00:00 Speaker A
super short term in the next couple of weeks here, when it comes to headlines coming out of these trade talks, what would make you more bullish?
00:10 Tim Murray
I so I I would say, um, one of the big one of the most important things to watch is the 10%. So, we came into this year with tariff the the aggregate tariff rate on a weighted average basis that we were charging the rest of the world. It was 2.5%, something in that neighborhood. Um, if and then we got the the the tariffs put on, the reciprocal tariffs and a 10% blanket tariff, right? So, 10, even if we get rid of all of the 10 or all of the reciprocal tariffs, you still got 10% left. That’s a 400% increase in tariffs. Um, so what I would be watching is, is that 10% a floor or not, right? So if we start to see deals where we actually get that 10% would get down from that 10%, that would be a really good, um, sign. But if the 10% kind of looks like a floor, you’re you’re that’s going to be tough unless you get really big exemptions.
02:41 Speaker A
Yeah, and to that exact point, how do you trade in this environment, Tim? I noticed in your in your notes that you sent over, you talked about the six to 18 month outlook being extremely opaque. How do you allocate capital when you can’t see a year and a half from now?
03:15 Tim Murray
Yeah, I so what I would say is you need to make sure you have a plan. One, what we do know is there’s going to be a lot of uncertainty and a lot of volatility going forward. So, I would say one, you want to have cash. Um, you want to probably dial down how much, um, risk you have. And if you’re, you know, if you’re in a situation where you can’t stand a lot of volatility, I would I would look to de-risk your portfolio. And fairly signal. But but if you if you’re in a situation where you think, hey, I I want to take advantage of any weakness, just be prepared for all that volatility, have a plan going in. You have to look at it and say, hey, this is the point where I think the bad news is priced in, and this is where I would start buying because the day that the prices look the best is going to be the day when the news is the worst. Just keep that in mind.
05:12 Speaker A
Tim, what is the best move when it comes to that de-risking? We’ve seen the flight to international, the flight to gold. Uh, what move is the best one in your view?
05:39 Tim Murray
So I think it’s still cash. Uh, I I do think international bonds is is a good alternative to US Treasuries. But just given where the Fed is with, you know, they have dueling mandates right now, not just dual mandates. That’s going to make them conflicted about, you know, so any economic weakness is not necessarily going to be met with Fed cuts. So I would say cash is probably your best place to be at this point.
06:44 Speaker A
All right, Tim Murray. Thank you so much for joining us this morning. Appreciate it.
06:51 Tim Murray
Thanks, Madison.