own, over the last few months. I mean, it is a much smaller market than gold. I mean, gold is one of the most liquid currencies in the world. Silver is a much smaller market because of its value and just sheer size. But what you’re seeing is silver is really benefiting from its dual role as a monetary metal and also as an industrial metal. And so investors typically will hold silver as a hedge against risks or an inflation hedge, or in many cases, in emerging markets where gold becomes too expensive for them to buy, they sometimes transition to buying silver as a substitute. We see that right now happening in India. So more and more people are buying silver in India than gold, because of the price differential, but silver is also a beneficiary of a growing number of clean energy technologies that are very silver intensive. The most common is is obviously solar panels, because silver is so conductive in terms of exciting electrons in those panels, they essentially create a silver paste that they put inside these solar panels to make them more efficient. And as the world is deploying record amounts of solar panels because the cost of them have collapsed over the last few years, more and more demand for silver is not going for investment purposes or medical uses or whatnot. It’s going specifically for solar panels. And what you find is that at the end of the life of those solar panels, which might be 20 or 25 years, it’s very hard to recycle those metals inside there, so it generally gets wasted. Unlike other metals, you know, there’s a lot of value in them. It’s there’s a lot of effort to recycle those metals. We don’t think a lot of that silver is going to come back to the market. So it’s essentially used and consumed for forever. So
James Connor 22:12
let’s move on now and discuss uranium. And I’m sure you would agree with me when I say no other commodity has such a positive backdrop as uranium does. But this isn’t really being reflected in the price or in the equity prices, and why don’t we just first start with the spot price? Maybe you can give us some color. How many pounds of traded this year, and how does that compare to last year?
John Ciampaglia 22:34
Yeah, sure. So the Iranian market’s been a bit of a head scratcher this year. Last year, we had a huge breakout in the price where we ended, ended up 2023 at a price of $91 a pound in the spot market, which was up 89% for the calendar year. So it really broke out on very strong fundamentals. Increased, you know, shift back to nuclear energy in many countries, and coupled with supply challenges, a lot of mines that have restarted have had some production hiccups to start. And the world’s largest producer in Kazakhstan, you know, finally acknowledged in August that it was not going to be able to meet its higher production targets that it had given a year earlier. So we’ve got a growing demand profile. We have a kind of choppy and somewhat, you know, uncertain supply outlook. And yet, with that backdrop, the price of of uranium has gone from about $91 at the beginning of the year, as I mentioned, to right now we’re sitting at about $80 and so people are kind of questioning, okay, with this very bullish backdrop, why is the price corrected? And we think there’s a few factors obviously at play. We think that one, you know, I think it’s a natural it’s a natural event to have a bit of a healthy correction as part of an overall bull market. We see that all the time where commodity prices can go up hundreds of percent over multi multiple year bear market, bull markets, but along the way, can have many, 30, 40% corrections, which you know, can shake out investors. So yes, we’ve had a bit of a correction right now, but we also think that the primary buyers of uranium, which are utilities have been distracted by a lot of things this year. One, the United States banned the importation of Russian enriched uranium. That became law in August, and that created a big distraction. There are waivers that are being granted to for a period of time where utility can flee their case for Department of Energy to say, look, I don’t have an alternative supplier, so I need to continue to take these deliveries from Russia. Those are just starting to be given out, but only for this year and next. So there’s some uncertainty about what happens after that. Putin has threatened like palladium to cut off the west from uranium and retaliation for. All of these sanctions. So there’s been a lot of noise, you know, geopolitically and from a regulatory perspective. And utilities, I think, have really stepped to the stop sidelines and have not procured as much uranium this year as you would think they would. And we see the volumes in the spot market come down significantly the volumes in the term market. While they’ve started to pick up in the last month or so, it’s all been China driven. So China continues to accumulate large amounts of uranium because they are building the most number of new reactors in the world, and they’re very smartly ensuring they’ve got their security of supply with with fuel to meet their future needs. But we get the sense that Western utilities are sitting on the sidelines with the belief, or the hope, that prices will come down and so they don’t have to buy immediately. They can wait the market out. And it seems as though we have a bit of a stalemate between sellers and buyers. And you know, the sellers have largely sold production forward for a number of years, so they’re not in a rush to lower prices or sell more because they’ve sold a lot of material on forward contracts. And you know, it’s getting harder and harder to bring new production online. The sellers, excuse me, the buyers, are clearly of the belief that prices will come down. So, you know, be patient, and you know, it’ll be interesting to see how this goes. But at the end of the day, you know, I think it’s, it’s fair to say that you can delay and defer your purchases, but at the end of the day, you need to buy because, you know, fuel is absolutely critical, and there’s no way to substitute uranium for something else, like you can with other commodities.
James Connor 26:41
And who would be the top three producers of uranium in the world? Well, this
John Ciampaglia 26:45
is the interesting thing about it, is that there’s really only two big producers in the world. And so if you think about a critical mineral that produces 20% of US electricity, 10% of global electricity, you’ve got basically two, you know, companies that produce the vast majority of it, which is one is a state owned company in Kazakhstan called Kazakh from the other one is a Canadian company called Cameco. You know, those two companies are the largest producers of uranium in the world. There are a number of producers that are much smaller scale, that are either in the process of restarting old mines that have been closed when the price of uranium was, you know, $30 or less per pound. Now that the price of uranium is sending out the right signals and there’s improved demand, those owners of those mines are slowly turning them back all online. We’ve seen a number of mines come back to production this year, and many more that are working on coming back in the production. And that’s why the equities in the uranium sector, I think, have performed really well. If you take a step back and look how they’ve done over the last four years, they are more volatile because they’re smaller cap companies, many of which are just, you know, getting back into generating cash flow. But the stocks have done very well over the last four years on the back of these improving fundamentals and obviously improved uranium prices.
James Connor 28:16
So there’s been so much big news coming out this year on nuclear energy, and, by extension, uranium. And I guess the most recent news is just the emergence of big tech into nuclear energy. Maybe you can speak to that, yeah.
John Ciampaglia 28:28
So in the last few weeks, there’s been a lot of exciting news developments and announcements related to big tech. So big tech kind of covers, you know, Microsoft, Amazon, cloud, Google, meta, Apple and Oracle, and they’re all kind of following a similar strategy, which is they need to source large quantities of electricity, and preferably clean, meaning no greenhouse gasses or low greenhouse gasses. And preferably firm, firm, meaning the electricity source runs all the time, or provide electricity all the time, versus variable or into or intermittent energy sources like renewables. And they’re doing this because they are all developing a technology, and they’re all in a race to be leaders in artificial intelligence. And why? Why this is so linked to electricity is because the data centers that run these essentially super computers that do this artificial intelligence are incredibly electricity intensive relative to traditional data centers, and some estimates I’ve seen are seven to 10 times more electricity intensive than a typical data center that, you know, we would use for, you know, surfing the web, or, you know, loading photos up or whatever. So it’s it’s a race to to be a leader here, and what these technology companies have figured. Out that one of the biggest obstacles is not the technology, it’s sourcing the electricity. And that’s because if you look at the US grid, for example, low growth on it for the last 20 years has been almost zero, and so we haven’t had a lot of energy addition. We’ve had a lot of changes in energy mix, but overall, the low growth has been largely static. Now you’re seeing these big tech companies signaling to their local utilities, hey, we need a lot more electricity. I’m just going to put this into context the let’s, let’s, let’s pick on Microsoft for a minute, because they’re obviously one of the leaders of AI in the world. They currently have 19 gigawatts of electricity contracted mostly renewables to power its AI data centers, and has another 10 gigawatts of electricity to be built, mostly with the partnership they signed a few months with Brookfield. So you know, you might say, Okay, well, what does that equate to? Well, that’s an enormous amount of power. That is the equivalent of powering millions of homes and businesses each year. So they have an incredible appetite for more electricity, and what they’re doing is they’re approaching utilities and they’re signing power purchase agreements, which are basically agreements that say, Look, if you provide me the power I will provide you, I will be your fixed customer for the next 20 years, and will agree on a price, and that price that the these big tech companies are willing to pay is materially higher than the current prices electricity. And so the one that caught everyone’s attention a few weeks back was Microsoft signing a deal with consolation energy, which is the US utility that operates the largest number of nuclear power stations in the country, and they signed one of these 20 year power purchase agreements, and they’re going to restart a nuclear power station that’s been Closed for five years, and that has never happened before, a plant closing and five years later, saying, we need this power. We need this clean and firm power, and we’re willing to pay for it. And since that announcement, a whole handful of other tech companies have made similar announcements, not about restarting existing or, you know, shuttered power stations, but signaling that they would be financing the construction of a number of small modular reactors, which are, you know, smaller scale nuclear power stations specifically to provide power for their AI data centers. So this is kind of a new case study or use case for, you know, nuclear power and big tech. And why everyone’s excited about it is because big tech has big money. You know, they’re sitting on massive hoards of cash, and they have the ability to finance these in some cases, first of a kind technologies that utilities may be reluctant to take the financial risk to build these new technologies. So in the absence of government capital or a centralized government power generation model, it’s very important to get capital outside capital coming in, in some cases with government money and assistance, to really start building more capacity, and that, you know, is not going to impact the demand for uranium today, but in five years from now, 10 years from now and so on, if this becomes an option that really scales and grows, you could see a new source of uranium demand that even a year ago, nobody really thought about
Andrew Brill 33:41
on Election Day. Anthony Scaramucci joined us. He spoke about the market rally that took place. He also touched on the debt and how that may have affected the election. He also explained why the corporate tax rate is lower than some pay on our personal taxes. Anthony, what does it mean that the stock market today is up a Dow is up about 400 NASDAQ up over 200 any meaning to that?
Anthony Scaramucci 34:09
So there’s, I think it’s a little bit of a snapback rally. The market has been soft the last couple of days. Crypto markets soft the last couple of days. Traders will say that’s an indication that Trump is winning. I think Wall Street generally, the consensus is that Trump is winning. The predictive markets have him winning and
Anthony Scaramucci 34:47
and Mitt Romney was, quote unquote winning, and even though the polls were statistically tied, those margins of errors actually broke for Barack Obama. He won sort of 5347 uh. Up, but you know Wall Street saying that he’s going to win. Now, you know, sand Drucker Miller had a good point. Wall Street’s generally been right about these things. They’d get a lot of information. 1000s of research analysts are calling through this data. And so you know, if you were looking at Wall Street, you’re saying Trump’s gonna win. If you’re looking at her field operation, you’re saying, well, she’s gonna win. And so again, it’s still a toss up. But I do think that the market, you know, is sort of telling it’s 50, 50.1 Trump, 49.9 in terms of the chances for Harris. You know, I do think that, looking at those numbers again, being as objective as possible, you’d have to say that’s a positive sign for Donald Trump. Yeah.
Andrew Brill 35:51
But if a couple people are not feeling well and don’t get to the polls, that could swing either way, because it’s that close. You know, you brought up Stanley Druckenmiller, and he’s very concerned about the debt and where we’re going. Both of these candidates are going to add to the debt different ways. Of course, Trump is talking about tariffs. Kamala Harris talking about cutting taxes for the middle and lower classes and trying to, you know, make up the difference, other ways, where we sit on the dead Anthony. And how does this? How do you think this has affected this election? So
Anthony Scaramucci 36:25
it’s interesting, because I had a debate with vivid Ramaswamy this morning on CNBC. And, you know, he, he, he and I are going to be in violent disagreement about the tariffs. He says that, you know, Joe Biden left every single tariff in place. That’s factually inaccurate. He left some strategic Chinese tariffs in place that were related to protecting some industries and related to our national security, but he did not leave every tariff in place, and so you have to use the tariffs in a delicate way. You don’t want to touch off a global trade war. We certainly need to protect our industries, but one other big thing and one other big negative, if they go hog wild on the tariffs, you’re going to have a wipe out of disposable income for middle and lower income people. So Elon Musk is telling people, quite honestly, sort of you know, Elon is not a politician. He’s many things, and arguably one of the most successful people in the world, but he’s not a politician. He’s saying, oh, you know, we’re going to put in these measures with the Department of Government. Officially, there’ll be two or three years of catastrophic economic activity in the United States. And so I can tell you that austerity is never the right thing to do for a government that has 25 26% of the GDP. I can tell you that if we cut, if we took Elon Musk at his word and we took Donald Trump at his word, we’re going to go into a depression. Because if you’re going to cut $2 trillion of spending, first of all, I don’t even know if they could legally do that based on the obligations that they have in terms of these entitlement spending, but we’ve got 2 trillion in spending. You’re going to take tariffs up to 300% as the vice president pointed out, that’s generally a sales tax on lower middle income people. And then the third leg of the stool economically is you’re going to deport people. So as I pointed out to Vivid this morning, you want to deport 2 million people. Okay, that’s going to cost you $88 billion you are going to have to put them in camps. You’ll have to concentrate them in camps. You’ll have to drive around in our cities and SWAT teams and pull these people out of houses. And That’ll hurt our tax base, it’ll hurt our GDP, it’ll hurt our contributions to Social Security. So if you want to do all those things, okay, but you’re calling for a massive economic depression if you do all three of those things. So So I like her plan better. Lots of economists, maybe there were 24 Nobel Prize winners said her plan reduces the deficit, at least deficits growing, but it’s going to come down as a percentage of overall GDP. Her tax rates are a little higher. There’s no question about that. Nobody obviously wants to pay higher taxes, but can’t do what we’re doing now. You’ve got lots of deficit spending, and Andrew, you know, that’s unfunded tax liability. So you’re going to pay it one way or another, you’re going to pay it in terms of the monetization of the debt through inflation, or you’re going to pay it through the actually having to pay it, meaning to the tax man and the IRS. So one way or another, we have to pay this stuff. You can’t, can’t, can’t be in a position to over promise the electorate, like we’ve been doing, which has been very damaging to living standards. Went through the economic plans
Andrew Brill 39:49
Anthony and something really, really struck me. We have a corporate tax rate of 21% Donald Trump wants to lower it to 15% Kamala Harris wants to raise it to 28% but. Trump took office the first time it was 35% they brought it down to 21% now corporate tax rate at 21% I looked at individual tax rates. For a individual that’s making $100,000 they’re paying 24% and for a married couple, they’re also up 200,000 they’re paying 24% so the individual is paying more than the corporate tax. Anthony, how is this fair? I’m working for the government. I’m paying over 51% tax because I live in New York, the taxes are high. You live in New York. It’s, it’s, it’s crazy. How are individuals paying more money than corporations?
Anthony Scaramucci 40:37
Well, again, I think one of the one of the corporations would push back and say, don’t judge the corporate tax versus the individuals. Judge it on a global basis. And let’s look at where corporations are taxed around the world. And where does the United States rank in terms of where those corporations are taxed? At 35% we were ranked lowest at 21% we’re at the top now, meaning we have very reasonably favorable tax rates. I think the Harris team would say 28% is a necessary thing to do. Trump would push back, though. He’d say, okay, tax them at 28% they’ll leave for Ireland. They’ll leave for the Cayman Islands, they’ll go to places that will help them shelter these taxes. And you know, so we don’t want that either. You know, you have to always find the harmony between these two things, the intersection of what’s good for the deficit, what’s good for our tax revenues, but doesn’t blow people out of the seat. You know, when Trump limited you’re a New Yorker, so am I? When Trump limited the state and local income tax deduction to $10,000 he caused mass migration. You know, since 2017 we’ve lost over 500,000 people in New York, over 500,000 people in California, and it hasn’t really helped. And I, when I was talking to Trump, this is going way back, december 2017 is you have to remember, these port cities are economic engines for the rest of the country. You know, people come in, generally come in, poor. Talk about people coming in legally. They come in poor. The Sergey brins Go on to create Google. The Elon Musks go on to create Tesla and SpaceX. You know, it’s one of these things where we gotta be mindful of helping these people on the way through the door. So you need these social safety nets in these areas. And I think it was much smarter to have the income tax deduction. So, you know, taxes, Andrew, whether we like it or not, they’re incentives. They motivate people. You can’t overtax them. They’ll run. You don’t want to undertake some though, while we’re have all these goods and services going on.
Andrew Brill 42:53
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