Kingsview CIO Scott Martin On News Nation – with Connell McShane – 5.5.25

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CONNELL MCSHANE:  Stocks are down for the major U.S. media companies today. The President is threatening tariffs on foreign films. Companies like Netflix, Warner Bros. Discovery, Amazon, Walt Disney, and Paramount Global are all seeing their stock prices fall as we head toward the close of trading. Over the weekend, the President said he’s ordering a 100% tariff on any movie not made in America, claiming the U.S. movie industry is “dying a very fast death.” He wants films made in America again.

Scott Martin joins us now, Chief Investment Officer at Kingsview Wealth Management.

Hi, Scott. I didn’t think much of this at first. I saw it as Trump picking a fight—essentially, as one of our earlier guests put it—with Gavin Newsom. But clearly, the companies and their shareholders weren’t fans of it. The big media names took a hit.

SCOTT MARTIN:  No, they weren’t. And of course, Gavin’s state is where many of those movies are made. So there you go, Connell. It’s been a bit amusing, honestly. I mean, I enjoyed movies like The Rock, as you topically mentioned. That was a good one. Maybe we can bring that kind of film back.

But if you look at Netflix, for example—yeah, there was a pullback in the stock today—but it’s nothing compared to the growth we’ve seen this year. The stock is up something like 25% year to date. There are strong reasons they’re doing well, and I think they’ll weather this Trump rhetoric just fine.

CONNELL MCSHANE:  Right. I wasn’t sure what this really meant at first. And speaking of that pullback for Netflix—if he really went after them with tariffs, even on shows like The Crown, which was produced overseas, what happens then?

SCOTT MARTIN:  It could become an issue, depending on where some of the production is done, absolutely. And if you’re going to ask people to fake locations with AI—say you pretend you’re shooting overseas for a scene or two—that’s maybe what studios would be encouraged to do. So yeah, Netflix might need to think more strategically about production.

But this is typical Trump fashion, Connell—just throwing ideas out there to see what sticks, and what people might laugh at or cheer for.

CONNELL MCSHANE:  Maybe laugh, maybe not. Let’s switch gears. The President also talked a lot about the economy this weekend. When asked about inflation, he claimed the price of groceries and energy is down. He pointed to oil and gas prices. We have a chart of oil here on the tablet—prices are coming down.

What’s your take on that? Obviously, lower gas prices are good, but at a certain point, when oil gets too cheap, it’s not great for the major producers. What do you make of the decline in oil prices?

SCOTT MARTIN:  It probably signals what’s coming—or what’s already happening, honestly. This tariff talk and some of the broader rhetoric have definitely rattled both the markets and the global economy. I don’t think that’s the best path forward.

We also saw OPEC increase production, which has pressured prices. They could reverse that at any moment. So while lower prices at the pump are good for consumers, if oil drops another 10% or so, that starts to become problematic for energy companies and the broader economy.

CONNELL MCSHANE:  Yeah, it always sounds good to the consumer when prices go down. But sometimes it takes a while for lower oil to translate to lower gas prices. So before we let you go—what’s the difference between a “good” reason for lower oil and a “bad” one?

SCOTT MARTIN: Exactly. When supply is high because demand has cratered, that’s not good. That’s a sign the economy’s slowing down. That puts downward pressure on price from the top. Compare that to a simple production boost, which knocks the price down—like we saw, what, 20% on that chart? That’s a big move.

Also keep in mind the Strategic Petroleum Reserve is low, thanks to drawdowns under the Biden administration, so there’s latent demand that’s not yet showing up in the price. So economically, yeah—this could be a sign that things are slowing globally more than people initially realized.

CONNELL MCSHANE:  So even with things slowing down, is there any reason for the Fed to cut rates in this environment?

SCOTT MARTIN:  I really don’t think so. The more outside players step back and let the market, consumers, and businesses sort this out on their own, the better. We don’t need the powers-that-be micromanaging every move—whether it’s interest rates or economic policy. So yeah, the Fed staying out of it, as they have recently, is probably the right move.

CONNELL MCSHANE:  The President may want them to cut rates, but no one really expects that on Wednesday.

Thanks as always, Scott. Scott Martin with us.