• Menu
  • Skip to right header navigation
  • Skip to main content
  • Skip to secondary navigation
  • Skip to primary sidebar
  • Skip to footer

Before Header

Philadelphia Wealth & Asset Management Firm

wealth management

  • Why TBA?
    • Why Tower Bridge Advisors?
    • FAQs
  • Who We Serve
    • Individuals & Families
    • Financial Advisors
    • Institutions & Consultants
  • People
    • James M. Meyer, CFA® – CEO
    • Robert T. Whalen – Principal
    • Nicholas R. Filippo – VP, Sales & Marketing
    • Jeffrey Kachel – CFO, Principal & CTO
    • Chad M. Imgrund – Sr. Research Analyst
    • Christopher E. Gildea – Senior Portfolio Manager, Co-Chief Investment Officer
    • Daniel P. Rodan – Sr. Portfolio Mgr.
    • Christopher M. Crooks, CFA®, CFP® – Senior Portfolio Manager, Co-Chief Investment Officer
    • Michael J. Adams – Sr. Portfolio Manager
    • Shawn M. Gallagher, CFA® – Sr. Portfolio Mgr.
  • Wealth Management
    • How to Select the Best Wealth Management Firms
  • Process
    • Financial Planning
    • Process – Equities
    • Process – Fixed Income
  • Client Service
  • News
    • Market Commentary
  • Video
    • Economic Updates
  • Contact
    • Become A TBA Advisor
    • Ask a Financial Question
  • We are looking to add advisors to our team. Click here to learn more!
  • We are looking to add advisors to our team. Click here to learn more!
  • Click to Call: 610.260.2200
  • Send A Message
  • Why TBA?
    • Why Tower Bridge Advisors?
    • FAQs
  • Services
    • Individuals & Families
    • Financial Advisors
    • Institutions & Consultants
  • People
    • James M. Meyer, CFA – Principal & CIO
    • Raymond F. Reed, CFA – Principal
    • Robert T. Whalen – Principal
    • Nicholas R. Filippo – VP, Sales & Marketing
    • Jeffrey Kachel – CFO, Principal & CTO
    • Chad M. Imgrund – Sr. Research Analyst
    • Christopher E. Gildea – Sr. Portfolio Mgr.
    • Daniel P. Rodan – Sr. Portfolio Mgr.
  • Wealth Management
  • Our Process
    • Financial Planning
    • Process: Equities
    • Process – Fixed Income
  • Client Service
  • News
    • News & Resources
    • Market Commentary
  • Videos
    • Economic Updates
  • Contact
    • Become a TBA Advisor
    • Ask a Financial Question
wealth management

June 9, 2025 – This week the focus will be on trade negotiations with China and the progress getting the Big Beautiful Bill on the President’s desk. The former is likely to be complicated and slow moving, but any movement in the right direction should keep investors happy. As for the legislation, it will be inflationary and worrisome long-term if one focuses on future debt service requirements. But this market has heard wolf cried too often to care until either interest rates spike higher or the dollar comes under renewed attack.

//  by Tower Bridge Advisors

If the Trump Presidency can be summed up in one word, perhaps that word is transactional. Every step is viewed as a transaction, not just monetary. But there is always a winner and a loser. Win-win isn’t normally in his playbook. Obviously, the Presidency is multi-faceted. And because of that fact, often various steps can be in conflict with each other. A simple example is the Ukraine war. In dollar and cents terms, Trump wants to either spend less or have Ukraine or its allies finance our support. But dollars and cents don’t address the implications to the world order of a truce, stalemate or ongoing war.

Last week, I talked about the need to focus on economic items of strategic importance. Keeping technological superiority. Not being beholden to China for rare earth materials key to the production of motors and everything powered by them, especially automobiles. Maintaining leadership in pharmaceutical research. Being energy self-sufficient. And, of course, keeping our military superiority. But, as noted last week and punctuated by steps taken or threatened over the past seven days, tariffs and export controls get in the way. Last week’s talk between Trump and Xi set the process in motion. Over the past couple of months, tariffs on Chinese goods of 30-145% have been threatened. But tariffs alone won’t be on the table this week or in future discussions. Two weeks ago, when Nvidia# reported earnings, it noted that export bans on chips to China would cut forecasted 2026 revenues of close to $50 billion. If you want to improve balance of payments, preventing your top manufacturer of semiconductors to withhold sales to China of that amount is clearly counterproductive. While a case can be made to withhold the most sophisticated and powerful chips, a total ban contradicts any strategy to elevate U.S. technological leadership.

Nor is the notion of banning all Chinese students from obtaining visas to matriculate at our universities. Putting Trump’s spat with Harvard aside, why would you want many of the world’s smartest minds to learn and work somewhere else? Studies show that over 80% of Chinese who obtain PhDs in the U.S. in science and/or engineering stay in this country at least 5 years after they graduate. Over three quarters of AI firms funded in the last decade have immigrant founders.

Thus, when China and the U.S. begin discussions, it won’t be simply about an agreed level of tariffs. Among the topics to be discussed are:

1. Fentanyl – This comes up every time as justification for higher tariffs. Not to mitigate the fentanyl issue, but other than getting China to take certain steps to stem the flow to the U.S., it will be hard to put what our administration wants into transactional terms. It’s an important issue but hardly the key one.
2. Rare Earths – China is not only the leading producer of rare earths but totally dominates their processing. It is critical that the U.S. find alternative sources and develop a domestic ability to process them. But that will take years. Thus, this is one trump card in China’s favor
3. Intellectual Property theft – This is important but less critical over time. China files as many patents as we do. Yes, it reverse engineers a lot of American products. But that doesn’t mean it straight up copies everything we create. As China builds upon its own long-term plan to achieve dominance in critical industries similar to what we should be doing, copying what we make will become less and less important.
4. Dumping – China produces more than any other country. We buy more than anyone else. That’s why there is a big balance of payments deficit in the first place. China also subsidizes key industries. We can and maybe should be using the tax code. China would produce more if it could dump excess production on the world at or below cost. We need to build and enforce barriers. Tariffs are an important tool. This is clearly a trump card in our favor.
5. Export controls – When we prohibit American companies from selling into China, we may provide some protection to our leadership in the long run. But look at the situation in reverse. Putting 50% tariffs on steel and aluminum imports will give U.S. manufacturers a competitive advantage. But the gap exists because our plants aren’t modern or cost efficient. It means, even if American consumers of aluminum and steel could steer more orders to American manufacturers, the costs will be higher. Ditto trying to force Apple to assemble all iPhones here. Even if one could find the facilities and workers to do the work, the costs to Apple# and consumers would be prohibitively higher. When we put export bans on chips, what we do, besides creating lost sales for the American companies, is strip the Chinese companies of their toughest competition. If Chinese chips were hypothetically 50% less efficient than the American counterpart, that deficiency could be offset by incorporating 3x the number of chips into a device. Cumbersome? Yes. Requires more power? Yes. But China is building its electrical capacity at 3x the rate of the U.S. In other words, we can create roadblocks but Chinese creativity will create workarounds.
6. Barriers to U.S. companies working in China – These have to be broken down.
7. TikTok – Trump wants to keep it alive. Given his feud with Musk and the limited audience of his own Truth Social platform, he needs TikTok to reach broader audiences, especially if X is less available.
Thus, we can see that these trade negotiations are multi-faceted and very complicated.

With all that said, the stock market marches forward. It certainly isn’t because the world’s problems, economic or otherwise have been resolved. The wars in Ukraine and the Middle East are no closer to resolution today than they were six months ago. Tariff uncertainty has left managements in a state of confusion freezing many capital spending plans. Overall numbers don’t show much change yet largely because of the immense amount of money being spent on data centers and expenditures needed to support explosive AI growth. On the positive side, consumers are still spending, employment is still solid, and both profits and GDP are still rising. 10-year Treasury yields have remained in a 4-5% range for two years. Right now, they are smack in the middle of the range. While the dollar’s value fell sharply before and immediately after Liberation Day, it has held steady for the past two months. Hot IPOs are starting to ignite speculative fever, and bitcoin stays near all-time highs. The rise in speculative fever can be concerning but it isn’t quite at a crescendo level yet.

While a march to all-time highs could continue (we aren’t very far away), stocks aren’t cheap and markets seem to slough off the warning signs related to an expanding deficit. Trump never worried about rising deficits in his first term and he has always believed in leverage and the use of debt. Conservative hawks will undoubtedly extract an ounce of flesh from the House big beautiful bill that the Senate now inherits but they are unlikely to derail it. Trump wants to sign it by July 4. That may prove aggressive. But if Congress dilly dallies too long, it may be forced to deal with the debt ceiling separately, something neither party wants to do. Nor does full expiration of the 2017 tax cuts make sense either. So, something will pass and it is unlikely to be far different than the core package sent from the House to the Senate.

The obvious question is whether adding $20-25 trillion to our national debt over the next decade will make a difference. The answer is clearly yes. How that evidences itself (e.g. higher interest rates; escalating inflation, etc.) is an open question. Rising inflation would result in higher asset prices, and a devalued currency. It would likely extend the bifurcation between rich and poor (who don’t own a home or a stock portfolio). But that’s a topic for another day.

Right now, Wall Street’s clear focus will be on how the Big Beautiful Bill gets across the finish line as well as the progress, if any, in trade negotiations with China. Wall Street wants to hear friendly words on both issues this week. If it does, the rally continues, at least in the short-run.

Today, Natalie Portman is 44. Johnny Depp is 62. Michael J. Fox turns 64.

Thus, tariffs will be only a small

James M. Meyer, CFA 610-260-2220

Tower Bridge Advisors manages over $1.3 Billion for individuals, families and select institutions with $1 Million or more of investable assets. We build portfolios of individual securities customized for each client's specific goals and objectives. Contact Nick Filippo (610-260-2222, nfilippo@towerbridgeadvisors.com) to learn more or to set up a complimentary portfolio review.

# – This security is owned by the author of this report or accounts under his management at Tower Bridge Advisors.

Additional information on companies in this report is available on request. This report is not a complete analysis of every material fact representing company, industry or security mentioned herein. This firm or its officers, stockholders, employees and clients, in the normal course of business, may have or acquire a position including options, if any, in the securities mentioned. This communication shall not be deemed to constitute an offer, or solicitation on our part with respect to the sale or purchase of any securities. The information above has been obtained from sources believed reliable, but is not necessarily complete and is not guaranteed. This report is prepared for general information only. It does not have regard to the specific investment objectives, financial situation or the particular needs of any specific person who may receive this report. Investors should seek financial advice regarding the appropriateness of investing in any securities or investment strategies discussed in this report and should understand that statements regarding future prospects may not be realized. Opinions are subject to change without notice.

Filed Under: Market Commentary

Previous Post: « June 5, 2025 – The Old Faithful Geyser in Yellowstone National Park erupts regularly, but not on an exact schedule. Considering the most recent 100 eruptions, the average time between eruptions ranged from 55 minutes to over 2 hours. Likewise, inflation and employment data can cause ebbs and flows in the bond market, creating volatility for investors. Economic data are currently coming in mixed, mostly related to changing tariff policy. Meanwhile, equity markets are slightly positive so far this year, and only off about 3% from all-time highs.
Next Post: June 12, 2025 – Despite a resilient stock market grinding near all-time highs, a fresh wave of geopolitical risk and fiscal policy uncertainty is creating headwinds. A chorus of Wall Street’s most respected investors is sounding the alarm, warning of dangerously high valuations, an unsustainable U.S. debt burden, and the rising probability of an economic slowdown. »

Primary Sidebar

Market Commentary

Sign Me Up!

Latest News

  • August 7, 2025 – Football is considered a game of inches. Consider the “Brotherly Shove,” popularized by the Philadelphia Eagles, which is a play used to gain very short yardage and advance down the field. In order to counter this offense, defensive opponents have employed various tactics, but without much success. Two consumer-focused companies, McDonalds and Disney, recently reported quarterly earnings, and are slugging it out on the field as consumer preferences change and these companies try to adapt.
  • August 4, 2025 – Confusing economic reports on GDP and the labor market can be decoded to show that growth in the first half of 2025 was muted while inflation was well contained before the full impact of tariffs. If those data trends continue, look for one to three 25-basis point rate cuts before the end of 2025. That outlook may change with subsequent data but it is increasingly clear that an economy that has proven so resilient may need a bit more help to offset the impact of tariffs and significantly lower population growth.
  • July 31, 2025 – The U.S. economy demonstrated a strong rebound in Q2 2025 with 3.0% GDP growth. Tech giants Microsoft and Meta significantly exceeded earnings expectations, fueled by the ongoing AI boom and robust cloud and digital advertising performance. While the current AI-driven market rally shows parallels to the dot-com era’s speculative growth, today’s tech giants exhibit stronger financial fundamentals than many during the earlier boom. Investors should balance the allure of high growth with valuation discipline and diversification to mitigate risks in this dynamic market.
  • July 28, 2025 – The world looks pretty healthy but rising speculation elevates our concern. When the amount of corporate money flowing into bitcoin is twice the amount raised in initial public offerings to date, that gets our attention. With that said the focus this week will be on earnings and a slew of economic data on inflation, interest rates, and employment, all of which can be market moving.
  • July 24, 2025 – Like the game of Go in China, or Igo in Japan, the evolving tariff negotiations between the U.S. and our trading partners are creating a constantly changing gameboard and continue to dominate the news cycle. Markets reacted positively yesterday to indications that Japan’s tariffs would be capped at 15%, less than the 25% expected, and a potential deal with the European Union. Tariffs are already having an impact on corporate earnings and outlooks, although equity markets continue to gain ground.
  • July 21, 2025 – Last week was a quiet week for news. The real heart of earnings season starts to kick in this week. Meanwhile the new crypto legislation signed into law last week is likely to change our lives a lot more than what we will learn from a few earnings reports.
  • July 17, 2025 – Stocks rebounded after President Trump clarified his stance on Federal Reserve Chair Jerome Powell. While consumer and producer price indexes suggest some inflation moderation, particularly in services, certain tariff-exposed goods continue to see price increases. Despite these pressures, the U.S. economy shows underlying strength, exemplified by strong bank earnings and robust consumer spending, though the long-term impact of escalating tariffs remains a key uncertainty.
  • July 14, 2025 – Tariffs and earnings will be in the bullseye of investor focus for the next three weeks. Earnings should be good with the weak dollar giving a boost to reported foreign results. As for tariffs, the announcements are likely to be scarier than the coming reality. But even with more muted final outcomes, the likely overall tariff picture will almost certainly be the most severe since the early 1930s. Tariffs will affect different companies in different ways, a factor likely to lead to an increasing dispersion in stock performance in the months ahead.
  • July 10, 2025 – Professional dodgeball exists in the form of the National Dodgeball League. The NDL was founded in 2004 and is the only professional dodgeball league in the US, sporting 24 professional teams. Investors, corporate management teams and our trading partners may feel like they are playing dodgeball this year due to shifting tariff policies. Market volatility has indeed been above average in the first half of 2025. So far, we have dodged a major economic slowdown, job losses or significant inflationary pressures from tariffs, although the second half of 2025 could witness a bounce in these metrics.
  • July 7, 2025 – Treasury Secretary Bessent talks of his 3-3-3 goals, 3% growth, 3% inflation and a reduction of the deficit-to-GDP ratio from over 6 to just 3. Those are mighty goals. The passage of the reconciliation bill may make short-term movement in the right direction but the ongoing buildup of debt may make reaching those long-term goals difficult.

Footer

Wealth Management Services

  • Individuals & Families
  • Financial Advisors
  • Institutions & Consultants

Important Links

  • ADV Part 2 & CRS
  • Privacy Policy

Tower Bridge Advisors, a Philadelphia Wealth and Asset Management firm, is registered with the SEC as a Registered Investment Advisor.

Portfolio Review

Is your portfolio constructed to meet your current and future needs? Contact us today to set up a complimentary portfolio review, using our sophisticated portfolio analysis system.

Contact

Copyright © 2023 Tower Bridge Advisors

Philadelphia Wealth & Asset Management, Registered Investment Advisors

300 Barr Harbor Drive
Suite 705
West Conshohocken, PA 19428

Phone: 610.260.2200
Toll Free: 866.959.2200

  • Why Tower Bridge Advisors?
  • Investment Services
  • Our Team
  • Wealth Management
  • Investment Process
  • Client Service
  • News
  • Market Commentary
  • Economic Update Videos
  • Contact