Good day all. Last week President Trump kept yet another promise and imposed tariffs on imports globally. Some countries were hit with the baseline tariff, 10%, and others that have been engaged in protectionism and putting major tariffs on American products with significantly higher ones.
Wall Street, which has had it’s collective head up their posteriors for decades, was “Caught by surprise” by the tariffs and have been melting down since the tariffs kicked in. One country that’s been getting hit especially hard is the People’s Republic of China, which has a long history of dumping on American markets and other protectionist measures. (That’s another story all by itself)
What many people have failed to understand is that the tariffs are, among other things, a negotiating tool. As of Sunday, April 6th, some 50 countries have contacted the White House looking to do some deals to reduce the tariffs on both sides to zero. Here are some of the details from CTV News:
Top administration officials said Sunday that more than 50 countries targeted by U.S. President Donald Trump’s new tariffs have reached out to begin negotiations over the sweeping import taxes that have sent financial markets reeling, raised fears of a recession and upended the global trading system.
The whole point of the tariffs was to upset the old system. Actually, it was to blow it right out of the water.
The higher rates are set to be collected beginning Wednesday, ushering in a new era of economic uncertainty with no clear end in sight. Treasury Secretary Scott Bessent said unfair trade practices are not “the kind of thing you can negotiate away in days or weeks.” The United States, he said, must see “what the countries offer and whether it’s believable.”
When this story first came out, it was 50 countries that wanted to talk with the White House. As I started working on this post, it was up to 70 countries.
Trump, who spent the weekend in Florida playing golf, posted online that “WE WILL WIN. HANG TOUGH, it won’t be easy.” His Cabinet members and economic advisers were out in force Sunday defending the tariffs and downplaying the consequences for the global economy.
“There doesn’t have to be a recession. Who knows how the market is going to react in a day, in a week?” Bessent said. “What we are looking at is building the long-term economic fundamentals for prosperity.”
Now there are some very interesting developments. Yes, the stock markets are way down from their historic highs, and yes, I took a hit, but I’m not concerned, but oil prices are down to around $65/barrel. (As I work on this, the market skyrocketed over 10%) With energy costs dropping that means transportation costs are also dropping. Wall Street may be in a panic, but Main Street is not. They are beginning to see things improve. (Yes, egg prices are coming down as well. The chicken flocks are starting to come back from the Biden Massacre)
Countries are scrambling to figure out how to respond to the tariffs, with China and others retaliating quickly.
Currently. The “Tit for Tat” retaliations appear to be China and the EU. China is, of course, not happy with President Trump being reelected. They’ve grown used to buying presidents and members of Congress. The EU has other issues, namely the president of the European Commission, Ursula von der Leyen.
She has been pushing the EU into a new dark age and has been trying to force the United States to basically submit to the whims of the WEF and the Brussels bureaucrats. She is currently working to shut down free speech in Europe and is trying to suppress the 1st Amendment in the United States. Her primary target is, of course, Elon Musk and TwitterX.
She is also a protectionist and, along with pretty much all of Europe, has been blocking American exports into the EU for decades. This is one of the primary reasons for the tariffs in the first place. To force other nations to drop their protectionist policies and let the United States compete.
In Congress, where Trump’s Republican Party has long championed free trade, the tariff regiment has been met with applause but also significant unease.
Those who are uneasy are of two types. The first are the “Chamber of Commerce” types who think that getting cheap goods into the United states is a good thing, but aren’t considering the effect it has on the American manufacturing base. The second group actually believes that there is true free trade and that anything that interrupts this is bad.
It’s quite early in the process of course, but a lot of businesses think the tariffs are a good thing. One group is the beef industry. What many people may not know is that a lot of counties block American beef and other agricultural products in order to protect their own industries. According to Drovers:
During the event, which was broadcast live across the U.S. and abroad, Trump held up a chart showing specific countries in line for what he described as reciprocal tariffs.
“?We will charge them approximately half of what they are — and have been — charging us,” he said. “So, the tariffs will not be a full reciprocal. I could have done that, I guess, but it would have been tough for a lot of countries.”
It appears that the National Cattleman’s Beef Association is on board with President Trump’s plans.
National Cattlemen’s Beef Association (NCBA) Senior Vice President of Government Affairs Ethan Lane also issued a statement after attending President Donald J. Trump’s announcement at the White House.
“For too long, America’s family farmers and ranchers have been mistreated by certain trading partners around the world,” Lane said. “President Trump is taking action to address numerous trade barriers that prevent consumers overseas from enjoying high-quality, wholesome American beef.
“NCBA will continue engaging with the White House to ensure fair treatment for America’s cattle producers around the world and optimize opportunities for exports abroad,” Lane added.
What many people don’t know, and I certainly didn’t, is that Australia exports beef to the United States but will not allow one ounce of American beef to be imported into Australia.
Australia has sold roughly $29 billion of beef to American consumers. Meanwhile, the U.S. has not been able to sell $1 of fresh U.S. beef in Australia due to non-scientific barriers, Lane said.
It gets better too. Vietnam puts a 30% tariff on American beef but no tariffs on Australian beef. Thailand puts a 50% tariff on American beef. Both countries have been hit with at least the minimum tariffs and I know that Vietnam is now talking with the Trump administration.
Another potential issue is grain exports. A lot of growers are concerned that grain products might be blocked by other countries. They could of course, but the United States is one of the largest grain producers in the world. Blocking our grain exports will probably do more harm to the other countries then us.
As I said, this is going to be a long term fight and a lot of negotiations. Economists are making a lot of statements and pronouncements regarding the tariffs, but really, when have they been right about anything? Far to many of them live and work in a bubble and don’t actually understand how things really work. (See Paul Krugman. He has been pretty much wrong about everything for his entire career)
As I write this post, it looks like South Korea and Vietnam may be close to a deal. There are other nations as well. China has decided to be pig headed and now the tariff on their goods is now 104%. There are a couple of RINO’s who want to remove President Trump’s ability to set tariffs, but I doubt it will go anywhere. Even if it somehow passes, President Trump will veto it. All it is doing is marking several Republicans for primary termination when they are up for reelection.
None of these people seem to understand what President Trump is actually doing. He is working to break the old Bretton Woods system put in place after World War Two. That system long ago outlived it’s usefulness. The idea of Free Trade is nice, but it takes both parties to play by the rules. For to long, the United States has been taken advantage of. Now we have a president who is going to fight back, and who doesn’t care what people think. President Trump may be right. He may be wrong. But he is an old school patriot who is putting America first. It’s about time too.
***UPDATE***
As I was finishing this up, President Trump announced a 90 day pause on the tariffs for most countries. These are the ones coming to Washington to talk and see if they can work out a deal. Not all countries are affected by this pause. The ones that continued with their retaliation are still being hit with tariffs and in the case of China, they have been increased to over 100%. This pause is why the markets exploded Wednesday, April 9th.
Thatisall
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~The Angry Webmaster~
Good data – had no idea about the beef!
I stumbled on that one completely by accident. I have been to China a couple of times, but that was 20 years ago and before the current Mao wannabe was in power.