Podcast Summary: The Exchange – “Too Late and Wrong,” & Chip Concerns (April 17, 2025)
Overview
This episode of CNBC’s The Exchange centers on heightened uncertainty in U.S. economic and financial policy, sparked by President Trump’s renewed calls for the removal of Federal Reserve Chair Jerome Powell. The show dives into the implications of such rhetoric for markets, examines the current state of chip stocks amid tariff and export control fears, breaks down Netflix's upcoming earnings in light of shifting industry metrics, unpacks the latest antitrust challenge against Alphabet (Google), and assesses broader market trends with commentary from leading strategists.
Key Segments & Discussion Points
1. Trump vs. Powell: Can a President Fire the Fed Chair?
[01:04–16:06]
- Main Issue: President Trump, via Truth Social, called Fed Chair Jay Powell "too late and wrong," demanding his removal. A senior White House official claimed this wasn't a direct threat, but uncertainty rippled through markets.
- Expert Panel: Steve Liesman (CNBC), Stephanie Roth (Wolff Research), James Pethokoukis (AEI).
Discussion Highlights:
- Can a sitting president fire the Fed Chair?
- Steve Liesman: “The chair can be fired by the President for cause… Disagreeing with monetary policy… would… not be sufficient cause to dismiss the chair.” [05:30]
- James Pethokoukis: “It could become more plausible depending on the Supreme Court” but is not the norm; Trump’s post adds unneeded market uncertainty. [06:04]
- Impact of Trump’s post:
- Stephanie Roth: “I don’t believe they’re going to be influenced by him… they’re going to stick to what they do best, which is follow the data.” [07:03]
- Jimmy: “What is the point of that unless you’re trying to pin a potential recession on Powell...creating more uncertainty may actually bring about the outcome you fear.” [06:23]
Market Outlook:
- Stephanie Roth: Expects two Fed rate cuts in late 2025, not before September. [07:40]
- If Powell were forced out, who would replace him?
- “It wouldn’t surprise me if the next Fed chair would be like… someone who's already been approved by the Senate, someone the President knows.” – James Pethokoukis [10:14]
- Concern over political influence:
- Liesman cautioned: “When a central bank loses independence… look at the Turkish lira for what can happen.” [14:51]
2. Broad Market Update & Sector Movers
[02:21–04:44]
- Dow modestly down, S&P and Nasdaq slightly higher due to sector divergence:
- Real estate, energy, and utilities outperform, while tech, consumer discretionary, and communications lag.
- UnitedHealth drags on the Dow with a disappointing earnings and outlook, while Eli Lilly surges on strong obesity-drug trial data.
Notable Quote:
“UnitedHealth… talking about a roughly 800 to 900 point decline in the Dow just to UnitedHealth alone.” – Market Reporter [02:21]
3. US & Global Economic Risks: Tariffs, Growth, and Policy Uncertainty
[16:06–23:24]
- Panel: Paul Christopher (Wells Fargo) and Barry Bannister (Stifel).
- Tariffs & global trade deals: Uncertainty over potential trade agreements with China, Japan, EU, and others compounds market anxiety. [17:18]
- Sector strategies: Defensive value names (food, beverage, tobacco, healthcare equipment, waste management, and gold) are preferred in a “stagflation” environment. [19:04]
- Europe faces energy and defense spending crises, making U.S. equities relatively more attractive.
Notable Quotes:
- “The S&P 500 probably does warrant a lower P/E multiple today compared to a month ago…” – Paul Christopher [19:34]
- “If we did see a recession materialize... that stagflationary fear would still exist in the market…” – Barry Bannister [22:21]
4. Netflix Earnings Preview: The Subscriber Era is Over
[25:15–31:14]
- Guests: Julia Boorstin (CNBC), Mark Douglas (Mountain).
- Netflix no longer reporting quarterly subscriber numbers.
- “This comes at a time when Netflix is focused more on engagement than on overall subscriber numbers.” – Julia Boorstin [26:09]
- Revenue and profit growth, especially from the evolving ad-supported tier, are the new investor focus.
- Potential for ARPU (average revenue per user) to surpass raw subscriber growth as a key success metric.
Memorable Exchange:
- “They’ll make more off the ad-supported version [of Netflix]... that's a backlog of revenue they haven't yet fully tapped into.” – Mark Douglas [29:37]
- Will they hit 350 million subs?
- Julia Boorstin: “Less relevant than how much their average revenue per user is...” [30:27]
- Mark Douglas: “I think you can expect by 12 months from now that they break 350.” [31:04]
5. Antitrust Trouble for Google/Alphabet
[33:44–36:26]
- Recap: Judge finds Alphabet (Google) holds an illegal monopoly in some online ad markets, opening door to potential forced breakup of ad business.
- Analysis by Deirdre Bosa:
- Regulatory scrutiny “diverts resources, talent, attention away from the core. And the core right now could not be more important — Artificial Intelligence…” [34:05]
- Even as the regulatory process drags out, these cases affect strategic positioning, especially “as AI models become commoditized” and distribution (e.g., Chrome, WhatsApp) becomes more critical. [35:51]
6. Chip Stocks: Weakness Amid Tariff, Export Control Fears
[36:26–43:07]
- Nvidia, Broadcom, Intel, SuperMicro, Micron down sharply: Nvidia is down 30% from its high and faces a major write-off due to tightened export controls on AI chip sales to China.
- TSMC holds up: Seen as a comparatively positive outlier based on strong profits and resilient outlook, but Wall Street remains cautious.
Trader Take: Jeff Kilberg (KKM Financial):
- Sees current chip weakness as a “buy the dip” opportunity:
- “When it feels this bad in semis, this is the time to buy. This is a longer term play.” [40:30]
- Nvidia's forward P/E has dropped from 50 to 22 (a 60% haircut in valuation), suggesting room for upside. [38:58]
- On SMH (semiconductor ETF): “I’m okay with the concentration in SMH because what led us up is also going to lead us out.” [40:30]
- Gold as hedge: “You have seen a little bit of a… repositioning where people just want to own gold the same way… as their 401k.” [42:45]
7. President Trump Press Conference: Powell, Trade, and Global Affairs
[43:14–49:31]
- Trump repeats: “If I want [Powell] out, he’ll be out of there real fast, believe me.” [43:40]
- Refuses to explicitly state if he will take steps to remove Powell, dodges direct follow-ups.
- Trade deals: Treasury Secretary Scott (presumably Scott Bessant) says top 15 economies are first in line, names Japan, EU, South Korea, and India as in-progress.
- Ukraine minerals deal expected to be signed next week. [46:07]
White House Reporter Megan Cassella Analysis:
- Trump "walking a fine line" between airing grievances and avoiding actually firing Powell. [47:18]
- Tariffs: “Countries like the UK... [received] a 10% tariff; not much to negotiate, but maybe specific exemptions.” [48:56]
Market Mood: Markets move higher as hopes for trade deals and some sort of policy clarity rise, with the S&P 500 up 12.5% from its lows.
Notable Quotes & Moments
-
On Trump’s approach to Powell:
- “If I want him out, he’ll be out of there real fast, believe me.” – President Trump [43:40]
- “When a central bank loses independence… look at the Turkish lira.” – Steve Liesman [14:51]
-
On Netflix strategy:
- “They’ll make more off the ad-supported version.” – Mark Douglas [29:37]
- “Less relevant than how much their average revenue per user is…” – Julia Boorstin [30:27]
-
On chip sector pain:
- “Nvidia has come down 30%. The forward PE ratio… was up over 50. Now it's down at 22. So that 4p of 22 is a 60% haircut. The stocks come down 30%. There's a discrepancy there. I want to be an owner.” – Jeff Kilberg [38:58]
Timestamps for Major Segments
- Trump vs. Powell & Fed independence: [01:04–16:06]
- Market update and sector performance: [02:21–04:44]
- Risks, trade, and portfolio strategy: [16:06–23:24]
- Netflix earnings & ad-supported future: [25:15–31:14]
- Antitrust ruling against Google: [33:44–36:26]
- Chip sector analysis: [36:26–43:07]
- Presidential press conference recap: [43:14–49:31]
- Closing reflections and market outlook: [49:31–52:13]
Tone & Style
The episode blends hard-nosed economic analysis with moments of cautious humor and candid political commentary, capturing the mood of a market and electorate fed up with uncertainty but seeking signals amid the noise. Audio from President Trump is especially direct and combative.
Conclusion
This edition of The Exchange provided a robust snapshot of overlapping risks facing markets—from presidential pressure on monetary policy, the practical reality of trade negotiations, renewed tech sector legal headwinds, and volatility in key growth sectors like semis. Despite the current fog, guests generally endorse defensive positioning and patience, advising against panic and urging investors to focus on underlying trends and quality within both equities and fixed income. The uncertainty, while unnerving, continues to generate critical debate about the independence of American institutions and the resilience of its markets.