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Speaker 1: Welcome to Ask Fear and Greed, where we answer questions

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Speaker 1: about business, investing, economics, politics, and more. I'm Adam Lang

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Speaker 1: and hello Sean Aylmer.

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Speaker 2: Hello Dansky, Sean.

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Speaker 1: Another ripping question today, given all the noise around Donald

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Speaker 1: Trump's tariff policies, which countries stand to suffer most?

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Speaker 2: Ah, there are a bunch of ways you could answer this.

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Speaker 2: So you can think about the countries that attracting the

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Speaker 2: biggest tariffs. You can think about the goods that are

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Speaker 2: attracting the biggest tariffs. You can think about the largest

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Speaker 2: trading partners with the US, and then I supase, you

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Speaker 2: can also think about the second round defects. So the

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Speaker 2: countries that aren't necessarily directly impacted from the tariffs, like Australia,

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Speaker 2: but will be hit because our training partners like China,

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Speaker 2: will be hit hard by the tariffs. So lots of

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Speaker 2: ways to look at this question. I suppose before he

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Speaker 2: answered me attempt to answer it, big, big caveat. We

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Speaker 2: can only go on the information we have right now,

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Speaker 2: what Donald Trump has said so far.

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Speaker 1: And that has had a history of changing a bit.

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Speaker 2: Yeah, he likes to change his mind, and what we

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Speaker 2: here is often a negotiating position in his mind. So

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Speaker 2: at the moment, in the last twenty four hours, for example,

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Speaker 2: the Europeans have said we're going to not actually impose

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Speaker 2: tariffs on the US, because I know the US have

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Speaker 2: just imposed percent tariff's on us. But we think we

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Speaker 2: can negotiate still. So the big caveat is we can

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Speaker 2: only work on the information we have right now. That's

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Speaker 2: our countries are tracking the highest tariff. Well, I think

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Speaker 2: the winner at this point goes to Brazil. Well we'll

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Speaker 2: come to China in a moment, but Brazil fifty percent.

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Speaker 2: That's because Donald Trump doesn't the way it doesn't like

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Speaker 2: the way Ja Boltonaro, an ally and former leader Brazil

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Speaker 2: is being treated in that country. So nothing to do

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Speaker 2: with economics, just sort of personal preference or something. Rather

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Speaker 2: there Canada thirty five percent is going to be hit hard,

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Speaker 2: Thailand at thirty six percent, Indonesia's thirty two percent, EU

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Speaker 2: and Mexico thirty percent, Japan and South Korea twenty five percent,

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Speaker 2: so they're all pretty high. It's a bit unclear where

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Speaker 2: China sits. A deal's done, we think it's at fifty

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Speaker 2: five percent, but we don't really know. This was quite

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Speaker 2: a few weeks ago. It was actually late last month

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Speaker 2: that Trump said a deal's done and suggests it was

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Speaker 2: fifty five percent. But we haven't heard anything since then,

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Speaker 2: so we're not one hundred percent sure. So if we're

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Speaker 2: thinking about which country is the biggest tariff, probably Brazil

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Speaker 2: is a winner. Maybe it's China, not really sure. So

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Speaker 2: that's that If you think of the goods that will

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Speaker 2: attract the biggest tariffs, well, pharmaceuticals, he's looking at two

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Speaker 2: hundred percent. That's massive. I mean still aluminium and a

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Speaker 2: cop has fifty percent, automobiles at twenty five percent. The

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Speaker 2: top imports into the US oil, cars, technology and computers,

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Speaker 2: and pharmaceuticals. That's why that two hundred percent is huge.

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Speaker 2: Does that mean the price of medicine goes up for

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Speaker 2: people in the US. One country has hit really hard

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Speaker 2: by this is Switzerland. It exports plenty of drugs into

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Speaker 2: the US. So if pharmaceuticceutical gets hit, that'll hit Switzerland.

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Speaker 2: For example. What's the next time we said the largest

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Speaker 2: training partners, Well, the EU as a block is the

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Speaker 2: largest trading partner with the US. Germany's number one there.

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Speaker 2: If you don't think of that as a block, like

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Speaker 2: China's bigger, Mexico bigger than individual countries, not bigger than

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Speaker 2: the EU as a whole, but China, Mexico, Canada, Japan

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Speaker 2: and the UK are up there. Switzerland's another big one.

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Speaker 2: Think pharmaceuticals and then those second round effects. It is

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Speaker 2: countries like Australia that will lose out if global growth slows.

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Speaker 2: But I don't think we're going to be hit hard

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Speaker 2: as places like Canada, Mexico, EU, Germany. I think kars

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Speaker 2: the automobile tariffs, probably China. There's a bunch of Asian

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Speaker 2: countries like Indonesia, Thailand, Laos, Myanmar. They produce a lot

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Speaker 2: of goods selling into the US. They've got really high

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Speaker 2: tariffs as well, and their economies are probably more reliant

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Speaker 2: on US sales than many other economies, so I think

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Speaker 2: they'll be hit hard too. I think what we're realizing here, Adam,

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Speaker 2: this me carrying on so much. A lot of countries

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Speaker 2: is going to be hit really hard. But probably it's

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Speaker 2: kind of EU, Canada, Mexico, China, which are really the

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Speaker 2: big ones in terms of the numbers, but perhaps how

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Speaker 2: people live their life every day, and you know, there

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Speaker 2: to be a lot of workers in Thailand, in Indonesia,

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Speaker 2: in Southeast Asia generally, who are really going to be

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Speaker 2: affected by this.

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Speaker 1: Look without sort of wishing to complicate it furtherh on,

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Speaker 1: because we understand this is a movable feast. You know,

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Speaker 1: the actual tariff amounts still seem to be a work

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Speaker 1: in progress, and you have finished products, but then you

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Speaker 1: also have the inputs. For example, in America, there's sixty

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Speaker 1: times the number of steel workers in industries that are

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Speaker 1: associated with using that steel, and how the tariffs will

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Speaker 1: flow on to those other inputs. It's actually hard to

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Speaker 1: see how it will all play out over time.

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Speaker 2: Yeah, I mean, so if there's sixty other industries, the

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Speaker 2: idea is that the US steel industry will pick up

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Speaker 2: the slack, But they won't pick up the slack quickly.

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Speaker 2: There's going to be a downturn. You can't just turn

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Speaker 2: on a steel manufacturing plan and say off you go.

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Speaker 2: And so, yeah, what happens to those people in those

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Speaker 2: sixty industries. It's incredible hard I think.

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Speaker 1: Short answer from my point of view is it remains

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Speaker 1: to be seen.

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Speaker 2: Yeah, But I mean your point here, it's really who's

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Speaker 2: going to be hit hardest. Maybe it's the US that's

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Speaker 2: actually going to be hit hardest.

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Speaker 1: Well, it ends up hitting consumer prices, doesn't it.

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Speaker 2: Yeah, and you can have a major slow down, You

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Speaker 2: could have a recession in the US on the back

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Speaker 2: of this and a lot of those other countries. I mean,

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Speaker 2: it's harder for Canada and Mexico, but certainly the EU,

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Speaker 2: certainly Asian countries including China, will find alternate markets. We

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Speaker 2: know the EU at the moment is already talking to China,

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Speaker 2: to Canada and Japan. They will all be looking for

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Speaker 2: other markets. But the country that actually may in the

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Speaker 2: end suffer more than anyone else is the US itself.

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Speaker 1: Fascinating and fluctuating from my point of view.

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Speaker 2: Sean, fascinating and fluctuating. Very nice.

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Speaker 1: Thank you very much, Sean.

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Speaker 2: Thanks Adam.

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Speaker 1: If you have your own question for Fear and Greed,

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Speaker 1: jump onto the website Fearangreed dot com, dot au or

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Speaker 1: send it through any of the social media platforms. I'm

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Speaker 1: Adam Lang and this is asked Fear and Greed