Transcript
JVL (0:00)
Hello, everyone. This is the Bulwark. I'm JVL here with my colleagues Andrew Egger and Will Saletan. And this is the morning after Liberation Day. The tariffs are coming in good and hard and the markets are reacting. The woke socialist markets don't seem to appreciate the brilliance of Trump's beautiful, very strong tariffs. Andrew. I mean, putting aside whatever ideological biases you might have, just as a matter of conception, are these tariffs worked out with a very high degree of specificity and some real intelligence and forethought. You went digging into these today.
Andrew Egger (0:53)
Yeah. So this is a. We've all been kind of waiting in suspense, kind of on tenorhooks. The White House has been teasing Liberation Day when we're gonna roll out all these tariffs for quite some time. But it was sitting on the details. It was saying, you know, we're gonna have a bunch of tariffs. We wonder what they're gonna look like. Nobody knows. But they're coming at 4pm and they're going into effect at midnight. The White House rolls them out at 4pm Yesterday, President Trump gets up to speak at the White House. It's kind of amazing. You can what. You could watch it happen on cnbc. They had President Trump on the left and they had a stock ticker on the right. And he started talking, he started holding up charts and the arrow started pointing straight down. I mean, like, I've never seen anything like it in my life. But. But what? I mean, so they come out with these tariffs. It's gigantic tariffs on all these countries, basically every, you know, country after country after country after country, along with like a 10% flat rate. But then with these, with these, like, specific, specific tariffs, in theory, geared toward these different countries, everyone starts looking at these numbers, trying to figure, trying to wrap their heads around them, trying to figure out what's going on. The White House has billed these, what they, according to what they say are these are reciprocal tariffs, which is like their political winner. They think there are maybe a lot of people out there who aren't like, pro tariff in general, but they think, okay, if other countries have tariffs on us, maybe it's reasonable that we should have tariffs on them as well. So that's what the White House is calling these things, reciprocal tariffs. But as people start crunching the numbers just in a very basic way, they don't make sense at all. According to that metric, there are countries that have a lot of tariffs on us, that don't have a whole lot of tariffs according to these new trade policies. There are countries that don't have very many tariffs on us, that have massive tariffs according to these trade policies. Smarter math minds than I quickly hit upon what's actually happening here, which is literally just that the Trump administration has taken the countries with whom we have a large trade deficit and they are giving, and they have slapped tariffs, reciprocal tariffs on those countries essentially in relate in ratio to, in relation to how large that trade deficit is. There's a, there's a small, I mean the formula is literally exports minus imports divided by total imports. I mean it's, it's, and the White House has acknowledged, they've said, they've said that's absolutely not what we're doing. Here's our math. And then people have looked at the math and it's a very simple equation that says exports minus imports divided by imports. I mean it's, we're so through the looking glass here and like just, I'm ranting like, just to quickly describe what that means. If we buy a lot of things from a country but they don't buy a lot of things from us, we have a big tariff on them now just starting now starting immediately, starting at midnight last night. If we buy a lot of coffee from Indonesia, but Indonesia doesn't buy a lot of copies from us, surprise, American importers now have to pay big tariffs to import that coffee from Indonesia. And that's just the, I mean, and that's economy wide with a, with a very, very few number of exceptions, including Russia. For some insane reason it doesn't happen with Russia but basically every other place in the entire world. This is the way it's going to operate now. So yeah, that's kind of, that's kind of where we're at. And again this is like we're right at the opening bell as we're recording this. Who knows what's going to happen a day in the markets. But, but I mean you could, you could watch the after hours trading literally drop off a cliff as Trump was speaking yesterday. And that was before we even like figured out how stupid the math was on all this stuff. So that's where we're at.