Trump's Tariff Turmoil

to go very well. You have this kind of economic shock to the system, this kind of you know, record breaking balls in the stock market. It's the type of story that everybody pays attention to. This is not the type of stories that it's just people that are invested in the stock market, or just wealthy people invested in the stock market. This is a global story. This is arguably the lead story in every major news organization around

the world because these tariffs have impacted everybody. So look, I think a few things here that we both overestimated with Trump and underestimated with Trump. And it has to do with the idea that he's a transactional guy. And the assumption was and frankly, this is what many in the business community because Donald Trump campaigned on this, he said he was going to do this. He is believed

in tariffs. It goes back to nineteen eighty seven. Back in nineteen eighty seven, when Roger Stone was trying to help create Donald Trump the politician, Donald Trump bought a full page ad in the New York Times. I believe it was in New York Times, maybe been the Post Times in journal actually, but it was definitely a full page ad that talked about how Japan was ripping off America and that Japan our trade deficit, and you know,

we had idiot negotiators. If you recall nineteen eighty seven, Ronald Reagan was president, so he in some ways, Donald Trump, who doesn't have much of an ideology, right he was one time pro jo and now he's pro life and all these things. If there's one issue has been consistent on, it's this belief that the American economy should and should

all be sort of within the borders of America. So he does I think this is one of his actual core beliefs, that this is the way the system should work, that there should be more manufacturing in the country, that if you have that that and he sees everything through this binary way, there's winners and losers, and America is the winner, so therefore they shouldn't have trade deficits with anybody. People should have trade deficits with America, but it shouldn't

be the other way around. So he's somebody that doesn't really you know. If I were, if I were a critic, I'd say he doesn't understand the global economy. But he certainly doesn't. I would say he doesn't really, he doesn't buy in to this idea that the global economy has been a success. I for the life of me, I don't see how people don't look why most people don't understand that if you essentially look from post World War two to now, America has written the rules for the

global economy and it has benefited America immensely. Still the

wealthiest nation still, you know, and I say little things. Go to any other country and ask yourself if you'd rather live there or hear when it comes to simple things like the mail service or the quality of toilet paper, never mind the availability of goods and services, the availability the fact that we do have a lot more cheap goods available to us. Why do I grew up in Miami, people used to fly in from other countries in order

to simply go shopping in the United States. Okay, is this has been what the global economy has done for America. So I know it's not cool to be for the status quo these days. Right, everybody wants to disrupt and change and disrupt and change. But this is one disruption that doesn't make a lot of sense because one could argue that since America has essentially decided that the cause of World War two was that we didn't have enough the economic ties with each other, and the more economic

ties you have, that less likely you're going to fight each other. And so guess what. The last time we went through this tariff business, it was followed by World War Two, and there's plenty of evidence that it was a pretty direct link. The nineteen twenty nine stock market crash essentially was the beginning of the collapse of the German economy was already fragile. It sort of accelerated the collapse of the German economy, which of course accelerated the

rise of Adolf Hitler. And I don't think I need to tell you what happened after he took over Germany. So The point is is that this the American leadership post World War Two concluded we can't have this type. So what was born all of these multi national multilateral organizations, whether it's NATO, the IMF, all of these things, and it has been a success. We went nearly eighty years without a war in Europe essentially, or almost eighty years. There was the Balkan War. We can't ignore that, and

obviously we have the war now with Ukraine. But the fact of the matter has been relative peace on Europe, the longest arguably period of peace in Europe if for a thousand years, if you want a nitpick on this. So this is a radical change and it isn't going

to get better overnight. So what does this mean politically? It's already pretty clear to me that most elected Republicans, if they could vote without fear of Donald Trump, would take back tariff authority tomorrow. You're already seeing some Senate Republicans Chuck Grassley is introduced to bill with Maria Cantwell that I think we'll have majority support, probably not yet sixty votes, but trust me, it'll get there. But let's

talk realistically. What do I how should you watch the next eighteen months, essentially between now and the midterms, because if there is a change in control of either house in Congress the midterms, I do think these teriffs will go away almost immediately. So if let's make this, I

believe right now, if there were a Democratic House and a Republican Senate that they would collectively grab the tariff keys away from Donald Trump. And so the likelihood of a Democratic House and a Republican senate's pretty high come January of twenty twenty seven. But between now and then, the question is would there be a majority in the House and a majority in the Senate to do this with the Republicans in charge of the House. In the answer to that, that is likely. No. There is a

big distinction between House Republicans and Senate Republicans. House Republicans are more reliant on the base of Donald Trump's party. They're more reliant on Donald Trump, and they're frankly, you know, their political careers would be dead if Donald Trump decided to kill their careers. I'm not saying Senate Republicans aren't fragile to potential threats from the Donald Trump base, but there's certainly a bit more inoculated and many of them

don't have to run in twenty six. Not all of them have to be on the ballot in twenty six, So there's a little bit In fact, many of them won't be on the ballot ever again with Donald Trump or with Donald Trump as president, So there's a little bit more security that they have in their minds to try to separate themselves from Trump. And frankly, even if you are on the ballot in twenty six, senators are

dealing with a general election electorate. Okay, so a guy like Tom Tillis may be vulnerable to a Trump primary. Challenge of the matter is he only wins a reelection if he can figure out how to win the middle and on this tariff business, which really hurts a state like North Carolina. To he's going to have to sit here and walk a line. He doesn't want to antagonize Trump because I think he would struggle in a primary

in North Carolina. And at the same time, you know, if somebody to is right beat him in a primary, I don't think that person can win a general election in these midterms of North Carolina. So that's just one example.

But the point is this is what I would watch for over the next sort of three to six months. I think the don't assume that Donald Trump is negotiating with countries. Do I think some countries will get some negotiated reprieve. Yes, I think the UK will not much. Anybody else in Europe, anybody aligned with the EU know, but I think the UK, because of Brexit, he will

be more inclined to do a deal there. I think he's likely to do a one on one deal with Japan because the Japanese have basically been courting him very carefully. They've been obsessed with courting him multiple leaders, certainly this ruling party has, and I think he is likely to reward them with some sort of side deal. But for the most part, I think he believes this in his bones, and so I don't think there's going to be a ton of reprieve. So what does that mean? The markets

are still going to be volatile, People are not going to be happy. Remember who's watching the stock market the most these days, it's retirees. What's one other thing about retirees that people forget about. They vote, right, the person most likely to vote in a special or election or a midterm election is somebody over the age of fifty they are the most likely voter, so and right now they're the ones most sensitive to a loss in value.

Baby Boomers, people in their thirties and forties, you know, you can even look at this moment, Oh, maybe there's a buying opportunity. You know, you're still invested for the long term ten years, fifteen years, touch in your retirement, you might have more patience for this. But if you're in your fifties, sixties, or seventies, aka the people who are the most likely voter and the people the most likely to show up, you're going to be very sensitive

to these market disruptions. So I think you're going to

likely to see that this is sort of I would. I think this is going to be what the Afghanistan withdrawal was to Joe Biden, is what this tariff bomb that Donald Trump set off earlier this week is going to be for him. That Afghanistan withdrawal for Joe Biden dropped his approval rating anywhere below forty five somewhere between. You know, sometimes could get as low as thirty eight. He never got above forty five again for the rest

of his presence. At this point, I don't expect Donald Trump to get above forty four or forty five for the rest of his presidency because of this tariff stuff. So this is likely to make him less popular, doesn't mean he's going to be less popular among the MAGA base. In fact, you see, you know, he's got his propaganda

machine going his media. The sort of the supportive folks of his in the media are sort of putting their blinders on and pretending that this is you know, he's got some brilliant plan here, but it's it's it's going to become toxic. You're going to have I think a few things to watch for include House Republicans who decide

not to seek reelection. Some of them may decide I'm going to run for governor, I'm going to run for the Senate, but I'm not going to run for the House, because I think a House Republican is going to be a lot more vulnerable in this environment than a Senate Republican.

Senate Republican might be able to inoculate themselves some you've already seen a few of them break away when you had ran Paul Mitch McConnell, Lisa Murkowski, Susan Collins vote with the Democrats on that, on the on the Canadian tariffs, So I think you will have some some that do that.

If you start seeing the Republican retirements get into the double digits, it almost will be handing the Democrats control of the House. And I think that will be something to watch for because I think you look, we already saw in these Monday elections that the Republican base is not that engaged. At least Donald Trump's base is not engaged enough to win these elections, certainly not in Wisconsin. We saw a place like a Scanbia County in Florida

vote for a Democrat for Congress. For the first time since two thousand and six has a Scambia County supported a Democrat either for Congress, do you a Senate or the presidency. Why is that significant? Well, it's Scambia County is home to Pensacola, a naval base. It's got probably the largest cohort of federal government workers or federal government adjacent workers in the state of Florida because of all the adjacent aspects that come with a major naval base

like the one in Pensacola. Already see the vulnerability and that's just a reaction to all of the all of the cuts that have been taking place due to DOGE, and certainly some of this comfort onto that now you have this economy that's going to hit people right in the pocketbooks. I mean, the dollar store is going to turn into the ten dollar store. You know, they're not going to be able to find things that cost a dollar. That's going to hit a lot of Trump voters. That's

going to hit a lot of red districts. So I don't think he's going to back down. I think the thing that what we all thought about Donald Trump, that he was transactional, that the markets would be a guardrail.

I think we now need to realize that this third term stuff is such bs. He's more Thelma Louise here. He's got nothing to lose in his mind. He actually this might be the one thing he has conviction about, and he I think has a higher pain tolerance for the market chile rations, a higher pain tolerance for maybe rich people calling him to complain than the average politician. The average politician, Republican or Democrat, has their largest donor

on speed dial on their cell phone. So I think members of Congress are going to be hearing, not just from their constituents with fault and gray phone calls into the congressional offices, but the members of Congress themselves are going to hear from their biggest supporters, who are all going to look at their stock portfolios and panic. So it is hard to see how this gets better for

Republicans before now and the midterms. And I know we consider and say this is a long way to go, but this is something, this severing of ties with so many allies. I got to read you this one quote here from the Canadian Prime Minister, which is just an

astonishing quote, but it's pretty important. This is the current Canadian Prime Minister, Mark Carney, and he said the following the eighty year period when the United States embraced the Mannal of global economic leadership, when it forged alliances rooted in trust, in mutual respect, and champion the free and open exchange of goods and services is over. While this is a tragedy, it is also the new reality. And

that's why I don't think I think Trump had the miscon conception that somehow America was essentially an essential economy and that there's just no way that countries wouldn't essentially change their economic behavior to appease the United States. This is providing a huge opening for China. We now have two of our closest Asian economic allies, Japan and South Korea, who are coordinating with the Chinese on how to respond to the US tariffs. We have the Canadians figuring out

with the EU how to coordinate. We have now thrown people countries that we thought were allies of the United States into the arms of China, which seems to be an absolute you know, the unintended consequence that nobody should want left or right. I mean, if we lose our alliances to our chief economic and frankly cultural rival for global supremacy, what have we done? You know, we're not

going to like that. So that's why, you know I always say to people who don't want America to be the beat cop, I said, Okay, if America is not the world's policeman, somebody will be. And you're not going to like any other country being the world's cop. You're going to be a lot happier for the world's cop. And we're just seating this turf we are giving China and opening all around the world with countries that were so aligned with US, I never thought those bonds would

be shaken. So look, I think this is a Republican Party that's quoting disaster. I'm going to quote Ran Paul, who made a various stute point a couple nights ago. Ran Paul one of the few Republican senators who's been publicly pushing back against these tariffs. This is his sort of core libertarianism in him. A libertarian doesn't want any time gariffs on anything. But he pointed out a very

important fact. The Republican Party pre World War Two was very similar to the current Republican Party of today, a bit isolationist. It was the party of business, and back then in the nineteen tens, twenties, and thirties, America's businesses were afraid of foreign competition, and so they did want tariffs because it protected their businesses, it protected their wealth. This is not how the economy works anymore. This is the equivalent of Donald Trump trying to somehow manufacture the

ice block industry again. You know, there was the ice block industry used to be a big deal in Europe until we figured out refrigeration and we didn't need blocks of ice to cool our food. And this is the equivalent of trying to turn back the clock to an era that doesn't exist. You know, we put those tariffs in when we were we weren't using airplanes for cargo. Then we were using ships and certainly in this country trade. So it is there's no part of this that makes sense.

And trying to look back and say this was some golden age, it wasn't a golden age. We had extreme poverty back in the late nineteenth century, early twentieth century, we had child labor issues, we had terrible work conditions. So I'm not sure what part of that era of business, what part of that era of the economy, is actually something to wish we had again. So you know, this is and you know what happened after that. The Republican Party wasn't trusted with control of the legislative branch for

nearly sixty years. Sixty years. You know, they had a brief period where they controlled the House the two elections in the fifties thanks to the popularity of Dwight Eisenhower, but that went away quickly and they went forty straight

years with control of the House. This all goes back to the Republican Party and their trade issue and being essentially punished for essentially wrecking the economy in the twenties that led to the Great Depression, and many economists have concluded it was the bad tariff regime, among other things, that put us in that situation. So I can't see a positive outlook politically here for the Republicans. And the question is how when do how many congressional Republicans break

for him? And when do they break for him? I explained earlier, I highly doubt the House Republicans will crack because they got there because of Trump. So in some ways, in for a diamond for a dollar, the Senate Republicans want to break, Maybe they'll wait till after they passed the tax cut because they're going to need a lot

of help from Trump on that. By the way, you want to talk about stupidity with this legislative agenda by this White House. If he knew he always wanted to do this teriff for all these tariffs, he should have waited six months, gotten his tax cut, then done this. Instead, he's now the tax I think he's put his tax cuts in jeopardy here, because I think this economy is just going to be in terrible shape. Come the end of the summer into the fall, we're going to see

all sorts of horrible warning signs. You're going to see a rise of unemployment rate. We've already seen that the parent company of Chrysler and Cheep has already announced TERFF related layouts. And so the tax cut's going to come. I'm sure Donald Trump's going to try desperately to come up with some sort of rebate check of some sort to try to and call it like sort of hey, I'm going to give the first, you know, the first chunk of tariff money that comes in the country. I'm

going to give it back to my farmers. I'm going to give it back. And it really isn't you know. All it is is our own money that we paid that essentially is covering the tariff costs then being sent back perhaps in check form. But I'm not sure Congress is going to be comfortable going along with that because whether it'll even come as as believable. But I think he will try something to mitigate this, but I don't

think it's going to be getting rid of the tariffs. And even if he gets rid of him, it's not going to solve the larger problem he has already severed. He's already severed all of these economic and potentially national security ties with so many key allies that putting these partnerships back together is going to take decades. It's going to take decades, and it's going to take because the concern this is now twice that America's elected him, and

this disruptive ideology. So our European our traditional European partners, are traditional Asian partners. They're not going to quickly get back into bed with us, even if the next term is sort of somebody who is a non a president who isn't in favor of trump Ism. But it's going

to be a long seventeen months, so I think people will have to prepare accordingly. I think you will see a pullback and spend and that will be just all of that will be a domino effect. But I do expect Congress will finally find its spine and take its tariff power back from the presidency. But it may not happen until you have at least one chamber in Democratic hands. And I think of at the House, if the Democrats pick up the House and Republicans, even if it's you know,

Republicans don't lose a single senency. I promise you there's a large majority that if they know it, can they know they have the votes in the House to do it, they will take the tariff keys away from the mad King here. And I think that likelihood is quite high that this is This is potentially one of the greatest political disasters. This is I'm trying to come up look for other equivalents. Maybe this could be as bad as what happened to Democrats in ninety four with the assault

weapons ban, with healthcare. Perhaps this is as bad as the Tea Party for the Republicans for the Democrats in twenty ten. Perhaps it's Watergate nineteen seventy four. But I think this is not going to be a small ripple. This is going to be a gigantic crack here. And who knows it. Perhaps perhaps this leads to a new fight inside the Republican party. Maybe there are primaries. I'm not there yet. I think as long as Donald is king of his party, you're not going to see successful

primary challenges. But I do think if this does lead to what happened the last time the Republicans played with terror fire and it leads to huge successes for the Democrats. You will see the Republican Party have a real fight over the direction post Trump. But for now, prepare for a very tumultuous and likely This is You know, Donald Trump's life just got so much harder to politically conduct this presidency. Good luck everybody. M