Andres Garcia-Amaya, Zoe Financial CEO, joins 'The Exchange' to discuss markets, Trump considering firing Fed Chair Powell and the market reaction to the news.

Washington

Andres Garcia-Amaya, CEO of Zoe Financial, commented on recent market volatility in response to political developments, including speculation about the potential firing of the Federal Reserve Chair. He emphasized that until proposed policies are formally implemented, market reactions should be considered 'noise.' Garcia-Amaya also noted that economic indicators, such as GDP growth and earnings momentum, suggest a positive outlook for the markets.

He highlighted that while headlines and policy speculation can cause temporary market swings, investors should focus on concrete data and actual policy changes. Garcia-Amaya remains optimistic about market performance, citing strong earnings and IPO activity as positive signs.

Until something is implemented, it's noise, says Zoe Financial CEO

There's a sense, okay, we had the initial reaction, now we've kind of recovered. Maybe people were overreacting and we shouldn't take this threat too seriously. How does it fit in with everything else that's going on here? Yeah, I think we could look at the tariffs and the market's reaction as a bogey here, which is it went from, oh my God, where this is heading to, until something becomes law and it's implemented, let's count it as noise, right? And the important thing here is that it's clear that the president is watching the ticker as well. And therefore, if he sent that trial balloon and it went in that direction, tells me that this might still be in the noise category. Let's not totally dismiss it, but it's still in noise category. This could have been a triumphant day for him as well. Have you seen the headlines? The Financial Times talking about how we've gone from Trump always chickens out to the world always chickens out. I believe Greg Ip had kind of a similar line in the journal where he said, the market's shifted its perception of what's happening here. And to Peter's point, there's some impact in the CPI yesterday, but that this policy is now much less problematic than we might've thought or people were first describing it as a couple of months ago. Yeah, no, I think that a lot of the comments around the Fed I echo, which is even if they were to cut, we're talking about 50 basis points here. You can't ignore, like, if you look at GDP now, like the Atlantis Feds numbers, they're looking at 2.6 for this quarter. The consensus is like 1.5, right? So there's been a reacceleration in some of the hard numbers and the Fed has to look at that and say, let's pause and see where this is going. So I think that's prudent. Yeah, so now tell me kind of your take so far. We've got a couple of days of earnings season. We have those fundamental data points to figure out as well. What's it all tell you about the market's behavior? I remain fairly bullish on the markets because of that earnings momentum is actually in the upswing. There is upside surprises in the banks. I mentioned financials for a while. IPO season is just, you know, the gates are opening rather than closing. But to have August IPOs at all is, you know. Exactly, so I remain fairly optimistic and I think it's important to remember that normal returns are abnormal, meaning like getting 6% to 12% returns per year, it's actually, like it happens 10% of the time. Getting 20% plus returns in a calendar year happens 25% of the time. That's crazy. So from that perspective, if the momentum is going in that direction, I remain more bullish rather than bearish. All right, Andres, appreciate it. Andres Garcia, Amaya.

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