WEBVTT - Trump Tariffs Send Stocks Lower; Amazon Falls & Apple Gains on Earning 0:00:02.560 --> 0:00:07.080 Bloomberg Audio Studios, Podcasts, Radio News. 0:00:10.039 --> 0:00:13.200 Good morning, I'm Nathan Hager and I'm Karen Moscow. Here 0:00:13.240 --> 0:00:14.960 are the stories we're following today. 0:00:15.200 --> 0:00:18.400 Karen, Yeah, futures are following this morning after President Donald 0:00:18.400 --> 0:00:21.760 Trump unleashed his final round of tariff announcements on countries 0:00:21.840 --> 0:00:25.799 around the world hours before his August first deadline. The 0:00:25.840 --> 0:00:29.479 President slapped thirty five percent tariffs on Canadian goods not 0:00:29.600 --> 0:00:33.560 covered under the US Mexico Canada trade agreement. Switzerland's products 0:00:33.600 --> 0:00:36.480 were hit with a thirty nine percent rate, and Taiwan's 0:00:36.520 --> 0:00:39.640 exports are facing a twenty percent duty, though that country 0:00:39.680 --> 0:00:42.559 says it expects to keep negotiating. We get more from 0:00:42.600 --> 0:00:45.120 Bloomberg News Global Trade editor Brendan Murray. 0:00:45.400 --> 0:00:48.159 The bottom line here is that the average US tariff 0:00:48.200 --> 0:00:51.000 rate is going from about two and a half percent 0:00:51.440 --> 0:00:55.440 before Trump was sworn in in January to around fifteen 0:00:55.480 --> 0:01:00.360 percent according to Bloomberg Economics. And that's, in any economist book, 0:01:00.800 --> 0:01:04.080 a difficult thing for an economy to absorb. So I 0:01:04.080 --> 0:01:07.279 think we'll see some more talks going on in the weeks. 0:01:07.319 --> 0:01:08.880 In the days and weeks ahead. 0:01:08.600 --> 0:01:11.759 Bloomberg's Brenton Murray says most countries are facing a baseline 0:01:11.800 --> 0:01:14.640 ten percent rate, while roughly forty nations are jumping to 0:01:14.680 --> 0:01:18.720 fifteen percent. The new tariffs won't take effect until August seventh, 0:01:18.840 --> 0:01:21.720 to give US Customs and Border Protection time to prepare. 0:01:22.040 --> 0:01:25.280 Former US trade negotiator Steven Olsen says that could add 0:01:25.319 --> 0:01:26.440 to market uncertainty. 0:01:26.680 --> 0:01:29.200 We do have a week to go, and this is 0:01:29.440 --> 0:01:34.160 a man who thrives on chaos and unpredictability and sometimes 0:01:34.160 --> 0:01:37.800 seems to be running his trade policy like a reality 0:01:37.920 --> 0:01:42.480 TV show. So until these tariffs actually go into effect 0:01:42.520 --> 0:01:45.520 on August seventh, let's sit back and see what happens. 0:01:45.640 --> 0:01:48.920 Former trade negotiator Steven Olsen says President Trump has embraced 0:01:48.960 --> 0:01:51.960 tariffs for decades, so these moves should not come as 0:01:52.000 --> 0:01:53.040 a surprise. 0:01:53.000 --> 0:01:53.360 Well, Nathan. 0:01:53.440 --> 0:01:57.120 President Trump is also escalating his campaign to pressure pharmaceutical 0:01:57.160 --> 0:02:00.400 companies to lower drug prices, and Bloomberg's John Tucker joins 0:02:00.480 --> 0:02:02.400 us with the very latest John, good morning. 0:02:02.200 --> 0:02:06.320 And good morning Karen. In letters send to Eli, Lilly, Novo, Nordis, Pfizer, 0:02:06.440 --> 0:02:09.960 and others, Trump insisted the companies immediately lower what they 0:02:10.040 --> 0:02:13.240 charge Medicaid for existing drugs. He also asked them to 0:02:13.320 --> 0:02:16.840 guarantee that future medicines be launched and remain at prices 0:02:16.919 --> 0:02:20.360 on par with what they cost overseas. He gave the 0:02:20.400 --> 0:02:24.040 world's seventeen largest drug makers sixty days to comply. If 0:02:24.040 --> 0:02:27.480 they don't, he writes, his administration will quote deploy every 0:02:27.520 --> 0:02:31.600 tool in our arsenal to protect American families. The pharmaceutical 0:02:31.600 --> 0:02:34.560 industry has long protested the idea of globally linked drug 0:02:34.600 --> 0:02:37.600 prices as a threat to years of US dominance in 0:02:37.680 --> 0:02:42.040 biomedical research. They've urged the administration instead to turn its 0:02:42.040 --> 0:02:45.480 attention to the middle men in the supply chain. Right now, 0:02:45.520 --> 0:02:48.880 in European trading, shares of Novo nordis down another four 0:02:48.919 --> 0:02:52.760 point eight percent. That company loses its spot among Europe's 0:02:52.840 --> 0:02:56.760 ten most valuable companies. Peiser pre market is down six 0:02:56.880 --> 0:03:00.280 tenths of a percentw Yor Income John Tucker Bloomberg. 0:03:00.560 --> 0:03:03.120 Okay, John, thank you. Earnings are also very much in 0:03:03.200 --> 0:03:05.800 focus this morning. We're watching shares of Amazon. They are 0:03:05.840 --> 0:03:08.840 down more than eight percent pre market. The online retail 0:03:08.880 --> 0:03:12.440 giants projecting weaker than expected operating income and is trailing 0:03:12.480 --> 0:03:15.720 the sales growth of its cloud rivals. That has investors 0:03:15.760 --> 0:03:20.080 questioning whether Amazon's huge investments and artificial intelligence are paying off. 0:03:20.320 --> 0:03:23.480 Anarag Rana is a senior tech analyst at Bloomberg Intelligence. 0:03:23.880 --> 0:03:27.600 Do you see you know, they met expectations on Aw's 0:03:27.639 --> 0:03:31.160 growth of seventeen percent in constant currency. But you know, 0:03:31.240 --> 0:03:33.400 this is where we are saying that this is probably 0:03:33.440 --> 0:03:36.560 not good enough because Microsoft beat by a big number. 0:03:36.720 --> 0:03:39.040 Google beat by a big number, and the big question 0:03:39.120 --> 0:03:41.480 is going to be, you know, why didn't Amazon beat 0:03:41.520 --> 0:03:42.400 by a big number? 0:03:42.840 --> 0:03:46.080 Bloomberg Intelligence is on arag Rana says Amazon spenter record 0:03:46.160 --> 0:03:49.440 thirty one point four billion dollars on capital expenditures in 0:03:49.480 --> 0:03:51.880 the quarter. That was up about ninety percent from the 0:03:51.880 --> 0:03:53.280 same period a year earlier. 0:03:53.920 --> 0:03:56.240 On the flip side, Nathan shares of Apple are at 0:03:56.280 --> 0:03:58.840 more than one and a half percent. The iPhone maker 0:03:58.880 --> 0:04:01.520 posted as fast as corely revenue growth in more than 0:04:01.600 --> 0:04:04.560 three years. Strong iPhone sales and a rebound in Shana 0:04:04.960 --> 0:04:07.520 helped beat estimates despite a projected tariff hit. 0:04:07.880 --> 0:04:09.800 Mark German covers Apple for Bloomberg. 0:04:10.040 --> 0:04:12.360 There are people who still have iPhones that are several 0:04:12.440 --> 0:04:16.240 years old, four to six even older years of iPhone right, 0:04:16.279 --> 0:04:19.279 There's people on Android, there's people new to the smartphone market, 0:04:19.560 --> 0:04:24.200 and clearly the impact of tariffs didn't have a negative. 0:04:24.480 --> 0:04:25.239 Impact on Apple. 0:04:25.279 --> 0:04:28.440 It had a positive impact on Apple. That's because a 0:04:28.480 --> 0:04:31.240 lot of people were anticipating major price hikes to the 0:04:31.279 --> 0:04:34.080 iPhone and they flooded Apple retail stores. 0:04:34.400 --> 0:04:37.760 Bloomer's Mark German says Apple predicted that fourth quarter revenue 0:04:37.800 --> 0:04:39.680 would be up by a percentage in the mid to 0:04:39.760 --> 0:04:42.720 high single digits. CEO Tim Cook also says the company 0:04:42.760 --> 0:04:45.040 is helping investment in artificial intelligence. 0:04:45.160 --> 0:04:47.520 Well, this morning, Karen, the earnings focus turns from big 0:04:47.560 --> 0:04:50.080 tech to big oil. We'll hear from both ex On 0:04:50.200 --> 0:04:53.799 Mobile and Chevron. We get a preview from Bloomberg's Tom Busby. 0:04:54.200 --> 0:04:57.000 Investors at Exon Mobile eager to hear about the company's 0:04:57.040 --> 0:05:00.719 progress and developing a massive oil field in Guyana, also 0:05:00.760 --> 0:05:04.200 the latest shale production plans in the Permian Basin. Bloomberg 0:05:04.200 --> 0:05:07.160 consensus calls for revenue of eighty point three nine billion 0:05:07.200 --> 0:05:10.480 dollars and adjusted earnings per share of a dollar fifty six. 0:05:10.960 --> 0:05:13.719 Chevron investors want to hear about the company's long delayed 0:05:13.720 --> 0:05:17.040 but now completed acquisition of Hess and how that'll impact 0:05:17.080 --> 0:05:20.520 its share buyback plans. Bloomberg consensus calls for revenue of 0:05:20.560 --> 0:05:23.680 forty six point seventy five billion on adjusted earnings per 0:05:23.720 --> 0:05:27.400 share of a dollar seventy one. Tom buzzby Bloomberg. 0:05:27.000 --> 0:05:28.279 Radio, All right, Tom, Thanks. 0:05:28.320 --> 0:05:30.800 A busy week on the economic front concludes this morning 0:05:30.800 --> 0:05:33.839 with the July jobs report. Economists are forecasting a gain 0:05:33.880 --> 0:05:36.240 of one hundred and four thousand jobs at an unemployment 0:05:36.320 --> 0:05:39.160 rate of four point two percent. Begin more with Bloomberg's 0:05:39.200 --> 0:05:39.960 Michael McKee. 0:05:40.200 --> 0:05:42.680 Job growth will slow and unemployment will have ticked up 0:05:42.680 --> 0:05:45.680 in July, economists forecasts. But it's not the end of 0:05:45.680 --> 0:05:49.479 the world or even the economic expansion. Once again, it's tariffs. 0:05:49.560 --> 0:05:53.039 Companies have been suspending guidance and announcing price increases to 0:05:53.160 --> 0:05:56.799 offset tariffs, but they have not yet resorted to cutting jobs. 0:05:57.279 --> 0:05:59.880 It won't matter much to the FAD if unemployment does 0:06:00.120 --> 0:06:02.640 rise by a tenth or so, but a quick jump 0:06:02.680 --> 0:06:05.960 to say four and a half percent, would worry policymakers, 0:06:06.200 --> 0:06:09.000 who may take it as a signal policy is too tight. 0:06:09.200 --> 0:06:11.800 There will be time to consider the implications no matter 0:06:11.880 --> 0:06:14.680 what we get. The next FED meeting is not until 0:06:14.680 --> 0:06:17.640 September seventeenth. Michael McKee, Bloomberg radio. 0:06:17.680 --> 0:06:19.799 All right, Mike, thanks and speaking of the Fed, President 0:06:19.800 --> 0:06:22.640 Trump is keeping up his pressure campaign on j. Powell 0:06:22.680 --> 0:06:25.359 to lower rates, once again, taking to social media to 0:06:25.400 --> 0:06:28.520 criticize the FED chair. Lyle Brainerd is a former vice 0:06:28.600 --> 0:06:29.800 chair of the Federal Reserve. 0:06:30.040 --> 0:06:33.520 What has been surprising to me is to hear the 0:06:33.560 --> 0:06:37.160 President talk about lowering rates as though it is the 0:06:37.200 --> 0:06:45.800 Federal Reserves responsibility to lower rates for US Treasury debt management. 0:06:45.839 --> 0:06:49.720 And that, of course, is exactly how central banks go 0:06:49.839 --> 0:06:51.880 wrong in emerging markets. 0:06:52.160 --> 0:06:55.000 Former FED Vice chair Lyle brainer also says she thinks 0:06:55.040 --> 0:06:58.359 the President's higher tariff rates will hamper economic growth. 0:06:59.000 --> 0:07:01.800 And finally, Nathan and of an Era, Ray Dalio has 0:07:01.839 --> 0:07:05.120 sold his last remaining stake in Bridgewater Associates and also 0:07:05.200 --> 0:07:08.640 left the hedge Funds board. Dalio first announced his succession 0:07:08.680 --> 0:07:10.680 plan more than a decade ago, but he did not 0:07:10.800 --> 0:07:13.160 fully hand over the rains until twenty twenty two, when 0:07:13.200 --> 0:07:16.000 he transferred his voting rights to its board of directors 0:07:16.040 --> 0:07:18.240 and stepped down as one of its three co chief 0:07:18.280 --> 0:07:21.320 investment officers. He stayed on the board at the time, 0:07:21.400 --> 0:07:27.480 and Dalio founded the firm in nineteen seventy five. Time 0:07:27.520 --> 0:07:28.840 now for a look at some of the other stories 0:07:28.880 --> 0:07:30.200 making news in New York and around the. 0:07:30.160 --> 0:07:32.800 World, and for that we're joined by Bloomberg's and Michael Barr. Michael, 0:07:32.800 --> 0:07:34.239 good Morning, Good morning, Karen. 0:07:34.360 --> 0:07:38.160 Storms have been lashing the East Coast from Virginia to Connecticut, 0:07:38.240 --> 0:07:42.600 flooding roadways in New York. Vehicles were stranded in pockets 0:07:42.600 --> 0:07:45.800 of high water and water pouring over a train in 0:07:45.880 --> 0:07:51.080 Manhattan's Grand Central Terminal. Commuter rail lines into suburban Long 0:07:51.120 --> 0:07:55.040 Island and New Jersey were suspended in places, flash flood 0:07:55.080 --> 0:07:58.679 warnings and effect for parts of New York City, New Jersey, 0:07:58.720 --> 0:08:02.320 and Philadelphia. States of emergency have been declared in New 0:08:02.400 --> 0:08:05.720 Jersey and New York City. With more on the weather, 0:08:05.760 --> 0:08:08.080 here's Bloomberg meete religius Craig Allen. 0:08:08.200 --> 0:08:11.000 The delus from last evening. That's gone. There are still 0:08:11.000 --> 0:08:13.480 some showers around. They'll be moving out of the area. 0:08:13.880 --> 0:08:16.920 All flood alerts have been canceled. I mean, it must 0:08:16.920 --> 0:08:19.240 have been frightening for some of those caught in the 0:08:19.240 --> 0:08:22.240 flooding range that caused the flash flooding on some of 0:08:22.240 --> 0:08:24.200 the major interstates around the region. 0:08:24.440 --> 0:08:28.200 Bloomberg Media relogist Craig Allen. The storms delayed flights from 0:08:28.200 --> 0:08:32.920 Boston to Washington, d C. The NYPD and politicians gathered 0:08:32.960 --> 0:08:35.840 at the funeral Thursday for the officer killed in the 0:08:35.840 --> 0:08:40.200 Midtown Manhattan mass shooting this week. Ditital Islam was off 0:08:40.320 --> 0:08:43.520 duty working security when he was fatally shot by a 0:08:43.600 --> 0:08:47.199 gunman at three forty five Park Avenue. Islam is one 0:08:47.240 --> 0:08:51.720 of three funerals these past few days. Also yesterday, funeral 0:08:51.760 --> 0:08:56.360 services took place for Blackstone executive Wesley Lapatner. Her fourteen 0:08:56.440 --> 0:08:57.960 year old daughter gave the eulogy. 0:08:58.360 --> 0:09:00.960 My mom was like my Rocky. 0:09:01.200 --> 0:09:05.400 I would talk to her and I can't or canny news, 0:09:06.040 --> 0:09:07.520 nothing else would make it better. 0:09:08.520 --> 0:09:13.000 Funeral services were held for Roudent employee Julia Hyman on Wednesday. 0:09:13.559 --> 0:09:17.760 Israel's military intelligence agency is undergoing changes. The service is 0:09:17.800 --> 0:09:22.560 making profound revisions, including reviving an Arabic language recruitment program 0:09:22.679 --> 0:09:26.120 for high school students and training all troops in Arabic 0:09:26.240 --> 0:09:30.079 and Islam. It comes after the October seventh, twenty twenty 0:09:30.120 --> 0:09:33.559 three attack by hamas global news twenty four hours a 0:09:33.640 --> 0:09:36.160 day and whenever you want it with the Bloomberg News 0:09:36.160 --> 0:09:37.960 Now Michael Barr and this is Bloomberg. 0:09:38.040 --> 0:09:39.680 Karen all right, Michael Barr, thank you. 0:09:44.559 --> 0:09:46.840 Time now for the Bloombergy sports Okay, brought to you 0:09:46.880 --> 0:09:49.200 by Flushing Bank, and here's John stash Hour. 0:09:49.280 --> 0:09:50.720 John, good morning, Good morning, careen. 0:09:50.800 --> 0:09:53.400 It was let's make a deal day throughout baseball and 0:09:53.440 --> 0:09:56.440 perhaps no team busier just before the trade deadline than 0:09:56.520 --> 0:09:59.360 the Yankees. They had already added three players. They added 0:09:59.400 --> 0:10:02.400 four more. There are three relief pitchers. David Bednar was 0:10:02.400 --> 0:10:05.079 a two time All Star in Pittsburgh. Camillo de Val 0:10:05.200 --> 0:10:07.960 had over one hundred career saves, while in San Francisco, 0:10:08.080 --> 0:10:10.120 Jake Bird comes from Colorado. And then in the eighth 0:10:10.200 --> 0:10:12.960 inning of the Yanks seven to four went over Tampa Bay. 0:10:13.000 --> 0:10:15.360 They acquired a player who was in the opposing dugout. 0:10:15.720 --> 0:10:18.839 Jose Caballero has been Baseball's best base dealer of the 0:10:18.880 --> 0:10:22.280 past two seasons. Aaron Boom impressed with what the front office, 0:10:22.280 --> 0:10:22.960 SA chief. 0:10:23.120 --> 0:10:24.319 Love what they were able to do. 0:10:25.760 --> 0:10:28.760 I think we're a better club today than yesterday, and 0:10:29.840 --> 0:10:33.720 certainly today than we were last week. And now we 0:10:33.760 --> 0:10:36.760 know what we were going with and what we got, 0:10:37.840 --> 0:10:38.040 you know. 0:10:39.440 --> 0:10:41.720 Onward, they win over the Rays the third in a row. 0:10:41.760 --> 0:10:43.640 They jumped to a seven nothing lead. It was seven 0:10:43.679 --> 0:10:45.240 to four when there was a rain delay of nearly 0:10:45.280 --> 0:10:47.640 three hours and then no scoring after that. Yanks down 0:10:47.679 --> 0:10:50.120 three and a half behind Toronto, playing tonight in Miami 0:10:50.200 --> 0:10:52.440 and the Metz Hosta Giants. Mets have a new center fielder, 0:10:52.840 --> 0:10:55.880 Cedric Mullin spent eight seasons in Baltimore. A few years ago, 0:10:55.920 --> 0:10:59.320 had thirty home runs and stolen bases. Carlos Correa, going 0:10:59.320 --> 0:11:02.439 from Minnesota back to Houston, where he spent seven years, 0:11:02.440 --> 0:11:04.960 helped the Astros win a World Series. The Red Sox 0:11:05.040 --> 0:11:08.040 landed pitcher Dustin May from the Dodgers. They beaten May 0:11:08.080 --> 0:11:11.240 in a game a few days ago at Benway. Taylor Rogers, 0:11:11.280 --> 0:11:13.560 whose twin brother Tyler was just acquired by the Mets, 0:11:13.640 --> 0:11:15.720 was traded for the second day in a row. He's 0:11:15.760 --> 0:11:18.760 touring the NL Central, went from Cincinnati to Pittsburgh and 0:11:18.840 --> 0:11:21.600 now the Cubs. A year ago, the Knicks sent a 0:11:21.640 --> 0:11:24.199 boatload of draft picks to the Nets from Michel Bridges. 0:11:24.200 --> 0:11:27.080 He averaged eighteen points a game, led the NBA AD 0:11:27.160 --> 0:11:29.640 minutes played in. Bridges now has a new contract with 0:11:29.720 --> 0:11:32.440 the Knicks four years, one hundred and fifty million, he 0:11:32.480 --> 0:11:35.440 has never missed a game in his seven year career. 0:11:35.520 --> 0:11:37.599 John Staneshawer Bloomberg Sports. 0:11:39.280 --> 0:11:43.400 Coast to Coast on Bloomberg Radio, nationwide on Sirius XM, 0:11:43.559 --> 0:11:46.400 and around the world on Bloomberg dot Com and the 0:11:46.440 --> 0:11:49.520 Bloomberg Business Altum. This is Bloomberg Daybreak. 0:11:49.720 --> 0:11:53.040 Good morning, I'm Nathan Hager here. It is August first, 0:11:53.080 --> 0:11:56.600 and as promised, President Donald Trump has announced a slew 0:11:56.679 --> 0:11:59.480 of new terror frights on countries around the world, after 0:11:59.520 --> 0:12:02.360 announcing deals with a handful of them in recent weeks. 0:12:02.679 --> 0:12:05.760 But former US trade negotiator Steven Olsen says he wouldn't 0:12:05.760 --> 0:12:06.840 call these deals. 0:12:07.200 --> 0:12:11.040 What we've got here are a series of extremely vague 0:12:11.559 --> 0:12:17.440 framework agreements which will require additional negotiations before they're actually 0:12:17.520 --> 0:12:22.800 translated into anything even approximating well, we could legitimately refer 0:12:22.920 --> 0:12:24.400 to a trade agreement. 0:12:24.679 --> 0:12:27.000 Steven Olsen is now a senior fellow at the Institute 0:12:27.040 --> 0:12:29.640 of Southeast Asian Studies and for more. We're joined this 0:12:29.679 --> 0:12:32.840 morning by Bloomberg News Senior editor Bill Ferries. So, Bill, 0:12:32.880 --> 0:12:34.720 what do we have this morning? 0:12:34.720 --> 0:12:38.360 Good morning, Good morning. So yeah, we're here. 0:12:38.440 --> 0:12:42.440 It's been a long bumpy road since those April second 0:12:42.640 --> 0:12:46.320 Liberation Day tariffs were first announced, We've seen a lot 0:12:46.320 --> 0:12:49.760 of pauses and fits and starts since then. This does 0:12:49.800 --> 0:12:52.040 seem to be a kind of the moment. 0:12:52.120 --> 0:12:52.320 Now. 0:12:52.559 --> 0:12:55.480 President Trump, as you said, unleashed a whole slew of tariffs, 0:12:56.320 --> 0:13:00.000 some some big surprises in there, some countries getting more 0:13:00.080 --> 0:13:03.040 than they bargained for, and I think the baseline rate 0:13:03.080 --> 0:13:06.840 of ten percent kind of a pleasant surprise to other 0:13:06.920 --> 0:13:10.880 countries who maybe had been expecting that to increase. So 0:13:12.040 --> 0:13:17.600 the market's kind of still digesting this, and it's you know, 0:13:17.640 --> 0:13:20.840 there's still countries, big, big outliers there like China and 0:13:20.880 --> 0:13:25.400 India still looking to make deals. So it does seem 0:13:25.480 --> 0:13:27.840 like the deadline has been reached, but there's still going 0:13:27.920 --> 0:13:29.480 to be a lot going on in the days and 0:13:29.520 --> 0:13:30.160 weeks in head. 0:13:30.480 --> 0:13:33.000 Well, let's get into that. What could we see over 0:13:33.040 --> 0:13:36.360 the next few days here, particularly when we're seeing you know, 0:13:36.480 --> 0:13:41.080 some countries like Switzerland and Canada getting hit with much 0:13:41.160 --> 0:13:44.360 higher rates than that ten percent baseline you just mentioned. 0:13:44.920 --> 0:13:47.359 Yeah, I think those are two of the big surprises, 0:13:47.600 --> 0:13:51.880 particularly Switzerland getting a thirty nine percent tariff when you 0:13:52.000 --> 0:13:55.760 consider that many of its neighbors who are EU nations 0:13:55.800 --> 0:14:00.360 got about a fifteen percent. Switzerland, of course, exports huge 0:14:00.400 --> 0:14:03.080 amount of pharmaceuticals to the US, so that's going to 0:14:03.120 --> 0:14:06.920 have an immediate hit on drug prices once that comes 0:14:06.960 --> 0:14:12.120 into effect August seventh. And out in Asia, you've seen 0:14:12.160 --> 0:14:16.959 countries or governments like Taiwan getting twenty percent, while two 0:14:17.040 --> 0:14:19.960 of its biggest rivals, Japan and South Korea, were at 0:14:20.000 --> 0:14:23.400 fifteen percent. So the effect of these tariffs as it 0:14:23.480 --> 0:14:25.880 plays out in the days and weeks ahead, is going 0:14:25.920 --> 0:14:29.560 to be shifting kind of the competitive landscape between countries 0:14:30.160 --> 0:14:33.320 that may you know, have typically competed in similar products 0:14:33.320 --> 0:14:35.840 but have different rates when it comes to exporting to 0:14:35.880 --> 0:14:36.320 the US. 0:14:36.920 --> 0:14:39.120 To your point, I guess we've heard from Taiwan as 0:14:39.160 --> 0:14:41.960 well that they consider that twenty percent rate that you 0:14:42.120 --> 0:14:46.280 just mentioned temporary and that more negotiations could be to come. 0:14:46.400 --> 0:14:49.160 Is that what we should expect here, that even more 0:14:49.200 --> 0:14:53.200 of these countries could keep negotiating even after this August 0:14:53.240 --> 0:14:54.720 first deadline that's coming gone. 0:14:55.280 --> 0:14:58.600 Yeah, I mean, so the August first deadline that will 0:14:58.960 --> 0:15:02.200 those tariffs are sposed to kick in August seventh. In theory, 0:15:02.240 --> 0:15:05.240 I think there's going to be time there to negotiate 0:15:05.520 --> 0:15:08.680 But last, yes, I think nations, if they've learned anything 0:15:08.680 --> 0:15:11.240 about President Trump, it's that he's a deal maker. He 0:15:11.400 --> 0:15:14.080 likes to make deals. They the White House may feel 0:15:14.120 --> 0:15:16.240 like it has made those deals. But I think if 0:15:16.320 --> 0:15:20.320 a if a country comes in, if India or a 0:15:20.400 --> 0:15:23.400 Taiwan comes in, and they say, you know, they find 0:15:23.400 --> 0:15:26.920 a way to perhaps buy more American products or or 0:15:27.000 --> 0:15:31.520 make some changes. I don't think that down the road 0:15:31.520 --> 0:15:33.120 we're you know, I think down the road, I think 0:15:33.160 --> 0:15:36.800 we're going to see more deals getting tweaked. And that's 0:15:36.880 --> 0:15:38.600 what a lot of governments are going to be banking 0:15:38.600 --> 0:15:39.520 on going forward. 0:15:40.040 --> 0:15:44.200 So if we do see these terrif rates kicking in, 0:15:44.560 --> 0:15:48.640 as you mentioned on August seventh, once the US Customs 0:15:48.640 --> 0:15:52.160 and Border Protection gets that time to adjust to this, 0:15:52.320 --> 0:15:56.960 what's the potential economic impact from where these terif rates lie. 0:15:57.000 --> 0:16:01.680 Now it's a huge global economic experiment and an experiment 0:16:01.720 --> 0:16:04.640 for the US economy. I mean, these tariffs, these US 0:16:04.760 --> 0:16:06.600 tariffs are now going to be at the highest rate 0:16:06.680 --> 0:16:09.960 since World War Two. And even if some countries are 0:16:10.000 --> 0:16:13.880 breathing a sigh of relief that they got just ten percent, 0:16:14.520 --> 0:16:16.840 and I'm thinking, you know, countries like Singapore for instance, 0:16:16.840 --> 0:16:20.520 ten percent. The average US tariff was about two percent 0:16:21.000 --> 0:16:24.680 six months ago. So these are huge changes and they 0:16:24.760 --> 0:16:28.680 will continue to trickle through into the US economy and 0:16:28.680 --> 0:16:32.440 it's hard to not see that starting to affect inflation 0:16:32.640 --> 0:16:34.640 more seriously in the months ahead. 0:16:34.800 --> 0:16:36.600 And on top of all this bill, I guess we're 0:16:36.680 --> 0:16:41.120 still waiting for a lot of sectoral tariff announcements as well. 0:16:41.160 --> 0:16:43.400 I mean, what could that mean when it comes to 0:16:44.360 --> 0:16:45.560 certainty in the market. 0:16:46.400 --> 0:16:49.520 Yeah, there is still a lot of uncertainty. There are 0:16:49.560 --> 0:16:54.960 products pharmaceuticals are chief among them, semiconductors, those are still 0:16:55.000 --> 0:16:58.320 being subject to what the US calls these Section two 0:16:58.440 --> 0:17:02.920 three two investigations to see if there's a national security risk, 0:17:03.360 --> 0:17:08.040 and presumably if there are, that allows Donald Trump to 0:17:08.480 --> 0:17:12.480 put additional tariffs on those products. So, by no means 0:17:12.560 --> 0:17:15.480 is this the end of it, just because countries have 0:17:15.600 --> 0:17:19.080 gotten their number some of the products they export Switzerland 0:17:19.119 --> 0:17:22.640 I said thirty nine percent, but a big pharma exporter, 0:17:22.880 --> 0:17:26.760 they could be seen increased tariffs on those products once 0:17:27.359 --> 0:17:29.480 the US reaches those decisions. 0:17:29.119 --> 0:17:31.240 And not the end of it, but maybe the market 0:17:31.240 --> 0:17:34.639 adjustment to what's happening now is just beginning. Thank you. 0:17:34.720 --> 0:17:35.000 For this. 0:17:35.040 --> 0:17:38.959 Bloomberg News Senior editor Bill ferries with us on this 0:17:39.160 --> 0:17:40.960 August first, Karen. 0:17:40.960 --> 0:17:43.480 Nathan, we're also focusing on the markets in big tech 0:17:43.560 --> 0:17:47.199 earnings this morning. Shares of Amazon, they are down more 0:17:47.280 --> 0:17:51.320 than eight percent, Apple up. It's higher by almost two 0:17:51.320 --> 0:17:54.080 percent right now. And this follows yesterday's After the Bell 0:17:54.200 --> 0:17:57.240 reports for more, We're pleased to welcome Bloomberg Radio and 0:17:57.280 --> 0:17:59.119 TV anchor Kreedie Goopta Creedy. 0:17:59.119 --> 0:18:00.520 Good morning, Hey, Chriatie. 0:18:00.600 --> 0:18:02.760 Let's start with Amazon, because it's really hard to ignore 0:18:02.800 --> 0:18:04.040 the stock move this morning. 0:18:04.200 --> 0:18:05.480 What are investors reacting to? 0:18:06.359 --> 0:18:09.200 Good morning, Karen, Yeah, it's been a really interesting tech 0:18:09.240 --> 0:18:11.520 earning story, A tale of two. I think is fair 0:18:11.520 --> 0:18:13.960 to say Amazon cheres down by eight percent, treating about 0:18:13.960 --> 0:18:15.200 two hundred and fifteen. 0:18:14.920 --> 0:18:15.720 Dollars a share. 0:18:15.760 --> 0:18:18.960 This is all about weakness when it comes to Amazon 0:18:19.000 --> 0:18:21.800 Web services. When you think Amazon, we think about the packages, 0:18:21.800 --> 0:18:24.399 we think about the e commerce business. But ultimately they 0:18:24.400 --> 0:18:27.320 are pivoting firmly in the tech direction and that's where 0:18:27.320 --> 0:18:28.520 they've disappointed the market. 0:18:28.640 --> 0:18:28.760 Now. 0:18:28.760 --> 0:18:31.639 It doesn't help that we also got Microsoft earnings just 0:18:31.680 --> 0:18:35.000 twenty four hours before, which really set a positive tone 0:18:35.040 --> 0:18:37.679 for cloud adoption for the Asia kind of services that 0:18:37.720 --> 0:18:41.120 they had, So the expectations were pretty high for Amazon 0:18:41.200 --> 0:18:44.880 to impress the market, and to be fair, they did 0:18:44.880 --> 0:18:47.920 in some ways. Their revenues did come in better than expected, 0:18:48.280 --> 0:18:50.399 but not by much. And this is a market that 0:18:50.520 --> 0:18:52.879 is very tough on tech companies right now that the 0:18:52.920 --> 0:18:56.520 expectations are high and you have to be even better 0:18:56.600 --> 0:18:58.840 than the expectations. You have to get an A plus 0:18:58.840 --> 0:19:01.399 plus instead of just and a plus. And this is 0:19:01.400 --> 0:19:04.080 where Amazon kind of finds itself right now because they're 0:19:04.080 --> 0:19:07.840 also talking about weaker than expected operating income as well 0:19:07.880 --> 0:19:10.480 as some of the sales growth when it comes to aws. 0:19:10.520 --> 0:19:12.920 So that big idea of spend. 0:19:12.600 --> 0:19:15.000 Big on AI, spend big on cloud and see that 0:19:15.080 --> 0:19:18.960 kind of multiply ultimately over time. That's the shadow of 0:19:19.000 --> 0:19:21.240 doubt that's being cast from Wall Street this morning. 0:19:21.400 --> 0:19:23.760 And it really did seem like CEO Andy Jasse he 0:19:23.960 --> 0:19:26.800 had a longer view when it came to all of this, 0:19:26.960 --> 0:19:29.320 but he still couldn't ease those concerns on the earnings call, 0:19:29.359 --> 0:19:30.119 could he? 0:19:30.119 --> 0:19:30.640 He couldn't. 0:19:30.640 --> 0:19:32.560 He's trying to use that magic word that I think 0:19:32.560 --> 0:19:34.800 we've seen and not just the tech companies in the 0:19:34.840 --> 0:19:38.560 tech space, but across corporate America and arguably the global 0:19:38.640 --> 0:19:41.400 corporate sphere, which is artificial intelligence. And there was an 0:19:41.400 --> 0:19:44.440 era where every time you said artificial intelligence, the stock 0:19:44.480 --> 0:19:47.359 would just spike because of this kind of momentum driven story. 0:19:47.640 --> 0:19:49.639 And he's making that point. He says, look, we're very 0:19:49.680 --> 0:19:51.919 early days in that investment story. We know Amazon has 0:19:51.920 --> 0:19:55.400 that massive anthropic venture as well, and they are competing 0:19:55.440 --> 0:19:59.560 with the likes of Alphabet, Microsoft, Oracle among others as 0:19:59.560 --> 0:20:00.600 well in the out space. 0:20:00.920 --> 0:20:02.760 There. He's saying, give it some time. 0:20:03.240 --> 0:20:05.560 But this is now at a point where Wall Street 0:20:05.600 --> 0:20:08.679 is looking at these AI kind of expectations, looking at 0:20:08.720 --> 0:20:10.800 these AI investments and say when is it going to 0:20:10.840 --> 0:20:13.800 pay off? And Andy Jesse wasn't able to make that case. 0:20:14.119 --> 0:20:16.440 All right, well, we're seeing better reaction to Apple this 0:20:16.600 --> 0:20:19.840 morning it reported fastest revenue growth in more than three years. 0:20:19.880 --> 0:20:21.199 What else did you take away from this? 0:20:21.800 --> 0:20:23.960 You know, it's funny because we go into Amazon with 0:20:24.000 --> 0:20:27.200 such a strong earnings expectations. With Apple, you went in 0:20:27.480 --> 0:20:30.040 with some pretty beat up earnings expectations. 0:20:30.040 --> 0:20:32.640 The idea that the tariff story would really. 0:20:32.480 --> 0:20:35.480 Eat into the bottom line, would eat into the supply chains, 0:20:35.600 --> 0:20:38.200