About this episode
The Trump administration is shaking up Washington with hundreds of executive orders and an aggressive push to cut government spending. But what’s important for markets and what’s just media fodder?
Head of Public Policy Jason Cole examines the first weeks of the Trump administration and their implications for markets. Jason joins Senior Vice President of Investment Research Andrew Korz to address the potential impact of tariffs, tax reform and regulatory changes on key strategies.
“If I’ve got to go into my crystal ball whether or not the Trump’s tax cuts are going to get extended, I think it’s going to be a debate that rages throughout the year. And advisors and investors need to be aware that there’s not full tax certainty, but I think ultimately there will be a tax bill and it maybe a one- or two-year extension.”–Jason Cole
Transcript excerpt
[00:00:04] Andrew Korz: Welcome to FireSide, a podcast from FS Investments. My name is Andrew Korz, Senior Vice President of Investment Research here at FS, and today our goal is to cut through the noise. In just over two weeks, the Donald Trump administration has shaken up Washington with hundreds of executive orders, novel foreign policy ideas and an aggressive push to cut government spending. We’ve got the ideal person in the studio with us today to help sift through what’s important for markets and what’s just media fodder. Jason Cole, Head of Public Policy and our resident Washington insider. Welcome to the show and thanks for taking the time.
[00:00:36] Jason Cole: Thanks, Andrew. Great to be back. And I love how you set that up with the noise. Because I think we can maybe look for the signal in the noise. And I’m looking forward to talking about that.
[00:00:46] Andrew Korz: Yeah. There’s a lot of different stories crossing every minute, it seems. Before we dig into the specific topics, I want to start off with a broader question that’s centered around the market’s perception of the new administration. So it seems to me, and let me know if you agree with this, like we’ve gone from a post-election period, the honeymoon phase—where there was a lot of excitement in markets around the pro-growth priorities of the new Trump administration—to now, it feels like maybe the last five or six weeks, markets are up, but there’s more of an uneasy feeling about the next thing that’s going to happen.
The way I see it is there’s two policy buckets broadly that are competing for the market’s attention. The first is you’ve got the more traditional conservative priorities of lowering taxes, cutting red tape, etc. The market tends to like those things. And then you’ve got the more, I would call it, populist set of priorities, like tariffs, immigration reform, which the markets seem to be a little bit more, shall we say, ambiguous about.
And I think there’s this perception, in markets at least, that President Trump really cares about the direction of the stock market. As most presidents do. And that the market can discipline the administration into focusing more on the pro-growth priorities and less on things like tariffs. Do you agree with that or do you think the market’s fundamentally missing something here?
