When the headlines change, so does the President's opinion on things. Well, folks, President Trump lives in the world of reality. As I've been saying for a very long time, when the headlines are changing, so is the president's opinion. We'll get to that in a moment.
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00:00:28.000subscribe. So yesterday at one o'clock in the afternoon, the president of the United States made a U-turn on his tariff policy.
00:00:34.000He put out a statement on Truth Social that read, quote, Based on the lack of respect that China has shown to the world's markets, I am hereby raising the tariff charged to China by the United States of America to 125% effective immediately.
00:00:46.000At some point, hopefully in the near future, China will realize that the days of ripping off the United States and other countries is no longer sustainable or acceptable.
00:00:52.000Conversely, and based on the fact that more than 75 countries have called representatives of the United States, including the Departments of Commerce, Treasury, and the U.S. Trade Representative, to negotiate a solution to the subjects being discussed relative to trade trade barriers, tariffs, currency manipulation, and non-monetary tariffs, and that these countries have
00:01:07.000not, at my strong suggestion, retaliated in any way, shape, or form against the United States, I have authorized a 90-day pause and a substantially lowered reciprocal tariff during this period of 10%, also effective immediately.
00:01:17.000Thank you for your attention to this matter.
00:01:19.000So that is in fact a U-turn for the President.
00:01:22.000...of the United States, who was suggesting just a couple of days earlier that there would be no postponement.
00:01:26.000That was suggested by pretty much everybody in the president's cabinet.
00:01:29.000It was said over and over and over again.
00:01:45.000Basically, the entire global economic system was shouting at him that he needed to reverse this tariff system that he was about to put into place.
00:01:53.000Jamie Dimon of J.P. Morgan appeared on Fox Business specifically to message to the president because the president watches Fox News.
00:01:58.000Jamie Dimon has essentially admitted as much.
00:02:01.000Here he was Wednesday morning explaining that a tariff war would bring a almost certain recession.
00:02:09.000I am going to defer to my economy to this point, but I think probably that's a likely outcome.
00:02:16.000Okay, between him saying that and also the bond market completely Wrecking itself.
00:02:21.000On Wednesday morning, the President of the United States saw the reality and he reversed himself.
00:02:27.000The bond market sell-off that was initiated by President Trump's statements about tariffs, meaning that people started selling their bonds in the market.
00:02:35.000They were so disquieted by what was happening that they realized they couldn't be in stocks.
00:02:41.000And they realized they couldn't shift their money over to bonds because inflation was going to kick in, which meant that the bonds would be worthless as inflation increased.
00:02:49.000And so people started selling their bonds off.
00:02:51.000The bond yield spiked yesterday morning all the way up to the 30-year bond yield spiked all the way up to 5%, meaning that no one was buying bonds.
00:03:00.000Everybody was selling bonds at a particular time.
00:03:03.000And so the president of the United States did what he was supposed to do, and he saw reality, and he changed his mind.
00:03:08.000That is the thing that actually happened.
00:03:12.000So again, for all the people who believe that the stock market didn't matter five seconds ago, when the stock market was declining, we were told the stock market didn't matter.
00:03:19.000And then when the stock market spiked after President Trump did this, we were told that the stock market now mattered an awful lot.
00:03:24.000One of the same people who a moment ago were saying a giant global tariff war would actually be salutary and good for the United States, who then reversed themselves and said, actually, it was all part of the plan.
00:03:34.000A tariff war would have been super bad, and we're glad the president actually planned it out this way.
00:03:38.000Why don't we just get your position at the outset, and then we can tell whether you are fibbing or not in order to achieve a particular political end.
00:03:46.000Okay, President Trump made that announcement, and naturally, the market spiked.
00:03:49.000Of course, because everyone in the investment community, everybody who understands how basic economics 101 works, understood that when the president backed off of the most severe tariff regime in modern history, that that would spike the markets.
00:04:04.000I remember I was at the gym yesterday, working out, when this went down, and I was watching the stock tickers, and suddenly the markets jumped 2,000 points, and I turned and said to a friend, he must have paused the tariffs.
00:04:15.000Because that was obviously the only reason that the markets would spike.
00:04:18.000Which suggests that, again, the investment community is not stupid when it comes to, you know, investment and economics.
00:04:25.000According to the Wall Street Journal, investors had spent nearly a week dumping everything American when seven minutes after markets opened on Wednesday, the president posted on social media it was time to buy.
00:04:33.000By the day's end, U.S. stocks staged a historic rally after another Trump post announced a 90-day pause on some tariffs and signaled a willingness to negotiate on trade.
00:04:42.000Wednesday's surge added a record $5.1 trillion in value.
00:05:44.000Scott Besson, the Treasury Secretary, who essentially talked the President into the reversal.
00:05:48.000He louded the negotiating strategy yesterday.
00:05:52.000We saw the successful negotiating strategy that President Trump implemented a week ago today.
00:05:59.000It has brought more than 75 countries forward to negotiate.
00:06:03.000It took great courage, great courage, for him to stay the course until this moment.
00:06:08.000And what we have ended up with here, as I told everyone a week ago, in this very spot, do not retaliate, and you will be rewarded.
00:06:22.000Okay, Howard Lutnick, the Commerce Secretary who lost this argument, the Commerce Secretary Lutnick, He was the one who was arguing for these tariffs to basically remain.
00:06:30.000He thought that was just good for the economy, period.
00:06:32.000Besant always saw them as a way of achieving reciprocal tariffs.
00:06:37.000Scott Besant and I sat with the president while he wrote one of the most extraordinary truth posts of his presidency.
00:06:41.000The world is ready to work with President Trump to fix global trade, and China has chosen the opposite direction.
00:06:45.000Okay, so the big argument that's now broken out online is whether this is all part of a 40 chess plan, an underwater, upside-down, hungry, hungry hippo's plan in order to somehow achieve A 5% drop in the markets, a 125% tariff on China, tremendous uncertainty with regard to investment futures and tariff deals with a bunch of countries that we could have called up on the phone.
00:07:10.000If the president gets to the right policy, I don't really care how he got to the policy, but he's getting to the right policy.
00:07:15.000And again, I think there are two going theories here of what President Trump did.
00:07:19.000Theory number one is the theory that I have posited.
00:07:21.000The president lives in the world of reality.
00:07:23.000Meaning, if he puts out a proposal, and that proposal does not work, he is not ideologically tied to his own proposal such that he is willing to undergo enormous pain in order to prove the veracity of his ideology.
00:07:35.000So if he puts out a tariff plan, and it turns out the markets hate it, and it turns out people are calling him up day and night telling him it's a bad plan, and it turns out the bond market experiences a mass sell-off, that he reverses himself and then finds a better policy.
00:07:47.000Which is one of the good things about, that's not a criticism of President Trump, that is a praise of President Trump.
00:08:04.000Because making a U-turn in the middle of a bad policy shows that you are more interested in getting the right outcome than you are in your own perception of ego.
00:08:24.000Somehow, this is a sign of weakness by the politician.
00:08:27.000Or maybe it's a sign of strength because, number one, you can get away with it.
00:08:30.000And number two, it shows that you actually care about the end outcome.
00:08:34.000The argument I've made about President Trump over and over and over to people who would not vote for President Trump in the last election cycle is even if you don't like what President Trump is selling, he is utilitarian enough that if the outcome is likely to be bad, he will change his policy.
00:08:49.000And then there's opinion number two, which was, again, that this was 5D chess existing in dimensions beyond time and space, that it was all planned out, every element of this.
00:09:00.000Now, in order for you to believe that every element of this was, in fact, planned out, you would have to believe that the president, a month ago, at his State of the Union, laid out a hardcore tariff regime in order to not do it within 13 hours after announcing that it was now in place,
00:09:20.000And that he couldn't have just achieved the actual goals that he achieved here without all this sort of manipulation.
00:09:26.000So he would have to lay out a giant Liberation Day plan at the State of the Union address.
00:09:31.000Then he would have to unleash gigantic tariffs based not on reciprocal tariff rates, but based on trade deficits that would include islands, including penguins.
00:09:40.000And then you would have to have the stock market talk.
00:09:44.000The stock market would have to tumble 10% and come to the precipice of complete nuclear meltdown.
00:09:49.000You'd have to assume that President Trump then wanted his entire team to fight with each other publicly.
00:09:54.000He would want Elon Musk calling Peter Navarro Peter Retardo and Peter Navarro calling President Trump and Peter Navarro calling Elon Musk a car assembler as opposed to a car manufacturer and Scott Besant and Howard Lutnick retailing completely different messages.
00:10:06.000All of this was necessary to the plan.
00:10:09.000And then, let the tariffs go into place to spark a bond market sell-off.
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00:12:38.000Now again, I don't care whether it was the art of the deal, whether it was a plan or whether it was not a plan.
00:12:42.000The only reason That it makes any difference at all, whether it was quote-unquote part of the plan or not part of the plan, is because the suggestion from people who say that it was all part of the plan is that if you criticize bad policy, somehow it undermines the plan.
00:12:55.000If it was all part of the plan, you need people to criticize the bad policy so as to push the president into doing the reversal.
00:13:01.000If it's all part of the plan, then so is the criticism.
00:13:04.000Again, this is part of the problem with these very sophisticated theories of it was all part of the plan.
00:13:08.000Okay, so it was all part of the plan except for what?
00:13:10.000The people who said that it was bad policy?
00:13:12.000So if those people had shut up, then he still would have done exactly the same thing.
00:13:16.000Or maybe, or maybe the president, because he is a smart, capable man who is able to read tea leaves and see headlines and adjust and stick and move, because he's able to do that, actually, it is quite important that honest commentators actually say the thing.
00:13:32.000That when a policy is bad, they say it's a bad policy.
00:13:34.000And when a policy is good, they say it is a good policy.
00:13:37.000Because otherwise you can't tell what the hell they think.
00:13:39.000And you can't tell what is good policy and what is bad policy.
00:13:43.000And so again, both of these lines are sort of being retailed.
00:13:46.000And then the president, it turns out, just basically said, one of the things I love about President Trump, he's totally transparent.
00:14:24.000Look, he's trying to fix the fundamental trade imbalances that have been going on for this country for 35 years.
00:14:31.000I mean, we were just in the Oval Office and he said, I don't blame China.
00:14:35.000I blame the people who sat behind the desk of the Oval Office for letting this occur.
00:14:40.000It is time to take back the ability to trade with America and Donald Trump is leading the charge to do that.
00:14:48.000Okay, so apparently, according to Commerce Secretary Lutnick, the markets, the bond markets, nothing of this had any impact on Trump.
00:14:53.000This is all part of the 40 hungry, hungry hippos upside down underwater chess plan.
00:14:58.000And then Caroline Lovett, I understand, all these people work for the Trump administration, and so they have an interest in suggesting, of course, that this is all part of the plan.
00:15:08.000I get it, because they think that they have to project strength, and that if you say that it was all part of the plan, as opposed to the reality, which is that the president is utilitarian enough and smart enough to react to circumstance.
00:15:19.000Again, I disagree, but I understand why they're doing it.
00:15:21.000Here was Caroline Leavitt, White House press secretary, saying, you know, this is all the art of the deal.
00:15:25.000Again, you'd have to assume that all of this was designed in order to achieve what?
00:15:30.000That couldn't have been achieved by picking up the phone or just doing the tariffs on China.
00:15:35.000Many of you in the media clearly missed the art of the deal.
00:15:39.000You clearly failed to see what President Trump is doing here.
00:15:42.000You tried to say that the rest of the world would be moved closer to China, when in fact we've seen the opposite effect.
00:15:48.000The entire world is calling the United States of America, not China, because they need our markets, they need our consumers, and they need this president in the Oval Office to talk to them.
00:16:00.000Okay, we'll get to that in a minute, because what China's going to do next, what every other country's going to do next, still remains sort of an open question.
00:16:06.000Yes, they want to negotiate an off-ramp with the United States to avoid these tariffs.
00:16:09.000That doesn't necessarily mean that they are not also going to triangulate with China.
00:16:13.000However, then there's the other theory, okay?
00:16:15.000The theory that I have retailed, which is that the president changed his mind because the circumstances changed.
00:16:19.000That he put in place a tariff regime that was unsustainable for the global economy, and the markets reacted.
00:16:26.000As they do when they take in new information.
00:16:28.000And then he saw the markets react and he didn't like it.
00:16:30.000And as Exhibit A, in the explanation for his activity, that market activity, bond sell-offs, market sell-offs, criticism changed the President's opinion.
00:16:41.000I present to you Donald J. Trump, President of the United States, saying exactly that yesterday.
00:17:27.000This is a question because it does relate to who is trustworthy in the public space when you're talking about these issues.
00:17:35.000The people who would be just as happy if he left the tariffs on or the people who are happy that he took the tariffs off and always thought he should take the tariffs off except for on China.
00:17:44.000And again, President Trump just says the quiet part out loud.
00:17:47.000Again, the people who are positing that this was all part of the magical Ocean's Eleven plan.
00:17:54.000All those people keep getting undercut by the fact that the President of the United States is telling them openly that that's not what happened.
00:18:18.000Our country's stronger than it's ever been.
00:18:21.000And somebody had to do that with, we had to take the medicine.
00:18:25.000We had to go through the operation, and that's what we've been through.
00:18:30.000Okay, so, whether you think we had to go through the operation or we didn't have to go through the operation, bottom line is, we ended up in a spot that is a much better spot than we were in three days ago.
00:18:38.000And again, all of the reporting suggests precisely the theory that the president changed where he was on this because of the reaction.
00:18:46.000Again, that is a praise of the president, not a rip on him.
00:18:49.000If the president changes his opinion for utilitarian reasons in order to achieve a better end goal, that's him being smart.
00:18:55.000It would be stupid to continue running full speed into a wall in the name of Peter Navarro's benighted idiocy with regard to trade.
00:19:04.000You don't need Ron Vera guiding you on trade, Mr. President.
00:19:08.000If you want to see a real bull market, the president should fire Peter Navarro today if he wants to see an actual bull market run.
00:19:16.000He was reporting from the White House.
00:19:18.000He said, yeah, pretty clearly this was sparked by the bond market sell-off.
00:19:21.000What happened in the bond market overnight, the spike in yields on the 30-year and the 10-year bond, which showed that people were dumping our bonds.
00:19:31.000And who were those people dumping our bonds?
00:20:05.000When you're talking about bond yields dramatically spiking, very often that presages serious economic turmoil, downturns, and all the rest of the signals, an underlying real problem.
00:20:15.000In fact, I asked my sponsor, Perplexity, about this.
00:20:19.000I asked, quote, can you please provide historical examples of situations in which U.S. bond yields spike dramatically?
00:20:23.000How often do they presage serious economic turmoil?
00:21:22.000And then, of course, it just happened the other day.
00:21:25.000So as Perplexity AI points out, while not all yield spikes lead directly to economic crises, they frequently signal underlying vulnerabilities in fiscal or monetary policy that may contribute to turmoil if left unaddressed.
00:21:35.000In other words, bond yields don't spike for no reason at all.
00:21:38.000There is a reason the bond yield spikes, and there's a reason why President Trump saw that and went, you know, maybe I should do a U-turn here.
00:21:44.000Fox News also reported that even staffers in the White House were taken by surprise by President Trump's about-face.
00:21:49.000So the idea, again, that this was like a well-thought-out plan with everybody involved.
00:21:53.000Clearly not for the staffers of the White House.
00:21:56.000Yo, this is really interesting what's happened.
00:21:58.000I was actually the one who walked into lower press here.
00:22:01.000That's where a number of the press communication folks are at the White House.
00:22:04.000And I asked them, is it true a 90-day pause?
00:22:06.000And they looked at me with blank stares.
00:22:07.000I had to tell the press folks that the president had put on true social that he's considered the 90-day pause on tariffs.
00:22:39.000If the proposal breaks all the rules, and the rules were stupid, he maintains the proposal.
00:22:44.000If it breaks all the rules and it turns out that things are going to crater, then he changes where he was.
00:22:49.000And that's precisely what he did here.
00:22:51.000According to the Wall Street Journal, quote, President Trump finally blinked.
00:22:54.000It took a week for the plunge in the stock and bond markets, along with the sustained campaign by executives, lawmakers, lobbyists and foreign leaders to prompt Trump to roll back for 90 days, a major element of his sweeping tariff plan.
00:23:03.000The president said the reaction to the tariffs was getting a bit yippy, like a nervous athlete unable to perform.
00:23:08.000And he relied on his instincts to change course as he watched the bond market tank and listened to business leaders, including Jamie Dimon, expressed fears of recession.
00:23:38.000Quote, Besant was flooded with worried calls from Wall Street over the weekend and felt strongly he had to persuade Trump a pause was needed.
00:23:44.000It wouldn't be a capitulation, Besant argued, because they were going to have so many deals.
00:23:47.000He revealed little publicly about why the president and his team waited until Wednesday afternoon to enact it, with Trump saying he decided on the move Wednesday morning.
00:23:55.000So he openly said he decided on a Wednesday morning.
00:23:58.000It's all part of the plan, but he decided.
00:24:00.000Besson said more than 75 countries have reached out seeking a deal to ease tariffs with Japan at the front of the queue.
00:24:05.000One key to the change, Trump's decision to give Besson more authority within his team of trade advisors, people close to the discussion said, along with the talks on Sunday.
00:24:17.000Besson flew down Sunday to Florida and afterward was authorized to make comments publicly about deals, which heartened many people close to Trump who believed the Treasury Secretary could find an exit ramp.
00:24:25.000And indeed, on Wednesday morning, as Scott Besson went out there and retailed deal after deal after deal, the markets were kind of roiling, but they had not yet dumped.
00:24:33.000And I tweeted, Shortly before President Trump actually U-turned, I tweeted that Besant was single-handedly holding the markets up.
00:24:47.000Because Besant represented the off-ramps.
00:24:50.000When the two men returned to Washington together on Air Force One, Besant encouraged Trump to focus on negotiations according to a person familiar with the conversation.
00:24:58.000Another factor that made Trump more willing to relent on tariffs...was that so many countries are in negotiations with the administration.
00:25:03.000Trump was also swayed by the stock market and the parade of business leaders expressing concerns about the tariffs.
00:25:08.000So in other words, all the people who he labeled panic hands, who were in his ear telling him this was a bad idea, he listened to them, as he should have.
00:25:15.000Over the past few days, executives and lobbyists had flooded White House Chief of Staff Susie Wiles' phone according to a person close to her.
00:25:21.000A White House aide noted it was standard for the President's Chief of Staff to field calls on his behalf.
00:25:25.000The message delivered to Trump and his top advisors by chief executives was that they needed to find an off ramp.
00:25:31.000He privately acknowledged his trade policy, Trump did, could trigger a recession, but said he wanted to be sure it didn't cause a depression, according to people familiar with the conversations.
00:25:48.000At the White House on Wednesday, he had lunch with financier and investor Charles Schwab, and with Michigan Democratic Governor Gretchen Whitmer, who had warned Michigan was already feeling the impact of the tariffs throughout its automotive industry.
00:25:59.000On Tuesday evening, Trump said he absorbed the bad news about the plummeting bond market.
00:26:02.000Quote, I saw last night where people were getting a little queasy.
00:26:05.000He then watched Diamond's interview Wednesday morning with Maria Bartiromo.
00:26:09.000That's when we played a few minutes ago.
00:26:10.000During the interview, Diamond said a recession was a likely outcome.
00:26:13.000Diamond has not had a substantive conversation with Trump for years, apparently, but his appearance on Fox Business had been in place for some time and Diamond knew Trump and his inner circle often watched Fox.
00:26:24.000Trump told reporters he'd been thinking about pausing tariffs over the last few days.
00:26:27.000Adding, quote, it probably came together early this morning, fairly early this morning.
00:26:31.000We wrote it up from our hearts, Trump said.
00:26:33.000We don't want to hurt countries that don't need to be hurt, and they all want to negotiate.
00:26:37.000So, again, this idea that this was sort of like brilliantly negotiated all the way back a week ago or a month ago, it's not true, but that doesn't matter.
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00:29:10.000And so now the off-ramp is becoming available.
00:29:12.000Canada's Mark Carney, the Prime Minister, who replaced Justin Trudeau, he says that this is a welcome reprieve.
00:29:18.000He put out a tweet, quote, This pause on reciprocal tariffs announced by President Trump is a welcome reprieve for the global economy.
00:29:22.000As President Trump and I have agreed, the US President and Canadian Prime Minister will commence negotiations on a new economic and security relationship immediately following the federal election.
00:29:30.000As part of today's announcement, the President has signaled that the US will engage in bilateral negotiations with a number of other countries.
00:29:35.000This will likely result in a fundamental restructuring of the global trading system.
00:29:39.000In that context, Canada must also continue to deepen its relationships with trading partners that share our values, including the free and open exchange of goods, services and ideas.
00:29:48.000This election is importantly about who can best fight for Canadian families, workers, and businessmen at the negotiating tables with the United States and other potential partner countries.
00:29:56.000So, that is Canada looking for an off-ramp.
00:29:59.000The tariffs on China remain, and that is going to be the big sort of push down on the economy in the near future.
00:30:05.000Now, that may be pain that is worthy of going through.
00:30:08.000I've been an advocate of tariffing the living hell out of China for as long as I can remember.
00:30:12.000I've said for years, I'm not even sure it was good policy in the 1970s for Henry Kissinger and Richard Nixon to open China.
00:30:17.000Maybe we should have just let them collapse from within instead of ushering them into the global trading system with the bizarre hope that this was somehow going to moderate their politics.
00:30:25.000Instead, they've retained all of their authoritarianism, but they've also gained an enormous amount of global economic power.
00:30:33.000With that said, the shock and awe of the tariffs that President Trump is putting on, those will have ramifications, there's no question.
00:31:21.000What is the off-ramp with China if there is one?
00:31:24.000Because there are risks that attend on upping the ante with China in this sort of dramatic, non-escalatory fashion, just kind of like ramping up to zero to 60 in 2.6 seconds.
00:31:34.000Here's Scott Pesant going after China yesterday.
00:31:37.000But in terms of escalation, unfortunately, the biggest offender in the global trading system is China.
00:31:44.000And they're the only country who's escalated.
00:31:49.000And I can tell the rest of the world that I'm not sure whether it was the prime minister or the economic minister in Spain made some comments this morning.
00:31:58.000Oh, well, maybe we should align ourselves more with China.
00:32:02.000That would be cutting your own throat.
00:32:07.000So, Besant, again, is basically saying, choose China or choose us.
00:32:11.000And then he says, we will keep slapping China.
00:32:13.000This is yesterday after the U-turn and reversal by President Trump.
00:32:17.000As I said a week ago today, don't retaliate.
00:32:23.000And China, they kept escalating and escalating.
00:32:28.000And now they have 125% tariffs that will be effective immediately.
00:32:35.000Okay, then he continued along these lines.
00:32:37.000He says, listen, China can hurt us, but we're going to hurt them more in a trade war, which is true, actually.
00:32:43.000In terms of certainty, we will see what China does, but what I am certain of, what I'm certain of is that what China is doing...
00:32:52.000...will affect their economy much more than it will ours because they have an export-driven, flood the world with cheap export models and the rest of the world now understands because when we put up our tariff wall, those exports are already flowing to the rest of the G7 and to the global south.
00:33:14.000Okay, so, he's pointing out here that, again, we do an enormous amount of trade with Europe, we do an enormous amount of trade with the Global South.
00:33:20.000Now, there are countries that trade much more with China than they trade with us.
00:33:23.000Japan is one of those countries, for example.
00:33:26.000Kind of approximately the same percentage of Japan's export market goes to the United States as goes to China.
00:33:31.000They import significantly more from China, Japan does, than they import from the United States, for example.
00:33:37.000However, there is, in fact, bipartisan consensus that China cheats.
00:34:41.000And this, again, is why the market is roiled.
00:34:43.000Because China does have tools it can use against the United States.
00:34:47.000According to the Wall Street Journal, the escalating trade conflict between the United States and China has reignited fears that Beijing could use financial markets to hit back at Washington.
00:34:54.000China is one of the largest overseas owners of U.S. government debt.
00:34:58.000There have long been fears that China could dump U.S. treasuries that make up a large chunk of its foreign exchange reserves.
00:35:03.000China owned about $1.2 trillion in U.S. treasury securities in January.
00:35:08.000But they might be able to actually own more because they have third parties that are buying them and all the rest.
00:35:12.000U.S. government data showed China owned There's a bunch of stuff that China could try to do.
00:35:41.000The real question is, Is there an off-ramp here for China that forces them to, for example, abide by IP regulations?
00:35:51.000Is there some sort of goal that the United States is attempting to implement with regard to China?
00:35:55.000Can we isolate China without actually provoking them into doing the biggest thing, which would be blockading Taiwan?
00:36:01.000So one of the things that we do have to watch out for with regard to China is let's say we go to 125% tariffs, which we have on China, and let's say we maintain those.
00:36:08.000And let's say everything goes swimmingly the way that I would want it to go.
00:36:12.000We signed zero tariff agreements with Vietnam, with Japan, with South Korea.
00:36:15.000We signed zero tariff agreements with the EU.
00:36:18.000Suddenly, you basically have a free world trading system that excludes China.
00:36:21.000And we start using the levers of financial power against China in the world markets in a much more severe way.
00:36:26.000And China becomes more and more isolated.
00:36:28.000well then you do run the risk that China at some point will attempt to blockade Taiwan as a negotiating chip against the rest of the world economy because they figure if they're in serious trouble anyway they may as well threaten to melt down the entire global economy by basically destroying the semiconductor industry.
00:36:43.000That's something that China very well could do which is one of the reasons why you need a simultaneous military build-up and a stronger position in the in the Indo-Pacific region.
00:36:54.000I assume that's one of the reasons why the Trump administration is also pushing on the budget for $1 trillion Pentagon budget.
00:37:02.000If you're going to box in China, you've got to box them in along every line, not just some lines.
00:37:07.000It's also one of the reasons, by the way, why some people, or even China hawks, have suggested that going directly to 125% tariff on China, it would be better to go a little bit slower and sort of boil the frog more slowly.
00:37:20.000Go to 20% tariffs, then go to 40% tariffs.
00:37:22.000Allow people to reshore, gradually tighten the noose around China, and make it so that it buys us some time to actually up our game.
00:37:29.000In the South China Sea, in the Taiwan Straits, before China tries to melt everything down if they feel too much pressure.
00:37:38.000The bottom line is that the situation that we are now in, that President Trump has put us in, is way better than the position we were in eight days ago when the President of the United States was announcing Liberation Day.
00:38:41.000Now you have an administration where presumably you don't have internal battles and everybody is aimed in the same direction.
00:38:46.000The president has shifted course, which is a very good thing.
00:38:49.000Now let's hear the entire spell out, the entire rollout, and then you'll see a much more solid stock market, a much more sanguine investment community.
00:38:56.000Joining us is Mary Margaret Olihan, our White House reporter.
00:38:59.000She joined Pete Hegseth on a trip down to Panama.
00:39:11.000So, how was the beautiful country of Panama, and what was that experience like traveling with Pete Hegseth?
00:39:17.000Well, this is one of the coolest trips I've ever been on, honestly.
00:39:20.000We went down on Monday evening, flew down with the secretary to Panama.
00:39:24.000It was a small group of reporters, and I was honored to be one of them.
00:39:28.000And what was really interesting about this trip was we learned on the way down there that this...
00:39:33.000...trip was focused on protecting the Panama Canal from China.
00:39:37.000And so Secretary Hegseth and his team had a little bit of a daunting task.
00:39:40.000They had to convince Panama that it was in their interest, too, to protect the Panama Canal from China.
00:39:46.000And so the Secretary and his team were really focused on making sure that all of the reporters understood what we were getting into, where we were going.
00:39:53.000You know, this was a diverse group of reporters.
00:39:55.000There was Breitbart, National Pulse, Reuters, and a military...
00:39:59.000Defense publication and all of us were interested in finding out how this was going to go.
00:40:03.000And it was interesting because the secretary and his team were a little cautiously optimistic, but they seemed like they too were ready for things to go in a couple different directions, but they were very eager and ready to get on the ground.
00:40:14.000So we went down there and the secretary went to the Panama president's palace and engaged in a number of bilateral meetings.
00:40:23.000And the end result of this trip was that they came out of it with multiple agreements signed between the United States and Panama.
00:40:29.000And they did, in fact, successfully convince the president of Panama and the minister of defense to agree to protect the Panama Canal from China.
00:40:38.000Secretary Hegseth told us last night that this was a historic visit and that the effects of this visit will hopefully continue on throughout this administration and the next.
00:40:48.000So part of these agreements, Ben, We're not only to protect the canal, but also to engage in sort of joint military exercises between the United States and Panama at places like Fort Sherman where they can engage in jungle training.
00:41:02.000And Fort Sherman was a really cool old military base that the United States used to have and then turned over to Panama.
00:41:08.000And it looks like that might be up and running again soon, and these soldiers will be able to participate in jungle training there, which is very cool and really neat to be on the ground and to see the secretary interacting with the troops in these places.
00:41:21.000So I could go on and on about this for hours.
00:41:23.000I'm not going to forget it anytime soon, but a very historic visit and so neat to be there while this diplomacy was in action.
00:41:31.000So, Mary Margaret, for those who don't understand the situation with the Panama Canal, it is not that the United States needs total control over the Panama Canal.
00:41:38.000I believe that what was negotiated was really about what happens at either end of the Panama Canal.
00:41:42.000So basically, the Chinese were controlling essentially territory embassies.
00:41:47.000They had a firm that was controlling one of the ends of the other end of the Panama Canal.
00:41:51.000And I think the concern for the United States was, in case of a wartime scenario, China could essentially just sink things at either end of the canal and then prevent transit of American ships through.
00:42:03.000And as we know, Ben, the Trump administration, one of its very highest concerns is the control that the Chinese Communist Party has throughout the world.
00:42:12.000They've been paying very close attention to how China has interacted with Panama, with the Panama Canal, with Venezuela.
00:42:18.000And as they watched these things and began to grow more and more concerned, President Trump put out a bunch of different statements on social media earlier this year saying that we were going to retake the Panama Canal.
00:42:29.000And obviously some people thought this might be a dead serious assertion, that we might be going in with our military to retake the canal.
00:42:37.000And I heard that there were some Panamanians that were concerned about this as well.
00:42:41.000And so part of Secretary Hegseth and his team's job yesterday was to emphasize the importance of Panamanian sovereignty.
00:42:47.000That the United States is not going to come in and take over the canal, but instead wants to work with Panama to ensure that the canal is actually safe from Chinese interference, and that the historic partnerships between Panama and the United States can grow and flourish and protect both of our countries' interests in a different way.
00:43:07.000I think it was a very delicate situation to handle.
00:43:10.000I did not envy the Secretary this task, but...
00:43:13.000He was very optimistic when we spoke with him last night before he got on the plane and we all went with him back to D.C. It was very hot, by the way, 90 degrees down there and super humid.
00:43:23.000And all of these military men are in their military uniforms and braving the heat.
00:43:28.000And Hegsa told us, you know, I specifically asked him, are you worried about China's retaliation from these negotiations this week and this diplomacy?
00:43:36.000And he looked me in the eye and said, no, not worried about it at all.
00:43:39.000He said, we'll continue to stand our ground and we're going to move forward with the United States plans in this area.
00:43:47.000So I think he'll be back here today at the White House, hopefully speaking with the president about these negotiations.
00:43:53.000And as far as we know, this is going to go on into the future with more talks between Panama and the United States on how they can best secure both our countries' interests.
00:44:03.000Well, Mary Margaret, really appreciate the time and congrats on another successful foray into the wilderness with members of the Trump administration.
00:44:29.000Does not include many of the cuts that the House budget originally included, and so both houses of Congress are now sort of fighting with each other.
00:44:36.000There was a press conference earlier on Thursday morning in which the Speaker of the House and the Senate Majority Leader got together and they talked about a commitment to, in fact, find cuts in the budget.
00:44:48.000According to Politico, House Republicans cleared a key hurdle Wednesday afternoon toward advancing a budget framework.
00:44:56.000Man, these margins are just non-existent.
00:44:59.000On the rule to tee up floor debate on the Senate approved budget resolution and a vote on approval.
00:45:03.000While many fiscal hawks said throughout the week they would vote against the budget itself, some of those holdouts are now working with a group of GOP senators to hammer out an agreement on spending cuts.
00:45:11.000That burgeoning deal could boost House Republican support for the budget framework.
00:45:14.000If the measure fails, it would be an embarrassing setback for the House GOP and for President Trump.
00:45:17.000Trump himself is pushing very hard for the budget, as he should.
00:45:21.000That budget does include a massive spending upgrade with regards to the Department of Defense.
00:45:26.000Pete Hegseth posted from his personal account that,
00:45:32.000P.S. We intend to spend every taxpayer dollar wisely on lethality and readiness.
00:45:36.000That's a significant increase from the $892 billion funding Congress allocated for national defense programs this year.
00:45:41.000Peace through strength requires an arsenal, pretty obviously.
00:45:46.000President Trump said, quote, nobody's seen anything like it.
00:45:57.000Meanwhile, again, there's significant negotiation going on between the House and the Senate with regard to this budget bill.
00:46:07.000Members of the House would like to see more cuts embedded.
00:46:11.000Members of the Senate just want to get something done.
00:46:15.000GOP holdouts forced a delay in a vote on the Trump budget plan yesterday.
00:46:18.000According to the Wall Street Journal, Republican leaders postponed a vote on the blueprint for President Trump's big, beautiful bill, throwing the GOP legislative agenda into temporary uncertainty as they try to find a path forward on tax cuts and spending.
00:46:28.000A handful of hard right conservatives resisted the pleas from Republican leaders and Trump who had urged wavering House members to close your eyes and get there.
00:46:35.000The holdouts argued the plan that came out of the Senate on Saturday did not lock in enough spending cuts alongside extensions of those expiring tax cuts.
00:46:42.000Key members of the holdout group met with top Republican senators and then with Mike Johnson for more than an hour.
00:46:48.000According to lawmakers, they did not produce enough of a breakthrough to get the budget adopted on Wednesday.
00:46:53.000The big beautiful bill is going to happen because if it doesn't, then the economy really will dump.
00:46:56.000If it turns out that the tax cuts that President Trump put into place in his first term are not extended and reinstated, then of course the economy is going to sink pretty significantly.
00:47:07.000Meanwhile, President Trump was in a good mood the rest of the day yesterday after having announced the reversal on the tariff plans.
00:47:14.000He signed an executive order restoring the ability of Americans to get high-pressure showerheads, which, you know, This alone is worth your vote for President Trump.
00:47:25.000There's nothing worse than low water pressure in a shower.
00:47:28.000Here's the President signing one of the most significant of his executive orders.
00:47:33.000With this executive order, we're effectively going to be reversing that set of regulations to ensure that Americans have choice in the consumer market.
00:47:41.000If they want a low-flow showerhead, they can buy one.
00:47:43.000If they want a real-deal showerhead, they should have the ability to get one.
00:47:55.000They used to have a restrictor where you could take it out, but now they weld it in.
00:47:59.000And you take a shower, wash your hands, whatever you do, including dishwashers when no water comes out, but you wash your hands, and in my case, I like to take a nice shower to take care of my beautiful hair.
00:48:12.000I have to stand in the shower for 15 minutes until it gets wet.
00:49:21.000President Trump also reiterated yesterday.
00:49:23.000That with regard to the negotiations that are supposed to take place with Iran over the weekend, that they better get on board or bad things are going to happen.
00:49:30.000This, of course, is the right approach to Iran.
00:49:34.000Peace through strength remains the only solid foreign policy approach.
00:49:40.000You said the other day that if they do not agree to a potential nuclear deal, that it would be very dangerous for them.
00:50:16.000This president authorized the killing of Qasem Soleimani.
00:50:19.000And it resulted in zero repercussions from the Iranians, because it turns out Iran is a particularly weak state that does not have projective power against the United States.
00:50:28.000If they get a nuclear weapon, a lot of that changes.
00:50:33.000And meanwhile, the president should be avoiding distractions.
00:50:36.000Again, I've been saying since he was elected, before he was elected, that if this administration does all the things President Trump wants it to do, that is only going to happen if distractions are avoided.
00:50:47.000And that means avoiding the sort of water torture that is drips and drops of action that are unpopular with the American people because the way that relationships go bad is a bunch of smaller things and then the floor goes out and there isn't enough goodwill to hold up the relationship with the politician.
00:51:04.000Yesterday, the president announced that he was revoking the security clearance as belonging.
00:51:08.000To former CISA leader Chris Krebs and also ex-DHS official Miles Taylor.
00:51:12.000Now, Miles Taylor is a bit of a different story because Miles Taylor was writing anonymous op-eds from inside the Trump administration while the president was the president.
00:51:19.000Chris Krebs is a bit of a different story.
00:51:21.000So Chris Krebs is an appointee of President Trump, and he was leading the cybersecurity agency.
00:51:28.000It's not just that he decided that he was going to revoke security clearances, which of course he has the power to do.
00:51:32.000He also signed an executive order calling for the DOJ to investigate their...
00:51:37.000So again, Taylor was the chief of staff to Homeland Security Secretary during the first Trump administration.
00:51:44.000Then he started writing anonymous accounts ripping into President Trump.
00:51:48.000He fired Krebs by tweet after Krebs fact-checked the president and said that the 2020 election was the most secure in American history.
00:51:55.000Trump called Krebs a wise guy, a fraud, and a disgrace during Wednesday's signing.
00:52:01.000I'm not sure that any of that is criminal.
00:52:03.000Here he was instructing the DOJ to investigate.
00:52:43.000So we'll find out whether or not it was a safe election.
00:52:46.000And if it wasn't, he's got a big price to pay.
00:52:51.000So again, this sort of stuff is a distraction and it's a mistake by the president.
00:52:55.000He should not be sicking the DOJ on people who have a different opinion about the 2020 election.
00:53:03.000Again, including people who are inside his own administration.
00:53:05.000Even if you disagree with Chris Krebs' viewpoint on this, that doesn't make it criminal activity.
00:53:09.000And if it's bad when the Democrats do it to President Trump, you know, using the DOJ to simply go after political opponents is not good when President Trump does it either.
00:53:17.000All right, folks, now it's time for a segment that we are now initiating in which I break down a terrible argument of the week piece by piece.
00:53:23.000Today's featured takedown is John Oliver from HBO.
00:54:02.000Monologues the other night I've ever seen.
00:54:04.000John Oliver is so trapped inside the left-wing echo chamber that he actually believes that it's necessary for him to defend the idea that men should punch women in a boxing ring.
00:54:12.000That quote-unquote trans athletes must be allowed to play with members of the opposite biological sex.
00:54:19.000And in order to make this claim, he somehow has to square the circle of pretending that men playing with women is not unfair to the women.
00:54:26.000Which means he now has to pretend that actually men are not better at sports than women.
00:54:31.000When it comes to trans athletes who've medically transitioned, studies of cis athletes are not necessarily relevant.
00:54:37.000A lot of medical gender-affirming treatments, like hormone therapy, have a meaningful impact on body and hormone composition.
00:54:43.000So the question then becomes, what do those impacts mean for athletic performance?
00:54:48.000We spoke to scientists on all sides of this issue, and the one thing they actually agree on is that in part because the number of trans athletes is so small, the body of research specifically about them is extremely limited.
00:55:20.000Therefore, men who have hormone treatments don't have any sort of accessibilities over women.
00:55:24.000Therefore, they should be allowed to play with women.
00:55:26.000This is a classic in the genre of absence of evidence does not equal evidence of absence.
00:55:31.000In other words, absence of evidence that men with hormone treatments have an advantage over women does not mean evidence of absence of that advantage.
00:55:40.000This is like a classic logical fallacy in which he is engaging right here.
00:55:44.000So he's like, we can't look at these studies that say that men are stronger than women.
00:55:47.000We have to look at the non-existent studies.
00:55:49.000But those studies don't exist, and therefore men don't have an advantage over women.
00:55:53.000Okay, my dude, that is not how logic works.
00:55:57.000...studies comparing specific anatomical features like muscle mass in women who transition but which don't directly speak to their impact on athletic performance, but we were only able to find 12 studies that actually tested trans adult women's physical fitness in a lab or other performance scenario.
00:56:12.000Eight have a sample size of less than 20. And two are of a single athlete.
00:56:17.000And look, I don't have any scientific experience, even though I look like a cross between a scientist and the profoundly sick mice he's studying, but you probably shouldn't draw broad conclusions off a sample size of one.
00:56:30.000Those 12 studies generally find that medically transitioning does impact trans women's performance, but disagree on how or by how much.
00:56:42.000He's laying out a bunch of studies that don't support his own position, but then he's dismissing the studies because the sample size is too small.
00:56:49.000So he has literally cited zero evidence for his proposition so far.
00:56:53.000And somehow he's going to magic that into the idea that men playing against women is somehow fair.
00:56:58.000Actually published the only longitudinal study to date of multiple athletes studying the impact of transitioning on eight long-distance runners.
00:57:06.000She found after at least a year on hormone therapy, their race times turned out to be more athletically similar to those of cisgender women.
00:57:13.000It is undoubtedly true that trans women will maintain advantages in some sports.
00:57:32.000Probably not so much in endurance sports, but in size and strength sports.
00:57:44.000Our larger frames are now being powered by reduced muscle mass and reduced aerobic capacity, and that can lead to disadvantages in terms like quickness, recovery, endurance, things that maybe aren't quite as obvious as being bigger and stronger.
00:57:59.000Right, bigger and stronger bodies are not automatically advantaged in every scenario.
00:58:03.000I mean, put the rock in a pure bar class and see what happens.
00:59:01.000He just continues to argue based on no evidence that it's totally fair for men to play with the ladies because he says so, essentially.
00:59:10.000After having come up with zero evidence to the proposition that it's fair for men to play with the women, he then says it shouldn't be an issue anyway because no man is transitioning just to play with the women.
00:59:19.000Which is weird because there actually are a bunch of men who are transitioning to play with the women.
00:59:25.000By this I mean not that they would not do whatever they are doing, hormone treatments and surgery.
01:00:16.000Why should the women care about the motivation for why a gigantic man like Leah Thomas is now racing against Riley Gaines?
01:00:22.000Why should Riley Gaines care what the motivation is?
01:00:24.000She now has to race against a dude who was a low-ranked male swimmer but blows the other women out of the water because he's a dude.
01:00:32.000The thing is, hypotheticals like that circulate constantly and often centre around someone transitioning solely to gain a competitive advantage.
01:00:41.000But as this trans researcher points out, that is an absurd proposition.
01:00:45.000Trans women don't transition for sports.
01:01:53.000Add some fake boobs and cut off your penis, and that might be a very different motivation than the motivation for wanting to play with the ladies now that you are bigger and stronger than all the ladies.
01:02:00.000It doesn't have to be the same motivation.
01:02:07.000That should actually be the name of John Oliver's show.
01:02:08.000Silly and Reductive, starring John Oliver.
01:02:12.000underlying premise of that question from the world's most famous sports cheater, that those assigned male at birth are automatically going to have certain immutable physical advantages.
01:02:21.000That gets raised constantly, which is why we're going to spend most of our time talking about trans women and girls, even though in these five states, these bans impact trans boys in schools, too.
01:02:32.000It is obviously true that on average, cisgender men and post-pubescent boys have some specific athletic performance advantages, though the relative size of that advantage also depends on the sport and the event in swimming.
01:02:45.000For instance, male athletic performance advantage is roughly 13% in the 50-meter freestyle, but less than 6% in the 1,500-meter free, which is still clearly significant.
01:03:08.000No, the thing that gets implied is that if you are looking at the ends of the bell curve, which is where top athletic performance happens, The end of the bell curve.
01:03:17.000If you have men who have transitioned into women at the end of the bell curve, they are almost always going to out-compete women because they're at the end of the bell curve.
01:04:30.000As scripture tells us, men are men and women are women and God is his own son and some mothers are virgins and some mothers-in-law are pillars of salt and some daughters are sex partners and colorful coats of dream tellers and brothers are murderers but also brothers are backup husbands for wives and babies can be for splitting in half and water is wine and also with you,