In a recent Q&A during Hedgeye's Q2 2025 Macro Themes Mid-Quarter Update, our CEO Keith McCullough responded to a subscriber’s question about how to interpret the market rebound following tariff headlines and the so-called “Liberation Day” selloff.
McCullough stressed that markets initially crashed because investors underestimated the seriousness of tariff enforcement and panicked:
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"The market got absolutely nuked because people didn't understand the three E's: the tariff policy was going to be Explicit, it was going to be Extended, and it was going to be Enforced." |
McCullough also emphasized that while earnings data has held up so far—companies are running at 12% year-over-year earnings growth—the focus remains on forward-looking risk.
However, the recent bounce doesn’t change the broader macro view.
“The greatest disease of the investor’s mind is the need to know,” McCullough said. “Our process is designed to embrace the uncertainty.”
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