Cabot Phillips

Well, if we've learned anything about Donald Trump in the last few years, it's that this is a man who loves cutting a good deal. And on Monday, we saw the most consequential deal of his second term come to fruition. After formal negotiations in Switzerland this weekend, China has now agreed to cut tariffs on American imports from 125% down to just 10%, while the U.S.

Well, if we've learned anything about Donald Trump in the last few years, it's that this is a man who loves cutting a good deal. And on Monday, we saw the most consequential deal of his second term come to fruition. After formal negotiations in Switzerland this weekend, China has now agreed to cut tariffs on American imports from 125% down to just 10%, while the U.S.

will cut rates from 145% to 10%. And importantly, Beijing has also agreed to suspend or outright cancel non-tariff countermeasures against the U.S. That means their existing ban on rare earth mineral exports could be coming to an end. They'll also remove dozens of American companies from a blacklist that had kept them from operating within China's borders.

will cut rates from 145% to 10%. And importantly, Beijing has also agreed to suspend or outright cancel non-tariff countermeasures against the U.S. That means their existing ban on rare earth mineral exports could be coming to an end. They'll also remove dozens of American companies from a blacklist that had kept them from operating within China's borders.

The new rates will apply for the next 90 days. In the meantime, the two sides will work on making a permanent deal. Here's President Trump announcing the deal from the White House Monday.

The new rates will apply for the next 90 days. In the meantime, the two sides will work on making a permanent deal. Here's President Trump announcing the deal from the White House Monday.

Now, this deal marks a stunning turnaround and reversal of hostilities. Ahead of this weekend's meetings, for example, even Treasury Secretary Scott Besant said the deal was a long ways off and that his goal heading in was de-escalation, not a big trade deal. That's a direct quote. But clearly, the Chinese were more willing to negotiate than many had expected.

Now, this deal marks a stunning turnaround and reversal of hostilities. Ahead of this weekend's meetings, for example, even Treasury Secretary Scott Besant said the deal was a long ways off and that his goal heading in was de-escalation, not a big trade deal. That's a direct quote. But clearly, the Chinese were more willing to negotiate than many had expected.

For their part, Beijing signed on to a joint statement that referenced a, quote, spirit of mutual opening, continued communication, cooperation, and mutual respect. So they're showing a little love there. That's quite a different message than we heard last month. Indeed. The Chinese were calling the U.S. bullies, saying they were going to make us pay, etc.,

For their part, Beijing signed on to a joint statement that referenced a, quote, spirit of mutual opening, continued communication, cooperation, and mutual respect. So they're showing a little love there. That's quite a different message than we heard last month. Indeed. The Chinese were calling the U.S. bullies, saying they were going to make us pay, etc.,

As more proof of these improving relations, the two sides also agreed to establish a formal process for future streamlined trade talks that includes the use of a third country as a mediator.

As more proof of these improving relations, the two sides also agreed to establish a formal process for future streamlined trade talks that includes the use of a third country as a mediator.

Yeah, that's an important note. In February, President Trump implemented an additional 20% tariff on Chinese imports as retaliation for their involvement in the production and distribution of fentanyl. The White House says that Beijing knows the drug is being made there and that it's then being shipped to cartels who bring it to the U.S., but that they've done nothing to stop it.

Yeah, that's an important note. In February, President Trump implemented an additional 20% tariff on Chinese imports as retaliation for their involvement in the production and distribution of fentanyl. The White House says that Beijing knows the drug is being made there and that it's then being shipped to cartels who bring it to the U.S., but that they've done nothing to stop it.

To illustrate that point, during negotiations, Secretary Besant reportedly held up a grain of sugar, telling his Chinese counterparts, quote, this could kill a person if it were fentanyl. He then picked up a cube and said this is enough to kill people across the entire city.

To illustrate that point, during negotiations, Secretary Besant reportedly held up a grain of sugar, telling his Chinese counterparts, quote, this could kill a person if it were fentanyl. He then picked up a cube and said this is enough to kill people across the entire city.

The Trump administration says that until China proves that it's actually cracking down on the drug's production, that additional 20% tariff will remain in place. So that means that right now, the effective rate for Chinese imports is actually 30%, not 10%.

The Trump administration says that until China proves that it's actually cracking down on the drug's production, that additional 20% tariff will remain in place. So that means that right now, the effective rate for Chinese imports is actually 30%, not 10%.

And in a similar vein, the Trump administration has made clear that while they are willing to open up the flow of certain Chinese goods to the U.S., they want to break our reliance on essential imports like weapons, technology, and importantly, pharmaceuticals. Here's Besant to that point Monday.

And in a similar vein, the Trump administration has made clear that while they are willing to open up the flow of certain Chinese goods to the U.S., they want to break our reliance on essential imports like weapons, technology, and importantly, pharmaceuticals. Here's Besant to that point Monday.