On "Forbes Newsroom," Spencer Hakimian, founder and chief investment officer of hedge fund Tolou Capital Management, spoke about
Category
🗞
NewsTranscript
00:00I'm Maggie McGrath, senior editor at Forbes. Economic data that has come out this week is
00:06showing a mixed report as to the health of the broader U.S. economy. January and February data
00:13look somewhat strong, but it's getting softer as we look at March and April. And the big question
00:19is, how much of this is because of President Trump's tariffs and the market volatility that
00:24has emerged as a result of the uncertainty around these policies? Joining us to discuss all of this
00:31is Spencer Hakimian. He is the founder and chief investment officer of hedge fund Tulu Capital
00:36Management. He is also a Forbes 30 Under 30 alum. Spencer, thanks so much for coming back.
00:43Good morning. So before we started recording, you and I were talking about some of the data that's
00:48come out this week. We've had some jobless claims. We've had a look at first quarter GDP, and we
00:52continue to see earnings coming across corporate America. Let's start with GDP. As an investor,
00:57what jumped out at you from this report? There's two things that really jumped out at me. And I hate
01:06to be the bearer of bad news, but neither of them were so positive in my lens. The first thing was
01:12just the headlight print, you know, that everyone saw first quarter GDP contracted by about 0.3%
01:18on an annualized basis. And that mostly had to do with the fact that net exports, which is just
01:25exports minus imports, had fallen substantially on a rush from American businesses and households
01:32to buy some of those imports before this wave of tariffs came into place.
01:37But I think possibly more importantly here is that real personal consumption, which at the end of
01:45the day is the engine of our economy. This is households going to buy breakfast in the morning,
01:52going to buy clothes to go to work, you know, car payments, everything that the real economy
01:58depends on is really slowing down at a rapid pace. So if we go back to the fourth quarter of 2024,
02:06that figure, real consumption grew at 4% on an annual basis, which is very strong and indicative
02:15of a very healthy economy, which in my opinion, we had at the end of 2024. And I believe the data
02:20corroborates it. Now, if we go to the first quarter of 2025, that figure has already fallen to only 1.8%.
02:28So we've had a 220 basis point fall off in real consumption. And mind you, Maggie, the first
02:35quarter of GDP, it measures the time period of January 1st until March 31st. So there were no
02:42tariffs in place yet, right? There was no liberation. They had not happened yet. The auto tariffs came on
02:48on April 3rd. The Mexican and the Canadian tariffs are still being delayed. The steel tariffs, although they
02:55were somewhat in place, they really hadn't really in earnest gone into effect until mid-April. So what I'm
03:02worried about is we're already seeing such a sharp contraction or not a contraction, but a slowdown in the
03:10growth of real growth. And we haven't even gotten to the point that prices have spiked or that businesses
03:18have potentially started laying off people. So I think something that will be worth talking about
03:24on this show is how the data is progressively getting a little bit worse as the weeks, as the
03:31months, as the days go by. So, and I think there's a lot of evidence to show it.
03:35So, let's do this.