URGENT: PREPARE FOR APRIL 2: Tariffs, Fed Rate, Inflation Update (HOW TO INVEST NOW)

Next week is gonna be a very big week in the stock market. Trump has said that April 2nd, he'll be announcing more tariffs and we've all seen what happens to the market when he's done that in the past weeks. So I believe that next week is when the market's actually gonna start pricing in that fear of what's to come on April 2nd with the tariffs. And we're already seeing that today with the markets down a bunch again. I wanna give you my highlights from this week, especially with the Fed announcement and with the tariffs coming and just all the other craziness going on, and then explain my thoughts on what's gonna happen in the very near future in the next couple of weeks, but then also what's gonna happen over the next year or so. My name's Nolan Govea. My students call me Professor G and I made this channel to make investing simplified. So earlier this week, the Federal Reserve held interest rates steady on Wednesday as policymakers await clear signals of how the Trump administration's tariffs and other policies will affect the US economy. Updated forecasts released Wednesday show that on average, committee members expect to cut borrowing costs by about half a percent later this year. Trump's tariffs could complicate that process though. Recent surveys suggest that more businesses are preparing to raise prices and consumers are expecting higher inflation since the president's import taxes began taking effect last month. So these tariffs are obviously a very, very big deal. And the fact that the Fed just kept rates steady, they didn't decrease them, which is what a lot of people were hoping for and the stock market was hoping for. So we got to figure this thing out. There's also a very big possibility that we're already at the market bottom, which is very important for us as investors because if this is the bottom, it's a great time to be getting in. This guest says the Fed put is alive and well, and that's one of four positive signs he's seeing for the markets this week. Joining us is Fundstrat's head of research, Tom Lee, also a CNBC contributor. Tom, it's good to have you. And let's just kind of start with that theme and maybe you can build on what Steve just told us. How do you interpret the Fed's move yesterday? Welcome. Well, I think markets were positively surprised by the Fed's move, in part because recent staff papers from the Fed had argued tariffs would actually be multi-year inflationary effects. So Fed Chair Powell's comments yesterday, I think did catch a lot of folks by surprise just because it is a view that markets probably wanted to hear, that they'd like to hear that the Fed is viewing tariffs as possibly transitory because that puts them in a position to actually intervene if labor markets start to weaken. And in fact, that's evident in the SAP because 90% of Fed staffers now see not only risk to growth, the GDP growth forecast, but it was 90% seeing it as downside risk. So this idea of downside risk means that the Fed is saying that they're actually ready to support the economy, which is very good for investors. When the Fed sees a need to bring down the rate to then support the economy by easing the financial tension, bringing down that rate a little bit, this usually has a very strong correlation to the stock market rising as the Fed rate drops. Steve, would you agree with that characterization or how do you think the Fed or Goolsby or a member like that might respond to the idea that they're still at the ready to support the economy? They're at the ready to support the economy through keeping rates where they are right now. He kind of took off the table or never has put on the table this idea of hiking rates. I think it's a difficult and very interesting dance the Fed has to do here. I think there's an argument and people I've talked to have supported this, of the Fed talking tough right now about inflation to make sure and play a role in the idea that the tariffs do not become a broader inflationary, have a broader inflationary effect, but then being ready as needed to address the downside. Right now, it seems like because Powell feels like he's restrictive enough to deal with that inflation problem, that all the talk or the leaning here is addressing the potential negative effects of the tariffs and the idea that they both brought down their growth forecast while they raised the inflation forecast. So let's see what Tom Lee says about where we are today in the stock market in this week or so and what's gonna happen as of April 2nd. I think that sort of the big elephant in the room has been the absolute fear that has become systematic in markets around April 2nd and the tariff deadlines. And I think that there have been little hints this week that instead of April 2nd being the date of some sort of annihilation of trade relationships, that we may start to see either deals before then or even delays in implementation. And I think that really investors are gonna breathe a sigh of relief because as you can tell, pessimism has become very pervasive because of the fears of what will happen on April 2nd. So I think that's a positive. And then the other is, and it's really a technical perspective, but Mark Newton, our head of technical strategy has pointed out there are increasing signs of that we've actually established a tradable bottom. And that's not only the fact that we declined so quickly, but it's that market breadth has really been expanding and then actually following through in a way that looks like this is not a 10% decline that's leading to a 20%, but a 10% waterfall decline slash heart attack for stocks driven by rate selling and now it's tradable. Huge, what he's saying here is that we may actually be at the bottom or nearing the bottom of the stock market drop and that instead of this thing continuing to crash like huge, we've already seen those crashes. I think lately we've all been a little bit more fearful than anything else about the what ifs with the tariffs and with all the other craziness going on. And we're kind of pricing in this fear into the market and being very, very pessimistic. We might be overcorrecting by holding off until April thinking there's gonna be this gigantic crash because that's the real tariff announcement. But if you've seen the stock market over the last couple of weeks, there hasn't really been any other really, really bad information that's come out that merits this much of a drop in the stock market or at least the stock market staying down other than the fact that we know that this tariff announcement's coming out and that the Fed hasn't changed the rates. I think we're all waiting for this new announcement on April 2nd to do anything in the stock market and so we're keeping our money out or at least not pushing too much more in and that actually might be a mistake. So those would be a couple of big positives, kind of technical signs, maybe April, because I've seen that reporting too where the White House evidently working with trading partners trying to get some stuff dialed back before April 2nd and so forth. What else, Tom, do you see that encourages you? Well, I'd say that probably the final thing that I've seen is, and this is really from our meeting with clients, is that we know there's actually quite a lot of dry powder. Many of our clients have raised a lot of cash. I mean, it's also evident in a lot of the money market balances or prime brokerage de-risking that's taking place and it's at a time when investor sentiment has moved far more than is justified by the market moves. Whether you look at AAII or Investors Intelligence, both have registered recession-like readings and sentiment. And so it really creates the room for positive surprise. And that, again, I think, like what you just said, if tariff headlines aren't as bearish and if there's all this last minute work on negotiating something, and yesterday there was a tweet about how into the night Hassett and Lutnick and Besant were working on a trade deal. That got so little notice. I think it just tells me markets could be positively surprised. So lots of possibility here. So many people are just holding off and waiting until they see what happens next. We're all sitting in this uncertainty and this what-if scenario, which is why Tom Lee is saying that we may have already priced all the bad information into the market and this might actually be the market bottom. So my thoughts on what's gonna happen in the near future, like April 2nd through that first week of April or so, and then through the end of the year. No matter what, I do think that on April 2nd and even before, maybe the Friday before that announcement, I do think we're gonna see a market drop. No matter how much we talk about it and how much people even know that this is gonna be an emotional thing, I still think emotions are gonna creep in and we are gonna see some sell-off. So just kind of expect that. I know for me, I'm gonna be watching those days specifically and just try to buy in as heavy as possible. I'm definitely not pulling money out today, though, and now in anticipation of that drop. I'm continuing the dollar cost average like normal, but with any dry powder that you have on the side, if it does drop by like two, three, 5% or something in a day, I see those as very favorable prices. What I do think is gonna happen over the rest of the year, though, is we're gonna have a slight downward trend. We're gonna see kind of just this stalling market where people do think we might drop even further and that's gonna keep people out of the market and just a little bit scared for that bottom. But we don't know when the bottom is. We also don't know when the top is. We just know that right now the prices are better than they were last year. So this year is a great year to just be dollar cost averaging into great ETFs or mutual funds with low fees that are a broad index style. Something like I talk about in my three fund portfolio. I believe the people that continue to dollar cost average and that just continue to be invested all throughout 2025 are gonna be the ones that see the most profit in 2026 and 2027. I believe that the economy will take a turn for the positive in probably 2026, but I do think we're gonna have to weather some pain or at least some discomfort through 2025. But I would just highly recommend that we keep invested, keep going with the dollar cost average style and try to sell the news and just keep doing what you've been doing. With all this bad news, as soon as we start seeing some good news, it's really gonna turn that market and it's gonna turn it on a dime. So you're not gonna have time to just pull that money out and start throwing it in. You're not gonna know when it's time that we're in the bull market. But if you've been dollar cost averaging and you have all that money sitting there, as soon as it does go up, now your money and your assets will go up with it. Watch either of these two videos to keep you going strong in your investing journey. And remember to keep investing simplified.