May 6, 2025 • 30 mins
Listen on:
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Watch on: https://www.youtube.com/@WatchdogOnWallstreet/featured
Chris presents a “Trilogy of Tariff Terror,” exposing the fallout from U.S. tariffs. He first debunks pro-tariff articles as paid propaganda from agenda-driven think tanks, likening media to a “sewer.” Second, he cites Vizion’s trade data showing a widening U.S. trade deficit, a 20% drop in container imports, and slumps in agriculture and auto sectors (e.g., Ford’s $2.5 billion tariff hit), with companies like Mattel and Nucor facing exemptions or losses. Third, Markowski warns of a treasury market “flash crash” (10-year yields from 3.9% to 4.56%) post-Liberation Day, risking global financial collapse if U.S. debt credibility falters. He urges fiscal discipline, criticizing a $5 trillion debt ceiling hike, and fears Trump’s tariff and tax cut push could break the world economy. www.watchdogonwallstreet.com
Apple Podcasts:https://podcasts.apple.com/us/podcast/watchdog-on-wall-street-with-chris-markowski/id570687608
Spotify: https://open.spotify.com/show/2PtgPvJvqc2gkpGIkNMR5i
Watch on: https://www.youtube.com/@WatchdogOnWallstreet/featured
Chris presents a “Trilogy of Tariff Terror,” exposing the fallout from U.S. tariffs. He first debunks pro-tariff articles as paid propaganda from agenda-driven think tanks, likening media to a “sewer.” Second, he cites Vizion’s trade data showing a widening U.S. trade deficit, a 20% drop in container imports, and slumps in agriculture and auto sectors (e.g., Ford’s $2.5 billion tariff hit), with companies like Mattel and Nucor facing exemptions or losses. Third, Markowski warns of a treasury market “flash crash” (10-year yields from 3.9% to 4.56%) post-Liberation Day, risking global financial collapse if U.S. debt credibility falters. He urges fiscal discipline, criticizing a $5 trillion debt ceiling hike, and fears Trump’s tariff and tax cut push could break the world economy. www.watchdogonwallstreet.com
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
The Watchdog on Wall Street podcast explaining the news coming
out of the complex worlds of finance, economics, and politics
and the impact it we'll have on everyday Americans. Author,
investment banker, consumer advocate, analyst, and trader Chris Markowski.
Speaker 2 (00:16):
The Trilogy of Terriff Terror two movies. When I was
a kid, I to this day not going to forget
they both gave me nightmares. For what reason. We were kids.
We used to like frightening movies, stay up late watching
certain things. The Exorcist scared the hell. I mean, there
was another one. It was a television show and I
(00:40):
don't remember. I don't remember. It was three different stories.
I don't remember the first two. But the third one
in Trilogy of Terror had to do with this doll,
this scary African doll, and I had really scary teeth,
and the chain fell off the doll that kept the
evil spirit at bay, and then the doll came to life.
(01:03):
I don't know if that's what started it, but I
hate dolls, hate them, Always always been afraid of dolls.
Can't stand them. My kids, when they were younger, they
knew that, and if I was away from my home office,
they would hide dolls all over my office, trying to
scare me. But that's just kids being kids. But anyway,
neither here nor there, We're going to do a little trilogy,
(01:26):
trilogy of tariff terror right here first and foremost. Listen,
I appreciate, appreciate the various different messages and emails that
I'm getting for people, you know. And again, what they're
doing is people are sending me columns articles written by
so called experts. So called experts they show up on
(01:48):
like market Watch or various different places there that are
in support of the tariff strategy that our country has undertaken.
And listen, you're trying, and you you know, you're trying
to prove your point. However you have to. You have
to take a look at the source, look at the
(02:11):
person that wrote the article. And most of you don't
understand this, and I trying to explain this over the
years here on the program. A lot of what you
read nowadays is bought and sold. That's right, it's a commodity.
I have a popular podcast. I've had a radio show
(02:34):
for twenty five years. I could put a lot of
coin in my pocket by having various different people come
on the show. People will pay me money to come
on my show and basically push whatever they're pushing at
that point in time. That's their job, that's their job.
(02:55):
Their job is to get out whatever they're told to
get out. They're influencing in that manner, and it works
with the news. Works with the news. You'll have various
different think tanks or organizations, and they often have names
like the Center for Super Awesome American Prosperity, and they
(03:18):
come up with all this this nonsense. They make up
these ridiculous organizations which are funded by politics, politicians, agendas,
various different groups, and they're out there to push an agenda.
The BS that is out there when it comes to
the news nowadays, it's a sewer. It is a sewer.
(03:41):
I was thinking about it today. There was that scene
in Ocean's eleven when Basher Basher crawled out from the
sewer in Las Vegas and he was covered in poop.
That's that's that's basically what it is anyway. Anyway, it's
a for play type of system. And the same way
(04:03):
you're paying for trophies too, you're paying for trophies to again,
if you want to be featured in something somewhere you
have to pay anyway. Anyway, Moving on, moving on, let's
let's talk about some of the headlines. I'm gonna go
over some facts here today. Not bs. This is not
(04:27):
fake news. This is not the news pushing down. This
is actually coming from ports. And I don't know if
you saw today. Our trade deficit is widening. That's right,
it's getting worse instead of better. What began is a
rapid drop in US imports, a shippers cut orders from
manufacturing partners around the world has now extended into a
(04:50):
nation wide export slump, with the US agricultural sector and
top farm products including soybeans, corn and taking the hardest
hit China in particular, began in January, now extends to
US ports. This is Trade tracker Vision, which analyzed US
(05:13):
export container bookings for the five week period before the
tariffs began. In the five weeks after decline in container ships.
The CEO of Vision, Kyle Henderson, we haven't seen anything
like this since the disruptions of the summer of twenty twenty.
That means goods expected to arrive in the next six
(05:36):
to eight weeks simply won't with tariffs driving costs higher.
Small businesses are pausing orders. Products that once move reliably
are now twice as expensive, forcing importers into tough decisions.
These are facts. This is not hyperbole, This is not theory.
(05:59):
This is what is happening. Retailers have been urging consumers
to buy sooner rather than later. Again, the latest forecast
shows that the number of inbound containers ships. We'll see
a sharp drop in May, with trade disruptions leading to
a twenty percent decrease in US container imports from Asia,
(06:22):
pivotal time of year for the holiday shopping season when
orders are typically being placed to supply chains. Tipping point
is left to chain against. June is kind of like
do or die when it comes to this. I can
go more in detail with this. The CEO of Mattel
interviewed this morning and was asked about bringing production of
(06:45):
toys back to the United States. He said, no, that's
not going to happen. It's not going to happen. It
doesn't make any sense. He said, We're going to continue
to design toys, going to continue to do our creative
work in the United States, but they're not moving toy
(07:06):
manufacturing to the United States. Ford Ford suspends twenty twenty
five guidance two point five billion dollar impact from tariffs. Again,
I'm sorry, you have to at this point in time,
you have to feel sorry. You have to feel sorry
(07:33):
for Ford. Ford and other American auto manufacturers were forced.
First forced because of ridiculous cafe standards, are making cars
that they couldn't make money on, and that was still
internal combustion engine cars. Then it moved on to electric vehicles.
Oh yeah, that that mock series that Ford makes, Mustangs, whatnot?
(07:54):
A lot of that is manufactured in Mexico. Why, well,
they got to keep the costs down because they're losing
their shirts on the cars. They're already losing money on
those cars. So they did everything that they could so
they could lose less money because they were being forced
to make those cars. Now you're putting tariffs on them,
(08:22):
then they're just going to move those plants to the
United States. Lickety split. Two point five billion dollar impact.
You don't think that that is eventually going to filter
its way down to the consumer. Well, you think Ford's
just going to eat that? You really think that that's case?
(08:46):
You think that they should have to eat that. No, Again,
a tariff is a tax it's a tax. Is a
quick side note here. One of the things that drives
me berserk all the time is when you have leftists
(09:06):
leftis now we need to raise corporate taxes. May go
on to are these evil corporations and raise taxes. What
do I explain to you? Okay, a corporate tax is
not a tax on a business. It's not. Corporate tax
is a tax on you. Businesses are what corporations tax
(09:29):
ID number and a logo. They don't have a tree
at their corporate office that grows money that they use
to pay their taxes. They price the taxes that they
have to pay into the goods and services that they
are providing to you. If a tariff is a cost
to a business, they are going to price it into
(09:51):
the products that they are selling to you. Tariff lesson
at new Core Steel. This is funny. Yeah, yeah, Jade
Vance was at new Core last week and yeah, well
you know new Core they like, oh I'll at steel
(10:13):
coming ahead and love these tariffs some of them. Yeah, yeah,
they put tariffs on, uh, put tariffs on new Core.
Well I'm steel incoming steel, so new Core benefits from that.
But uh, some of the tariffs are going to actually
hurt new Core having to deal with pig iron and
(10:39):
direct reduced iron. Uh, these things come from Brazil and Trinidad.
So what is Newcre looking to do right now? They're
looking for an exemption. They're looking for in a deal.
Oh oh, not to mention the fact that they were
expanding a plant here in the United States and luckily
(11:00):
they got all of the equipment which is made in
Europe prior to the tariffs. But if they want to
expand again all tariffs on that equipment, they're going to
need another exemption. Are you going to get an exemption?
Probably not? Probably not. Got to hand this one to Delta,
(11:20):
Okay at Bastion over Delta said, nah, No, the air
buses that we ordered were not We're not paying tariffs
on these things. What they did, but they did this
was kind of cool. They actually used the planes and
flew them to Japan. I'm not making this up. This
is genius ways around Trump tariffs. They flew their airplanes
(11:45):
that they're buying from Airbus to Japan, so before they
bring them back to the United States, they're classified as
used airplanes so they can get around the tariffs. Not
making it up, but it was kind of genius if
you ask me. So, you can do that with certain
things like airplanes, other things, not so much. Apple. Apple
(12:06):
won't be able to avoid price hikes for long. iPhone
maker is absorbing nine hundred million in tearff cross this quarter.
You you think that they're not gonna start pricing this
into their products. Of course they are. Of course they are.
You are going to pay, They say, it's the thing
(12:32):
about tariffs. Okay, you people buying there, They're gonna make
these companies pay. No, you're not. You are gonna pay.
I am gonna pay. We're all gonna pay. We're just
getting taxed. And then we get this as well. You
know Trump is talking about, uh, oil prices are coming down.
(12:57):
Why do you think that is? Do you think it's
because of drill, baby, drill? No? Why why don't you
go and take a look. Okay, well again we deal
in facts here. Okay, try to test me on anything
that I'm giving on. Go in to go take a
look and say, when the price of oil fill off
(13:20):
a cliff, well, well just go take a look. See
when oil such falling off a cliff? Why? Why is
oil falling off a cliff? Because less economic activity, less
economic activity, extra use. Oh yeah, sure yeah. Opek is
(13:41):
using this to their advantage too, and they're upping what
they're doing. They're smart. They're upping their production, which is
going to hurt American oil producers. Shale Giant Diamondback says
US oil output has peaked, slashes slashes, it's capital expenditures
(14:06):
because of what is taking place, meaning what people are
going to lose their jobs. People are going to lose
their jobs. I talked about that show that I'm a
big fan of Landman Billy Bob Thornton awesome. In that show,
there is a production costs for oil, a break even number.
(14:27):
There's a break even number for the production of oil,
and there's a sweet spot. And once it goes below
that sweet spot, guess what, it makes no sense to
get it out of the ground. Makes no sense to
get out of the ground because you're going to be
selling it, selling it for less than what you are
(14:49):
producing it. That's what's taking place right now. I want
to talk a little bit. I did talk about Trump
and his is pencils and dolls. Matthew Hennessy actually had
a pretty interesting take on this. Today. I'm going to
(15:11):
comment on it outrageous claims. This is true. Outrageous claims
are the gasoline that makes Donald Trump's political career go.
Without a steady flow of shocking statements, the motor would stall,
But engines also require air. If you get the mixture wrong,
(15:33):
the engine floods in the car won't start. Trump got
the mixture wrong when saying, maybe the children will have
two dollars instead of thirty dollars, and maybe the two
dollars will cost a couple bucks more than they normally would.
The Chinese ships that deliver cheap goods to American ports
are loaded up with stuff, much of which not all
(15:55):
of it, but much of which we don't need. He
made that point again on Meet the Press as well,
and they talked about pencils. They don't need two hundred
and fifty pencils, they need five again Jimmy Carter Esque
(16:17):
I called it neo Marxist malaise type talk. This is
this is new. Okay, this is new. This is new
for a president you know you've had in the past.
(16:40):
You know we had in the past, We've you know,
World War two, Uh, you know, tighten your belts because
of war and uh, scrap metal drives. Again, this is
because of a policy decision. Hennessy makes the point, you're
(17:03):
really used. Americans are not used to having an essence
of president basically say, hey, you're being too materialistic. Listen,
you know, might that be the case for certain people? Yes,
(17:23):
I listen. I ask you a question, why do you
think so many people, so many people try to get
into this country every single year. I don't. I don't
know how you think this is going to resonate well
with people. People to you know, the president of the
United States telling them how how wasteful, wasteful they are,
(17:50):
not to mention the fact it's coming from Donald Trump.
This is a guy. This is a guy that would
slap throughout his life and all the more power to
him he was able to do it. Would slap his
name on everything for crying out loud, Trump vodka. The
guy doesn't drink Trump water, Trump furniture. He had slap
(18:15):
his name on everything started, you know, failed universities. He's
got a bloody gold toilet for crying out loud. You
see how he decorates, and he's telling the country to
tone it down. This is a Again, I'm not I'm
(18:40):
not getting it you know it was funny too. It's
twenty two. I'm not making this up. I'm not making
this up. There was an actual column today in the
Wall Street Journal written by Amy Chan. Amy Chan is
the chief sustainable say sustainability officer at Berkeley, the chief
(19:02):
sustainability officer EESGDI left wing stuff. This is the stuff
that Trump doesn't like. He's supposedly trying to push back against,
praising Trump, praising Trump, saying that again all of this
and people buying less stuff, and this is going to
be wonderful for the environment. I'm not making this up anyway.
(19:30):
Another aspect, third part of our ar trilogy of tariff terror.
I tried very hard this month. I tried very hard
this month to try to express my concern with how
these tariffs were rolled out. And I said, from the
(19:52):
get go, okay, I don't have any problem with tariffs
that are applied in a surgical manner where there is
some sort of reciprocal where there is it makes sense
to everyone out there. From the very beginning, this was
(20:12):
an absolute disaster. And spare me, spare me the three
D five D ten D chess that Trump is playing
right now. Okay, if you honestly still believe that. I'm sorry, Okay,
you got to lay off the magapills, you got to
lay off the drugs. Okay. Trump was scared, shis to
(20:36):
put it mildly, when he saw what happened in the
bond markets. You'd think that they were planning on walking
back those ninety day that the ninety day reprieve. No, no,
a gentleman that I uh. From time to time. He's again,
he's a great writer. He's in my industry. His name
(20:58):
is Ben Hunts. He's got a group called the Epsilon Group,
kind of like a kind of a group of like
minded investment professionals and advisors. And again, he and I
and many things we think alike. And we also use
sub references quite often in our columns and then when
(21:22):
we speak. He had a column out there today. Again
it's great because it's Godfather Godfather three, our true enemy
has yet to reveal himself. This is you know, a line,
(21:45):
a line that was used in Godfather three. And you know,
a lot of people so the worst we're not a
great movie, but come on, al Pacino was was awesome
in that movie, awesome, and he had that line. It
was kind of right after the assassination attempt in Atlantic City.
But anyway, anyway, our true enemy has yet to reveal himself.
(22:09):
And he goes back to a point in time. This
is something that I've written about extensively. I've talked about
over this. Try to teach people about this. We knew
at Markowski Investments. We knew that something wicked this way
was coming in two thousand and six, two thousand and seven.
Even at the end parts of two thousand and five,
(22:31):
I was having WTF moments when it came to real
estate and what I was seeing going on. And you
go back to that point in time, you can go
to do searches of the news nobody. I mean, was
it two thousand Was it two thousand and seven? Two
(22:54):
thousand and seven, I think is when the two hedge
funds over at bear Stearns Employed did At that point
in time, I remember exactly where I was. I was
outside outside of CBS studio of Gandhy Boulevard and Tampa, Florida,
after just doing an interview, coming back in my car,
(23:16):
and I heard about what was taking place. I heard
about these hedge funds, was like, oh, oh things, things
are going to escalate. But at that point in time
of the news, crickets crickets, Ben BERNANKI, oh, this is
the housing market is rock solid. The true enemy out there,
(23:43):
the over financialized US residential mortgage market hadn't revealed itself
until it did till it did subprime loans, how they
packaged them. I mean all of these things. Again, I
knew that something was wrong, Okay, I did. I had
(24:05):
no knowledge of how bad it actually was. I didn't.
I didn't know about the S, S and P and
Moodies being in cahoots with the various different firms and
putting triple A ratings on bonds a myriad of different things.
I had no knowledge of that at all. Anyway, Anyway, today,
(24:30):
why am I bringing this up today? And Ben Hunt
brings it up to the same thing that I was
saying earlier on this month. Still scaring the crap out
of me. Today Our treasury market, our treasury market. You
(24:54):
want to talk about wrecking an immense amount of damage
on the global financial system, and go and take a
look at that. What happened the flash crash the ten
year and thirty year treasuries following Liberation Day. Yeah, ten
(25:19):
year treasure was at three point nine, went to four
point five six. Thirty year went from four point three
to four point nine seven. Doesn't seem like a lot,
but it's a fricking lot. Again. This is the unfortunate
thing is people don't understand.
Speaker 3 (25:41):
Okay, the world runs okay on the fact that we
the people, Okay, the United States of America.
Speaker 2 (25:50):
Is we're good. We're good, we are zero risk, we
are good on our debt. If that goes away again,
it's what people who try to get your arms around
this US treasury market. I'm gonna quote Ben in this. Okay,
(26:16):
I covered this earlier. We're gonna let somebody else basically
speak the same way that I did. The touchstone of
every loan in the world, every insurance policy in the world,
every equity valuation in the world. When it flash crash
like that, it broke. Why did it break? The full
(26:39):
faith and credit of the United States came into question.
Speaker 3 (26:48):
Oh no, no, no, haha, we're just kidding everybody.
Speaker 2 (26:52):
Oh no, no, no, we're just kidding. O psych oh
we're taking those reciprocal tariffs off on everyone. Wooooooo do
you understand here? Another one week, sixty five point basis
(27:15):
point increase in US long term interest rates would have
broke the world. Yeah, that's great David Bowie song, the
Man who Sold the World. They'd have to rewrite that
song to the man who broke the world. Everything would break,
(27:37):
every ensure would be in regulatory for barons and would
need to raise capital most banks. The dollar would crash,
equity markets would crash, lending and credit would come to
a halt. The Fed would be forced to engage what
is called yield curve control, where they would buy out,
flat out, buy and force big banks to buy ten
(27:58):
year and thirty yearsuries in order to keep their value
propped up. Would it work, Yeah, for a little bit,
for a little bit, but which is basically the Fed,
you know, printing money. That's what scared me. That's what
(28:22):
was done another way. And again we're watching it take
place right now. We have to get our fiscal house
in order. Okay, fiscal house and order big beautiful bill
(28:44):
five trillion dollars raising the debt ceiling. Listen, people, this
is this is again. This is serious stuff and something
I've been warning about for some time sometime. Ben Hunts
(29:09):
from the get go full disclosure. Okay, I voted for
Trump twice. I don't think Ben did. I'm not a fan.
And he writes, he said, do you think that Trump
would back down from passing a big, beautiful tax cut
bill even if the bond market freaks out about it?
(29:29):
Do you really think that Trump would back down from
passing a big, beautiful tax cut bill and continue to
back down from his terrace, or do you think Trump
will start talking about the need to do something about
non US holders of US treasuries because they're not treating
him fairly. A b or C again, Listen, he used
(29:58):
Trump in his history with bad debts and bankruptcies, he
uses he doesn't look at them in the same way.
You know, I owe somebody money. You owe some people money.
It's it's an obligation that we base on a moral grounding.
(30:19):
I don't know if he's the same when it comes
to that. This is this is the true enemy, people.
True enemy has yet to reveal itself. I just revealed it.
This is the Trilogy of terrorf Terror Watchdog on Wall
(30:43):
Street dot Com
The Watchdog on Wall Street podcast explaining the news coming
out of the complex worlds of finance, economics, and politics
and the impact it we'll have on everyday Americans. Author,
investment banker, consumer advocate, analyst, and trader Chris Markowski.
Speaker 2 (00:16):
The Trilogy of Terriff Terror two movies. When I was
a kid, I to this day not going to forget
they both gave me nightmares. For what reason. We were kids.
We used to like frightening movies, stay up late watching
certain things. The Exorcist scared the hell. I mean, there
was another one. It was a television show and I
(00:40):
don't remember. I don't remember. It was three different stories.
I don't remember the first two. But the third one
in Trilogy of Terror had to do with this doll,
this scary African doll, and I had really scary teeth,
and the chain fell off the doll that kept the
evil spirit at bay, and then the doll came to life.
(01:03):
I don't know if that's what started it, but I
hate dolls, hate them, Always always been afraid of dolls.
Can't stand them. My kids, when they were younger, they
knew that, and if I was away from my home office,
they would hide dolls all over my office, trying to
scare me. But that's just kids being kids. But anyway,
neither here nor there, We're going to do a little trilogy,
(01:26):
trilogy of tariff terror right here first and foremost. Listen,
I appreciate, appreciate the various different messages and emails that
I'm getting for people, you know. And again, what they're
doing is people are sending me columns articles written by
so called experts. So called experts they show up on
(01:48):
like market Watch or various different places there that are
in support of the tariff strategy that our country has undertaken.
And listen, you're trying, and you you know, you're trying
to prove your point. However you have to. You have
to take a look at the source, look at the
(02:11):
person that wrote the article. And most of you don't
understand this, and I trying to explain this over the
years here on the program. A lot of what you
read nowadays is bought and sold. That's right, it's a commodity.
I have a popular podcast. I've had a radio show
(02:34):
for twenty five years. I could put a lot of
coin in my pocket by having various different people come
on the show. People will pay me money to come
on my show and basically push whatever they're pushing at
that point in time. That's their job, that's their job.
(02:55):
Their job is to get out whatever they're told to
get out. They're influencing in that manner, and it works
with the news. Works with the news. You'll have various
different think tanks or organizations, and they often have names
like the Center for Super Awesome American Prosperity, and they
(03:18):
come up with all this this nonsense. They make up
these ridiculous organizations which are funded by politics, politicians, agendas,
various different groups, and they're out there to push an agenda.
The BS that is out there when it comes to
the news nowadays, it's a sewer. It is a sewer.
(03:41):
I was thinking about it today. There was that scene
in Ocean's eleven when Basher Basher crawled out from the
sewer in Las Vegas and he was covered in poop.
That's that's that's basically what it is anyway. Anyway, it's
a for play type of system. And the same way
(04:03):
you're paying for trophies too, you're paying for trophies to again,
if you want to be featured in something somewhere you
have to pay anyway. Anyway, Moving on, moving on, let's
let's talk about some of the headlines. I'm gonna go
over some facts here today. Not bs. This is not
(04:27):
fake news. This is not the news pushing down. This
is actually coming from ports. And I don't know if
you saw today. Our trade deficit is widening. That's right,
it's getting worse instead of better. What began is a
rapid drop in US imports, a shippers cut orders from
manufacturing partners around the world has now extended into a
(04:50):
nation wide export slump, with the US agricultural sector and
top farm products including soybeans, corn and taking the hardest
hit China in particular, began in January, now extends to
US ports. This is Trade tracker Vision, which analyzed US
(05:13):
export container bookings for the five week period before the
tariffs began. In the five weeks after decline in container ships.
The CEO of Vision, Kyle Henderson, we haven't seen anything
like this since the disruptions of the summer of twenty twenty.
That means goods expected to arrive in the next six
(05:36):
to eight weeks simply won't with tariffs driving costs higher.
Small businesses are pausing orders. Products that once move reliably
are now twice as expensive, forcing importers into tough decisions.
These are facts. This is not hyperbole, This is not theory.
(05:59):
This is what is happening. Retailers have been urging consumers
to buy sooner rather than later. Again, the latest forecast
shows that the number of inbound containers ships. We'll see
a sharp drop in May, with trade disruptions leading to
a twenty percent decrease in US container imports from Asia,
(06:22):
pivotal time of year for the holiday shopping season when
orders are typically being placed to supply chains. Tipping point
is left to chain against. June is kind of like
do or die when it comes to this. I can
go more in detail with this. The CEO of Mattel
interviewed this morning and was asked about bringing production of
(06:45):
toys back to the United States. He said, no, that's
not going to happen. It's not going to happen. It
doesn't make any sense. He said, We're going to continue
to design toys, going to continue to do our creative
work in the United States, but they're not moving toy
(07:06):
manufacturing to the United States. Ford Ford suspends twenty twenty
five guidance two point five billion dollar impact from tariffs. Again,
I'm sorry, you have to at this point in time,
you have to feel sorry. You have to feel sorry
(07:33):
for Ford. Ford and other American auto manufacturers were forced.
First forced because of ridiculous cafe standards, are making cars
that they couldn't make money on, and that was still
internal combustion engine cars. Then it moved on to electric vehicles.
Oh yeah, that that mock series that Ford makes, Mustangs, whatnot?
(07:54):
A lot of that is manufactured in Mexico. Why, well,
they got to keep the costs down because they're losing
their shirts on the cars. They're already losing money on
those cars. So they did everything that they could so
they could lose less money because they were being forced
to make those cars. Now you're putting tariffs on them,
(08:22):
then they're just going to move those plants to the
United States. Lickety split. Two point five billion dollar impact.
You don't think that that is eventually going to filter
its way down to the consumer. Well, you think Ford's
just going to eat that? You really think that that's case?
(08:46):
You think that they should have to eat that. No, Again,
a tariff is a tax it's a tax. Is a
quick side note here. One of the things that drives
me berserk all the time is when you have leftists
(09:06):
leftis now we need to raise corporate taxes. May go
on to are these evil corporations and raise taxes. What
do I explain to you? Okay, a corporate tax is
not a tax on a business. It's not. Corporate tax
is a tax on you. Businesses are what corporations tax
(09:29):
ID number and a logo. They don't have a tree
at their corporate office that grows money that they use
to pay their taxes. They price the taxes that they
have to pay into the goods and services that they
are providing to you. If a tariff is a cost
to a business, they are going to price it into
(09:51):
the products that they are selling to you. Tariff lesson
at new Core Steel. This is funny. Yeah, yeah, Jade
Vance was at new Core last week and yeah, well
you know new Core they like, oh I'll at steel
(10:13):
coming ahead and love these tariffs some of them. Yeah, yeah,
they put tariffs on, uh, put tariffs on new Core.
Well I'm steel incoming steel, so new Core benefits from that.
But uh, some of the tariffs are going to actually
hurt new Core having to deal with pig iron and
(10:39):
direct reduced iron. Uh, these things come from Brazil and Trinidad.
So what is Newcre looking to do right now? They're
looking for an exemption. They're looking for in a deal.
Oh oh, not to mention the fact that they were
expanding a plant here in the United States and luckily
(11:00):
they got all of the equipment which is made in
Europe prior to the tariffs. But if they want to
expand again all tariffs on that equipment, they're going to
need another exemption. Are you going to get an exemption?
Probably not? Probably not. Got to hand this one to Delta,
(11:20):
Okay at Bastion over Delta said, nah, No, the air
buses that we ordered were not We're not paying tariffs
on these things. What they did, but they did this
was kind of cool. They actually used the planes and
flew them to Japan. I'm not making this up. This
is genius ways around Trump tariffs. They flew their airplanes
(11:45):
that they're buying from Airbus to Japan, so before they
bring them back to the United States, they're classified as
used airplanes so they can get around the tariffs. Not
making it up, but it was kind of genius if
you ask me. So, you can do that with certain
things like airplanes, other things, not so much. Apple. Apple
(12:06):
won't be able to avoid price hikes for long. iPhone
maker is absorbing nine hundred million in tearff cross this quarter.
You you think that they're not gonna start pricing this
into their products. Of course they are. Of course they are.
You are going to pay, They say, it's the thing
(12:32):
about tariffs. Okay, you people buying there, They're gonna make
these companies pay. No, you're not. You are gonna pay.
I am gonna pay. We're all gonna pay. We're just
getting taxed. And then we get this as well. You
know Trump is talking about, uh, oil prices are coming down.
(12:57):
Why do you think that is? Do you think it's
because of drill, baby, drill? No? Why why don't you
go and take a look. Okay, well again we deal
in facts here. Okay, try to test me on anything
that I'm giving on. Go in to go take a
look and say, when the price of oil fill off
(13:20):
a cliff, well, well just go take a look. See
when oil such falling off a cliff? Why? Why is
oil falling off a cliff? Because less economic activity, less
economic activity, extra use. Oh yeah, sure yeah. Opek is
(13:41):
using this to their advantage too, and they're upping what
they're doing. They're smart. They're upping their production, which is
going to hurt American oil producers. Shale Giant Diamondback says
US oil output has peaked, slashes slashes, it's capital expenditures
(14:06):
because of what is taking place, meaning what people are
going to lose their jobs. People are going to lose
their jobs. I talked about that show that I'm a
big fan of Landman Billy Bob Thornton awesome. In that show,
there is a production costs for oil, a break even number.
(14:27):
There's a break even number for the production of oil,
and there's a sweet spot. And once it goes below
that sweet spot, guess what, it makes no sense to
get it out of the ground. Makes no sense to
get out of the ground because you're going to be
selling it, selling it for less than what you are
(14:49):
producing it. That's what's taking place right now. I want
to talk a little bit. I did talk about Trump
and his is pencils and dolls. Matthew Hennessy actually had
a pretty interesting take on this. Today. I'm going to
(15:11):
comment on it outrageous claims. This is true. Outrageous claims
are the gasoline that makes Donald Trump's political career go.
Without a steady flow of shocking statements, the motor would stall,
But engines also require air. If you get the mixture wrong,
(15:33):
the engine floods in the car won't start. Trump got
the mixture wrong when saying, maybe the children will have
two dollars instead of thirty dollars, and maybe the two
dollars will cost a couple bucks more than they normally would.
The Chinese ships that deliver cheap goods to American ports
are loaded up with stuff, much of which not all
(15:55):
of it, but much of which we don't need. He
made that point again on Meet the Press as well,
and they talked about pencils. They don't need two hundred
and fifty pencils, they need five again Jimmy Carter Esque
(16:17):
I called it neo Marxist malaise type talk. This is
this is new. Okay, this is new. This is new
for a president you know you've had in the past.
(16:40):
You know we had in the past, We've you know,
World War two, Uh, you know, tighten your belts because
of war and uh, scrap metal drives. Again, this is
because of a policy decision. Hennessy makes the point, you're
(17:03):
really used. Americans are not used to having an essence
of president basically say, hey, you're being too materialistic. Listen,
you know, might that be the case for certain people? Yes,
(17:23):
I listen. I ask you a question, why do you
think so many people, so many people try to get
into this country every single year. I don't. I don't
know how you think this is going to resonate well
with people. People to you know, the president of the
United States telling them how how wasteful, wasteful they are,
(17:50):
not to mention the fact it's coming from Donald Trump.
This is a guy. This is a guy that would
slap throughout his life and all the more power to
him he was able to do it. Would slap his
name on everything for crying out loud, Trump vodka. The
guy doesn't drink Trump water, Trump furniture. He had slap
(18:15):
his name on everything started, you know, failed universities. He's
got a bloody gold toilet for crying out loud. You
see how he decorates, and he's telling the country to
tone it down. This is a Again, I'm not I'm
(18:40):
not getting it you know it was funny too. It's
twenty two. I'm not making this up. I'm not making
this up. There was an actual column today in the
Wall Street Journal written by Amy Chan. Amy Chan is
the chief sustainable say sustainability officer at Berkeley, the chief
(19:02):
sustainability officer EESGDI left wing stuff. This is the stuff
that Trump doesn't like. He's supposedly trying to push back against,
praising Trump, praising Trump, saying that again all of this
and people buying less stuff, and this is going to
be wonderful for the environment. I'm not making this up anyway.
(19:30):
Another aspect, third part of our ar trilogy of tariff terror.
I tried very hard this month. I tried very hard
this month to try to express my concern with how
these tariffs were rolled out. And I said, from the
(19:52):
get go, okay, I don't have any problem with tariffs
that are applied in a surgical manner where there is
some sort of reciprocal where there is it makes sense
to everyone out there. From the very beginning, this was
(20:12):
an absolute disaster. And spare me, spare me the three
D five D ten D chess that Trump is playing
right now. Okay, if you honestly still believe that. I'm sorry, Okay,
you got to lay off the magapills, you got to
lay off the drugs. Okay. Trump was scared, shis to
(20:36):
put it mildly, when he saw what happened in the
bond markets. You'd think that they were planning on walking
back those ninety day that the ninety day reprieve. No, no,
a gentleman that I uh. From time to time. He's again,
he's a great writer. He's in my industry. His name
(20:58):
is Ben Hunts. He's got a group called the Epsilon Group,
kind of like a kind of a group of like
minded investment professionals and advisors. And again, he and I
and many things we think alike. And we also use
sub references quite often in our columns and then when
(21:22):
we speak. He had a column out there today. Again
it's great because it's Godfather Godfather three, our true enemy
has yet to reveal himself. This is you know, a line,
(21:45):
a line that was used in Godfather three. And you know,
a lot of people so the worst we're not a
great movie, but come on, al Pacino was was awesome
in that movie, awesome, and he had that line. It
was kind of right after the assassination attempt in Atlantic City.
But anyway, anyway, our true enemy has yet to reveal himself.
(22:09):
And he goes back to a point in time. This
is something that I've written about extensively. I've talked about
over this. Try to teach people about this. We knew
at Markowski Investments. We knew that something wicked this way
was coming in two thousand and six, two thousand and seven.
Even at the end parts of two thousand and five,
(22:31):
I was having WTF moments when it came to real
estate and what I was seeing going on. And you
go back to that point in time, you can go
to do searches of the news nobody. I mean, was
it two thousand Was it two thousand and seven? Two
(22:54):
thousand and seven, I think is when the two hedge
funds over at bear Stearns Employed did At that point
in time, I remember exactly where I was. I was
outside outside of CBS studio of Gandhy Boulevard and Tampa, Florida,
after just doing an interview, coming back in my car,
(23:16):
and I heard about what was taking place. I heard
about these hedge funds, was like, oh, oh things, things
are going to escalate. But at that point in time
of the news, crickets crickets, Ben BERNANKI, oh, this is
the housing market is rock solid. The true enemy out there,
(23:43):
the over financialized US residential mortgage market hadn't revealed itself
until it did till it did subprime loans, how they
packaged them. I mean all of these things. Again, I
knew that something was wrong, Okay, I did. I had
(24:05):
no knowledge of how bad it actually was. I didn't.
I didn't know about the S, S and P and
Moodies being in cahoots with the various different firms and
putting triple A ratings on bonds a myriad of different things.
I had no knowledge of that at all. Anyway, Anyway, today,
(24:30):
why am I bringing this up today? And Ben Hunt
brings it up to the same thing that I was
saying earlier on this month. Still scaring the crap out
of me. Today Our treasury market, our treasury market. You
(24:54):
want to talk about wrecking an immense amount of damage
on the global financial system, and go and take a
look at that. What happened the flash crash the ten
year and thirty year treasuries following Liberation Day. Yeah, ten
(25:19):
year treasure was at three point nine, went to four
point five six. Thirty year went from four point three
to four point nine seven. Doesn't seem like a lot,
but it's a fricking lot. Again. This is the unfortunate
thing is people don't understand.
Speaker 3 (25:41):
Okay, the world runs okay on the fact that we
the people, Okay, the United States of America.
Speaker 2 (25:50):
Is we're good. We're good, we are zero risk, we
are good on our debt. If that goes away again,
it's what people who try to get your arms around
this US treasury market. I'm gonna quote Ben in this. Okay,
(26:16):
I covered this earlier. We're gonna let somebody else basically
speak the same way that I did. The touchstone of
every loan in the world, every insurance policy in the world,
every equity valuation in the world. When it flash crash
like that, it broke. Why did it break? The full
(26:39):
faith and credit of the United States came into question.
Speaker 3 (26:48):
Oh no, no, no, haha, we're just kidding everybody.
Speaker 2 (26:52):
Oh no, no, no, we're just kidding. O psych oh
we're taking those reciprocal tariffs off on everyone. Wooooooo do
you understand here? Another one week, sixty five point basis
(27:15):
point increase in US long term interest rates would have
broke the world. Yeah, that's great David Bowie song, the
Man who Sold the World. They'd have to rewrite that
song to the man who broke the world. Everything would break,
(27:37):
every ensure would be in regulatory for barons and would
need to raise capital most banks. The dollar would crash,
equity markets would crash, lending and credit would come to
a halt. The Fed would be forced to engage what
is called yield curve control, where they would buy out,
flat out, buy and force big banks to buy ten
(27:58):
year and thirty yearsuries in order to keep their value
propped up. Would it work, Yeah, for a little bit,
for a little bit, but which is basically the Fed,
you know, printing money. That's what scared me. That's what
(28:22):
was done another way. And again we're watching it take
place right now. We have to get our fiscal house
in order. Okay, fiscal house and order big beautiful bill
(28:44):
five trillion dollars raising the debt ceiling. Listen, people, this
is this is again. This is serious stuff and something
I've been warning about for some time sometime. Ben Hunts
(29:09):
from the get go full disclosure. Okay, I voted for
Trump twice. I don't think Ben did. I'm not a fan.
And he writes, he said, do you think that Trump
would back down from passing a big, beautiful tax cut
bill even if the bond market freaks out about it?
(29:29):
Do you really think that Trump would back down from
passing a big, beautiful tax cut bill and continue to
back down from his terrace, or do you think Trump
will start talking about the need to do something about
non US holders of US treasuries because they're not treating
him fairly. A b or C again, Listen, he used
(29:58):
Trump in his history with bad debts and bankruptcies, he
uses he doesn't look at them in the same way.
You know, I owe somebody money. You owe some people money.
It's it's an obligation that we base on a moral grounding.
(30:19):
I don't know if he's the same when it comes
to that. This is this is the true enemy, people.
True enemy has yet to reveal itself. I just revealed it.
This is the Trilogy of terrorf Terror Watchdog on Wall
(30:43):
Street dot Com
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