00:00 Speaker A
Stocks moving to the upside this morning after the EU agreed to accelerate trade talks with the U.S. after President Trump threatened to impose a 50% tariff on the bloc's exports, which the administration says would take effect on July 9th. Joining us now on these and more. We've got Ed Mills, Raymond James, managing director, Ed, good to speak with you, good to grab some time here. Coming out of a weekend where we've kind of essentially just had the trade talks on the front end of it, and now on the back end of it once again. I mean, at this point we're kind of picking petals from a flower trying to figure out if we're any closer to a deal. How are you looking at this and ultimately what the pillars of a good deal would look like over the course of these talks?
01:41 Ed Mills
Yeah, Brad, the roller coaster continues here. What we've told clients at Raymond James is that, uh, expect this roller coaster to happen. Uh, expect that we're going to get posts and announcements from President Trump that he's going to double down. Uh, expect those to be walked back. Uh, but one thing that's really important here, Brad, is that President Trump is really good at resetting the goalpost. And so while we have a delay in this June 1st deadline of 50% for the EU. Uh, now that's going into July, but is the baseline higher than 10%? And that's what we should be asking ourselves. It looks like globally most of the world will be at 10%. Uh, the EU was set at 20% on, uh, liberation day. Is it going to be at 20% come July 9th? Is it going to be structurally higher? Uh, you ask what a good deal looks like, Brad? I think for this next couple of weeks, next couple of months, what the trade representative of the United States wants to do is rack up a lot of MOUs, getting a number from these countries of what they're willing to purchase from the United States, what they're willing to give for market access. Because I think what Donald Trump really wants here, Brad, is the ability to say, “I got a deal with a hundred plus countries representing Y trillions of dollars of purchases and X trillions of dollars of market access.” All of the details to be worked on later this year and into 2026.
04:10 Speaker A
So two questions for you, Ed. First of all, I want to start with what you're what you're just talking about here, the length of time it's going to take to work out the details from all these memoranda of understandings, the MOUs you referred to. What then is the market risk as those details are being worked out? Because the market is reacting to the plan to make a plan, right? Um, how important will those details be as we get them, and what's the potential for them to either provide positive or negative catalyst for stocks?
05:02 Ed Mills
Yeah, so Julie, when I was in New York last week meeting with clients, uh, what I heard time and time again is that we are past peak, uh, tariff concerns, that we have the kinder, gentler Trump. And what I was concerned about is I was telling clients, look, we're a tweet away from the tariffs to go up on EU, because those negotiations weren't going well, and that's exactly what we got. Um, so I think the market, if they can get assurances that it does not seem as if these tariffs are going to snap back on, then the market can continue to do well. But if there's a sense that they're going to snap back and our expectations that these deals are going to prolong uncertainty, that's when the market gets concerned. On April 2nd, almost every client I talked to was thinking about that as a clearing event. And then it was much worse than expected. And so my concern from the conversations I had at Raymond James last week was how much people are positioned once again for nothing to happen. When we're all on one side, that's when this market gets offsides.
