Lowering Our S&P 500 Targets

It has dawned on Wall Street (and us!) that President Trump’s tariffs aren’t negotiating chips to help the US lower tariffs around the world, promoting free trade. They’re trade barriers, triggering other countries to respond in kind, and they jeopardize US inflation and economic growth. We expect Mr. Trump to relent lest he cause a recession that reverses the GOP majority in Congress during the 2026 mid-term elections. But in response to the now heightened risk of stagflation, we are lowering our S&P 500 valuation expectations and year-end price targets. … Also: Eric discusses the potential for Fed rate cuts this year based on the latest inflation data.