John Carney - Finance & Economics Editor, Breitbart News Joins Houston's Morning News

Episode Transcript

Speaker 1 (00:00):
Six, twenty two, our time here in Houston's Porting News.
So that Mexican servesa that you like so much, if
it came across the border, there's gonna be a twenty
five percent tariff on it's starting tomorrow. John Carney joins
US Finance and Economics editor at bright Bart News. We
know the purpose behind what we're doing here as far
as tariffs go, John, What I think what seems to

(00:22):
be a sort of a mixed bag as far as
the reaction from good people like you and other economists,
is what ultimately this will do with the economy. Will
this lead to inflation? Will Mexico find out in a
hurry that a lot of people are not buying their
stuff anymore and therefore they'll capitulate on the tariffs. What
do you think is going to happen with all this?

Speaker 2 (00:42):
So I'm not sure that they're actually going to put
twenty five percent tariffs on tomorrow. There will be tariffs. Mexico, however,
has said that they're willing to cooperate not just on
the border intentional, but actually putting its own tariff on China,
creating what Treasury Secretary Scott Doesn't has called a Fortress

(01:06):
North America. So they may have managed to negotiate themselves
already to a lower tariff. Remember, Donald Trump has said
all along that he wants cooperation and he's willing to
trade down tariffs for more cooperation from Canada, more cooperation
from Mexico. It looks like we're getting that, at least

(01:27):
from Mexico. So we may get a tariff on Tuesday morning,
but it may not be twenty five percent. And I
think we won't see any real pric increases for most
of the things we import from Mexico from at a
consumer level because most because look especially let's take beer
a great example. You can very easily switch away from

(01:51):
the imported Mexican beer to a domestic brand to a
brand made somewhere that isn't Mexico. And so if you
are a merchan who wants to sell it, you are
not going to raise the price because people will just
shift out. Probably the most likely thing is Mexican companies
will lower their prices to keep them competitive in the US.

(02:11):
That will hurt Mexico and it will make the turfs
very painful. But I don't think we'll see a sort
of one for one rise in price in the US.

Speaker 1 (02:19):
Well, I'm guessing too, John Carney. From a practical standpoint,
we knew this day was potentially coming. So if you're
a beer distributor and you sell a lot of Modelo,
for example, you've probably been importing that stuff like crazy.
Here you are over the last couple of months to
just stockpilot. It's not like it's going to go bad, right.

Speaker 2 (02:36):
I mean, look, we won't last forever, but it will
last long enough that you have a lot of it
in already. And the producers, again, they don't want to
lose their market share. When the Mexican beer producers actually
have been in Modelo in particular, have done the huge
beneficiaries of the backlash against bud Block, they don't want

(03:01):
to lose their market share. That's a huge thing for
these companies is how much of the US market can
they control. They don't want to lose that by jacking
up their own prices. So rather than try to pass
through these two consumers, I think what we'll see is
that they will say, let's lower our prices, make a

(03:21):
smaller profit, but also make sure that we're still selling
all across America.

Speaker 1 (03:27):
Yeah, I think you're probably right. When it comes to
New Mexico, the question is is the Canadian government waking
up to this right now or are they going to
go ahead and keep their policies going.

Speaker 2 (03:38):
I think that they will wake up, especially if they
get a twenty five percent tare. One thing that some
people familiar with what the Trump administrator has done is said, look,
Trump has always talked about the same tariff level for
Mexico and Canada, but if Mexico cooperates more, they will
get a lower teriff than Canada does. That will put

(03:58):
a lot of pressure on the Canadian government to start
cooperating more with the US, because they'll say, how could
you not get us at least as good of a
deal as Mexico is getting. And so I think that
we'll see very rapidly that you know, they change their
policies so that they will do everything Mexico does. We
saw that, by the way, when when Mexico pledged to

(04:21):
put troops on their border to protect US from fentindyl,
to protect US from illegal immigration, Canada almost instantly said
they would do the same.

Speaker 1 (04:30):
Yeah, well, they have a prime minister in the government
that Hunt and Isa. It probably would behoove them to
do that, indeed, John Carney, thank you sir, always good
to talk to you. Financing Economics Editor, bright Bard News,
That is John Carney. It is six twenty seven