Business/Markets/Stocks/Economics Random, Random

[ti-amie]

Katie Martin‬
‪@katie0martin.ft.com‬
· 1h
“[Miran] got questions and that’s when it fell apart. When you’re with an audience that knows a lot, the talking points are taken apart pretty quickly.”


Top Trump adviser struggled to soothe investors in talks after market tumult
Stephen Miran met hedge funds and big asset managers after tariffs sparked Wall Street turmoil

Kate Duguid in New York, Costas Mourselas and Katie Martin in London and Demetri Sevastopulo in Washington

Published
2 hours ago

Updated
19:39


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https://www.ft.com/content/a815323b-ae2 ... 70588c9afa

Donald Trump’s top economic adviser Stephen Miran struggled to reassure leading bond investors in a meeting last week that followed a bout of intense tumult on Wall Street triggered by the president’s tariffs.

Miran, chair of the Council of Economic Advisers, met representatives from top hedge funds and other major investors at the White House’s Eisenhower Executive Office building on Friday, said people with direct knowledge of the matter.

Some participants found Friday’s meeting counter-productive, with two people describing Miran’s comments around tariffs and markets as “incoherent” or incomplete, and one of them saying Miran was “out of his depth”.

“[Miran] got questions and that’s when it fell apart,” said one person familiar with the meeting. “When you’re with an audience that knows a lot, the talking points are taken apart pretty quickly.”

Another person familiar with the meeting was more encouraged by the administration’s approach to deregulation and tax cuts.

The roughly 15 attendees included representatives of hedge funds Balyasny, Tudor and Citadel, as well as asset managers PGIM and BlackRock. The event, convened by Citigroup, was timed to coincide with the IMF’s spring meeting.

“Administration officials maintain regular contact with business leaders and industry groups about our trade and economic policies. The only interest guiding the administration and President Trump’s decision-making, however, is the best interest of the American people,” the White House said when asked about the meeting.

Citi, BlackRock, PGIM, Balyasny, Citadel and Tudor declined to comment.

Trump’s policies have triggered intense volatility in US equity and debt markets. US government bonds sold off sharply after the president’s April 2 announcement of steep “reciprocal” tariffs. They stabilised after he paused the levies for 90 days, but many investors remain on edge.

The US 10-year Treasury yield traded at 4.17 per cent on Tuesday, down from a high of 4.59 per cent on April 11. Yields move inversely to prices.

Treasury secretary Scott Bessent also addressed investors at a closed-door meeting last week. Bessent’s comments indicating he expected the US and China to reach a trade deal in the “very near future” helped lift US stocks.

But attendees of the meeting with Miran said he did little to assuage the participants about the tumult in markets and maintained the administration’s line that tariffs would hurt the US’s trading partners more than American consumers. Miran also stated the primary aim of tariffs was not to generate revenue, though additional revenue could be a benefit.

The Council of Economic Advisers was established after the second world war to provide advice on domestic and international economic policy to the president. However, the National Economic Council is responsible for co-ordinating policy.

Before joining the administration, Miran wrote about the merits of a so-called Mar-a-Lago Accord to align global markets more firmly around US interests in trade and geopolitics.

Elements of his thinking, pinned on the notion that the US dollar’s dominant reserve currency status represents a “burden”, were outlined in a widely read note in November. They include weakening the dollar and tying holders of US government bonds in to arrangements to fund defence spending, in return for an American security guarantee.

Early this month, Miran delivered a speech at the Hudson Institute think-tank that did not specifically call for a new global currency pact, but did say currency markets were “distorted” and there were “unfortunate side effects of providing reserve assets”.

Among his solutions were that countries should accept tariffs on exports to the US without retaliation, or simply “write cheques to Treasury that help us finance global public goods”.

Bond investors have balked both at this and at the rollout of Trump’s tariffs. Sinking long-term bond prices and a falling dollar suggest the US’s role as a market haven is under strain, investors say.

One person familiar with the situation said Miran had been increasingly distancing himself from the ideas in the 2024 paper in recent meetings with investors.

“He is in full-scale retreat,” said the person familiar with the matter.

Additional reporting by James Politi


https://www.ft.com/content/a815323b-ae2 ... 70588c9afa

[ti-amie]

White House trade advisor Peter Navarro brushed off concerns Wednesday about the unexpected drop in U.S. gross domestic product last quarter, saying, 'We really like where we're at now," and pointing to a surge in new domestic investment.

"I got to say just one thing about today's news, that's the best negative print I have ever seen in my life," Navarro said on CNBC's "Squawk on the Street" after the Commerce Department reported that GDP fell at a 0.3% annualized pace in the first quarter of 2025.

"The markets need to, like, look beneath the surface of that" figure, said Navarro, an ardent supporter of President Donald Trump's tariff policy.

"We had a 22% increase in domestic investment," he said.

"That is off the charts when you strip out inventories and the negative effects of the surge in imports because of the tariffs, you had 3% growth," Navarro said.

"So, we really like where we're at now," he added.

LocalPurchase3339
•
6h ago
Other than that the play was great.

-Mrs Lincoln

[ti-amie]

Saudi Arabia signals it can live with lower oil prices, sources say
By Ahmad Ghaddar, Olesya Astakhova and Alex Lawler
April 30, 202511:48 AM EDTUpdated 8 hours ago

LONDON, April 30 (Reuters) - Saudi Arabian officials are briefing allies and industry experts to say the kingdom is unwilling to prop up the oil market with further supply cuts and can handle a prolonged period of low prices, five sources with knowledge of the talks said.

This possible shift in Saudi policy could suggest a move toward producing more and expanding its market share, a major change after five years spent balancing the market through deep output as a leader of the OPEC+ group of oil producers.

Those cuts supported prices, in turn bolstering the oil export revenue that many oil producers rely on.
The Saudi government's communications office did not reply to a Reuters request for comment on the matter.

Riyadh has been angered by Kazakhstan and Iraq producing above their OPEC+ targets, the sources said. The group establishes those targets to keep supply and demand balanced in oil markets.
After pushing members to adhere to those targets and to compensate for oversupply in recent months, a frustrated Riyadh is changing tack, OPEC+ sources said.

Saudi Arabia pushed for a larger-than-planned OPEC+ output hike in May, a decision that helped send oil prices below $60 a barrel to a 4-year low.

Lower prices are bad news for producers that rely on oil exports to fund their economies.
Although producers like Saudi have a very low cost of production, they need higher oil prices to pay for government spending. When oil prices fall, many large oil-producing countries come under pressure to cut their budgets.

The Saudis appear to be briefing allies and experts that they are ready to do just that.
Saudi officials in recent weeks have told allies and market participants the kingdom can live with the fall in prices by raising borrowing and cutting costs, the five sources said.

"The Saudis are ready for lower prices and may need to pull back on some major projects," one of the sources said. All sources declined to be named due to sensitivity of the issue.

Saudi Arabia needs oil prices above $90 to balance its budget, higher than other large OPEC producers such as the United Arab Emirates, according to the International Monetary Fund (IMF).
Saudi Arabia may need to delay or cut back some projects due to the price drop, analysts have said.

NOT A PRICE WAR YET

OPEC+, which includes the Organization of the Petroleum Exporting Countries and allies such as Russia, may decide to speed up output hikes again in June, OPEC+ sources have said.
OPEC+ is cutting output by over 5 million barrels or 5% of global supply, to which Saudi Arabia is contributing two-fifths.

Russia, the second largest exporter in OPEC+ behind Saudi Arabia, is aware of Riyadh's plans for faster output increases, said two of the five sources who are familiar with the Russian thinking and conversations with Riyadh.

Russia would prefer the group stick to slower output increases, the two sources said.

Russian Deputy Prime Minister Alexander Novak's office did not reply to a request for comment.
Saudi Arabia and Russia, the de facto leaders of OPEC+, make the biggest contributions to OPEC+ cuts.
Russia's budget balances at about $70 a barrel and the Kremlin's spending is on the rise due to the Russian war in Ukraine.

Russia may see a further fall in revenue as prices for its discounted, sanctioned oil could fall below $50 a barrel as a result of OPEC+ output rises, one of the two sources said.

REASONS FOR CHANGE

Theories on the apparent change in Saudi strategy range from punishing OPEC+ members exceeding their quotas to a move to fight for market share after ceding ground to non-OPEC+ producers such as the United States and Guyana.

Higher output may also be a fillip to U.S. President Donald Trump, who has called for OPEC to boost output to help keep U.S. gasoline prices down.

Trump is due to visit Saudi Arabia in May and could offer Riyadh an arms package and a nuclear agreement.
OPEC+ decided to triple its planned output increase to 411,000 bpd.

That still leaves OPEC+ holding back more than 5 million bpd, curbs the group aims to unwind by the end of 2026.

"We would still call this a 'managed' unwind of cuts and not a fight for market share," UBS analyst Giovanni Staunovo said.

Reporting by Olesya Astakhova, Ahmad Ghaddar, Dmitry Zhdannikov, Alex Lawler, and Hadeel Al Sayegh additional reporting by Maha El Dahan and Federico Maccioni; editing by Jason Neely

https://www.reuters.com/business/energy ... ces%20said

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The art of a recession
By SUDEEP REDDY 04/30/2025 06:53 PM EDT

DEFLECTION TIME — Save the recession headlines. The first-quarter downturn wasn’t what matters.

In the coming weeks, fewer ships from Asia will enter West Coast ports — many with lighter loads than before. Truckers who transport imported goods to retailers across the country will suddenly find less work. And executives across the logistics industry will transition from screaming into a void (as they’re doing now) to an I-told-you-so posture once American consumers face supply shortages, price increases and layoffs by summer as a result of sweeping tariffs.

Unless President Donald Trump soon finds a face-saving retreat in his trade war, conditions are in place for a recession that Americans will feel viscerally — unlike the first-quarter dip in gross domestic product that showed little change in consumer behavior.

The signs are already here in gauges of consumer confidence, CEO sentiment, manufacturing surveys and other early indicators of a coming storm. They’re showing up in corporate earnings calls, during which CEOs are openly warning of trouble and admitting their lack of clarity about the months ahead. And they’re revealed most directly in the lived experience of people who manage enormously complex global supply chains to move trillions of dollars of goods around the world.

Wednesday morning’s GDP report — showing a slight contraction in economic activity – can be attributed to easily explained factors. The economy stalled in part due to businesses rushing to import goods to avoid potential Trump tariffs. Still, the negative number “may soon force Trump and his advisers to reckon with the political consequences of an electorate that is quickly souring on major elements of his economic agenda,” POLITICO’s Sam Sutton wrote today.

The presidential deflection was quickly underway. On social media, Trump attributed a minor Wednesday morning stock market dip to an “overhang” from a predecessor who flew into the sunset more than 100 days earlier. (Trump appears to have forgotten that he took credit for a record stock market under Joe Biden as anticipation of his policies.) At a Cabinet meeting hours later, Trump also pre-blamed Biden for second-quarter GDP numbers.

Even if the president can convince Americans to believe that, it may not be enough protective cover. Tariffs could take months to trigger what economists would generally consider a recession: a downturn in jobs, consumer spending, factory activity and other key signals of the economic cycle.

Trump still has time to retreat and pull the economy back from the cliff. Enough big businesses built up excess inventories in recent months that a quick change in policy would allow many of them to weather a brief stretch of tariff uncertainty. But pain is already on the way for small and medium-sized businesses that lack complex supply-chain management. “The world has not been faced with such enormous potential impacts to trade in more than 100 years,” UPS CEO Carol Tomé told investors this week, warning that many of the small businesses that rely on the shipping giant source 100% of their products from China.

Spotting recessions in real time is often more art than science. With the exception of the obvious Covid-driven downturn in early 2020, recent recessions usually featured substantial uncertainty in real time about whether such a downturn was actually underway. Economic data can be revised up and down.

In the days after 9/11, a recession seemed obvious; the semi-official arbiter of recessions, the National Bureau of Economic Research, later pegged the start date as six months earlier — March 2001. The Great Recession similarly seemed clear once the financial crisis hit in September 2008, but revised data later showed it began in December 2007.

The trigger for this approaching recession is widely seen as actions that began with Trump’s Liberation Day in early April — a moment that has scrambled the global economic order. Most mainstream economists today put the likelihood of a recession as roughly a coin flip. Making such a call based on science is harder when they hinge on a president’s whims.

One prominent economist recently told my colleague Victoria Guida: “Tariffs cause hell with the economy. I don’t know exactly where President Trump thinks things should go. I don’t know where he’s going. I’m very hopeful that he’s going to get tariffs down substantially. When he’s in the midst of negotiations, he scares the hell out of me like he scares the hell out of everyone else.”

That was Art Laffer, whom Trump awarded the Presidential Medal of Freedom in 2019. The famed economist was once among the president’s most unabashed economic cheerleaders.

https://www.politico.com/newsletters/po ... n-00319830

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Mia Farrow‬
‪@miafarrow.bsky.social‬
· 11m
Cover of The Economist just last October-the economy under Joe Biden was the envy of the world.

[ti-amie]

McDonald’s and General Motors say Trump’s tariff war is harming business
Fast-food company reports 3.6% fall in sales and carmaker says tariffs could cost it as much as $5bn in 2025

Joanna Partridge
Thu 1 May 2025 13.22 EDT

McDonald’s and General Motors have warned that uncertainty around Donald Trump’s tariff policy is hurting business, hitting sales and knocking profits.

The fast-food chain reported a 3.6% fall in sales in its US home market during the first quarter, driven mainly by lower customer numbers as consumers reined in their spending in the face of an unpredictable economic outlook.

It was the largest quarterly fall in sales since the Covid lockdowns of 2020, and comes as US measures of consumer confidence plummeted in March and April.

McDonald’s chief executive, Chris Kempczinski, said the company was navigating the “toughest of market conditions” as it also reported a surprise 1% fall in global sales in the first three months of the year.

“Consumers today are grappling with uncertainty,” Kempczinski added.

The company, headquartered in Chicago, has been trying to boost consumer spending on its Big Macs and chicken McNuggets through the launch of a new “value” menu.

Also on Thursday, GM, one of the “big three” Detroit carmakers, cut its profit guidance for the coming year, and cautioned that Trump’s tariffs could cost it as much as $5bn (£3.8bn) in 2025.

The carmaker said it was exposed to the costs even after Trump’s announcement that he would scale back some of the duties on foreign cars and parts. The move was designed to give a reprieve to US carmakers, after the domestic industry warned his strategy would increase costs for American manufacturers by tens of billions of dollars.

Carmakers subject to a 25% tariff on imports will now not be subject to other levies Trump has imposed, such as those on steel and aluminium. US carmakers will also be allowed to apply for temporary tariff relief on a proportion of the costs imposed for imported parts, although the relief will be phased out over the next two years.

Mary Barra, GM’s chief executive, said in a letter to shareholders that the company now expected to make a pre-tax profit of between $10bn and $12bn this year, including a tariff exposure of between $4bn and $5bn. This compares with previous profit guidance of $13.7bn to $15.7bn.

Despite the significant hit to profitability from tariffs, Barra’s letter stated the company was “grateful to President Trump for his support of the US automotive industry”.

“We look forward to maintaining our strong dialogue with the administration on trade and other policies as they continue to evolve,” Barra wrote.

Carmakers have been struggling to keep up with Trump’s frequent changes to his plans for sweeping levies, which have also forced Stellantis – the owner of brands including Jeep, Chrysler and Fiat – and German manufacturer Mercedes to withdraw their financial guidance for the year as a result of the uncertainty around tariff policy.

GM and the other two big Detroit carmakers, Stellantis and Ford, have significant manufacturing facilities in Mexico or Canada which serve the US market, prompting analysts to caution that the trio could be most vulnerable to Trump’s tariffs. Under free trade agreements, which have been in place for decades, parts and cars can crisscross that border many times.

Companies across a range of sectors have been struggling to keep up with changes to tariff policy announced by the Trump White House, which threaten to upend global supply chains and disrupt markets.

Uncertainty and abrupt policy U-turns also appear to be weighing on US consumers, while other hospitality businesses including Starbucks, Domino’s Pizza and Chipotle Mexican Grill have warned that Americans are cutting back on dining out.

It came as official figures showed that the US economy shrank by 0.3% between January and March, down from growth of 2.4% in the final quarter of 2024 and the first contraction since the start of 2022.

US consumer sentiment plunged by 32% to its lowest level since the 1990 recession between January and April, after the announcement of Trump’s tariffs sparked fears of a global trade war. The index of consumer sentiment score is based on a monthly survey asking Americans about their financial outlook.

https://www.theguardian.com/business/20 ... st-quarter

[ti-amie]

If people are cutting back on going to McDonalds the economy is in trouble.

I also read that sex workers are experiencing a decline in customers.

[ti-amie]

Eli Lilly (LLY-$700 billion market cap) CEO Dave Ricks emphasized that many essential hospital drugs, including generics, are produced overseas, mainly in India and China. With the U.S. reviewing the national security impact of drug imports, likely ahead of new tariffs, Ricks said the company supports reshoring key medicine production and is ready to help if needed.

US dependence to China for critical drug is not limited to Ibuprofen (95% reliance on China Import with shortage expected in few weeks) and other painkillers, but also antibiotics.

For instance, Cefuroxime, a widely used antibiotic, is expected to see sharp price increases due to rising manufacturing costs, supply chain disruptions, and a 145% U.S. tariff on Chinese pharmaceutical imports, which supply most of its key ingredients. A brief price drop in April was temporary, and India, once seen as an alternative source, also faces higher costs. Hospitals and generic drug makers may struggle, prompting early talks on subsidies, while patients are advised to explore alternatives.

https://www.chemanalyst.com/NewsAndDeal ... ount-36300

https://www.axios.com/2025/05/01/hospit ... ff-impacts

cambeiu
•
18m ago
•
Edited 15m ago
Economic Interdependency is what avoids wars.

"When goods can't cross borders, armies will'

-Frederic Bastiat

[ti-amie]

Source: Press Office of the Ministry of Commerce

Spokesperson of the Ministry of Commerce answers questions from reporters on the situation of Sino-US economic and trade dialogue and consultation

A reporter asked: Recently, the US side has repeatedly stated that it is negotiating with China on economic and trade issues and will reach an agreement. Does the Ministry of Commerce have any further news and comments on this?

Answer: China has noticed that senior US officials have repeatedly stated that they are willing to negotiate with China on tariff issues. At the same time, the US side has recently taken the initiative to convey information to China through relevant parties many times, hoping to talk with China. China is currently evaluating this.

China's position is consistent. If we fight, we will fight to the end; if we talk, the door is open. The tariff war and trade war were unilaterally initiated by the US side. If the US side wants to talk, it should show its sincerity and be prepared and take action on issues such as correcting its wrong practices and canceling unilateral tariff increases. We have noticed that the US side has been constantly leaking information about adjusting tariff measures recently. China wants to emphasize that if the US does not correct its erroneous unilateral tariff measures during any possible dialogue or talks, it means that the US has no sincerity at all and will further damage mutual trust between the two sides. Saying one thing and doing another, or even trying to coerce and blackmail under the guise of talks, will not work in China

You can draw your own conclusions, after reading the above full English transcript of China’s Ministry of Commerce statement, as to how close, or how far, the two countries are in terms of starting negotiations

As of 2 May 2025, per this Commerce Ministry statement, China is still sticking to its pre-condition to any talks that Trump rollback all his tariffs to pre-Liberation Day levels. This will take some major walk-back by Orange, since this will mean that he has to rollback not only the tariffs imposed on China, but on all other countries too...


TL;dr China is playing Go. Orange is setting up a checkers board...

[ti-amie]

U.S. Secretary of Commerce says the ‘new model’ is factory jobs for life—for you, your kids, and your grandkids
BY Emma Burleigh
May 2, 2025 at 1:21 PM EDT

U.S. Secretary of Commerce Howard Lutnick says factory gigs are the “great jobs of the future” that Gen Z could work in for the “rest” of their life—and so could their grandkids. But the workforce’s youngest cohort probably won’t be running to fill the roles.

Some white collar workers may be on the brink of layoffs thanks to AI, but the Secretary of Commerce says they will always have a place in America’s factories. As the U.S. puts up high tariffs and curbs immigration, the administration hopes to fuel an intergenerational manufacturing boom.

“It’s time to train people not to do the jobs of the past, but to do the great jobs of the future,” Howard Lutnick told CNBC this week.

“This is the new model, where you work in these plants for the rest of your life, and your kids work here, and your grandkids work here.”

While Lutnick said this is all part of President Trump’s larger plan to make America more independent from foreign imports and services, the administration’s targeted deportation of immigrants has left many domestic manufacturers scrambling for labor. To keep up with supply, people have to fill the plant jobs, and Lutnick thinks technicians tending to factory robots are the next hot gig.

“You gotta remember these plants, all these automated arms and stuff, they need to be fixed. They all need a technician to fix them,” he said. “This is tradecraft, this is high school-educated, great jobs.”

Robot technicians can earn $90k with just a high school diploma, Lutnick says

Robots are already starting to work side-by-side with humans on factory floors—and it’s causing panic amongst workers that the tech will eventually steal their jobs. But Lutnick snubbed that notion, arguing people will always be needed to repair the robots.

In fact, he advertises technician work as incredibly accessible and lucrative to U.S. citizens with just a high school diploma. Lutnick also pointed to local-led efforts to get community college students into the industry, using Arizona as an example of a state ramping up their efforts.

“You go to the community colleges, and you train people,” he said. “All these community colleges [in Arizona] are training people right now, technicians, and these are really good-paying jobs.”

The American businessman said technician jobs can pay anywhere from $70,000 to $90,000 from the jump—a promising gig with a low barrier to entry. Vocational schooling or apprenticeships are a nice touch on resumes, but only a high school diploma is required for most entry-level technician jobs. But it’s still not the dream for Gen Z turning to trade work.

Gen Z want blue-collar jobs—but not in a factory

Manufacturing was predicted to explode with job growth long before Trump’s immigration and tariff policies were implemented this year. This could be a huge win for Gen Z chasing trade work as a six-figure career path—if only they wanted the jobs.

Some 3.8 million new manufacturing opportunities are expected to open up by 2033, according to a 2024 report from Deloitte and the Manufacturing Institute. However, half of these roles are predicted to go unfilled due to labor supply issues and changing career choices. And Gen Zers, set to make up 30% of America’s workforce by 2030, are turning their nose up at factory work in particular.

Only 14% of Gen Z say they’d consider industrial work as a career path, according to a 2023 study from Soter Analytics. About a quarter of the young workers think that these jobs aren’t particularly safe, and don’t offer flexibility. They’d rather be an HVAC worker, plumber, or carpenter—safer blue-collar gigs where workers have more control over their schedules.

With America’s increasingly dire need for manufacturing workers, Lutnick’s vision of technicians as an inter-generational career may be a pipe dream. After all, only 25% of Americans think they’d be better off working in a factory, according to a 2024 poll from the CATO Institute. It’ll take a lot of convincing to get young Americans to take the leap.

https://fortune.com/article/secretary-o ... rade-work/

[ponchi101]

People will always needed to repair the robots.
In an era of incredible reliability. And that is not the point. How many technicians are needed to repair how many robots?

[ti-amie]

People will always needed to repair the robots.
In an era of incredible reliability. And that is not the point. How many technicians are needed to repair how many robots?

Exactly.

[ti-amie]

Donald Trump on Friday downplayed concerns about potential economic trouble, saying everything would be “OK” in the long term, even if the U.S economy experienced a recession in the short term.

Asked twice by “Meet the Press” moderator Kristen Welker whether it would be OK in the long run if there were a recession in the short term, the president said, “Look, yeah, it’s — everything’s OK. What we are — I said, this is a transition period. I think we’re going to do fantastically.”

Following up, Welker asked Trump if he was worried about a recession, to which he responded, “No.” Asked whether he thinks one could happen, Trump replied, “Anything can happen, but I think we’re going to have the greatest economy in the history of our country.”

The remarks come as analysts on Wall Street are increasingly worried that the country could face a recession due to Trump’s changing tariff policy.

“Well, you know, you say, ‘Some people on Wall Street say’ — well, I tell you something else. Some people on Wall Street say that we’re going to have the greatest economy in history. Why don’t you talk about them?” Trump said during the interview at his Mar-a-Lago resort in Florida.

“There are many people on Wall Street say this is going to be the greatest windfall ever happen,” the president added.

According to initial measurements released by the Commerce Department on Wednesday, the U.S. economy shrank by 0.3% in the first quarter of 2025, a reduction largely driven by a fall in exports and a boost in imports ahead of Trump’s expected tariffs.

On Wednesday, while meeting with members of his Cabinet, Trump deflected blame for the first-quarter gross domestic product numbers, saying they were a result of the economy former President Joe Biden left behind.

“You probably saw some numbers today,” Trump said, “and I have to start off by saying, that’s Biden.”

“That’s not Trump,” he added Wednesday. “Because we came in on January, these are quarterly numbers, and we came in and I was very against everything that Biden was doing in terms of the economy, destroying our country in so many ways.”



Since the start of his administration in January, Trump has sought to impose tariffs on America’s largest trading partners, including Canada, Mexico and China.

Early last month, the president paused the introduction of larger tariffs on most countries for 90 days, just days after imposing them. His partial retreat fueled a rally in markets, which as of Friday recovered the losses they suffered after his initial tariff announcement on April 2.

At the same time, Trump slapped even more tariffs on China, raising the tariff rate on the Asian nation to 145%.

Still, the president has repeatedly dismissed concerns that the tariffs on China will have major effects on the prices or availability of consumer goods in the U.S.

During the Cabinet meeting, he told reporters, “Somebody said, ‘Oh, the shelves are going to be open.’ Well, maybe the children will have two dolls instead of 30 dolls, you know? And maybe the two dolls will cost a couple of bucks more than they would normally.”

Source:

No paywall: https://www.nbcnews.com/politics/trump- ... rcna203511

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[ti-amie]

The Atlantic: https://www.theatlantic.com/economy/arc ... ts/682673/

KEY POINTS:

Port of Los Angeles Sees a 35% Drop in Cargo Traffic: High tariffs on Chinese goods have nearly halted shipments from China, according to Port Executive Director Eugene Seroka. He projected a 35% decrease in cargo arrivals compared to the same time last year.

Ports Handle Over 30% of U.S. Container Trade: The Port of Los Angeles and the neighboring Port of Long Beach together process 31% of all U.S. shipping container imports and exports (17% and 14%, respectively), making their slowdown a critical national issue.

Wider Economic Fallout Includes Job Loss and Supply Chain Slowdown: 1 in 9 jobs in the Los Angeles region is tied to port activity. Experts estimate a 9-12 month long recovery if tariffs are reversed today. As maritime traffic and cargo volume decline, the trucking industry and broader supply chain are also slowing, threatening small businesses and consumer goods availability nationwide.

FULL ARTICLE:

By Juliette Kayyem

A drop in maritime traffic suggests that the worst is yet to come.

Stock markets plunged for days after President Donald Trump announced steep tariffs on imports from around the world. The sell-off ebbed only when he suspended most, but not all, of the new measures for 90 days. The ticker tape is just one indicator of an economy, and other signs are growing more and more ominous—including at the Port of Los Angeles, where high tariffs on China are crushing maritime traffic. “Essentially all shipments out of China for major retailers and manufacturers have ceased,” Eugene Seroka, the executive director of the port, said on April 24.

Trump views tariffs as essential to rebuilding the manufacturing economy that the United States once had. But his erratic tariff announcements have badly disrupted the economy that the country has today, and that pain is already being felt in the world of logistics.

“These are big, massive bullwhips that have not been seen since COVID,” Evan Smith, the CEO of the supply-chain-management company Altana Technologies, told me. “The tariffs themselves are a shock to the system, and the shock is echoed and amplified across the entire chain. Even if there is resolution, it will take nine to 12 months to work out these bumps.”

The Port of Los Angeles, the busiest in the Western Hemisphere, processes about 17 percent of everything the United States imports or exports in shipping containers. The adjoining Port of Long Beach accounts for another 14 percent. Over the years, a whole ecosystem has arisen to support the loading and unloading of the cars, clothes, electronic gadgets, and other things that people want. There are workers and warehouses, trucks and loading pads, security structures and rail lines. Seroka estimated that cargo arrivals would soon be down 35 percent over the same time last year. At the moment, the drop in traffic seems likelier to accelerate than to reverse.

The number of cargo ships canceling port calls or entire voyages is on the rise. A number of shipments now under way were instigated before Trump’s so-called Liberation Day tariff announcement, on April 2. According to Forto, a cargo-management and -tracking company, reservations for shipping products must normally be placed two weeks before a cargo vessel launches. The trip from China from California typically takes two or more additional weeks. In other words, the full effects of U.S. tariff policies on maritime traffic may not be apparent for some time.

The economy, and the supply chains that allow it to function, can adjust fairly quickly to certain shocks, including weather disasters and even a pandemic. Early in the COVID shutdowns, toilet paper was in short supply as Americans spent more time at home and less at workplaces and schools. The problem eased as manufacturers ramped up production, transportation systems adapted, and consumer anxiety decreased. But Trump’s trade war is different because it is unpredictable and indefinite. Even if he were to renounce tariffs tomorrow, Trump has already shaken global confidence in American economic-policy making. No one can comfortably make business decisions based on what he does. Unless the Republican-controlled Congress steps in to quickly take away the president’s ability to impose import duties at will, a failed effortso far, even foreign trading partners who believe they have a deal with the United States could be at risk of capricious new taxes on their products.

Tariffs don’t just reduce the flow of goods coming into the country; they also cause an atrophying of the logistics system that moves products into, out of, and around the United States. “Less cargo volume, less jobs. That’s the rule here,” Mario Cordero, CEO of the Port of Long Beach, said recently, describing how one in nine jobs in the greater Los Angeles region arises directly or indirectly from its ports. “Port complexes are like your baby toe on your foot,” Peter Neffenger, the former commander of the Coast Guard sector that includes Los Angeles and Long Beach, told me. “You don’t think about it until you break it one day and realize, ‘I can’t walk.’”

Like the shipping business into and out of Los Angeles, the nationwide trucking industry is slowing down, because drivers have a lot less cargo to move. Without inventory arriving or en route, small businesses will falter; bigger industries will shrink; shelves will be empty. This week, Trump blamed former President Joe Biden, rather than his own policies, for the recent turmoil on Wall Street. What’s happening in Los Angeles suggests that, if anything, financial markets have yet to fully price in how much Trump’s tariff war is hurting the economy. The stock market goes up and down. Maritime indicators keep on sinking.