E.J. Antoni
Appearances
Morning Wire
Wall Street Turmoil & Ukraine’s Ceasefire Agreement | 3.12.25
It's largely because people are having trouble planning for the future. They don't know how the tariff game is eventually going to shake out. Now, some of that, you could argue, has to do with different folks in the administration not singing from the same hymnal. But I would argue a lot of it has to do with the fact that as soon as we're talking about reciprocal tariffs,
Morning Wire
Wall Street Turmoil & Ukraine’s Ceasefire Agreement | 3.12.25
you now have a whole nother element that's completely outside of your control, which is what is the president of Mexico going to do? What is the governor of Canada going to do? We don't know. And because our reciprocal tariffs are based off of what those foreign leaders are going to do, we have to essentially wait and see.
Morning Wire
Wall Street Turmoil & Ukraine’s Ceasefire Agreement | 3.12.25
You can't plan on anything because you don't know what that foreign leader is going to do. And our response, again, is dependent on what that foreign leader does.
Morning Wire
Wall Street Turmoil & Ukraine’s Ceasefire Agreement | 3.12.25
In a lot of ways, the market was simply just overbought. For literally years, we had government debt fueling both government spending as well as consumer spending, government handing out welfare payments, for example, that were funded by borrowing.
Morning Wire
Wall Street Turmoil & Ukraine’s Ceasefire Agreement | 3.12.25
And all of those different things have helped to drive corporate earnings, but they didn't create any kind of sustainable growth within the private sector. And the result of that has been people thinking that this runaway so-called growth would last forever. And clearly that's not possible. It
Morning Wire
Wall Street Turmoil & Ukraine’s Ceasefire Agreement | 3.12.25
Anyone who has had too much to drink and woke up the next day and had to deal with a headache knows exactly what this feels like. And so the solution is not to say, hey, I felt better when I was drinking, so I should go back to alcohol, right? And yes, the detox is a painful period. But look, the sins of the past always catch up to you, be they moral or monetary.
Morning Wire
Wall Street Turmoil & Ukraine’s Ceasefire Agreement | 3.12.25
What we're dealing with today is the result of all the runaway government spending and debt and other profligacies that we've had for several years now. So it will be painful to undo all of that mess, but that's the only way you get to long-term economic health.
Morning Wire
Wall Street Turmoil & Ukraine’s Ceasefire Agreement | 3.12.25
All of the models pointed to the market being overbought. And so some of this is simply rebalancing.
Morning Wire
Tariff Time & Marine Le Pen Convicted in France | 4.1.25
It's a fallacy that the entirety of a tariff is always and everywhere passed along to the end user, to consumers. If that were the case, for example, American dairy farmers who are facing a 270% tariff trying to get their products into Canada, they would simply pass that cost along. But they can't because it would make them uncompetitive, right?
Morning Wire
Tariff Time & Marine Le Pen Convicted in France | 4.1.25
A lot of the equations I've seen have it penciled in at about 50%. So again, that's not great because that means consumers are still going to bear some costs. But the idea that they're going to bear the entire cost, again, it's just a fallacy.
Morning Wire
Tariff Time & Marine Le Pen Convicted in France | 4.1.25
You know, the Fed cut interest rates when they had no business doing so back in the autumn. That caused commodity prices to spike. That is now turning into higher wholesale prices and higher retail prices that you and all the listeners have to pay. That's one of the reasons why we're still dealing with some inflationary fallout.
Morning Wire
Tariff Time & Marine Le Pen Convicted in France | 4.1.25
So that's basically the mess that has been dumped into this administration's lap and that they're now having to deal with.
Morning Wire
Military Recruitment Up & RFK Targets Food Dyes | 4.24.25
Well, a couple of things. One is, I think, a resolution to a lot of that mixed messaging that you mentioned, right? I mean, it was frankly chaos to start. A lot of that is getting resolved, not all of it, but a lot of it. So that's really good. It's a very welcome development. to have Trump and Besant really taking the lead in terms of negotiations. So less so Greer, Navarro, Lutnick.
Morning Wire
Military Recruitment Up & RFK Targets Food Dyes | 4.24.25
That's all a really welcome development again. In terms of the de-escalation, I think what we're looking for there is essentially agreements one by one just getting hammered out and eventually signed. It looks like trade deals reducing tariff and non-tariff barriers, which is very, very important.
Morning Wire
Military Recruitment Up & RFK Targets Food Dyes | 4.24.25
And so as those deals get done, as the details get ironed out, we can look for more free trade, not less. We can look for fairer trade. In other words, not only are American consumer markets still open to foreign producers, but finally, foreign consumer markets will be open to our domestic producers.
Morning Wire
Military Recruitment Up & RFK Targets Food Dyes | 4.24.25
Well, at the end of the day, markets really hate uncertainty, full stop. Even if you're going to get bad news, if it's at least certain. You can prepare, you can plan, whether on the consumer side or the firm side. It doesn't matter. So the real problem has been the uncertainty. The market doesn't really like Jerome Powell, but the idea of removing him creates a tremendous amount of uncertainty.
Morning Wire
Military Recruitment Up & RFK Targets Food Dyes | 4.24.25
And that's the last thing markets need right now on top of the uncertainty they already have. And so once Trump dropped the rhetoric about removing Powell, the Dow rallied.
Morning Wire
Military Recruitment Up & RFK Targets Food Dyes | 4.24.25
Well, unfortunately, the Fed really has just been putting politics before policy. They talk about how they're data dependent. As far as I can tell, the only data they're really paying attention to is whether the president is a Republican or a Democrat.
Morning Wire
Military Recruitment Up & RFK Targets Food Dyes | 4.24.25
When the Fed cut interest rates last year, again, right around the election, we saw 100 basis points of cuts, and then the yield on treasuries moved exactly the opposite direction. It went up 100 basis points. So as markets increasingly don't believe the Fed... whether that's looking at inflation predictions or employment predictions, what the Fed does is mattering less and less.
Morning Wire
Military Recruitment Up & RFK Targets Food Dyes | 4.24.25
And so markets, I think, are much more today focused on what's happening with tariffs, what's happening with the tax cut package. Is that actually going to get across the finish line? Because don't forget, that's 10 times the size of the tariffs if we're looking at impact on the consumer. So there's a whole lot up in the air right now.
Morning Wire
Military Recruitment Up & RFK Targets Food Dyes | 4.24.25
And although the Fed is one of those balls being juggled by the market at It's not the only thing, and I would say it's not even the biggest.
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
It looks like trade deals reducing tariff and non-tariff barriers, which is very, very important, that we include the non-tariff part of this as well. Oftentimes it's worse than the tariffs themselves. And so as those deals get done, as the details get ironed out, we can look for more free trade, not less. We can look for fairer trade. In other words...
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
Not only are American consumer markets still open to foreign producers, but finally, foreign consumer markets will be open to our domestic producers.
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
Again, we're seeing this movement to where other countries are willing to start knocking down some of their tariff rates and also their non-tariff barriers. That includes things like quotas, but also includes tariffs. Some more abstract things that you might not think they would affect international trade like currency manipulation.
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
But that's been a big way that a lot of these nations have effectively worked around American tariffs and also given their exports an artificial advantage in American markets.
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
So by cracking down on these different trade abuses, also abuses of things like country of origin laws, that's been a big one with China and Canada, where China sends stuff, they dump product in Canada, it gets repackaged, relabeled, and reshipped into the United States. Those kinds of abuses, as they get cracked down on, I think we're going to see, again, more free trade, not less.
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
And you're going to see a ratcheting down of not just the rhetoric, but the reality around tariffs.
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
Well, we're still seeing a lot of carve-outs, frankly, which is going to also help blunt the effect of these tariffs initially. I think, look, you're walking a tightrope here. On the one hand, if you really want to bring the pain to Beijing...
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
then you don't have any exemptions you have even higher tariff rates we're talking 400 on anything and everything coming in from china you know that's a double-edged sword the flip side there to that coin is that you're also going to bring a lot of pain to the american consumer because not all of that not all of that tariff is going to be paid for by the chinese producer some of it is going to fall on american consumers not all but some of it will
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
And so since we're already in a cost of living crisis, courtesy of what the Biden administration left us, we want to minimize the pain on the American consumer while maximizing the pain on the Chinese Communist Party. And so, you know, right now we do have a very high tariff rate, well over 100 percent on Chinese goods.
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
But again, we have a lot of carve outs on it regarding semiconductors, regarding different electronic components. So it remains to be seen what that's going to look like in the coming days.
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
Well, at the end of the day, markets really hate uncertainty, full stop. Even if you're going to get bad news, if it's at least certain, you can prepare, you can plan, whether on the consumer side or the firm side, it doesn't matter. So the real problem has been the uncertainty.
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
Going back to what we started talking about with tariffs, where you have different members of the administration saying different things, that creates unneeded uncertainty. uncertainty. The way these tariffs were rolled out, quite frankly, created a lot of unneeded uncertainty. Instead of just having pain overseas, it was a lot of pain here at home in our financial markets.
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
And sure enough, as you see different pieces of that uncertainty resolved, the thousand point drop in the Dow is reversed and we get a thousand point swing to the upside. And scarily, those thousand point swings have become the norm on basically a daily basis for the Dow.
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
But if you look at something like the whole conversation about whether Trump will remove Powell, this is, I think, a good illustration. The market doesn't really like Jerome Powell, but the idea of removing him creates a tremendous amount of uncertainty. And that's the last thing markets need right now on top of the uncertainty they already have.
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
Well, unfortunately, the Fed really has just been putting politics before policy. They talk about how they're data dependent. As far as I can tell, the only data they're really paying attention to is whether the president is a Republican or a Democrat. I mean, there was absolutely no empirical justification for the rate cuts that they instituted right before the election last year.
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
That was a blatant move of election interference, in my opinion. And now, despite the data being even more favorable today for a rate cut, they're refusing to do it. It makes absolutely no sense. This is the same Jerome Powell who, for example, when he was up for renomination, set a 75 basis point hike, or in other words, a three-quarter percentage point increase in interest rates.
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
That was off the table, he said. As soon as he was confirmed, he delivered four of those jumbo-sized rate hikes in a row. And it's also worth pointing out, not only is Jerome Powell blatantly political, but also we need to understand that just because the Fed makes a move doesn't mean the market will follow. When the Fed cut interest rates last year, again, right around the election –
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
We saw 100 basis points of cuts, and then the yield on treasuries moved exactly the opposite direction. It went up 100 basis points. So as markets increasingly don't believe the Fed, whether that's looking at inflation predictions or employment predictions, what the Fed does is mattering less and less.
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
And so markets, I think, are much more today focused on what's happening with tariffs, what's happening with the tax cut package. Is that actually going to get across the finish line? Because don't forget, that's 10 times the size of the tariffs if we're looking at impact on the consumer. You also have a lot going on in terms of the president's deregulatory agenda.
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
It remains to be seen whether or not that's going to get across the finish line. So there's a whole lot up in the air right now. And although the Fed is one of those balls being juggled by the market in the air right now, it's not the only thing. And I would say it's not even the biggest.
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
I think it's going to be a combination of getting the spending down, but also the revenue up. How do you get the revenue up? Look, we have to remember the lessons from the Laffer curve. Speaking of which, Dr. Laffer and Dr. Brian Dimitrovich just recently put out a great book called Taxes Have Consequences.
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
And the empirical analysis in there is absolutely immaculate, where they explain in great detail how the reductions in income tax rates, particularly the top marginal tax rate, results in not less tax revenue, but more. And the reason for that is because you grow the tax base and you essentially increase economic activity by reducing the marginal tax rate.
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
And so the lower tax rate actually yields more and not less income. tax revenue. And it's very clear throughout the history of the income tax. That's what happens because we're on the wrong side of the law for curve in terms of maximizing revenue. So getting this tax package through Congress onto the president's desk, getting his signature is absolutely imperative. It'll grow the economy.
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
It'll increase tax revenue, which will help put downward pressure on the deficit. But then also cutting the spending is an absolute must. And just to put in perspective how much the deficit is a spending problem and not a revenue problem. If Biden had come into office and simply done nothing.
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
In other words, allow all the one-time emergency COVID measures to expire, allow the budget to return to the 2019 levels, and then simply add no new spending. Allow existing spending on its current growth trajectory, things like Medicare, Social Security, Medicaid. Allow those things to continue growing at the normal pace, but don't add any discretionary spending.
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
No infrastructure bill, no CHIPS bill, no IRA, etc., We'd have a balanced budget today. So you can't tell me we have a revenue problem. We have a spending problem.
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
It'll definitely work in terms of the last part of that question, how long, it depends on the industry. Unfortunately, I can't give a blanket assessment because it is so industry-specific.
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
If you're talking about something like building a new cracking tower at a refinery, that's a billion-dollar investment that's going to take at least five years to build, and that's after you start breaking ground with essentially a fast-tracked regulatory process. So In some cases, you're looking at many, many years.
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
In other cases, you could be looking at as little as six months because sometimes we already have the infrastructure in place and it's just been mothballed. So the time is going to vary tremendously from industry to industry. In terms of how this actually gets done, though, tariffs, are they necessary? Yes. Are they sufficient? No. We need to not only –
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
Well, a couple of things. One is, I think, a resolution to a lot of that mixed messaging that you mentioned, right? I mean, it was frankly chaos to start where you had not only different members of the administration contradicting each other, but sometimes in the context of a single interview, you would have individuals contradicting themselves. A lot of that is getting resolved.
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
counter the tariff and non-tariff barriers to trade that other nations have imposed. We need to not only offset things like the value added taxes abroad and the currency manipulation abroad, but you also need to reform our tax code and our regulatory state. You need to not just reduce marginal tax rates, but you also need to change the fact that our tax code
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
provides an incentive to move a factory out of San Antonio, Texas, across the border into Mexico, produce stuff there, and then ship it back here to the United States. We literally give a tax incentive for that. So get rid of that, replace it with something like a border adjustment tax where we only tax imports and not exports. Right. Right.
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
A $50,000 employee costs $100,000 once you factor in the regulatory costs. That all needs to be reformed. A lot of our wounds are self-inflicted. So we need to not only address the problems that are imposed by foreign producers and foreign governments, we also have to address the problems that have been imposed by our own government here at home.
Morning Wire
Will Trump’s Economic Gamble Work? | 4.27.25
Not all of it, but a lot of it. So that's really good. It's a very welcome development to have Trump and Besant really taking the lead in terms of negotiations. So less so Greer, Navarro, Lutnik. In terms of the de-escalation, I think what we're looking for there is essentially agreements one by one just getting hammered out and eventually signed.
Morning Wire
Trade Deals, Tariff Truce & Trillions in US Investments
Yeah, I think that's a very good way to put it.
Morning Wire
Trade Deals, Tariff Truce & Trillions in US Investments
Well, it's certainly going to be good for the consumer in the short run. But when we talk to producers, in other words, when we talk to businesses, what we find, Regardless whether they're small or large businesses, the exact same thing. They're all really struggling with the volatility that tariffs have created.
Morning Wire
Trade Deals, Tariff Truce & Trillions in US Investments
And it's not simply that we're having a discussion about tariffs or that tariffs were put in place. It's that the tariff rates have not been consistent. They have not been steady. They've gone up. They've gone down. So this on-again, off-again movement has essentially made it impossible for a lot of folks to do business. So that's created, unfortunately, again, a lot of turmoil.
Morning Wire
Trade Deals, Tariff Truce & Trillions in US Investments
And we hope to have that resolved in the coming weeks as we get concrete deals and then as we get them ratified in the Senate.
Morning Wire
Trade Deals, Tariff Truce & Trillions in US Investments
Yeah, this is actually particularly good news, what we're seeing with a lot of these nations in the Middle East, where they are essentially going to be pouring investment into this country. This is where we've got to remember the capital surplus is the flip side of the trade deficit.
Morning Wire
Trade Deals, Tariff Truce & Trillions in US Investments
For literally every year except for seven from colonial times through 1870, that was the arrangement that the United States essentially had with the rest of the world, where we were buying more from abroad than they bought from us, but they were investing much more here than we were investing abroad.
Morning Wire
Trade Deals, Tariff Truce & Trillions in US Investments
And that not only created those investments, that is, here in the United States, not only created revenue streams, in other words, future income for foreigners, but it also created future income for folks here in the United States, whether that was an American investor or the American worker.
Morning Wire
Trade Deals, Tariff Truce & Trillions in US Investments
Let's start with that. A lot of that has to do with the fact that Trump has been very successful in slowing the rate of increase in terms of government spending. We saw, for example, with the first GDP report that government purchases actually declined in the first three months of this year compared to the last three months of 2024. That's great news. Doge is working. It's having an effect.
Morning Wire
Trade Deals, Tariff Truce & Trillions in US Investments
But at the same time, the government has also been up against the debt ceiling. And so even the spending that they've been doing, they haven't been able to borrow. They've been having to go through cash at the Treasury. They're down about $500 billion or so. So that means that essentially the government is not only spending less, but they're borrowing less.
Morning Wire
Trade Deals, Tariff Truce & Trillions in US Investments
This takes away the primary impetus behind inflation. So most of that price pressure is now gone. It is going to return, unfortunately, at some point. So we have to hope that this tax bill is not only cutting taxes, but cutting spending, too.
Morning Wire
Trade Deals, Tariff Truce & Trillions in US Investments
No, I don't think so. I think it's primarily going to be the issue of the government spending, borrowing, and then printing too much money to pay its bills. In terms of tariffs, we actually really haven't even seen
Morning Wire
Trade Deals, Tariff Truce & Trillions in US Investments
those effects yet, because when we look at something like the Consumer Price Index, that comes from a survey which is conducted three times a month, the beginning, the middle, and the end, to try to eliminate any temporary spikes within a particular month. Well, when we look at the price increases that we saw in the month of April, for example, that were related to tariffs,
Morning Wire
Trade Deals, Tariff Truce & Trillions in US Investments
They didn't arrive until the very end of the month, the last week. So only one of the three surveys in that month in terms of prices would have picked up any of those increases. We're much more likely to see the impact of tariffs in May, even though those tariffs were first introduced back in April.
Morning Wire
Trade Deals, Tariff Truce & Trillions in US Investments
Well, unfortunately, that's going to depend largely on how these trade deals shape out, because like we were just saying, they aren't really deals in the sense of we don't have anything concrete, not just in terms of these things haven't been ratified by their respective governments, but they don't even have concrete details in them in the case of something like China.
Morning Wire
Trade Deals, Tariff Truce & Trillions in US Investments
So markets are probably going to continue overreacting to whatever news comes out. In other words, if a piece of good news comes out, we'll see that big bull run. But if a piece of bad news comes out, it'll go the other way. Markets overreacted in the days after April 2nd, and frankly, they're overreacting now again. That's just the nature of the market. These markets are a beast.
Morning Wire
Trade Deals, Tariff Truce & Trillions in US Investments
Not quite, although we are vastly improved since the infamous Jim Cramer said we're going to have another Black Monday event. It turns out that that was probably the market bottom.
Morning Wire
Trade Deals, Tariff Truce & Trillions in US Investments
But again, for the most part, if we look at a lot of different things, not just equities, you can look at the treasury markets and others, we're basically back, not quite, but we're basically back to where we were on April 1st.
Morning Wire
Trade Deals, Tariff Truce & Trillions in US Investments
Well, I'm no attorney, but the attorneys that I have talked to on certain tariffs say there's absolutely no way they hold up. Things like the tariff on foreign films, for example. to do this. Another one is that 10% baseline tariff. I've heard from a lot of legal minds that say that's the least likely to hold up in court.
Morning Wire
Trade Deals, Tariff Truce & Trillions in US Investments
You're much more likely to see things like the individual rates on particular countries hold up in court. So a 35% rate on China versus a 25% rate on Canada, whatever the case may be. The individual rates are much more likely to hold up than the 10% across the board. But frankly, that's all the more reason why you should put that 10% rate into statute.
Morning Wire
Trade Deals, Tariff Truce & Trillions in US Investments
Don't do it as a tariff, do it as a border adjustment tax. So that way you're not doing things like double taxing an item that crosses a border more than once. That happens a lot in the automotive industry as parts go back and forth before they turn into a final assembly.
Morning Wire
Trade Deals, Tariff Truce & Trillions in US Investments
The other really nice thing about that is the fact that once you have enshrined that into statute, now you can actually use the revenue from something like a border adjustment tax to offset the lost revenue for reducing personal marginal income tax rates. I think that's a win-win because you're helping to shift some of the tax burden overseas.
Morning Wire
Trade Deals, Tariff Truce & Trillions in US Investments
Certainly reductions in rates, also the expensing provisions where you're not gonna force a business that has to buy a large item like a factory today to then take the tax deduction over multiple years. If they're outlaying the cash today, they should be able to take the full deduction today. Now, although that is in the bill, the problem is it's not permanent.
Morning Wire
Trade Deals, Tariff Truce & Trillions in US Investments
It's only going to last for a few years. And then we just have to go through this whole rigmarole all over again to try to get that provision renewed once more. So I would love to see things like that, the most pro-growth parts of this tax bill become permanent. And as always, I would like to see even further reductions in terms of those marginal tax rates.
Morning Wire
Trade Deals, Tariff Truce & Trillions in US Investments
I would not be surprised if on paper, and this is an important distinction here, if on paper you do see a recession and we can look at the first quarter GDP print as evidence for that. You saw the headline number drop about three tenths of a percentage point. Well, government spending, the reduction there in government purchases contributed a quarter percentage point decline.
Morning Wire
Trade Deals, Tariff Truce & Trillions in US Investments
In other words, it accounted for almost all of the decrease. Well, you continue down that trend of shrinking government purchases, reducing government spending, what's going to happen to headline GDP? It's going to continue to go down. But that's not a sign of impoverishment. That's a sign of wealth.
Morning Wire
Trade Deals, Tariff Truce & Trillions in US Investments
It's exactly the opposite of what happened during the Biden administration, where we continue to get these apparently blockbuster official metrics, if you will. All the while, Americans' standard of living went down and their cost of living went up. I care much less about what these, again, quote unquote, official numbers look like.
Morning Wire
Trade Deals, Tariff Truce & Trillions in US Investments
I care much more about what the average American can actually buy with his or her weekly paycheck. And so far under the Trump administration, that figure has gone up, not down. And it's recovered about a quarter of the losses under Biden. That I expect to continue for the quarters ahead.
Morning Wire
Trade Deals, Tariff Truce & Trillions in US Investments
Honestly, it feels a bit of an overreach to call it a deal. This is basically rolling back some but not all of the escalation in terms of tariff rates that we've seen for the last several weeks since April 2nd. And it essentially is an agreement not so much to do anything concrete but to continue talking. So, again, that's a step in the right direction.
Morning Wire
Trade Deals, Tariff Truce & Trillions in US Investments
I don't mean to poo-poo it and say this represents no progress whatsoever. I just don't want to overstate the case and make people think that this is somehow tremendous progress and we have anywhere near the same kind of deal that we do with the UK, for example.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
Well, I would love to know by what metric he is using to determine that this is the greatest economy ever. I mean, look at inflation, for example. He is handing President Trump an economy with a higher inflation rate than it ever was at any point during Trump's first term. So this idea that somehow the economy is firing on all cylinders, I'm sorry, I just don't see the evidence for that.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
You know, there are fewer... native-born Americans with jobs today than there were in 2019, five years ago before the pandemic. Again, by what metric are we using to say that the economy is better now than it ever has been before? What's better now than it ever has been before is government employment. The number of people employed by the government, over 23 million.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
Government is growing at an exponential rate. We're going to spend about $1.4 trillion to finance the debt in the year ahead. I mean, that's the only metric I can see that shows the economy really growing at a brisk pace.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
Sure, there have been some native-born Americans, for example, that have found work over the last several years. But on net, meaning if you consider the number of Americans who have also lost jobs, that exceeds the gains. So the number there is negative. That means that all of the net job creation we have seen over the last five years is has gone to foreign-born workers.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
So what's really sad is that the Biden administration has effectively turned the American labor market into a kind of temp agency for foreigners and for government bureaucrats, because we've seen a disproportionate amount of job growth in the government sector. We've seen the economy actually lose full-time jobs, not gain them. So we're gaining only part-time jobs.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
And again, if you look at the demographics, the only people who are gaining jobs on net are foreign-born workers.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
The latest on inflation, unfortunately, is that it is re-accelerating. And some of that has to do with the fact that the Biden administration continues to spend money we don't have. The Federal Reserve, in an act that I think is election interference, they took their foot off the brake and stomped back on the gas by cutting interest rates right before the election.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
These are all things that are going to contribute to higher prices. And we're only feeling some of the effect right now. Most of that inflationary impulse, though, is really going to play itself out in 2025. And frankly, I think they're handing Trump a bit of a ticking time bomb. when it comes to inflation.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
And, you know, we have this notion that's fueled by the media and by Federal Reserve officials that we've been trending towards this target inflation rate of 2% per year. But that's simply not true. We haven't been trending there. We've been trending to about 3%. And we actually arrived there quite some time ago, and we have been stuck there at about 3%.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
And there's no sign that we're going any lower anytime soon.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
Well, unfortunately, when the government does a bad action, we don't feel all of the bad effects right away. It's very similar to if you drink too much, you know, you get that buzz first, but then the hangover only comes the next morning. And we see the exact same thing with a lot of government overspending.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
Initially, we didn't get to 9% inflation right away at the start of the Biden administration. We got there about a year and a half into his term. And the reason for that was that it takes time for all this government spending to slosh its way through the financial system. But eventually it does work its way through and it ends up creating higher prices for consumers.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
That's what we're seeing play out yet again as the Biden administration not only continues the runaway spending, but now, again, we have this what I would think is election interference on the part of the Fed.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
cutting interest rates hard and fast right before the election to, I think, try to produce a certain outcome, which they obviously didn't get, but which will nonetheless produce some very bad effects for the American consumer next year. Now, on the other side of the equation, you have President Trump with a very pro-America energy policy that should help reduce prices.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
Because if you increase the supply of energy, you'll reduce the price. And when you reduce the price of energy, you reduce prices throughout the economy, since everything uses energy, all kinds of goods and services. So you have one thing from the Fed that's going to help push up prices. You have another thing coming out of this administration that will help push down prices.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
Which of those is going to win out at the end of the day is unclear.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
A deregulation would have a tremendous impact. And we actually saw that during the first Trump administration. There was an interesting gathering where he asked several hundred business leaders from everything from small to large businesses, what did you love most about my first term? By the way, you got to appreciate how the president always phrases these things. What did you love most about me?
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
But he gave them a choice. What was better, the tax cuts or the deregulation? Every single one of them said it was the deregulation. That provided much more benefit. And it not only provides benefits to those business leaders and to those businesses, but also to the broader economy. The reason being that when the government taxes you,
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
They take money from you, but that money is going to get spent somewhere else. So it may be less efficient, but it's not a complete subtraction from the economy. Regulation, however, is exactly that. It is a complete subtraction. It represents a loss of economic activity that's not being transferred from one person to another. It just vanishes.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
And so that deregulation can have a tremendous impact on increasing economic activity, on increasing profits for businesses, and on increasing take-home pay for workers. Again, all of which we saw during the first Trump administration. And it looks like they're really willing to go whole hog during their second term. So that's a reason to be very, very bullish.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
Manufacturing is a big one. People don't realize that there is a tremendous regulatory burden on the manufacturing sector in this country. And it's a key reason why so much of our manufacturing has been shifted overseas, why there has been so much corporate inversion of our heavy industry.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
For a typical manufacturing worker, let's say they're making about $50,000 a year, it's not uncommon for the regulatory burden attached to that worker that the factory owner, let's say, is effectively paying, that that regulatory burden would be $60,000. In other words, it's even more than the person's wages.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
Now, you throw on a benefits package, let's say, of another $40,000 or $50,000 for that worker, and all of a sudden, what looks like a $50,000 worker is to the rest of the world is actually about $150,000 in terms of total compensation costs for that factory owner. Conversely, you can send that job overseas and avoid most of that regulatory burden, avoid a lot of that benefits package, let's say.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
And you throw on top of that the fact that we tax manufactured goods at a lower rate when they come in from overseas than when they're made here at home. And all of a sudden, it's a no-brainer to send those jobs overseas. burden would be a tremendous boon for the American economy and for the American worker.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
I think so. It's very much a carrot and stick approach at the same time. We saw it in more distant history as well, and it produced exactly the same results. We forget that during America's golden age, when we saw our fastest rates of sustained economic growth, we didn't even have an income tax. The federal government fueled itself entirely basically based on tariff revenue.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
And so this idea that somehow increasing tariffs or relatively high rates of taxes on imported goods is somehow going to crash the economy or cause runaway inflation, I'm sorry, nothing could be further from the truth. Again, America's golden age had exactly those circumstances, high tariffs, except we didn't have high inflation.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
We actually had slight deflation during that period of about a tenth of percent per year. So again, there was no runaway inflation. There was no widespread unemployment. It really was America's golden age. And I think it's a key component to repeating that economic success.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
No, it wasn't, and it really demonstrates her complete economic illiteracy and also her ignorance of history. Again, just recent history, because under the first Trump administration, every dollar that was imposed of tariffs, only about 19 cents out of each of those dollars was actually paid for by American consumers. The other 81 cents about...
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
was paid for by overseas producers like Chinese steel producers, for example. The reason being is that if they tried to pass the full cost of the tariff on to American consumers and American businesses in the form of higher prices, then American consumers and businesses would simply choose an alternative that would at that point have been cheaper.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
So maybe that was importing from another country like Sweden and getting our steel from there. Or maybe it was getting our steel from domestic producers here at home, whatever the case may be. So you have to always keep in mind what we like to call tax incidents, which tells us not who is actually literally paying the tax, but who is actually paying the tax.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
In other words, just because a Chinese company is writing the check to the treasury doesn't mean that they're ultimately the ones bearing the cost. Now, in this case, they were. Again, it was about 81 cents on the dollar that they actually had to pay. But that's just one example of what would happen if we continue this policy.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
Now, that stands in stark contrast to domestic taxes, like the income tax or like a sales tax, where no matter where the tax incidence is, either on the seller or the buyer, it's still falling on an American.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
And so the difference between tariffs here and any of those strictly domestic taxes is that the tariffs are essentially causing foreigners to help pay America's tax liability instead of putting the entire burden on the American people.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
I love it. I can't tell you how much I love it. People don't understand the amount of red tape, especially from these different government three-letter agencies like the EPA that throw up roadblocks anywhere and everywhere and make all kinds of productive economic activity. simply unviable because the regulatory burden is so tremendous.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
But again, if you can get rid of that, then all of a sudden you get rid of the deadweight loss and you can create an economic resurgence. It's difficult to overestimate just how many projects there are in this country, or I should say that there could be, in this country, but for the regulations that get in the way of entrepreneurs and people who actually want to serve their fellow man.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
Because at the end of the day, that's how you make money in this country. You provide a good or service that people want, and in exchange, they're willing to pay you for it. But when government is going to throw on this tremendous regulatory burden, it makes it impossible for people to do that. Elon Musk gave a couple of really good examples lately
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
with his SpaceX program, where the EPA and different other agencies threw up all these roadblocks, like making him conduct an ocean survey to try to determine whether or not if one of his rockets fell out of the sky, it might happen to land on a shark in the ocean. I mean, it sounds ridiculous, but those are the kinds of things that organizations like the EPA are forcing businesses to do.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
And if you're a small business, you can't afford to do those things.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
I'm optimistic, but largely only because of the people that are going to be at the helm. The ship of state is going to go through some very, very turbulent waters in the year ahead. We have a lot of what I would call ticking time bombs within the economy. You know, we talked about inflation resurging. That's one of them. The commercial real estate market is on very, very shaky territory.
Morning Wire
Trump vs. Inflation: Can He Fix the US Economy? | 12.14.24
And that means that the small banking sector, which provides all of the commercial real estate loans, they're also looking at a lot of trouble coming down the pike. So again, we're facing a lot of economic headwinds. Let me put it that way. But I have a lot of confidence in leadership that they're going to be able to get us through. Great stuff. Thank you so much for talking with us.
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
Well, Andrew, thanks for having me. Unfortunately, a lot that we have to go on right now is really just rumor, and that's why there's so much volatility in the marketplace. Now, there are a few things that we know for sure, right? Like you mentioned Benjamin Netanyahu being in town. That's something we can definitively say is the case. But as far as nations being at the negotiating table,
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
Again, there's rumors that there's a lot more. There's rumors that there's a lot less. We have heard some EU officials go on the record saying that they are willing on certain things to go to zero tariffs if the US does as well. So again, there is definitely some good progress here. But overall, there's a lot of rumor, which means there's a lot of volatility. Another thing that we know for sure
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
was that because there were so many short positions on wall street as soon as we saw a little bit of an uptick today in stocks there was a rush to cover in other words people were starting to uh to buy stocks for fear that if the price went up they'd have to buy them at a an even higher price now normally stock prices going up would be a good thing but
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
In the case of a short position, it's exactly the opposite. You're betting on things going down, not up. So whatever the case, this all caused a tremendous amount of not just volatility, but a huge swing. The Dow had its biggest intraday swing ever, moving over 2,600 points. between its lowest and its highest point of the trading day, and we're only halfway done at this point.
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
So, again, tons of rumors, which means tons of volatility. Markets are looking for direction. They're looking for definitive answers. We thought we were going to get that last week with the tariff announcement, and unfortunately, because of the way these tariffs have been structured, we've gotten exactly the opposite of clear answers. We've gotten a lot of misdirection.
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
Andrew, these are great questions. Thank you for asking them. And it's really something I think where we need to set the record straight because there is so much misinformation out there. There are way too many versions of the truth here. There's only one truth. So here it is. What President Trump wanted were true reciprocal tariffs.
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
In other words, he wanted a kind of economic golden rule, if you will, where we say to other countries, look, you are imposing these tariff and non-tariff barriers on us. You are penalizing our exporters and therefore our workers. So we're going to do exactly the same thing to you, holding up a mirror, as it were, to these other countries.
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
That is what he tasked members of his administration with, like the Commerce Department, like the U.S. Trade Representative, etc. That was the whole reason for the delay, for example. Waiting until April 2nd was to give those folks time to calculate what are the average effective
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
tariff rates among all these different countries around the world instead what we got was something that has literally nothing to do let me be perfectly clear these tariff rates have nothing to do with other nations tariff and non-tariff barriers they simply looked at the ratio of imports to exports, and only looked at the imports and exports of products, not even services.
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
And so at the end of the day, you're simply looking at trade deficits. And again, it's just the trade deficit in terms of goods. Unfortunately, that means for some countries where we actually have an overall trade surplus, You know, maybe we sell them shoes. Excuse me. They they sell us shoes. So we're buying shoes from them, let's say.
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
And then maybe we turn around and sell them financial services. And they are buying much more in financial services from us than we buy shoes from them. That's a trade surplus for the United States, except that according to this formula, it's counted as a trade deficit. And we impose a penalty tariff rate on that country for having that trade deficit in goods with them.
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
That's a ludicrous trade policy. It's not going to get us what we want, which is more free trade. That's the whole point of reciprocal tariffs. It's to force other nations to get rid of their tariff and non-tariff barriers so that just as foreign nations have access to our consumer markets, Our producers can have access to their consumer markets. That's the goal here.
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
We want more free trade, not less. It's not that we're protectionists. It's that, again, we want true reciprocal free trade, free and fair trade, what some people call it. And the problem with how these tariffs are structured, because they're not actually looking at other nations' tariff and non-tariff barriers, is that we have imposed penalty rates on many countries who don't deserve them.
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
Why on earth is it we have a tariff rate on Israel that's almost twice as high as the one on Iran? Why is it that China has a tariff rate that's just, frankly, middle of the pack? They should have the highest rate among any nation because they engage in the most trade abuses, whether that's manipulation of the currency.
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
subsidizing industry and dumping artificially low-priced products in other countries' markets. You have slave labor. I can go on and on, whether it's currency manipulation, etc. The list just goes on and on when it comes to China and all of their unfair trade practices. And yet again, they have a middle-of-the-road tariff rate. So, The issue here is not the goal, right?
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
President Trump absolutely has the right goal. And I even think that his method, if you will, or his tactic of reciprocal tariffs was a good one. The issue here is how that was implemented. The issue here is that he has people within his administration who frankly have not served him well enough, who did not provide him with the reciprocal tariff schedule that That was promised.
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
That's the issue here. And again, if you look at markets reaction, when it was first announced we were going to have this 10% across the board tariff, markets actually rallied initially. The futures markets went up, I think, about 1.5% on that news. But then all of a sudden, when this tariff schedule appeared. where it made absolutely no sense.
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
These numbers clearly did not come from tariff and non-tariff barriers. That's when futures started to tumble. And then we've had now three days, basically, where the markets have really taken it on the chin. Again, this all has to do with uncertainty. People don't know where we're going to go from here. And that's a problem.
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
Well, I think one of the key things is going to be during these negotiating processes with different countries will be to come up with actual average effective tariff rates. So you look at a nation like Canada, look at all of their tariffs, but also their non-tariff barriers, their quotas, for example, that they put on things like American dairy products.
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
You know, that really hurts our dairy farmers. So figure out, okay, what is the mathematical equivalent in terms of an overall tariff in And so say to Canada, look, if you are willing to get rid of X, Y, and Z tariffs or non-tariff barriers that you currently have in place, we will reduce this tariff rate by a certain amount, okay? And that's your negotiating tool.
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
But the problem with, again, with the current tariff schedule, when there is no real relationship between those trade barriers and the rates, Some of these nations are coming to the negotiating table with their arms up in the air saying, we have no idea what we're supposed to do here. We have no idea how we can actually get these tariff rates down.
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
So I think some further explanation from the White House and some further clarification on what the actual rates should look like would go a long way. The other really big thing. is that it seems like we've kind of put the cart before the horse in a certain sense. You know, what this economy really needs is supply side policies.
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
We need drastic, I mean, drastic cuts to government spending, to taxes, to regulation. We need an energy production boom in this country. And so by getting tariffs first without all of those other things, The American middle class who has been drowning, it's like we just threw them an anchor without first building them a boat.
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
And so it is imperative that we get things like the tax cut across the finish line. And also what I would really like to see from Congress, this isn't just the administration's fault. Congress has been painfully slow to act on this. So I would love to see Congress in the reconciliation process where we get the tax bill through
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
to include in that process this 10% kind of baseline tariff that the president has put in place, put that into statute, but do it as a border adjustment tax. And that has a lot of different advantages. First, it gives a huge benefit to our exporters, which encourages production here, encourages manufacturing, and encourages American jobs, which is tremendous.
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
But it also puts the tariff only on imports. So you're not going to have Things like the car industry, where a car part may cross the border between the U.S., Mexico, and Canada half a dozen times before it goes into the final car assembly. You don't want that to get hit with a tax every single time. So a border adjustment tax solves a lot of those problems.
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
And the other great thing, by putting it in statute, is the fact that now you can include that in the calculation of the reconciliation process so that all the revenues can be used to reduce income taxes.
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
Well, thank you, Andrew. these different tariffs, which are going to generate revenue. These tariffs are being put in place by the executive and not put in statute by the legislature. They can't be counted in the reconciliation process in terms of revenue that's going to come into the treasury.
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
And that's so important because under reconciliation, this is supposed to be a process by which you take an existing budget and you basically just tweak it. And so you're not supposed to have drastic changes to either revenue or expenditures. you're supposed to essentially have no effect. It should even out.
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
So if we're going to make a change like reducing marginal tax rates on income taxes, which is terrific, that's a great thing. It's exactly what the economy needs. It's what the middle class needs. They need tax relief. But now you're going to need to offset that somewhere. And I understand the fact that there's a law for curve effect here.
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
In other words, as you reduce tax rates, that increases economic activity, which grows your tax base significantly. And if you grow the tax base faster than the tax rate declines, overall tax revenue actually increases. That's what we saw during the first Trump administration. The problem is that's not how the Congressional Budget Office scores it.
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
And so you need what they sometimes call an offset to the reduction in personal income tax rates. And a great way to do that would be to take the revenue that's going to come in from a tariff, a border adjustment tax is what we really have. Totally agree.
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
And then you can now essentially shift some of the tax burden onto foreigners, which is great from an economic standpoint because there is actually an externality at play here. It is our Navy that patrols the world's sea lanes. It is our Navy at our expense that keeps the ocean safe for international trade. And so it only makes sense that other nations would help pay that expense.
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
And a great way for them to do it would be to tax the the very thing that our Navy is supporting, which again, is international trade.
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
Thank you. Thank you. Thank you. Thank you. Thank you.
The Charlie Kirk Show
Rejecting Tariffs, or Rejecting Uncertainty?
Maybe Charlie Kirk is on the college campus.
The Dan Bongino Show
E.J. Antoni On Tariffs, Trade Wars, and the Economy | Ep. 09 - 03/27/25
I think it was certainly a surprise to a lot of folks who weren't expecting it, at least not this soon. Now, some of it is not going into effect immediately. In other words... cars currently made in Mexico, in Canada, they're going to have some time to verify, for example, what percentage of the components are actually being made in North America.
The Dan Bongino Show
E.J. Antoni On Tariffs, Trade Wars, and the Economy | Ep. 09 - 03/27/25
In other words, what does qualify for the USMCA and what does not. Part of the reason why so much ire has been directed at Canada lately, for example, is because of all the abuses that have been alleged within the USMCA. In other words, when you allow a Chinese company to come in and set up shop in Canada and sell stuff, That's really not Canadian. It's actually coming in from China.
The Dan Bongino Show
E.J. Antoni On Tariffs, Trade Wars, and the Economy | Ep. 09 - 03/27/25
But you're selling it under the guise of the USMCA. That's really an abuse of these country of origin laws. And so if Canada is not willing to crack down on that, then we're going to have to crack down on it.
The Dan Bongino Show
E.J. Antoni On Tariffs, Trade Wars, and the Economy | Ep. 09 - 03/27/25
Exactly. And it's not just the fact that they are evading the tariffs on China, but then they're getting it's kind of a one to punch because they're evading the Chinese tariffs. And then they're also getting the preferential treatment that other nations don't get within the USMCA. So it's not simply that China is not China, but they're on a level playing field with the rest of the world.
The Dan Bongino Show
E.J. Antoni On Tariffs, Trade Wars, and the Economy | Ep. 09 - 03/27/25
No, it's one step further. They're even getting preferential treatment.
The Dan Bongino Show
E.J. Antoni On Tariffs, Trade Wars, and the Economy | Ep. 09 - 03/27/25
Yeah. That's my late grandfather's. And since we have the same initials, it was, it was left to me. That's cool.
The Dan Bongino Show
E.J. Antoni On Tariffs, Trade Wars, and the Economy | Ep. 09 - 03/27/25
It's interesting. If it really was the case that all of these tariffs would instantly be passed along to the consumer in all instances, then American dairy farmers would have no problem competing in Canada because they would just take that 270% tariff or the equivalent thereof. and pass along to their Canadian consumers. Except they can't, because it would make them uncompetitive.
The Dan Bongino Show
E.J. Antoni On Tariffs, Trade Wars, and the Economy | Ep. 09 - 03/27/25
So that's clearly not what happens, at least not in all instances. Now, there are a lot of different factors at play. There are different elasticities from one good to another, from one market to another. You also have changes that happen in terms of currency exchange rates. So there's a lot of moving parts. Thank you. Thank you. Thank you.
The Dan Bongino Show
E.J. Antoni On Tariffs, Trade Wars, and the Economy | Ep. 09 - 03/27/25
Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you.
The Dan Bongino Show
E.J. Antoni On Tariffs, Trade Wars, and the Economy | Ep. 09 - 03/27/25
Thank you. Thank you. Thank you.
The Dan Bongino Show
E.J. Antoni On Tariffs, Trade Wars, and the Economy | Ep. 09 - 03/27/25
Thank you.
The Dan Bongino Show
E.J. Antoni On Tariffs, Trade Wars, and the Economy | Ep. 09 - 03/27/25
Thank you.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
Vince, good to see you. Beautiful studio, by the way. My first time in here. I love it.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
What about you? What do you think of me?
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
My pleasure. Thanks for having me.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
No, we've actually gotten very, very good inflation numbers, in part because when we look at these tariffs, a lot of them haven't even been implemented. Just the threat of the tariffs alone was enough to bring countries to the table and to kind of get everyone to call a truce. If you do get into some kind of really prolonged, protracted, I should say, trade war,
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
then sure, you might end up seeing some of those price increases. But as of right now, that's not what's happening at all. And it's so ironic, Vince, the exact same people who for years told us Biden's policies aren't going to cause any inflation, right? And then obviously it did. Now tell us Trump's policies are going to cause all kinds of inflation.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
These people are just perpetually wrong, but never in doubt.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
Yeah, absolutely. In fact, depending on which metric you want to use, some of it show this happened for the month of March, others for the month of April. So it just depends on which individual metric. We actually have a lot of different ways to measure inflation. But several of them now have showed prices actually declining. In other words, inflation went negative.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
So we talk about inflation a lot and say, OK, inflation came down. What does that mean? Right. It just means that prices are going up slower than they were before. So it's like if you're driving along in your car, your speedometer is showing you the inflation rate, how fast you're going down the road. The mile markers on the side of the road are showing you how far along you are.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
So if you slow the speed of your vehicle down, you're still going forward. Yes. Right. That means the mile markers continue going up. So, yes, inflation has come down, but prices are still rising. So what we saw again in either April or March, depending on which metric you want to use, is that some prices were actually going down. That's phenomenal news.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
Well, so not only do they have more money to spend, but the money's going further. So the big problem under Biden was the fact that, yes, the average paycheck just went through the roof. Yes. But it didn't go up as fast as prices. Prices outpaced everybody's earnings. Exactly. Exactly. So that's why people were so frustrated with the fact that, yes, they were working additional jobs.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
They had more income. They got raises, whatever the case may be. But they could still afford less than they could four years prior. Right. That was the big problem.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
Right. Right. Under Trump, it's been exactly the opposite. Has it been already? Yes. If we look at how fast incomes have risen compared to prices, incomes have risen about 1% faster. Now, obviously, that's not a huge number, but we're only a few months in. And the fact that we're already seeing this much of a difference, I think that's tremendous.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
Sure, sure. So there'll be some that are very broad, like energy, and then there's some that are really hyper-specific, like eggs. Taking the latter one first, what we saw under Biden was this insane policy where they were literally paying the farmers of egg-laying hens more to kill chickens to cull flocks than they could get by raising those chickens and bringing the eggs to market.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
And yes, that was in response to the avian flu, but it was a very stupid way to handle it because you caused hens that were perfectly fine to get slaughtered en masse. So if you kill all of the egg-laying hens, what's going to happen to your egg supply? It's going to plummet. That's exactly what happened. We had shortages. We had prices go through the roof.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
By simply reversing that policy and putting better ones in its place, you saw the supply of eggs explode again. And so prices for eggs have come way, way down, down like 60% now in just a couple of months. So that's tremendous news. But then you have very, very broad policies as well, like with energy. So in terms of energy, you're talking about a sector that's very, very forward-looking.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
They're not so much concerned about the economic constraints today. They're looking into the future. The reason for that is because almost everything they do takes a very long time. It takes not just months, but years, decades to build a new refinery. It takes many months to conduct the maintenance on a pipeline that's going to keep it operational. Right.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
And so under Biden, what we saw was facilities getting mothballed that are now being brought online because under Biden, it was a very anti-energy regulatory establishment. And under Trump, it's exactly the opposite. Yeah. And so as this new supply is anticipated to come online, it doesn't even need to hit us yet.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
Just the anticipation of new supply is driving futures prices down, which is how we trade energy on the futures market. And that's actually bringing down prices at the pump.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
Oh, sure. And that's something that we knew was going to happen in 2022, for example. And this was something we actually talked about back then, I think, on your WMAL show. Yeah. How whenever you have these huge spikes in prices, in other words, prices rise very quickly in a very short period of time, it takes a while for the insurance market to catch up.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
Because all of a sudden, cars become very expensive to replace, to repair. And the insurance market sees that. And then they decide in the coming months and years, we need to start hiking premiums to cover these higher costs.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
Not quite. It's that the insurance market actually takes a while to observe the real world market conditions and to see, all right, how much do we need to charge in premiums to cover our costs?
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
This is why the insurance market just, I mean, they got their clocks clean for a couple of years there because the premiums they were charging folks were way too low given the cost to repair a car or repair a home. Yes. And so now basically all their actuarial tables were completely out of date. Oh, I see. In literally just 12 or 18 months.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
So now as they recalculate all those things, and this is why the insurance spike under Biden didn't really start happening until his last year or so, but it's unfortunately continuing today, and those prices are probably going to stay elevated for a while.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
Sure. How do you see it? I think it's great news. We have about actually it's over four trillion dollars now of basically guaranteed investment. There's a lot more that has been pledged, they call it.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
Right, right. Now, that's going to be over several years. It's not immediate. It's not all at once. But still, over four or five years, that's a phenomenal increase in investment. And it's going to allow us to do things like build that steel mill in Louisiana that the South Koreans are paying for. It's going to create revenue, obviously, for them.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
But it's also going to create revenue for the American investors. And it creates American jobs. It allows us to build up our industrial base. That's phenomenal news.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
Well, you get essentially this kind of economic snowball where you create jobs in the area. Those people now are going to spend their income in that area, you know, disproportionately. And so that will create other jobs because other businesses are going to see more revenue, more demand. And this just snowballs. Now those businesses are hiring more folks.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
which means more people in the area, which means more development, more spending, more income, etc. So exactly the opposite of what we see when the economy is turning down in a recession, let's say, where job losses lead to more job losses and it snowballs downwards. This is an upward spiral instead of a downward spiral. So looking at the U.S.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
steel deal, for example, that they're hammering out right now with Nippon Steel, That's going to add about a billion dollars just to the Pittsburgh, the greater Pittsburgh area.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
It has essentially stabilized. So it is no longer getting worse, which it was up until January, maybe February. Wow. So it is basically stabilized right now. You're still seeing people, if you look in aggregate across the country, it's about $300 billion annually that people are paying in finance charges just on credit cards. And that's just the finance charges.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
That's like your interest in your late fees. Yes. That has nothing to do with anybody trying to pay down the balances on their credit card. So it's a very, very terrible situation. Yeah. The silver lining here is twofold. One, it's not getting worse, like we just said. And the other thing was what you mentioned earlier. Incomes are now rising faster than prices.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
And we're seeing that when we look at disposable income specifically, that statistic is rising even after adjusting for inflation. And so as people get more money in their pocket, they can start to pay down that debt. It's going to be very painful. It's not as if we can flip a switch and it's all perfect now, and I'm not going to try to paint that overly rosy picture for you.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
But things at least have stopped getting worse and now are starting to get better.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
So we are still seeing growth in foreign born employment, but the native born component of that has really picked up. And it's actually the same thing when we look at like part time and full time jobs. Yeah. Right. Especially in the last half of the Biden administration, full time jobs were going down. All the job growth was part time.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
And as you pointed out, it was pretty much all going to foreigners. Yes. So now what we're seeing, it's not just native-born Americans are getting jobs in addition to foreigners, but full-time employment is coming back while part-time employment keeps growing. So in other words, we are seeing only additions and not subtractions, which I think is a good thing overall. Yes.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
And full-time means that you get the benefits to have a full-time job. Right. And then with the government, that's one where that's actually reversing now. We've seen government jobs. So if you look at federal employment and I like to take the Postal Service out of that. So you're just looking at kind of the bureaucratic bloat in D.C. Right.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
The Postal Service is thrown in with federal jobs, but it's really its own agency. I'm trying to I'm trying to look at just federal employees, ex-Postal Service. That's gone down every month this year.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
You have to go back years. I mean, if you exclude COVID, right? Because COVID, everyone lost jobs for several months there. But if you exclude COVID, you have to go back years to find a time when the private sector was adding jobs this steadily while the federal government was laying folks off.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
And then you talk to the Fed and they're all worried about everything. I mean, it's just, it's incredible. This really is all good news. Now, is it great news? No, I'm not going to come in here and say everything's fine. Yeah, yeah, yeah. And we should rejoice. We got into a very deep hole after four years of the Biden catastrophe, as you called it. It was horrible.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
And it took Biden four years to make that mess. Yes. It's going to take us a couple of years to get out of it.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
I think overall, yes. So one of the problems with things like taxes on tips is it costs the Treasury so much to enforce it that it basically equals the revenue they get out of it. So if the Treasury wants to get another dollar in terms of tip receipts, tax receipts, they have to spend a dollar to do it. I mean, it's a waste. You should get rid of the tax just for that. But also,
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
Things like no tax on tips, no tax on overtime. That encourages people to work more, to work harder. That has a big supply side effect. It's like cutting marginal tax rates. So that would definitely end up increasing economic activity and leading to a net increase in revenue. And you mentioned making things permanent.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
The one thing that they did not make permanent, and I really hope the Senate fixes this, is the expensing provision. That's probably the biggest pro-growth part.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
So this allows a business, let's say they buy a big, beautiful studio like this, right? You want that business, since they spent the money right now to buy the studio, you want them to be able to deduct that today. Instead, what this does, this bill does, is it just basically gives a couple of years extension on that. Mm-hmm.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
And then a company like this is going to have to essentially deduct not just this year, but then possibly for the next 39 years, the full cost of the studio.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
Right. Sure enough, when Biden let this expire, this provision, we immediately saw an effect in investment. It completely chilled investment. The not only did the trend dip down, but we had several quarters where it actually went negative. We were losing investment. Right. Not gaining it. I mean, it was it has it has a terrible, terrible.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
Exactly. And what's really terrible about that is that investment is the only driver of long run economic growth. Yes. Under Biden, the short term driver of economic growth was just government spending. Yeah. Right.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
Exactly. Exactly. This is another case of double taxation. Yeah. Right. And so what I look, as you said, it's a huge bill. There's some good stuff in it. There's some bad stuff. And I think there's some ugly stuff in it, too. And I'm really hoping that the Senate just makes it better, make it a bigger, more beautiful bill than it already is. And I think they can do that.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
I think all our collective IQ just went down having to listen to that drivel. My goodness. Yeah, it was very simple. When the government prints trillions of dollars out of thin air, they become less scarce. And scarcity is fundamentally what gives things its value, right?
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
This is part of something called the diamond water paradox, which now that they can make synthetic diamonds, it's not as true anymore. But why is it that even though water is so much more useful, its price is so much less than diamonds, which have almost no utility, right? Especially compared to water.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
And there's a finite supply of water for what it's worth. It's because water is so much more abundant. Diamonds are so scarce. Yeah. Right. So if you make something less scarce, its value goes down. That's exactly what happened. That's exactly what we did to the dollar. I mean, the Fed literally doubled the assets on its balance sheet, which is the basis of the money supply, essentially.
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
What do you think is going to happen to the value of your currency when you devalue it?
The Dan Bongino Show
Terror In Colorado: Illegal Alien In Custody | Episode 55
Exactly, exactly. Because you still have, it's not as true as it was in the gold exchange standard, but it's still true today. When other currencies are based off of the value of the dollar or when they use dollars as the basis for their money supply, sure, you increase that supply. You're going to increase the supply and therefore decrease the value of other currencies.