WEBVTT - Bloomberg Surveillance TV: July 7th, 2025 0:00:02.400 --> 0:00:06.760 Bloomberg Audio Studios, Podcasts, radio News. 0:00:11.600 --> 0:00:15.440 This is the Bloomberg Surveillance Podcast. I'm Jonathan Ferrow, along 0:00:15.440 --> 0:00:18.680 with Lisa Bromwitz and Amrie Hordern. Join us each day 0:00:18.720 --> 0:00:22.239 for insight from the best in markets, economics, and geopolitics 0:00:22.400 --> 0:00:24.880 from our global headquarters in New York City. We are 0:00:24.920 --> 0:00:27.680 live on Bloomberg Television weekday mornings from six to nine 0:00:27.680 --> 0:00:31.280 am Eastern. Subscribe to the podcast on Apple, Spotify or 0:00:31.280 --> 0:00:33.919 anywhere else you listen, and as always on the Bloomberg 0:00:34.000 --> 0:00:37.760 Terminal and the Bloomberg Business App. Ben later Bradesco joins 0:00:37.800 --> 0:00:39.800 us now for more, Ben, Welcome to the program sir, 0:00:39.840 --> 0:00:41.440 it's been too long. Let's just get to sort of 0:00:41.440 --> 0:00:44.920 base case baseline expectations for the next several days. What 0:00:45.000 --> 0:00:47.000 are you and the team expected to see? 0:00:48.600 --> 0:00:51.560 Well, I'm hoping we see more of the same, right, 0:00:51.920 --> 0:00:55.600 I guess, continued on certainty, but actually no dramatic changes 0:00:56.120 --> 0:00:59.880 to this sort of backed off tariff scenario, you know, 0:01:00.000 --> 0:01:01.560 so this does see it feel a little bit like 0:01:01.840 --> 0:01:04.280 back to reality. Of course, it never went away. We 0:01:04.400 --> 0:01:07.960 just forgot about it for ninety days, and markets, you know, 0:01:08.080 --> 0:01:10.280 ripped off the back of that, and I think we're 0:01:10.280 --> 0:01:13.880 having a probably a predictable reset here. 0:01:14.200 --> 0:01:17.600 Ben, let's talk about how that reset might shape global markets. 0:01:17.680 --> 0:01:19.319 The bias at the stand of the year was to 0:01:19.319 --> 0:01:22.520 look to international assets and maybe leave the US behind. 0:01:22.560 --> 0:01:25.679 The US has snapped back so aggressively, so quickly, I 0:01:25.680 --> 0:01:27.800 think people are questioning that all over again. Where do 0:01:27.840 --> 0:01:28.880 you stand on the issue? 0:01:30.440 --> 0:01:32.120 Yeah, I sort of think the genie's out of the 0:01:32.160 --> 0:01:35.600 bottle on US exceptionalism. I'm not a bear on the US. 0:01:35.640 --> 0:01:37.600 I think the US is fine, but I am looking 0:01:37.640 --> 0:01:40.640 for much more average returns out of the US, these 0:01:40.640 --> 0:01:43.400 sort of typical ten percent levels, not the twice that 0:01:43.400 --> 0:01:45.160 that we've got used to in the last couple of years. 0:01:45.280 --> 0:01:46.920 And I think the rest of the world looks looks 0:01:46.920 --> 0:01:48.560 pretty good here. You still and most of the all 0:01:48.680 --> 0:01:51.600 have this sort of double equity in FX discount the 0:01:51.640 --> 0:01:55.880 week of dollars clearly helping. And I think some of 0:01:55.920 --> 0:01:59.520 these countries have real silver linings to a potential restart 0:01:59.520 --> 0:01:59.960 of this tower. 0:02:00.680 --> 0:02:02.160 Well, when it comes to the restar of the tariff 0:02:02.160 --> 0:02:04.320 for and you're looking at all these countries who you're 0:02:04.320 --> 0:02:07.320 most excited about. Everyone was very amped have been excited 0:02:07.360 --> 0:02:11.840 about Japan, but they've seemed to take in less of 0:02:11.840 --> 0:02:14.760 a priority with this administration than they did just thirty 0:02:14.800 --> 0:02:15.560 forty days ago. 0:02:17.120 --> 0:02:19.839 Look at Latin if you want to be excited. Cheapest market, 0:02:19.960 --> 0:02:21.959 cheapest markets in the world, best and fording markets in 0:02:22.000 --> 0:02:25.720 the world. This year, Mexico one of a tiny handful 0:02:25.760 --> 0:02:28.200 of company of countries that still have tariff free access 0:02:28.240 --> 0:02:31.480 to the US and places like Brazil, you know, low 0:02:31.520 --> 0:02:35.240 ten percent tariff, lots of commodity carveouts, and a market 0:02:35.280 --> 0:02:39.320 which would actually probably like more of a slowdown potentially 0:02:39.360 --> 0:02:41.240 coming in from coming in from the rest of the world. 0:02:41.280 --> 0:02:43.840 So there are you know, it's a big world. 0:02:43.840 --> 0:02:45.960 There are definitely markets out there that I think would 0:02:46.320 --> 0:02:48.640 you could have silver linings here. 0:02:49.120 --> 0:02:51.880 It's interesting you mentioned Brazil because the President was saying 0:02:51.919 --> 0:02:54.400 that any countries that align themselves with policies of the 0:02:54.480 --> 0:02:58.440 bricks could be charged an additional ten percent tariff. Brazil 0:02:58.840 --> 0:03:01.840 is the host country for this week's Brick Summit. Do 0:03:01.919 --> 0:03:04.000 you think Trump is more embolded now is a question 0:03:04.080 --> 0:03:07.040 Jonathan's been asking all morning, given the fact that he 0:03:07.160 --> 0:03:10.000 has had the markets at an all time high and he. 0:03:10.080 --> 0:03:11.600 Just passes one big, beautiful bill. 0:03:13.800 --> 0:03:14.880 We're going to find out that. 0:03:14.919 --> 0:03:17.080 I guess that's the one thing I know with some certainty. 0:03:17.200 --> 0:03:20.120 But yes, the Trump put is definitely not as strong 0:03:20.160 --> 0:03:22.359 now as it was, you know, when we were down 0:03:22.360 --> 0:03:24.800 in the whole, you know, twenty percent, you know, plus ago. 0:03:26.080 --> 0:03:28.000 You know, I would like to feel it's still in place. 0:03:28.120 --> 0:03:30.400 I would like to feel, you know, Trump feels he's 0:03:30.440 --> 0:03:32.320 in a better place. Does he really need to go 0:03:32.440 --> 0:03:37.400 through that all again, introduce that level of policy uncertainty. 0:03:37.680 --> 0:03:40.960 There's even greater drags on us growth. You know, I 0:03:41.000 --> 0:03:44.120 would hope, you know, cooler heads prevailed, but who knows. 0:03:44.120 --> 0:03:46.080 You know, we still have ninety percent of this administration 0:03:46.160 --> 0:03:46.360 to go. 0:03:46.800 --> 0:03:48.920 Ben, Investors feel like they're in a much better place 0:03:49.200 --> 0:03:52.320 compared to where there were a few months ago. Are companies? 0:03:52.600 --> 0:03:55.120 What are corporations doing now? Ben? And a question we 0:03:55.160 --> 0:03:57.920 asked on the previous hour. Have we established how these 0:03:57.960 --> 0:04:00.720 tariffs will be handled? Will it be passed or they 0:04:00.720 --> 0:04:01.880 have to eait it on margin? 0:04:03.560 --> 0:04:05.800 Listen, I think companies are just like the rest of us, right. 0:04:05.840 --> 0:04:08.600 I think this level of uncertainty, even though it may 0:04:08.640 --> 0:04:12.920 have come down a bit, is absolutely corrosive to decision making, 0:04:13.040 --> 0:04:16.640 to confidence, and I think everything else being equal. That 0:04:16.680 --> 0:04:19.920 means that you are hiring less people, you are doing 0:04:20.000 --> 0:04:23.760 less capex. And your question on tariffs, I think companies 0:04:23.760 --> 0:04:26.040 have shown us and the margins are there to prove it. 0:04:26.400 --> 0:04:28.680 They will pass this on. They will pull that pricing 0:04:28.760 --> 0:04:30.000 lever at every opportunity. 0:04:30.120 --> 0:04:32.840 Then which economy, which center consumers do you think is 0:04:32.880 --> 0:04:35.200 in a better position to absorb that hit. 0:04:37.360 --> 0:04:39.599 Well's the US consumer is going to take most of this, right, 0:04:39.680 --> 0:04:43.960 So the US consumer is in reasonably good shape. But 0:04:44.200 --> 0:04:46.000 you know, at the margin, this is all this is 0:04:46.040 --> 0:04:49.920 all slowing, right, So I'm not sure that the US 0:04:50.040 --> 0:04:51.400 is in the eye of the storm here. I think 0:04:51.400 --> 0:04:53.240 the rest of the world, you know, whether it's on 0:04:53.279 --> 0:04:56.400 the economy side with fiscal stimulus in places like Germany 0:04:56.440 --> 0:04:59.000 and China, whether it's on the market side with these 0:04:59.040 --> 0:05:02.599 double discounts on the on the equity market and the FX. 0:05:02.880 --> 0:05:05.920 I think international assets and this global rotation has further 0:05:05.960 --> 0:05:06.120 to go. 0:05:06.760 --> 0:05:08.880 Ben, I'd love to get your thoughts on China because 0:05:08.920 --> 0:05:11.160 that is something that the President is still working on, 0:05:11.200 --> 0:05:14.159 more of a bigger grand bargain deal he talks about. 0:05:14.360 --> 0:05:16.279 At the same time, they have a framework when it 0:05:16.320 --> 0:05:19.840 comes to export controls and critical minerals. 0:05:19.880 --> 0:05:21.640 Do you think China is investible. 0:05:23.480 --> 0:05:27.599 I think it's definitely investable. We are seeing very strong 0:05:27.640 --> 0:05:30.400 inflows into into Chinese assets. I was just looking at 0:05:30.400 --> 0:05:33.320 the numbers this morning from the from the US ETFs 0:05:33.560 --> 0:05:36.080 was like five hundred million last week into China five 0:05:36.120 --> 0:05:38.520 hundred million you know the week before. So absolutely the 0:05:38.560 --> 0:05:41.120 money's going in. This is a very cheap market. I 0:05:41.120 --> 0:05:43.160 think people are betting there's a deal to be done 0:05:43.760 --> 0:05:47.880 and there's a there's enough flexibility on the Chinese side too. 0:05:47.960 --> 0:05:50.800 They want to deal and they have a policy stimulus 0:05:50.839 --> 0:05:53.679 to maybe offset some of the costs to the tariffs 0:05:53.680 --> 0:05:54.480 that having to eat right. 0:05:54.480 --> 0:05:56.600 Now, Hi Ben, I appreciate your time, as always been. 0:05:56.720 --> 0:06:08.640 Later there a Pridesco. It's the type from Dan Eys 0:06:08.680 --> 0:06:11.680 of Wentbush Rights in the following must diving deeper into 0:06:11.760 --> 0:06:15.720 politics is exactly the opposite direction. The Tesla investors and 0:06:15.760 --> 0:06:18.320 shadholders want him to take dan Jo and to surround 0:06:18.360 --> 0:06:20.200 the type with Danka monic great to be. How much 0:06:20.200 --> 0:06:20.919 of a problem is this. 0:06:21.320 --> 0:06:22.280 It's a huge problem. 0:06:22.320 --> 0:06:24.480 I mean, it's what we've been talking about and you're 0:06:24.520 --> 0:06:27.320 hearing the show, you know for months that you went 0:06:27.520 --> 0:06:32.880 from Trumdministration Dige BFFs. Obviously there was a huge moment 0:06:32.920 --> 0:06:35.080 you had to step back from politics, and now that's 0:06:35.120 --> 0:06:37.720 exactly what investors want to see. And now you poke 0:06:37.800 --> 0:06:40.800 the bar in terms of Trump and now you're former 0:06:40.839 --> 0:06:44.920 em political party. So the point is, I believe you've 0:06:44.960 --> 0:06:48.040 now hit a point. I think the board's going to 0:06:48.160 --> 0:06:51.160 have to get involved because this is now over. I 0:06:51.200 --> 0:06:53.800 think there's a line in the sand that he's now 0:06:53.920 --> 0:06:56.840 starting across. And that's the frustration that someone that's a 0:06:56.920 --> 0:07:00.560 huge supporter of Tesla Autonomous, the Golden Age ahead, you 0:07:00.640 --> 0:07:02.640 cannot kind of go down this path. 0:07:02.680 --> 0:07:04.120 And I think that's why the stocks reacting. 0:07:04.200 --> 0:07:06.960 Let's some pack that volt himselfman describe what that might 0:07:07.000 --> 0:07:07.400 look like. 0:07:08.000 --> 0:07:10.600 Look, I wouldn't say it's necessarily an ultimatum, but you know, 0:07:10.680 --> 0:07:14.080 you cannot keep going down this path where you know. 0:07:14.920 --> 0:07:16.840 To start a political party ahead. 0:07:16.560 --> 0:07:18.840 Of the midterms, I mean the amount of work time 0:07:19.320 --> 0:07:23.160 and also you alienate potentially whether it's Republican Party, whether 0:07:23.200 --> 0:07:26.000 it's Trump. So now Trump goes from obviously a huge 0:07:26.040 --> 0:07:29.400 supporter to is that sort of an enemy or blockade, 0:07:29.400 --> 0:07:31.680 And I think that's why the stocks reacting the way 0:07:31.720 --> 0:07:33.440 it is because the last thing you want to see 0:07:33.480 --> 0:07:38.560 at this point autonomous regulatory that now must goes from 0:07:38.600 --> 0:07:41.480 front seat in the White House to ultimately you become 0:07:41.520 --> 0:07:42.320 more of a foe. 0:07:42.480 --> 0:07:44.920 When you say ultimatum, you mean the board saying to him, 0:07:45.000 --> 0:07:47.840 if you continue this behavior, you can no longer be CEO. 0:07:48.080 --> 0:07:50.160 Look, I think the board's gonna there. 0:07:50.200 --> 0:07:52.000 It's a tricky path right for the board, and this 0:07:52.120 --> 0:07:54.400 is not a board that this has had such a 0:07:54.480 --> 0:07:55.800 you know, a huge. 0:07:55.560 --> 0:07:59.640 Backbone when it comes to Musk. But I do think, look, investors, 0:08:00.040 --> 0:08:00.880 there's exhaustion. 0:08:01.200 --> 0:08:02.640 Do you want to see a new CEO book. 0:08:02.800 --> 0:08:06.200 I want Musk to stay CEO as Tesla because in 0:08:06.240 --> 0:08:09.400 my view, Musk is Tesla, Tesla as Musk the biggest 0:08:09.400 --> 0:08:10.280 asset of Tesla. 0:08:10.680 --> 0:08:13.000 But this political. 0:08:12.520 --> 0:08:15.160 Journey that he continues to go through, I think he 0:08:15.320 --> 0:08:18.480 just comes down to Investors have hit a point where 0:08:18.880 --> 0:08:22.040 they want him focused on Tesla and AI, and every 0:08:22.120 --> 0:08:25.280 time that happens, he just continues. 0:08:24.720 --> 0:08:26.760 To go further and further into the political theater. 0:08:26.880 --> 0:08:29.000 He might not be just burning bridges in the Beltway. 0:08:29.040 --> 0:08:30.440 I want to read you this quote from the Wall 0:08:30.440 --> 0:08:33.160 Street Journal reporting overnight because of the Musk Trump feud, 0:08:33.200 --> 0:08:36.600 Beijing no longer views the Tesla CEO as a geopolitical asset, 0:08:36.679 --> 0:08:39.320 will shy away from publicly courting him, so he canna 0:08:39.320 --> 0:08:42.560 have problems outside of the United States as well because 0:08:42.600 --> 0:08:45.520 of his political involvement in the United States. 0:08:45.600 --> 0:08:47.280 Look, it goes back to like, if you just take 0:08:47.320 --> 0:08:49.680 a step back here, it's like, let's try in a 0:08:49.760 --> 0:08:54.600 way to almost alienate every aspect of the ecosystem, right 0:08:54.600 --> 0:08:57.240 in terms of the core buyer to now maybe even 0:08:57.280 --> 0:09:00.000 Republicans to what you're seeing in China. 0:09:00.080 --> 0:09:01.840 And that's the hearts and lungs of Taska. 0:09:02.000 --> 0:09:05.400 I continued, we must is an asset there and it 0:09:05.520 --> 0:09:08.600 will play that sort of nice in the sandbox, but 0:09:08.679 --> 0:09:13.120 it does show you become an enemy or a food 0:09:13.240 --> 0:09:16.520 to Trump. What does that do in the political and 0:09:16.600 --> 0:09:18.640 obviously the geopolitical. 0:09:17.920 --> 0:09:20.400 And I think that's part. Look, that's that's. 0:09:20.280 --> 0:09:23.439 Part of the you know, the issue here is that 0:09:23.600 --> 0:09:28.040 you start to go into a quicksand situation where I 0:09:28.080 --> 0:09:31.840 think in the view of investors there's really no upside 0:09:31.960 --> 0:09:33.760 and you can say, okay, if you get mid terms 0:09:33.760 --> 0:09:35.840 and you have some success and he has political power, 0:09:35.840 --> 0:09:39.640 but that's independence of their ad really success in the US, but. 0:09:39.920 --> 0:09:43.200 It's massive risk. That's where the stock's selling off to 0:09:43.200 --> 0:09:43.560 where it is. 0:09:43.679 --> 0:09:46.360 The ANIX community is not exactly build up on the stock. 0:09:46.400 --> 0:09:48.720 It's actually very divided. And if you take the twelve 0:09:48.720 --> 0:09:51.840 month consensus price target, the average is about two ninety 0:09:51.880 --> 0:09:55.359 eight right now, and that's below where we closed on Satursday. 0:09:55.520 --> 0:09:58.440 How well understood are these risks they manifest and evolve 0:09:58.480 --> 0:09:59.080 over the weekend. 0:09:59.400 --> 0:10:02.720 Well, I think the risk now they continue to expand, 0:10:02.760 --> 0:10:04.680 and I think that's part of the issues that Okay 0:10:04.800 --> 0:10:06.400 for here it did you go back to a few 0:10:06.400 --> 0:10:09.480 weeks ago road attacks, the autonomous you know, must one 0:10:09.559 --> 0:10:12.920 hundred percent committed. Now it's like, hey, over the weekend, 0:10:12.960 --> 0:10:15.800 while you know, hot dog and doing a July fourth barbecue. 0:10:16.000 --> 0:10:19.040 Hey let's start a political party. Yeah it's a good idea. 0:10:19.080 --> 0:10:20.000 Yeah we're going to do that. 0:10:20.240 --> 0:10:23.840 So that's as an investor, it's the last thing you 0:10:23.920 --> 0:10:25.600 and I heard over the weekend. The last thing you 0:10:25.600 --> 0:10:27.120 want to see is him going on the spat. But 0:10:27.160 --> 0:10:30.400 I think the bigger worry is as he goes further 0:10:30.480 --> 0:10:34.199 and further down the path from from a Tesla perspective, 0:10:34.840 --> 0:10:38.840 does that maybe add risk in terms of Trump becoming 0:10:38.960 --> 0:10:43.160 more of a blockade rather around autonomous. 0:10:42.600 --> 0:10:44.360 And around some of the just describe what that means. 0:10:44.360 --> 0:10:45.040 What do you mean by that? 0:10:45.120 --> 0:10:45.640 What could he take? 0:10:45.800 --> 0:10:48.200 A big thing is around the federal roadmap in terms 0:10:48.240 --> 0:10:51.280 of autonomous. I mean, now, this is a key few 0:10:51.320 --> 0:10:54.440 years ahead for Tesla going not just from Austin, but 0:10:54.480 --> 0:10:57.280 twenty five cities over next year. If you start to 0:10:57.320 --> 0:11:01.000 put more blockades in terms of things that they need 0:11:01.040 --> 0:11:03.360 to meet in order to get on the road, if 0:11:03.400 --> 0:11:06.319 instead of more of a green light, it's a little 0:11:06.320 --> 0:11:07.439 more of a yellow red. 0:11:07.320 --> 0:11:10.280 Light, that's the word. That's what the stock's selling off. 0:11:10.679 --> 0:11:14.760 It's the fear that over the next six, twelve, eighteen 0:11:14.800 --> 0:11:18.840 months Trump starts to put little blockades in that. 0:11:19.080 --> 0:11:22.120 But even today the president is looking out for America's interest. 0:11:22.200 --> 0:11:24.600 If he just does that, it might hurt Elon Muss 0:11:24.640 --> 0:11:26.839 but also might hurt the United States when it comes 0:11:26.920 --> 0:11:28.160 to competition with China. 0:11:28.360 --> 0:11:31.400 And that's why we've said the biggest asset when it 0:11:31.440 --> 0:11:35.240 comes to autonomous is Tasa because when you think Willima's 0:11:35.440 --> 0:11:38.040 not going to scale at any level relative to Tessa. 0:11:38.240 --> 0:11:42.240 So when you're competing with China, Tesla and Musk is 0:11:42.280 --> 0:11:43.920 an accid no different than Jensen. 0:11:43.960 --> 0:11:47.439 That's why. Look, the hope is, at one point, is there. 0:11:47.360 --> 0:11:51.720 Some sort of meeting between Musk Trump? Can they sort 0:11:51.760 --> 0:11:54.840 of get to some resolution. The problem is every week 0:11:54.880 --> 0:11:57.840 he gets further and further, and this is not what 0:11:57.880 --> 0:11:59.960 you want to see. Just the amount of the content 0:12:00.120 --> 0:12:03.440 to every other tech company, from the Della, from Jents 0:12:03.520 --> 0:12:06.360 and from open Ai, from a Oracle and all down 0:12:06.360 --> 0:12:07.800 the AI path you don't want to see. 0:12:07.880 --> 0:12:09.360 Must now going down the Portico path. 0:12:09.440 --> 0:12:11.199 How much time does he have? You've got a pricetocket 0:12:11.240 --> 0:12:13.640 of five hundred in a pre market right now for 0:12:13.760 --> 0:12:15.480 at two ninety four. How much time does he have 0:12:15.520 --> 0:12:16.199 to back away from that? 0:12:16.280 --> 0:12:18.160 I mean, I think you basically have what I view 0:12:18.280 --> 0:12:20.800 is kind of like ninety days three months. I mean, 0:12:20.840 --> 0:12:22.800 I think there's a ninety days sort of I can 0:12:22.840 --> 0:12:25.600 see like some sort of ultimatum where if he continues 0:12:25.640 --> 0:12:27.560 to go on the path no different than how we 0:12:27.640 --> 0:12:30.640 view with Duge and Trump, or he's on that conference call. 0:12:30.520 --> 0:12:31.480 I had to back off. 0:12:32.400 --> 0:12:34.800 This is this is a I would just have to 0:12:34.840 --> 0:12:35.800 say a moment of truth. 0:12:35.840 --> 0:12:38.040 But this is a time now for Musk. 0:12:38.720 --> 0:12:42.400 He needs to choose and you can't keep having these 0:12:42.480 --> 0:12:44.880 one step forward, two steps back, one step forward, two 0:12:44.920 --> 0:12:48.200 steps back. And that's why the exhaustion is starting to 0:12:48.280 --> 0:12:50.040 play out in Tesla stock. 0:12:49.840 --> 0:12:53.199 Then West, It's going to say, certainly exhisted by a 0:12:53.200 --> 0:12:54.800 lot of this. The stuck is down by close to 0:12:54.840 --> 0:13:06.840 seven percent in the pre market. Let's turned back to 0:13:06.880 --> 0:13:10.240 Trade Treasury Secretary Scale Besson saying that some trade partners 0:13:10.280 --> 0:13:14.240 tariff rates will boomerang back to Liberation Day levels. Joining 0:13:14.320 --> 0:13:17.080 us now to discusses Kate Kalukowitz, the former White House 0:13:17.120 --> 0:13:20.959 trade official and former senior USTR trade negotiator. Kate, Welcome 0:13:21.000 --> 0:13:22.840 to the program. Is this the beginning of the end 0:13:22.960 --> 0:13:24.560 or just the end of the beginning? 0:13:26.040 --> 0:13:28.480 Well, I think this is President Trump at his best, 0:13:28.840 --> 0:13:32.240 when he's bringing the pressure and supporting his negotiators. I 0:13:32.280 --> 0:13:35.280 think this is his favorite time of the negotiations, when 0:13:35.280 --> 0:13:38.480 he can be extremely maximalist. And I think as a 0:13:38.559 --> 0:13:40.920 trade negotiator, it helps to have a leader like that 0:13:41.200 --> 0:13:44.120 pushing for the end, pushing for the negotiations to get 0:13:44.160 --> 0:13:47.319 over the finish line, and providing that sort of threat 0:13:47.480 --> 0:13:50.720 that helps his team actually tell their counterparts he's serious. 0:13:51.360 --> 0:13:54.079 Kate, what determines whether you get a UK outcome, a 0:13:54.240 --> 0:13:57.400 Viennam outcome, a China outcome, or something much worse. 0:13:58.720 --> 0:14:01.320 Well, you know, I actually think that's quite an important question, 0:14:01.480 --> 0:14:03.920 and the Vietnam deal sort of shows that there are 0:14:04.000 --> 0:14:06.960 two different trajectories here. Let's set China to the side 0:14:07.000 --> 0:14:09.680 for now, because I think that's a separate type of negotiation. 0:14:10.320 --> 0:14:12.280 But you have a UK outcome and you have a 0:14:12.400 --> 0:14:15.160 Vietnam outcome. And I think for the list of countries 0:14:15.280 --> 0:14:19.320 with which the United States is actively negotiating, you see 0:14:19.360 --> 0:14:22.800 two different pathways here. One for the more developed economies, 0:14:22.920 --> 0:14:26.800 probably looking for something like the UK god and those 0:14:26.920 --> 0:14:31.360 more export heavy economies that receive those very high tariff rates. 0:14:31.480 --> 0:14:34.840 Maybe the Vietnam deal reflects what the Trump administration is 0:14:35.240 --> 0:14:36.040 putting on the table. 0:14:36.440 --> 0:14:40.120 Is a Vietnam deal actually done though, Well. 0:14:40.720 --> 0:14:43.080 Back to our end of the beginning, You're right, Anne, Marie. 0:14:43.160 --> 0:14:46.920 These are framework agreements, and I think you described it perfectly. 0:14:47.040 --> 0:14:51.480 The truth announcing the Vietnam deal was I think quite gleeful. 0:14:51.880 --> 0:14:55.360 The Vietnamese, of course later in times said we still 0:14:55.400 --> 0:14:57.560 have a lot of things to work out here. But 0:14:58.040 --> 0:15:01.520 let's make no mistake, this is a re really important outcome. 0:15:01.680 --> 0:15:04.800 The Vietnamese, of course, were on the hook for very 0:15:04.920 --> 0:15:08.440 high tariffs. They've been the recipient of the ire of 0:15:08.520 --> 0:15:11.440 the Trump administration, going back to the first time around, 0:15:11.480 --> 0:15:15.400 the increasing trade deficit, particularly as it relates to China. 0:15:16.080 --> 0:15:18.960 The longer term play for the Vietnamese, however, is going 0:15:19.000 --> 0:15:22.680 to be how it manages this very very challenging place 0:15:22.760 --> 0:15:25.880 they find themselves between China and the United States. And 0:15:26.000 --> 0:15:28.600 these will be the details on the transhipment that they're 0:15:28.600 --> 0:15:29.520 going to have to work out. 0:15:29.840 --> 0:15:32.120 When you look at what's coming up this week, the 0:15:32.160 --> 0:15:34.200 President says at noon he's going to be sending tariff 0:15:34.320 --> 0:15:37.280 letters out. You have the European Union, the Commission talking 0:15:37.280 --> 0:15:38.840 about the fact that the President got on the phone 0:15:38.880 --> 0:15:41.000 with Ursula Vonderline. They're looking to get some sort of 0:15:41.080 --> 0:15:45.360 framework before July ninth. What buckets are different countries. 0:15:44.960 --> 0:15:49.360 In Well, I mean, I think you've seen the President 0:15:49.360 --> 0:15:52.880 and his surrogates talk about this smaller set of nations 0:15:53.000 --> 0:15:56.040 or economies which are much further along. I think the 0:15:56.120 --> 0:15:58.840 President had been quite hopeful last week Vietnam would be 0:15:58.880 --> 0:16:01.040 the first of several and now Smith's that day and 0:16:01.120 --> 0:16:05.280 you've seen him signal that talks with India quite forward, 0:16:05.360 --> 0:16:08.680 that talks with the EU are quite forward. Obviously he's 0:16:08.720 --> 0:16:11.360 been a little frustrated with where things are with Japan. 0:16:11.920 --> 0:16:14.760 But I think these are the countries that we can 0:16:14.920 --> 0:16:18.080 expect some outcomes this week if negotiators can get a 0:16:18.120 --> 0:16:20.280 few of these wrinkles, you know, ironed out. 0:16:20.560 --> 0:16:22.560 These are also the same countries though that given the 0:16:22.600 --> 0:16:25.840 fact that they are in these deep talks, will get extensions. 0:16:26.000 --> 0:16:29.000 And is that what you think Commerce Secretary Howard Lutnik 0:16:29.160 --> 0:16:32.359 was talking about when we talked about April for August first. 0:16:33.320 --> 0:16:36.440 Well, again, I think the President is trying to signal 0:16:36.520 --> 0:16:39.280 to these countries that they need to stop delaying. You know, 0:16:39.480 --> 0:16:42.080 he had hoped to have these deals ready last week. 0:16:42.560 --> 0:16:45.800 I think this new notion of letters going out is 0:16:45.880 --> 0:16:49.480 really his way of ratcheting up pressure. Typically when we 0:16:49.560 --> 0:16:51.760 see tariffs go into place, there is somewhat of a 0:16:51.880 --> 0:16:54.360 delay to allow importers some time to adjust. 0:16:54.560 --> 0:16:57.720 So I think we'll still have to see exactly. 0:16:57.400 --> 0:16:59.880 When things are implemented. But I really do see this 0:17:00.160 --> 0:17:03.240 more as the President trying to ratchet up leverage. 0:17:03.560 --> 0:17:05.680 How surprised are you they're given the fact that you 0:17:05.760 --> 0:17:09.119 were a trade negotiator under Trump, that Japan and the 0:17:09.160 --> 0:17:11.880 European Union have basically swapped fates. 0:17:13.040 --> 0:17:16.240 Well Japan is quite interesting because I think the President 0:17:16.520 --> 0:17:19.640 was surprised when he got the Knee Pond steel deal 0:17:19.720 --> 0:17:22.680 across the finish line. He probably suspected that would be 0:17:22.800 --> 0:17:26.600 sufficient to wrap things up. Of course, the Japanese really 0:17:26.680 --> 0:17:30.360 want to see an outcome on cars, and the President 0:17:30.440 --> 0:17:32.119 does not seem inclined to deliver that. 0:17:32.680 --> 0:17:32.800 Then. 0:17:32.880 --> 0:17:35.560 Of course, you know, when you're negotiating with democracies, this 0:17:35.720 --> 0:17:38.800 is always the challenge. Japan has an election coming up, 0:17:38.920 --> 0:17:42.879 which constrains its negotiators, so you know, it is quite 0:17:42.960 --> 0:17:45.280 shocking I think that we've ended up in this place, 0:17:45.400 --> 0:17:48.119 but this is part of being a trade negotiator with 0:17:48.560 --> 0:17:52.320 governments which have to be responsive to their own domestic constituencies. 0:17:53.000 --> 0:17:56.240 Europe I think will get across the finish line so 0:17:56.359 --> 0:17:59.280 long as we continue to have these leader level discussions, 0:17:59.640 --> 0:18:02.920 as we've discussed before. You know, the European Union is 0:18:03.000 --> 0:18:06.879 a very challenging negotiating partner because it does represent twenty 0:18:06.960 --> 0:18:11.160 seven different countries, and so if you don't get right 0:18:11.240 --> 0:18:13.080 to the leader level, you don't get right to these 0:18:13.160 --> 0:18:14.280 big commercial deals. 0:18:14.359 --> 0:18:15.600 It's very challenging. 0:18:16.440 --> 0:18:20.200 So if President vonder Land and President Trump maintain this dialogue, 0:18:20.200 --> 0:18:21.719 I think we can get that one finished. 0:18:21.920 --> 0:18:25.080 I Kate, appreciate your view. Kate Kalukowitz there joining us 0:18:25.119 --> 0:18:27.560 on the latest trade push down in Washington, d C. 0:18:37.840 --> 0:18:40.040 We begin this hour with stocks pulling back from all 0:18:40.119 --> 0:18:43.440 time highs as President Donald Trump reignites trade concerns. Kadi 0:18:43.480 --> 0:18:46.840 Kaminskive out for simplex writing, Equity trend signals are still 0:18:46.920 --> 0:18:50.640 modestly strong given the volatility and uncertainty in recent months. 0:18:50.720 --> 0:18:52.600 Candy joins us now for more. Can you welcome to 0:18:52.680 --> 0:18:55.800 the program, and good morning. It feels like sentiment is 0:18:55.880 --> 0:18:58.399 quite one sided now after the massive reversal over the 0:18:58.480 --> 0:19:00.680 last several months or so. Yet will still come on 0:19:00.720 --> 0:19:03.400 the program and say the pin tride is higher equities 0:19:03.440 --> 0:19:04.639 from here? Do you agree? 0:19:05.920 --> 0:19:07.919 I would have to agree that that's what we're seeing, 0:19:08.119 --> 0:19:11.280 especially in the market data. What was interesting, though, is 0:19:11.359 --> 0:19:13.520 we did see a little bit of a pivot last 0:19:13.600 --> 0:19:17.560 week where you saw small caps and perhaps more domestic. 0:19:17.200 --> 0:19:19.879 Focus being in ahead. 0:19:20.359 --> 0:19:22.560 And so I'd say that, you know, the general theme 0:19:22.680 --> 0:19:25.879 has continually been a little bit more pro growth and 0:19:26.040 --> 0:19:28.879 positive for equities, which is something I wouldn't have guessed 0:19:28.880 --> 0:19:29.680 a few weeks ago. 0:19:30.080 --> 0:19:32.600 In particular, Okay, you're seeing that inequities, Can you say 0:19:32.600 --> 0:19:34.679