Alex Frangos
Appearances
WSJ What’s News
A New Global Trade Order Takes Shape
I'll try. But basically what the White House has come up with is a formula not based on what the tariffs are imposed by other countries, but taking The goods trades deficit of a country and dividing it by the amount of goods that the U.S. imports from that country and getting a percentage and then chopping that in half and saying this is what our reciprocal tariff will be.
WSJ What’s News
A New Global Trade Order Takes Shape
The logic that the White House is giving for this is that the trade imbalance contains all of the various indicators. tariffs and non-tariff barriers that other countries impose that the White House sees as negative for the U.S.
WSJ What’s News
A New Global Trade Order Takes Shape
Yeah. I mean, he sees tariffs as a revenue generator that can make up for income taxes. The question is whether that works in the modern world, because what happens when you impose a tariff is people try to avoid it. And so they don't want to pay the tax. And especially if you make the tax very, very high, like they've done with China, it just doesn't make sense to do those trades anymore.
WSJ What’s News
A New Global Trade Order Takes Shape
And so the question is, will the tariffs raise as much as the White House thinks they will?
WSJ What’s News
A New Global Trade Order Takes Shape
Yeah, I mean, I think the number that they actually put on it was a bit lower because they said imports will decline. I mean, you can't have both things at once. The aim of these tariffs is, number one, bring manufacturing back to the U.S. Number two, raise revenue from imports. But if you're bringing manufacturing back to the U.S., you're not importing things because you're making it at home.
WSJ What’s News
A New Global Trade Order Takes Shape
So you kind of can't have both. The other important point here is that Trump has given a weak signal. for the reciprocal tariffs to come into effect. And people are really looking at this as an opportunity to get in there with the Trump administration from all these countries and say, look, we're going to do a whole bunch of things we promised. We promise we'll buy a bunch of U.S. goods.
WSJ What’s News
A New Global Trade Order Takes Shape
We'll stop shipping things to you that are causing these trade deficits. Please lower our reciprocal tariff. So it's possible that this is the beginning of the negotiation or the beginning of these tariffs, not the end.
WSJ What’s News
A New Global Trade Order Takes Shape
It's going to take a little while for the market to process all of the information. But the initial reaction is this is bad for the economy. So we're seeing kind of a recession trade. Stock futures are down. Oil prices are down. Bond yields are down. And one thing that's surprising is the dollar is also down, which is usually a sign that people are kind of negative on the U.S. economy.
WSJ What’s News
A New Global Trade Order Takes Shape
So far, the reaction is strong. Definitely, this is a big market day. It's not catastrophic. which market commentators are interpreting as, well, let's see what this looks like next week, because there's going to be a flurry of negotiation and promises. And maybe this won't be quite as robust as it looks today, but we'll just have to see.
WSJ What’s News
Negotiators Race to Extend Israel-Hamas Cease-Fire
The markets are really struggling to interpret the moves. And I think there's a difference of opinion. Some investors see this all as posturing, get closer to the deadline, raise the stakes. Aber sie denken, es wird ein Deal gemacht werden. Aber gestern hat er die China-Tarife erhöht. Und ich denke, das hat die Menschen ziemlich viel Spuk gemacht.
WSJ What’s News
Negotiators Race to Extend Israel-Hamas Cease-Fire
China ist heute Morgen rausgekommen und hat gesagt, dass sie sich verteidigen werden. Die Märkte im Ausland haben sich sehr gut gefühlt. Aber es gab diesen Zyklus, wo es einen Schreck gibt. Die Märkte wabbeln ein bisschen, aber dann kommen sie sich an. Es gibt viele Leute, mit denen wir sprechen, die sagen, sie werden nur warten, bis es einen echten Tarif gibt.
WSJ What’s News
Negotiators Race to Extend Israel-Hamas Cease-Fire
Wir haben Threats von vielen Dingen, Deadlines looming, Studien von dem und dem. Und ein wahrer Sinn, dass das Apparatus innerhalb der Regierung komplett überwältigt ist mit all diesen Vorschlägen und wie sie sie machen werden und wie schnell sie sie wirklich implementieren können. Also ist es sehr viel ein Mixed Bag.