RUSH: Now, the big news to me today, not the China trade war, because I really don’t think that the ChiComs can afford to engage in a huge one. And besides that, whatever sanctions we have placed, tariffs and so forth, are not gonna apply to tech. So it’s not gonna affect the price of your iPhone, your iPad, or your Samsung or whatever. Those things have been exempted as best as we can tell now.
But it’s still fascinating and interesting. And we haven’t seen this kind of thing done in a long time.
RUSH: We haven’t talked about trade with the ChiComs and tariffs yet today but may as well do so now because CNN can barely keep their pants up, they’re so excited here. Apparently, the U.S. Secretary of Commerce, Wilbur Ross, has said that Trump’s tariffs may never go into effect. And so CNN is interpreting this — well, they’re interpreting it a lot of ways. One of the ways, “Well, maybe what this means is that Wilbur knows better and just won’t implement them while telling Trump that they are being implemented.”
What is likely happening here is — and this is what Wilbur did allude to — is that the threat of tariffs, which, believe me, the ChiComs don’t want any part of this. I don’t care what you’ve heard about this. China cannot afford a trade war. But the anti-Trump fat cats on Wall Street are gonna jump on this as the latest excuse to drive down the stock market in their relentless effort to hurt the Trump economy and win the midterms ’cause don’t think that isn’t happening either.
Don’t believe for a minute that any manipulation possible, stock market, the economy in general, wherever they think they can cause things to deteriorate, to improve their chances of winning the midterms, they’ll do it. This is from Reuters: “China quickly hit back on Wednesday at Trump administration plans to slap tariffs on $50 billion in Chinese goods, retaliating with a list of similar duties on key U.S. imports including soybeans, planes, cars, whisky and chemicals.”
The whisky is probably for Kim Jong-un. The guy drinks like a fish, and if you’re in North Korea, where are you gonna get the stuff? You just don’t go down to the state store and say, “Here, give me a case of Johnnie Walker Blue.” They don’t have it. Kim Jong-un has to get it from somewhere. The ChiComs probably take care of it. And so if there might be tariffs on whisky… Kim Jong-un doesn’t have much money anyway, so that’s gonna be a panic point.
Reuters says here: “The speed with which the trade struggle between Washington and Beijing is ratcheting up led to a sharp selloff in global stock markets and commodities. Investors are wondering whether one of the worst trade disputes in many years could now turn into a full-scale trade war between,” the ChiComs and the United States.
Now, as is always the case — I mean, you can make book on it — the media is doing their best to make consumers think that tariffs are a new thing, that Trump is starting a trade war, that no president’s ever done this, it’s too risky, it’s too dangerous. But in reality every country in the world, including us, puts tariffs on foreign goods. We always have. They come on; they come off. In fact, the ChiComs have, in many cases, far and away the highest tariffs on foreign goods of any country in the world. India is a distant second, by the way.
So what’s really going on here is the ChiComs are simply increasing the tariffs it already has on U.S. products. The Bush administration announced tariffs and there’s a knee-jerk reaction, “Oh, no, oh, no, trade war, trade war, can’t do it, can’t do it.” But they are a little bit more commonplace than you are being led to believe.
But the bottom line, the ChiComs can’t afford a trade war. I know people don’t want to look at it that way because people have been conditioned to think that the ChiComs are brute force strength and that they rule the world and we can’t compete with them and this kind of thing, and that’s not the case. The ChiComs have so much of our debt they purchased, they can’t afford for the United States to go belly up economically. That’s not at all what they want. It doesn’t help them in that regard.
They regard us as an enemy in other ways, but economically they’re too invested here. So I think, in large part, the talk of tariffs is probably a negotiating ploy. And Trump feels seriously — Trump sent a tweet out earlier today (paraphrasing), “When you’re down $500 billion, how can you lose? You’re already losing when you’re down $500 billion. You gotta do something about it. It’s not as though we’re winning a trade war here and we have a positive balance of trade with the ChiComs, now a tariff war is gonna cause us to lose money. We’re already losing money left and right. How could it get any worse,” is Trump’s point. And of course he has a point.