00:00 Speaker A
President Trump is pushing through with his tariff agenda, unveiling a new batch of letters to country leaders outlining tariffs on goods imported from their countries beginning in August. For more, let's welcome Yahoo! Finance's senior columnist, Rick Newman, for this week's rendition of Trump-O-Nomics. Rick.
00:18 Rick Newman
Hey, Josh. Well, this week we had the July 9th deadline for something like 90 countries to make 90 trade deals with the United States. Of course, hardly any have done that. So what happened? Well, one thing happened is we got a new deadline, which is August 1st. And Trump has put out some numbers that, uh, these countries will face on, uh, tariffs on their imports if they, once again, don't come up with a deal. But we also got some surprises, um, the markets were not expecting. We got a 50%, uh, tariff threatened on Brazilian imports, and that's for political reasons, not for any economic reasons relating to, uh, Bolsonaro, the former president down there, who's facing prosecution charges. Uh, we got a new threatened 50% tariff on copper, maybe a 200% tariff on pharmaceuticals. And then the tariff on some Canadian imports, which used to be 25%, Trump says that's not going up to 35%. Almost nobody can keep track of all this. And I think what markets need to learn is this idea that there's going to come one of these deadlines and we're finally going to have some clarity on Trump's overall tariff plan. I think we should just forget about that. I don't think there's ever going to be clarity, because what we're learning is that Trump now thinks he can use tariffs to do just about anything. It doesn't, it's not even related to economics anymore. He can go after enemies, he can reward friends. Um, and he can do this on his own without any cabinet secretary having to approve it, without Congress. So we're going to get to this next deadline on August 1st. Maybe some new tariffs actually will go into effect. Um, but I think Trump is going to just keep this confusion going in markets, because he's figured out it's a powerful tool for him. So markets just have to get used to this.
02:40 Speaker A
I wonder, too, you know, Rick, we've been talking, the two of us, about investors are also trying to figure out where all this falls on the value chain. And so I, I thought it was interesting, you see this Bloomberg headline that Japan's car makers slashing export prices to the US to offset the tariff hit. And I just wonder if, if maybe what markets are thinking is that, you know what, however this shakes out, it's going to be, in some way, dispersed and not as material and meaningful, and maybe that's why all week, as you said, even though these headlines, to your point, Rick, I had trouble keeping up with the headlines, right? But the market just shrugged.
03:47 Rick Newman
Well, uh, I did it, or didn't it? I mean, um, you know, we had a nice string of new record highs in the stock market. Um, but that stopped. And we didn't have a huge selloff, um, when we got these tariff surprises, but markets went sideways. I like to keep reminding people that, okay, we have, you know, the US stock market is up. I think, what is it up 6% or something like that this year? Um, the US stock market is seriously underperforming foreign stock markets, and the sell America trade is, is not over. So we're chugging along here, but we're lagging behind everybody else to some extent. And, uh, Josh, I think we are in the process of everybody figuring out where the tariff pain is actually going to land. Um, Trump has spread this across. I mean, so Trump is cutting this in many ways. He's got, uh, product specific tariffs. He's got country specific tariffs. And then he's got, you know, for example, the Canadian tariffs, only some Canadian imports are subject to those. And then every month, it's another, it's another category of products. So, um, this is, this just takes its time to work through, uh, first of all, to work through supply chains, then to show up in corporate costs, uh, and then for the importing companies to figure out how much of those costs they're going to be able to pass along, and then for consumers to see the changes, and then for that to show up in the actual data. So, um, and we just, we just had, you know, the economist, I thought, got it right, who was just on right before, um, saying it's going to take, it's going to take a few months for all these things to work their way through. We're going to see, we're going to see something by the end of the year. In a year from now, we're going to have a better picture. Um, it's probably not going to be a pretty picture, but Trump doesn't care. Right now, Trump is, he's not chickening out. Uh, the average tariff rate is continuing to go higher. It was about 15%, uh, two weeks ago. Now it's about 18%. Um, and Trump is going to keep some, some of those tariffs on and there're going to be some new ones. So this is all here to stay, including the chaos.
06:55 Speaker A
No chickening out. Taco trade be damned. Thank you, Rick. Appreciate it.
07:02 Rick Newman
Thank you, Josh.
