Rob Kaplan

They are already either making plans or starting to act on plans. Here's the issue. And I'll give you a good example. Many folks, companies I talked to, had moved some manufacturing from China to Vietnam. Now we've got a very high tariff on Vietnam. So if we move to Vietnam, do we stay there and hope there'll be a trade agreement, or do we move?

And they're trying to make risk management decisions. The one decision that many are struggling with is how much can they move to the United States. We know that's the one place where we won't have a tariff. However, costs are higher. is this going to be a globally competitive investment?

And they're trying to make risk management decisions. The one decision that many are struggling with is how much can they move to the United States. We know that's the one place where we won't have a tariff. However, costs are higher. is this going to be a globally competitive investment?

And if the only reason it's competitive is a tariff moat, what if that tariff moat goes away in four or five years? So that's one of the issues folks are wrestling with. And also, they're talking a lot about, can we use technology to lower the costs? And so you'll see a lot of this manufacturing that does get moved here, I would guess, is going to be heavy use of technology, 3D printing,

And if the only reason it's competitive is a tariff moat, what if that tariff moat goes away in four or five years? So that's one of the issues folks are wrestling with. And also, they're talking a lot about, can we use technology to lower the costs? And so you'll see a lot of this manufacturing that does get moved here, I would guess, is going to be heavy use of technology, 3D printing,

other methods to lower the cost.

other methods to lower the cost.

And so let me just put all this in context because it's easy to lose sight of this. The U.S. economy is predominantly a services economy. We manufacture in the United States, I'll pick another 13 or 14 percent of GDP. We import let's say, 10%, 11%, 12% goods. And global manufacturing as a percentage of GDP globally is declining.

And so let me just put all this in context because it's easy to lose sight of this. The U.S. economy is predominantly a services economy. We manufacture in the United States, I'll pick another 13 or 14 percent of GDP. We import let's say, 10%, 11%, 12% goods. And global manufacturing as a percentage of GDP globally is declining.

OK, so we shouldn't forget as we go through this, we run a services surplus with the world. We're primarily a services economy. You want to make sure that we don't do damage to services while we're trying to bolster goods. And so that's, again, the balance we have to weave.

OK, so we shouldn't forget as we go through this, we run a services surplus with the world. We're primarily a services economy. You want to make sure that we don't do damage to services while we're trying to bolster goods. And so that's, again, the balance we have to weave.

This week, yeah.

This week, yeah.

So here's why these new trade deals, as they're announced, are going to be very informative. There are some number of capital committers in the market. And I talked to a number of them who believe this has all been a negotiating strategy and that tariffs are going to come down to closer to zero. I'm afraid.

So here's why these new trade deals, as they're announced, are going to be very informative. There are some number of capital committers in the market. And I talked to a number of them who believe this has all been a negotiating strategy and that tariffs are going to come down to closer to zero. I'm afraid.

That there's another scenario, which is the Trump administration wants the tariff revenue based on their comments. It's unclear how much money Doge is saving. Hopefully they'll do it. They'll say, but it's unclear. They want more tariff revenue and their objective may not be to negotiate down to zero. It might be negotiate down to 10 or 20 or 30.

That there's another scenario, which is the Trump administration wants the tariff revenue based on their comments. It's unclear how much money Doge is saving. Hopefully they'll do it. They'll say, but it's unclear. They want more tariff revenue and their objective may not be to negotiate down to zero. It might be negotiate down to 10 or 20 or 30.

And that is going to make the create significant challenges. And we don't know. exactly which way we're going, but you hear officials saying, we want the tariff revenue and how useful the tariff revenue is, particularly when they're talking about the tax bill and a desire to do more than extend the Trump tax cuts, to get tax on tips, tax on overtime, deductibility for buying a car.

And that is going to make the create significant challenges. And we don't know. exactly which way we're going, but you hear officials saying, we want the tariff revenue and how useful the tariff revenue is, particularly when they're talking about the tax bill and a desire to do more than extend the Trump tax cuts, to get tax on tips, tax on overtime, deductibility for buying a car.

And so I think there's some confusion in the market and it's affecting securities buying, the dollar, gold, treasuries, all these asset classes. Marc Thiessen All right.