We Can Do Hard Things
What in the World is Happening with Your 401(k) & Tariffs?? | Jessica Yellin with What We Need to Know
Thu, 10 Apr 2025
401. What in the World is Happening with Your 401(k) & Tariffs?? | Jessica Yellin with What We Need to Know Amanda and Webby Award Winning journalist, Jessica Yellin, delve into the intricacies of Trump's recent tariff policies and their impact on the global economy. -Why manufacturers are even less likely to open factories in America now than before -How tariffs will affect American business, the global space, the stock market and YOUR pocketbook -The resistance to Trump’s tariffs policies we’re starting to see in congress -The reason this is considered the greatest self-inflicted wound on the American economy by any president in history. Jessica Yellin is the founder of News Not Noise, a pioneering Webby award-winning independent news brand -- dedicated to helping you manage your “information overload.” She is the former chief White House correspondent for CNN and an Emmy, Peabody and Gracie Award-winning political correspondent. You can follow her on Instagram at Jessica Yellin. And also, to get real time, clear and brilliant reporting, go to substack.com and search for her page newsnotnoise and subscribe there. To learn more about listener data and our privacy practices visit: https://www.audacyinc.com/privacy-policy Learn more about your ad choices. Visit https://podcastchoices.com/adchoices
Chapter 1: What can we expect from the new book release?
It is getting very close to book release time. Our new book, We Can Do Hard Things, Answers to Life's 20 Questions, comes out on May 6th. You can pre-order We Can Do Hard Things anywhere you get your books or you can go to treatmedia.com. You can also join us for a virtual event that we're doing on publication day.
You guys, we're doing a live virtual event because since the tour sold out so quickly, Lots of you were sad to not be a part of it and we can't stand your sadness. So we're hosting a virtual event to support those who could not get tickets and to support our beloved local independent bookstores. All the proceeds from this virtual event are going to these local bookstores.
They show up for us, we're showing up for them. May 6th, if you pre-ordered the book from an independent bookstore, you don't have to buy it again to come to the event. Please register for the event by uploading your indie order at treatmedia.com. just click the option that says i've already pre-ordered from another indie okay we'll see you there
Chapter 2: Why are 401(k)s and markets in turmoil?
Welcome back to We Can Do Hard Things. This conversation with Jessica Yellen is all about how to make sense of the fact that your 401ks are crashing, that the markets are in free fall all over the world, and why that is happening and what you can expect next. We recorded this on Wednesday morning.
And literally the moment we ended our recording, Trump, who had insisted that these tariffs that we're talking about were here to stay and that he would be unswayed and he wasn't backing down and this was not a bluff, quote, I know what the hell I'm doing, end quote, announced a 90-day pause on tariffs to our most friendly countries. Turns out, I guess he was swayed.
We talk a ton in this podcast about how uncertainty is the enemy of business and the markets and the economy and ultimately, our own houses and our own budgets and how our credibility in meaning what we say and saying what we mean as a nation in terms of policy and plans to the rest of the world is at stake with all of this tomfoolery.
It is welcome what Trump did in pausing the 90-day period for the most friendly countries, but it also underscores exactly what we're talking about here on this podcast that you're about to listen to about the administration's literal miscalculations and the incredible damage that they're doing to the reliability of the information on which markets and economies and families depend.
It's also important to note that this 90-day pause that just got announced is only on the highest tariffs. And we talk about that in the podcast. They include tariffs on our top trading partners, but we're nowhere near out of the woods. They've kept in place 10% across the board and they raised tariffs on China to 125%. And we talk about in this podcast, the
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Chapter 3: How are Trump's tariffs affecting global relations?
implications of that beyond even the economy in terms of international relations and a trade war with China. So listen up. It's all evidence of the same. And hear what you need to know for your wallet and your 401k and your bottom line in terms of what the hell is going on in DC. Thanks. Welcome back to We Can Do Hard Things.
This is Amanda and Jessica, and we are here to do what we do once a week, which is to tell you what in the world is going on in the world and to tell you the biggest news you need to know and why it matters and to... shoot it to you straight so that you can receive what you need to know and not spend the rest of your week on a roller coaster with your nervous system going up and down.
We are just going to tell you what we need to know this week. And we are doing it with Jessica Yellen. She is the founder of News Not Noise, a pioneering Webby award-winning independent news brand. And And if anyone's paying attention, independent news brands are what we need. She's dedicated to helping you manage your information overload.
The former chief White House correspondent for CNN and Emmy Peabody and Gracie Award winning political correspondent. What is super helpful to everyone is that she has on Substack
page called News Not Noise, where you get all of her clarity and super brilliant reporting, where you can find out what you need to know about everything that's going on that day and really thoughtful analysis to see how it applies to your life. She's also doing these very cool interviews. So this week, we are talking a lot about the tariffs and the market tanking this week.
And she gives you the story behind the story. So this week, she had on Harvard professor and Obama's top economist, Jason Furman, who really goes into the economics and the implications for the global markets and the ripples across the world of what is happening from the White House. So check it out, News Not Noise on Substack.
And today we are talking about the upheaval, the mayhem, the WTF of the tariffs. So the initial tariffs went into effect over the weekend and the giant tariffs went into effect this morning. This is Wednesday, this morning at midnight, including the ones that are astonishingly high, like the 105% tariff on China. Those we will just begin to see the reaction to today.
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Chapter 4: What is the rationale behind imposing tariffs?
And this whole thing has resulted in about a 10% drop in the stock market, which is actually a 20% drop since the height of the market, which was a few months ago since Trump took office. The height of where it was with him to where we are now is about one fifth of the stock market drop. value.
One fifth, one five, 20%, which is trillions, trillions with a T of people's 401ks, of people's investments just evaporating as a result of this. So we're going to figure out from Jessica, what the hell, why this happened? What is happening? What is the long game? Is there an off ramp off of this madness? But first, Jessica, why tariffs? What is happening here and why?
That is the right approach. That was a very perfect setup because part of this is just the whims of one man and it's quite mind boggling to investors, you know, sophisticated market watchers, basic economists and folks at home, right? One of the most confusing things right now is that Trump has been promising to do tariffs all along, right? Mm-hmm. He promised it through the campaign.
And he also has been talking about tariffs since the 80s. He loves tariffs. And so he announces these and the market plunges and the world goes haywire and everybody's shocked and panicking. And lots of folks are asking me, why? Why is everyone reacting this way when we knew it was coming? And the reason is twofold. One is a lot of, there's a lot of research that shows people who are behind Trump
think that his most extreme policies somehow won't apply to them. It's a psychological thing that they'll get to carve out. And second, no one expected them to be as high as they are. It is irrational, self-destructive. Economists have called this the greatest self-inflicted wound on the economy by any president in American history.
Wow. And the people, he's been talking about tariffs for 40 years and he was talking about them leading into his first presidency. And what was the rate of tariffs in his first presidency? Because I think that's also a clue that we thought he was going to be, since he's been talking the same game, we thought he would
have the same cards to play in the second presidency as the first, which is demonstratively wrong.
So these are Jason Furman's numbers. This is what he does. He said in the first Trump administration, the total average tariff increase was 1.5 percent, 1.5. So far, the average tariff now is 22%. That's what Trump has done. But in some cases, as you point out, it's 50%. Those are on friendly trading partners.
And he slapped a 104 or 5% tariff on China, which is going to lead to a trade war with China. And one of the reasons the tariffs are so extraordinarily high, I just want everybody to just breathe for a minute and take this in, is bad math. Quite literally, they fucked up. And Trump is obsessed with this. He's surrounded by all these aides who are not, they know history.
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Chapter 5: Will tariffs bring manufacturing jobs back to America?
There's also evidence that they used chat GPT or an AI chat bot to calculate a lot of this stuff. Like when Trump came to the lawn at the White House and announced all this, he had these poster boards where he listed every 60 countries were targeting with extra high tariffs. And there was literally no rhyme or reason to this One, they weren't alphabetized.
They weren't in order of friendly to unfriendly nations. It wasn't numerically. It was chaos. And the blowback has been enormous for a couple of reasons. One is because these tariffs are extremely high and we can talk about what that does. The other is it's based on nonsense. And so you can't like, how do you negotiate a deal to back out of nonsense?
Like you can't accept his foundational premise because it's based on nothing. Right. And so people, especially in the business world who rely on numbers and math and, you know, things that are indisputable to make decisions are looking at this going, what is this?
Yeah. When you just said it's based on a miscalculation, it's like you couldn't imagine a bigger macro miscalculation in terms of like how this is going to work. But the fact that it's also based on a literal miscalculation is, is astonishing.
And that makes sense because people are saying this isn't even, people who are pro-tariff, people who are saying we should have tariffs are saying this is so outlandishly out of touch with anything that could ever actually work. that we don't even understand what's happening. Yes. We don't even know what, and those are the pro-tariff people.
So can you just for a hot second tell us, like, let's assume this was based on something. There are reasonable people who think reasonable tariffs are a good idea.
And why? So let's use the case of China, for example. Let's say that the U.S. imports a ton of stuff from China, factories made in China, and we send a ton of business in there. right? So they have jobs and they have revenue and economic activity because Americans are buying so much stuff that's made in China, which is true. But then let's say China doesn't allow the U.S.
to sell a lot of goods into China. That's a trade imbalance. And that's true, right? That's why people are mad at China in one of many reasons. China also is known to steal intellectual property, Chinese businesses, from the U.S. So there are a lot of reasons why that is a hostile trading relationship. And there are arguments to take steps to combat that.
And one way one might combat that, a responsible government, is to slap a tariff on goods that are coming from China that's a little bit of a lever. And it says, hey, China, if you're not going to let us sell more American stuff in there, you're going to steal our intellectual property. We're going to make it harder for your folks to make money off of America. and it gives us leverage.
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Chapter 6: How do tariffs impact everyday consumers?
In every instance, the opposite of what Trump says he wants the effect to be has happened. So that's not going to happen. And I want to tell everybody here, in case you haven't heard this, you will hear people say, well, this is going to be great for American made products like American cars. There is not a single car that is wholly made in America.
So even the most American of all trucks or whatever has parts that are made in Canada, parts that are made in Mexico, parts that come from overseas, metal and stuff that's brought in. So Every vehicle is going to be impacted by tariffs, and that's true of many other things.
Oddly, and maybe not coincidentally, Tesla is one of the few car companies where most component parts are made here, but even Tesla has some made overseas. Okay. And it's taking a beating because of China. It has manufacturing plants elsewhere. So manufacturing is not coming back here.
Then I just want to point out, we have also slapped tariffs on some of our most reliable trading partners, our friendliest nations, our closest allies, like the EU, Swiss watches, wine that we get in from Europe, countries that give us almost all of our coffee, diamonds, like you name it. These are not countries that are doing those inequitable practices I was talking about with China.
In fact, for example, and Jason talks about this in our interview, one of the countries where we have a trade deficit is Madagascar. Madagascar, our trade deficit is entirely because we buy vanilla from them and they don't have the money to buy that much that we make, right?
Or Bangladesh, they make a lot of the clothing we buy is made in Bangladesh because it's very low, underdeveloped country, low income. They can't buy our goods, but we buy a lot from them. So our trade gap is big, right? That gap. But it's not because they're taking advantage of us. It's because we're different sized economies. And how do you rectify that? Trump has slapped massive tariffs.
Is Trump going to slap tariffs on every country that has a trade gap? They can't level that out. And Jason points out the way to level out our trade gap with, for example, Madagascar is by eliminating vanilla flavor. So do we want to just stop buying vanilla so that we have a zero trade gap with Madagascar? It's ridiculous.
Right. It assumes that a trade gap is a problem when actually that was to our benefit to be able to get reasonably priced vanilla. Correct. No one's getting hurt by that.
And so we're all getting a course in like Econ 101, including the president and his trade advisors. So the most frequently stated reason by Trump that he's doing tariffs is to make sure we have a zero trade gap with all other countries. which is not a thing we want. And so he slapped these incredibly high levels of tariffs on countries where we have this inequitable gap.
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