Is Trump’s Manufacturing Comeback Real?

Speakers

Steve Rattner — Economic Analyst / CEO of Willett Advisors

Host — Interviewer

Summary

US manufacturing output is steadily declining despite political rhetoric; the only significant capital investment growth is in data center construction, not traditional factories.
Tariffs on auto parts are actively hurting US OEMs (Original Equipment Manufacturers) by raising input costs, with Ford explicitly cited as losing $900M due to these policies.
The "Chips Act" is the sole exception to industrial policy failure, successfully driving semiconductor fabrication facility construction in Arizona.
Achieving GDP growth above 2% is mathematically impossible without a massive productivity shock, which the speaker believes can only come from AI adoption (potentially driving growth to 3-3.5%).

Trade Ideas

Ticker	Direction	Speaker	Thesis	Time
DATA CENTERS /CONSTRUCTION	LONG	Steve Rattner Economic Analyst / CEO of Willett Advisors	"There's obviously a huge boom in construction going on in data centers... but I don't have any sign... that the number of car plants in this country is increasing." While general manufacturing (factories) is in secular decline, the build-out of AI/Cloud infrastructure is the singular bright spot in US capital investment. This concentrates demand on construction machinery, power management, and HVAC specific to data centers. LONG. This is the only sub-sector of "manufacturing/construction" with actual momentum. Regulatory pauses on power consumption or AI capex spending cuts.	1:12
F /GM /STLA	SHORT	Steve Rattner Economic Analyst / CEO of Willett Advisors	"When you put a tariff on auto parts, you're actually hurting what we call the OEMs... Ford, I think, losing $900 million because of tariffs." Protectionist policies are backfiring on legacy US automakers. Instead of protecting them, tariffs on imported parts increase their Cost of Goods Sold (COGS), compressing margins while they are already struggling with the EV transition. SHORT/AVOID. Policy headwinds are directly attacking profitability. Government bailouts or subsidies offsetting tariff costs.	3:46
TSM /INTC	LONG	Steve Rattner Economic Analyst / CEO of Willett Advisors	"I think the chips act was generally considered to be a success... we got a bunch of chips factories here and they're building more and more in Arizona." Unlike the auto industry, the semiconductor sector is effectively utilizing government subsidies ($50B Chips Act) to expand physical capacity. This validates the "onshoring" thesis specifically for silicon, but not for other goods. LONG. Government policy is effectively de-risking the capex for these specific companies. Execution delays in Arizona plants or labor shortages.	—
NVDA /MSFT /GOOGL	LONG	Steve Rattner Economic Analyst / CEO of Willett Advisors	"I do believe AI is a potential gamechanger. I do believe we could get to... GDP growth because of productivity growth... It could be three. It could be three and a half percent." The speaker argues that labor force growth is flat, so the only way to achieve the promised economic growth is through a massive spike in productivity (efficiency). AI is the only tool capable of delivering this 13%+ efficiency gain needed to meet growth targets. LONG. AI is not just a tech trade; it is a macroeconomic necessity for US GDP growth. AI models plateauing or failing to deliver enterprise ROI.	—
BYDDY	WATCH	Steve Rattner Economic Analyst / CEO of Willett Advisors	"BYD could sell... EVs here at I think conservatively at $10,000 less than a comparable US car... consumers would be amazed at how inexpensive and how good these cars are." BYD is fundamentally the superior manufacturer with a massive cost advantage. Currently, they are blocked by 100% tariffs. If trade wars escalate or conversely if tariffs are ever relaxed to fight inflation, BYD is positioned to dominate globally. WATCH. The company is fundamentally strong but politically blocked in the US. Permanent exclusion from Western markets via tariffs.	—