That’s fair.
Most of my clients are manufacturers and I’ve been worried about these tariffs since Trump started banging that drum. If he is as serious about them as it seems, it’s going to make for a very tough economy.
it’s very difficult to calculate given how the tariffs are being implemented, but early estimates are that this will be 10x what he implemented in his first term.
It’s inexplicable to such a degree that it leads to a conclusion of either rank stupidity or a very intentional effort to slam the breaks on the global economy and throw us into recession. As to why they would want to do that? I’ll leave that to others to decide for themselves.
If the announced tariffs stayed put, I think that's exactly what would happen. I don't think they will. This is a starting point for negotiation....an admittedly unrealistically high starting point, with questionable logic / calculation on how we get there.....but I guess it doesn't matter how it is calculated if you are just negotiating an unrealistically high number.
As a negotiating tactic, starting high and even being unpredictable / chaotic can be effective. I think he's taking too much risk in the way he is rolling these out. A panic selloff can lead to breaking things you didn't want to break.......that's a lot to risk if this is simply a way to negotiate.
If he truly is intent on keeping these tariffs in place for the pipe dream of effectively moving all manufacturing to the US......I will be standing with you Will with my get Trump pitchfork out. Because that would trigger a reallly bad economic situation. That won't happen.....but the market has to price at least a chance of that happening....and that is the risk in the way this has all rolled out.
As a commercial real estate dude, I'm digging the lower rates.....but not at the expense of the economy. The REITs are about flat....when typically they pop on this kind of interest rate drop.
In and of itself, I'm not bothered by the stock market taking a short term hit on tariff headlines.........so long as the ultimate destination is a good outcome in trade, and tariff certainty at a very reasonable level, where both the US and foreign partners can profit. If the ultimate destination on tariffs is where we are now........I have a big problem with it. As we all should.
The most reasurring commentary I've seen was from Mnuchin in his interview this morning. You can tell he knows these tariffs are not doable at this level. An unrealistically high starting point for negotiation.
