Trump's tariffs go into effect at midnight, and China responds with an 84% tariff on the United States. Meanwhile, an extinct wolf is back, and some people start to wonder if we're on the brink of World War III.
00:05:16.140Some people who saw this coming, maybe it's not so bad.
00:05:19.920Some people are going to look at the market turning down and saying this is actually a great opportunity
00:05:24.380because it means that stocks are on sale, so they're going to start buying.
00:05:28.120But regardless of how you're reacting, there are a lot of panicans out there.
00:05:31.500We talked about the panicans yesterday, the new political party identified by President Trump of weak and stupid people, as he says.
00:05:37.880Regardless of what you think, and if you're getting cold feet and you're getting a little shaky this morning because of the market downturn,
00:05:45.040because we're now apparently in a trade war with China,
00:05:47.880just remember, politicians of both parties have been demanding that we do something about China's unfair trade practices for at least 15 years.
00:05:59.120Probably longer in some cases, because China has been cheating.
00:08:05.560And don't forget, Besson is a very serious guy.
00:08:08.220I'm not saying that there aren't certain people around President Trump or around other Republicans who are kind of shooting from the hip who don't know what they're talking about.
00:08:16.360Scott Besson is an extremely successful hedge fund guy.
00:08:21.240Scott Besson has been an Ivy League economics professor, which, you know, I guess that could go either way.
00:08:43.000We're going to fix this problem right now.
00:08:44.420He also hinted, gave us a little bit more of a clue of what the goal of these tariffs is.
00:08:51.260If we put up a tariff wall, the ultimate goal would be to bring jobs back to the U.S.
00:08:59.220But in the meantime, we will be collecting substantial tariffs.
00:09:02.680As I said, I believe on this show that if we're successful, tariffs would be a melting ice cube in a way because you're taking in the revenues
00:09:13.500as the manufacturing facilities are built in the U.S.
00:09:18.020And there should be some level of symmetry between the taxes we begin taking in with the new industry from the payroll taxes as the tariffs decline.
00:09:30.200Okay, this is a fascinating point that Besson is making, and I think it's going to go over a lot of people's heads.
00:09:37.020Not because it's so complicated from the standpoint of economics, but because it's so subtle in its political language.
00:09:43.480So yesterday, I said on the show, also following a comment by the Treasury Secretary, that it seems to me the goal of the tariffs is more trade.
00:09:56.620Reduce trade barriers so you have more free trade.
00:09:59.060Increase jobs, you know, reshore American manufacturing, or raise revenue from the tariffs because the other countries have to pay to get access to our market.
00:10:05.520Those are the three goals, and they're in conflict with each other.
00:10:07.860I said yesterday, when Besson is talking about how we're negotiating with Japan so that we can have a new golden age of trade,
00:10:16.260it seems like the chief goal of the tariffs is reducing trade barriers and having more free trade.
00:10:21.860So not so much the jobs, not so much the revenue.
00:10:24.440But then here, Besson comes out and he says, well, actually, the long-term goal of the tariffs would be increasing jobs.
00:10:31.360So it's not increasing free trade, and it's not the revenue, as he points out.
00:10:35.280He says, look, in the meantime, we're going to get revenue, but the long-term goal is jobs, which is going to reduce the revenue.
00:10:41.220But he says, but it's kind of like a melting ice cube.
00:10:43.300It's all going to even out with the water because as the domestic manufacturing comes back, you're going to get taxes from the manufacturing.
00:10:52.300So even as you lose the revenue from the tariffs, you're going to get more taxes from the manufacturing.
00:11:21.040So now, look, maybe I'm really trying to read the tea leaves here.
00:11:24.380I mean, this administration is basically inscrutable.
00:11:26.760Every time you think you've got them pinned down on what they're doing with the tariff policy, they pull the rug out from under you, which is why the markets are reacting with such volatility.
00:11:37.120But even Besant here saying the long-term goal of tariffs would be is leaving himself an open.
00:11:42.900He's saying, yeah, if we do have tariffs in the long term, the goal would be the reshoring of manufacturing, which means that we would lose the revenue long term, but we'd make it up in the taxes.
00:11:50.860But maybe, maybe the goal is not tariffs in the long term.
00:12:14.500If you are China right now, you have no idea what Trump is doing.
00:12:19.460The way I know that's the case is because if you're an American right now, you have no idea what Trump is doing.
00:12:24.300And the way I know that it's the case is because even top administration officials don't seem willing to put their chips down one way or the other on what Trump is doing.
00:12:35.880As of now, though, if you're an investor, if you are an adversary, if you're a trading partner, especially if you're China, which is all three of those things, you've got to think, darn, they might not be kidding.
00:12:58.360The only reason that China is a rising power is because 25 years ago, it got access to the American market and joined the World Trade Organization.
00:13:05.260Not that it for the first time ever got access to the American market, but it really entered global trade on a mass scale.
00:13:12.820So if you're China, your growth as a potential global hegemon is entirely contingent on the trade practices of the last 25 years.
00:13:49.300First, though, text Knowles to 98, 98, 98.
00:13:52.960Tariffs have thrown the global economy into chaos.
00:13:55.880Potential widespread inflation tied to massive supply chain disruptions is weighing heavily on all of us.
00:14:01.040There is a silver lining that most people have missed.
00:14:02.780President Trump specifically exempted gold and silver bullion from those sweeping tariffs.
00:14:07.240While these new policies are triggering significant financial chaos and uncertainty, the administration preserved your ability to diversify into precious metals.
00:14:15.340If you are concerned about your savings, I encourage you to have a free consultation with a Birch Gold Precious Metals Specialist.
00:14:20.940The first step is to text Knowles, K-N-W-L-E-S, to 98, 98, 98.
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00:15:38.480And then Elon Musk, who helped to fund Trump's campaign, who campaigned with him, who really helped turn the tide in this election, and who remains a top advisor to him in this term.
00:15:51.640There have been tensions rising for a while, but he kind of started the fight when he goes on CNBC.
00:15:56.180And he says, yeah, yeah, the reason Elon Musk is opposed to the tariffs is because he's a car manufacturer and the tariffs are going to hurt him personally.
00:16:05.000When it comes to tariffs and trade, we all understand in the White House and the American people understand that Elon's a car manufacturer.
00:16:17.780If you go to his Texas plant, a good part of the engines that he gets, which in the EV case, is the batteries come from Japan and come from China.
00:17:44.820He's been going after Navarro for days now.
00:17:47.460What I find interesting about this is not just the gossip and the, ooh, he said this, and ooh, what a zinger, and oh, man, you know, let's go.
00:17:59.020The thing that is politically interesting about this fight to me is both Elon and Navarro can support tariffs in principle for totally different reasons.
00:18:10.180Navarro can support tariffs because he wants to reshore American manufacturing, and he doesn't care that much about growth, at least in terms of international trade.
00:18:22.500He really wants America to make stuff and to have greater self-reliance and to help the American worker and forget about free trade.
00:18:29.640And Elon can support the tariffs in principle because the tariffs are a good tool for leverage in getting better trade deals because we've had bad trade deals with a lot of our supposed allies for many years.
00:18:41.340And they can both support Trump's tariff policy to some degree for opposite reasons.
00:19:12.380How is, and you saw this play out just in the electorate.
00:19:15.560Trump did very, very well among Jews, better than usual.
00:19:18.540And he did quite well among Muslims, better than usual.
00:19:22.780How is, even though one of the biggest issues in the campaign was the Israel-Gaza war, you would think that those two parties would be on opposite sides.
00:19:29.520They're not, they coalesced around one candidate.
00:19:40.820And the Muslim side, which is often anti-Israel, looked at it and said, well, you know, under Trump, we didn't have this war in the Middle East.
00:19:48.540Under Trump, Gazans weren't getting absolutely pummeled by bombs.
00:19:52.180Under Trump, we had a foreign policy that was more favorable to us.
00:19:56.300So even if he's pro-Israel, he's also pro-peace.
00:19:59.380And so that, we're going to vote for him for that reason.
00:20:01.780Trump can bring in people who are agreeing with him and with his policies for opposite reasons.
00:20:10.320You even see this with serious social conservatives and social libertines and libertarians coming and supporting Trump for the same reason.
00:20:18.720On the one hand, Trump is the most socially conservative candidate that we've seen run for president since Pat Buchanan, certainly.
00:20:26.460On the other hand, he's the guy who waves the rainbow flag upside down at one of his rallies.
00:20:30.600So even the social conservatives would say he doesn't really care about the rainbow flag.
00:20:32.980He doesn't even know which way it goes.
00:20:33.920But the pro-socially liberal sexual revolution kind of crowd can say, no, Trump's cool with gay marriage.
00:20:42.060Trump's cool with some kinds of transgenderism.
00:20:50.960Trump can just bring these opposites together.
00:20:54.060And I think that's what's happening with the tariffs.
00:20:55.900Now, speaking of tariffs and the state of Israel, for that matter, Trump was sitting with Bibi Netanyahu.
00:21:03.520The question of tariffs on Israel came up because Israel preemptively, before Trump's tariffs went into effect, they said, we're going to reduce all of the tariffs that we have on American goods.
00:28:38.200He ran for president to reallocate money.
00:28:41.060He wants America to be richer, and he wants the government to be the appropriate size.
00:28:47.120Not nothing, not overextended, to be the appropriate size to do appropriate things.
00:28:52.760In other words, he wants to reallocate resources.
00:28:56.020This is an important lesson of the Trump era.
00:28:59.080Before the Trump era, in the Tea Party era, a lot of people said, we just need to bleed the government.
00:29:03.840We need to starve the beast, to use the language of Ronald Reagan.
00:29:06.400So we just want to shrink the government.
00:29:08.740But the thing is, if you just give away power, if you say, we don't want this power anymore, we're going to give it away, then that power is going to flow to other places.
00:29:18.780And that power is going to often be used by your enemies.
00:29:23.100So we say, we don't, we conservatives, we don't want the government involved in regulating the public square, say.
00:30:14.500We want government that exists within its own limits, but that does its job effectively within those limits.
00:30:21.060Speaking of illegal immigration, in particular, Jasmine Crockett, the new AOC.
00:30:25.040AOC, without the wisdom, Jasmine Crockett, this Democrat House member who makes a big show of herself just about every day.
00:30:34.600She has come out and claimed that we need illegal immigration because we Americans ain't going to pick that cotton no more.
00:30:45.540So I had to go around the country and educate people about what immigrants do for this country or the fact that we are a country of immigrants.