Ep. 2176 - MOTHER OF ALL TARIFFS: The Tariff War Has Begun
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What happened when the Trump tariffs finally took effect?
Folks, covering the news in the markets, well, it is fast and furious like drinking out of a fire hose, but here is the thing. The Daily Wire, what we are about is fact. We're going to bring you fact from a conservative perspective, and that means we're going to be honest with you. We are not going to BS you. The Daily Wire gives you what matters. All the angles, every fact, every time with unfiltered daily shows from the best in the business and the best in investigative journalism. You deserve the whole story. Don't settle for narrative. Subscribe to facts. Go to dailywire.com slash subscribe already. So unsurprisingly, the markets started the day down in pre-markets. The Dow Jones Industrial Average was down almost 1,000 points.
The S&P 500 was down about 2% as well. Frankly, I'd be a little bit surprised if it doesn't go lower today. And the reason I say that is because, of course, last night at 12.01 a.m., all of America's tariffs went into place. Now, how do those tariffs actually work? It takes a little while for them to kick in in practical ways. the way that these tariffs typically work is that there is a process, the product arrives at a port of entry, and then there's essentially a record that is kept of what has just been imported. And then the company that brought it in has somewhere between 10 and 30 days to actually pay the tariff on the good. And so there's a bit of a delay effect given this process. With that said, you're going to see prices adjust very, very quickly because everybody can see the tariff train coming down the road, how it's going to impact their business. So all the talk about how this is just for the stock market, it's just the Dow Jones, stop talking about the S&P 500, talk about Main Street and real business. Once the tariffs are in place, it hits everybody.
So far, the markets are a good way of aggregating human knowledge in the moment. As Benjamin Graham, the Warren Buffett mentor, suggested, in the short term, markets are a voting machine. In the long term, they are a weighing machine. We are now currently moving from voting to weighing. So if the last several days have been about voting, about the markets saying what they think is going to happen, now the rubber hits the road, now the pedal has hit the metal, and we're going to find out what these tariffs are actually going to do. The tariffs hit last night at 12.01 a.m. According to the Wall Street Journal, US stocks ended Tuesday in a downswing, capping a volatile session that began with hopes of newfound clarity on the president's tariffs policies. Now, remember, I talked yesterday and the day before about the fact that there are basically two different and widely variant rationales that have been given for the trade war. One is that we are attempting reciprocality.
What we want is for everybody to go to zero. It's sort of Elon Musk, Scott Besson's idea. If we're going to do a trade war, the goal is to get everybody to come to the United States on bended knee. We go to zero tariff policy, and now free trade rules the roost. That is rationale number one. Then there is the second rationale. which is, in fact, restrictionist. The idea here is that tariffs make America rich. We need to tax other goods from other countries in order to prop up domestic manufacturing, in order to come up with some sort of subsidized industrial policy in the United States in order to reshore. And this wing of the Republican Party is led by people like, for example, Peter Navarro and Howard Lutnick, the Commerce Secretary.
And these two rationales are incredibly different. And Trump has been retailing both of them at the same time. President Trump has been sometimes saying that he wants reciprocality, and sometimes he's been saying that tariffs will make us rich, and so it is totally unclear to the markets which one he wants. And let us be perfectly frank about this. If what he wanted was reciprocality, he did not need to declare a trade war on every country on Earth at the same time. He could have simply gone to Japan and said, listen, We need you to do the following things to get to a better trade deal. And if you don't, we're going to slap you with the tariff. And you could have done it behind the scenes and a trade deal could have been negotiated.
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