America’s Trade Problems Are Made in the U.S.A. (Uncut) 04-28-2025

America’s Trade Problems Are Made in the U.S.A. – Ep 1023

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Good evening, everybody. This is another Sunday night podcast following what was a big turnaround week for the markets. It really started on turnaround Tuesday, but it lasted the entire week.

Now, I don’t think it’s a permanent turnaround. I think it’s a bear market rally, a counter trend move in pretty much all of the markets. And this is how bear markets work.

You get some pretty big short term counter movements that kind of serve the purpose of creating a false sense of hope that the market has bottomed out. And so some new longs get suckered in. You get shorts covering.

Right. They’re throwing in the towel. And I think that’s what happened.

You know, it started on Tuesday, but that followed Monday where the Dow dropped another thousand points. And we had a big drop in the dollar, a rally in gold. And the catalyst for that day’s decline, I think, was Donald Trump’s off the cuff remarks on Truth Social.

I don’t know how much forethought went into this post, but he basically started calling Jerome Powell names, you know, like they’re at a playground. But he called him too late, Powell, and basically said that he missed a loser. He called him a loser.

And he said that Powell needs to cut rates and he can’t go soon enough. We got to get rid of Powell. You know, he’s he’s screwing up, you know, by not cutting rates.

And so the markets didn’t like that type of pressure on Powell from the White House to not only cut rates, but risk being fired if he if he didn’t cut rates. And and so the markets were reacting, I think, to those statements. And I think what happened, especially looking at what was happening on Monday night, because all of those trends continued on Monday night.

In fact, gold hit a new all time record high. It was within ten dollars of thirty five hundred. That’s how much gold had gone up.

It was above three thousand four hundred ninety. Now, you know, you may expect some profit taking at a round number like that. We were almost halfway between three thousand and four thousand.

And we had only just breached three thousand like weeks ago. And now we’re almost halfway to four thousand. But the dollar was getting killed.

The euro was above one fifteen. There was a ninety seven handle on the dollar index. Stock futures were selling off.

Bonds were under pressure. They didn’t make new lows, but they were on their way. And so I think looking at what was happening in the markets, the advisers to Donald Trump.

I got to him and said, we need to do some damage control. You need to walk back that truth social post. And so on Tuesday morning, early in the morning, Donald Trump said, you know, hey, of course, I’m not going to fire Trump, pal.

You know, he’s going to be there until the end of his term or I’m not going to do anything with pal. And the market had a huge rally on that. And, you know, it’s hard for me to believe with all of the market savvy people that are in the Trump administration, a lot of people have come from Wall Street, right, that are there.

And they know that the markets are going to move big on comments that come out of the White House, even though nothing actually happens. Right. Just somebody saying something, not actually doing anything, but just a post on truth.

Social can cause massive swings in the stock markets, in the currency markets, in the crypto market. I’m sure there are people in the Trump administration that are trading off of this. I mean, you know, I mean, how could they not be given the size of the moves and the fact that, you know, there’s no actual news.

I don’t even know if it’s insider trading because there’s nothing actually happening. These are just comments that really don’t mean anything. And in fact, I think the comments are specifically designed to impact the market.

I think the Donald Trump’s comment about Powell was, oh, my God, the market’s getting killed. I need to turn it around. So let me let me reassure the markets that, you know, there’s still Fed independence because that was what people were worried about that.

Oh, this means that we’re not going to have an independent Fed. We’re going to have a Fed controlled by the White House. And that’s going to be bad as if, you know, it hasn’t been bad all along.

But I agree that the more you politicize the central bank, the worse it is because all the political pressure is for easy money. That’s why it’s ridiculous for Donald Trump to be accusing Powell of being political in that Powell is not cutting rates. Because that’s political.

So the fact that he’s holding tight is more of an independent move because the political pressure is to cut. Now, he should actually be raising rates. And I think the fact that he’s not raising rates is because of political pressure.

You know, I mentioned this several times over the years and I really wish I could find a recording. I remember I looked for it at one time and I didn’t find it. But I was listening to a radio program, the Motley Fool radio show.

I don’t even know if it’s still on, you know, because I haven’t listened to it recently, but I was listening to it back then. I can’t even remember when it was, but it was quite some time ago. And they were interviewing Ben Bernanke, which is probably why I listened to it.

I mean, I don’t make a habit of listening to it, but because I knew they were interviewing Ben Bernanke and I wanted to hear what Bernanke had to say. He was not the Fed chair anymore. Right.

It was Yellen. But I wanted to hear, you know, what he said. And so one of the one of the questions that they asked him was and they played a clip of him saying that the subprime market was contained and, you know, there was nothing to worry about.

Right. And so the Motley Fool, you know, whoever was hosting it. I said that Jerome Powell, I mean, to Ben Bernanke.

So, Mr. Bernanke, you know, how do you feel now, years later, listening to those statements that you made, knowing how wrong you were? You said everything was fine, that subprime was contained and you were totally wrong. So, like, you know, what are your thoughts now? Right. On how wrong you were, which I thought was a pretty ballsy question.

Good question to ask him because he clearly was wrong. And so, you know, how do you feel? And I was very interested in his response. Right.

Because I thought, you know, what was he going to say? Yeah, he’s probably I thought he was going to say, well, you know, we all got it wrong. Nobody could have seen this coming. You know, I wasn’t alone.

All the major economists, everybody on Wall Street, everybody in academia. We all thought it, you know. So, you know, it was a hundred year flood.

Nobody could have predicted this. I mean, I’m not God. Right.

I can’t see something that comes crazy out of left field. Right. So I thought he was going to make some excuse that, you know, everybody got it wrong.

He didn’t say that. He actually told the truth, I think. And, you know, maybe you have to be an ex-Central Banker before you can tell the truth.

But this was his answer. I am not making this up. He said, well, you know, to be candid with you or to be honest, I really wasn’t in a position to speak my mind at that time because I was a member of the Bush administration.

And, you know, the party line was that the economy was in good shape and there was nothing to worry about. So I kind of had to go along with that. This is what he said.

So he basically said, look, I said that, but I didn’t really believe it. I didn’t get it wrong. I just had to put some positive spin on it because I didn’t want to say that things were bad.

When when Bush was talking about how great things were. And I couldn’t believe that he said that. And I couldn’t believe that nobody picked up on it in the media because that is a startling admission.

Because, number one, Bernanke was not a member of the Bush administration. The fact that he believed he was a member of that administration is what should be shocking because the Fed is supposed to be political. But here, Bernanke said, look, I couldn’t really say what I thought.

I knew that subprime wasn’t contained, that there was a big problem. But I couldn’t say that because that would have run counter to the the Bush administration and the message that they were sending out. And so I wanted to follow that message.

I wanted to march along with my leader. And I didn’t want to, you know, veer from that that message. I didn’t want to send a mixed message.

So I couldn’t be honest. That’s what he said. And so I thought that was a huge admission that this idea that the Fed is apolitical is wrong.

And I’ve always thought that every Fed chairman seems to feel that they are, you know, part of the current administration and that their goal is to reelect whoever is in power. You know, usually that’s the guy that that appointed him, but they want to get reappointed. And so they feel that they have to make whoever’s in power look good and do whatever whatever they want.

And so the idea, right, that the Fed is independent is nonsense anyway. All they do is is maintain a veneer of independence. But Bernanke let the cat out of the bag because I’m sure that he’s not the only one.

I’m sure Yellen was very much a team player for Obama. That’s why she never even raised rates once when Obama was president. She kept him at zero the whole time.

She didn’t start hiking rates until Trump won. Right. And then she started hiking rates.

So she kept rates at zero. That was very political. And Trump was right when he ran against Hillary Clinton back in 2016 of pointing out that the Fed was political and that kept rates low when they should have raised rates.

Then, of course, the minute he became president, he wanted the Fed to do exactly what he accused the Fed of doing when Obama was president. Right. It was very hypocritical for him to want exactly what he was correct in criticizing.

Well, if it was wrong for the Fed to be too loose under Obama, well, then it’s wrong for the Fed to be too loose under Trump. But Trump is, you know, beating the drum for the same same rate rate cuts. But the point I make it is it’s all nonsense anyway.

But when you come out and expose it, you really like rip away the curtain and you see who’s standing there. And the markets are thinking, oh, so Trump’s going to, you know, get rid of Powell and just put some lackey in there. That’s just going to be a rubber stamp so that, in effect, Trump is going to have his hand on the printing press.

Right. And be able to cut rates. So the dollar was tanking.

Gold was soaring. And so he came out and he did that damage control. And so that reversed gold.

So gold went from being up like 90 bucks that night to down, you know, 50 dollars or something. It was a big sell off. And then it continued.

Gold was volatile. You know, up 50 dollars, down 50, up 80. It was all over the place.

It ended up down on the week gold about three percent on the week, but it still closed a week above thirty three hundred. I mean, so you’re talking about a high price of gold above thirty three hundred. And I know it’s down tonight.

Last I check, it was down about 20 bucks. Now it’s only down about 11 bucks. Thirty three.

Oh, eight. So this is still a very high price for for gold. You know, silver at one point on Monday night, the gold silver ratio was like one hundred and seven, one hundred and eight.

I mean, that was a new record low for silver. Silver turned around, forgot to check the silver price, but silver was not down nearly as much as gold. And so silver gained on the week.

Let me take a quick look at what silver did. Actually, silver was up. It was up a half a percent.

So I think that is maybe a chance. We’ll see. I mean, I’ve been saying this and it’s been premature.

Maybe silver is bottom. We’ll see. But silver actually rose a half a percent on the week.

But the big movers were in the stock market. And it wasn’t just because of the damage control that was done on Tuesday, but we got more crafted statements from the Trump administration, especially, I think, from Scott Bassett about the trade war and the tariffs and and some positive statements that I think the tariffs will come down soon. Things are going well.

The negotiations are going good. So a lot of positive comments. And I think we’re all a bunch of BS.

Right. But I think these comments were deliberately floated out there to get the markets to rise, to get them to think, oh, OK, it’s almost over. Right.

We’re going to the war is going to be over. And we got this big relief rally really on nothing. But anyway, let me talk about I got a lot more talk about specifically about this at the other side of this commercial break.

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All right, we’re back. One second. I got to send this home.

1. Anyway, what was I talking about? I got distracted by this email that came in. So I’m talking about the reversal in the markets.

So the Dow Jones on the week, based on not only the statements about Powell not being fired, but on the trade war maybe coming to a swift ending, right, because all these great deals are being negotiated. And obviously, these high tariffs on China are unsustainable, right? That was an admission. The Trump administration said these tariffs are unsustainable.

And the reason they’re unsustainable is because we can’t sustain it, because we would basically be cut off from the Chinese imports that are so important to the economy. And that’s why they’re unsustainable. And so but, you know, who knows how long they’re actually going to be there.

And even if they lower them from 140 percent to 50 percent, I mean, it’s still a big problem for America. Right. It’s problematic for China, too.

But it’s a much bigger problem for the United States than it is for China. And as far as I’m concerned, in the long run, it’s the best thing that could happen to China, because China needs to stop trading with the United States to the degree that it does, because we’re screwing them over because we’re not paying. Right.

We’re just giving them IOUs that are basically not going to be worth anything. So their economy is getting all screwed up, maintaining this vendor financing of a customer that’s never going to pay. And it’s doing real damage to to their economy.

And the sooner they can repair that damage, the better for them. Anyway, so the Dow was up three point six percent on a week. The Russell 2000 was up five point three percent on the week.

The S&P was up five point eight percent and the Nasdaq was up eight point two percent in one week. So huge gains in the stock market, really based on nothing, nothing but hope. Right.

That the trade war is going to come to an end. Right. Which, again, is an admission that the trade war is a problem because when the market rallies is when they think it might be over.

So to the extent that. It’s going to continue because the tariffs write the end of the trade war means the tariffs go away, which is an admission by the market that the tariffs are bad. Right.

The tariffs are bad for the market. They’re bad for the dollar. They’re good for gold because whenever they talk about getting rid of the tariffs or lowering the tariffs, the markets go up.

Gold goes down. The dollar goes up. So the market mechanism is saying that tariffs are bad and the longer they’re here, the worse it’s going to be.

Right. So, you know, it’s only when Trump threatens to limit the harm that he’s doing that you get a rally in the market. Now, I think the tariffs are not going to go away so easily.

And so I think the markets are celebrating too soon. Anyway, I said gold was down three percent. The gold stocks, the GDX was down six and a half percent on the week and the GDXJ was down seven percent.

Why? It makes no sense. Yes, I know gold went down. But so what? It went down to thirty three hundred.

That is a very high price for gold relative to all of the earnings expectations for these gold stocks. Nobody that covers gold last year expected gold to be at thirty three hundred. In fact, when gold got to two thousand a little over a year ago, nobody thought it can go any higher.

They all thought that was the top. And here we are more than 50 percent higher. And stocks like Newmont and Barrick are lower than they were back then when gold was at two thousand.

Now, there are some stocks that are higher, but the two biggest stocks are actually lower. So why should they even go down at all? They should just be going up every day, regardless of where gold is. Who cares? I mean, if gold’s, you know, bopping around above three thousand, that is a phenomenal price.

In fact, we got the Newmont earnings. They were the first major gold company to come out with earnings. We got those earnings after the market closed on Thursday, I believe.

And so Newmont beat its earnings estimate by 42 percent. Forty two percent above what analysts thought they were going to earn. That is a massive beat their year over year revenue in the quarter was higher than the prior year’s revenue by 25 percent.

That is a huge increase in revenue in a year. But their profits quarter over quarter were up one hundred and twenty seven percent. I mean, how many companies in the S&P 500, Newmont’s the only gold company there, are going to report year over year profits up one hundred and twenty seven percent? A crazy amount.

You would think, oh, this stock’s going to be way up because, you know, gold was up like fifty dollars that day, too. It was a day that gold happened to be up. So gold’s up 50 bucks.

And the earnings come out. And the stock’s up like two percent that after hours. That was it.

And, you know, I listened to the earnings call and very boring. You know, you think the guy would be excited about all this money they’re making. And in fact, he said that we’re going to reiterate our earnings estimate that we have.

We’re on track. He said we’re on track to meet estimates. What do you mean to meet estimates? They’re on track to blow the estimates away.

I mean, why are they? They’re not even being optimistic about the rest of the year. Their average gold price for the first quarter where their profits were up one hundred twenty seven percent was below three thousand. It was like twenty nine hundred and fifty, something like that.

So we’re already 10 percent higher than that, which means the the estimates that came out last year for Q2, they’re going to kill them, too, unless gold prices crash. Right. So maybe even the CEO of Newmont is expecting the gold price to collapse.

Right. So he doesn’t want to appear too optimistic on on the earnings call. Right.

But, you know, to contrast that, and I pointed this out, Texas instruments announced their earnings at the same time. They actually earned less money than Barrick did quite a bit less. And their market cap is more than double what Newmont’s market cap is.

But they only beat by 20 percent. And their year over year revenue was up 11 percent and their year over year profits was up three percent. So on that beat, the stock was up like 10 percent.

And I think the following morning it was up like 11 percent. I don’t remember where it closed, but a huge gain on Texas instruments. And it was a yawn.

Now, by the end of the day, Barrick was up almost four percent. I mean, Newmont was up almost four percent. So it rallied all day.

And, you know, gold was stronger, I guess, that day. But still. It should be up much more.

In fact, Newmont was down on the week. I think it was down four percent on the week. So on a week that it reported record earnings and a huge beat, the stock was still down.

Because, you know, they’re still like whatever the price of gold moves down, they have to sell these stocks off. I mean, if the price of gold went to ten thousand tomorrow. Right.

And then it went down to nine thousand. Right. Would these stocks really have to get killed, especially if they barely moved up on the move to ten thousand? Once you have this kind of breakout, which is what we’ve had in gold.

See, what people don’t really get is that for years and years and years, gold has been underpriced and under owned. Right. Investors don’t own it.

Central banks have a very small amount. If you look historically, even though they’ve been buying a lot of gold, if you look at the gold that central banks own as a percentage of their total reserves, it’s still historically low. It’s not as low as it was, but it’s still below historical averages.

That’s because the currency reserves, mainly U.S. dollars, have exploded. And so central banks have under owned gold. Retail investors have completely under own under owned it and institutional investors.

So the private sector has under invested in gold and so has central banks. And so gold prices have been too low. Meanwhile, the cost of mining gold keeps going up because of inflation.

Now, if gold was purchased the way it should have been by investors and central banks, given how much inflation was being created and all the dollars in our trade deficits, the price of gold should have been a lot higher. But it wasn’t. And the biggest victims of that were the gold mining stocks, because they had to deal with the inflationary impact on costs without getting the full impact on the price of gold.

Well, that’s now changed ever since, I think, early twenty twenty four gold prices are now far outstripping the cost of mining. But Wall Street hasn’t figured that out yet. They haven’t rerated these stocks.

So at some point they need to be massively rerated at much, much higher prices, even if gold goes down hundreds of dollars, because it’s already moved up so much beyond the cost of mining it. Plus, this breakout means that gold is going up thirty four ninety that we got on Monday. That is not the record high for gold for all of eternity, not even probably for the rest of the month.

Gold prices are going above thirty five hundred. They’re going to go above four thousand. They’re going to go above five thousand.

So what should these gold stocks be worth? Because the cost of mining is not going to go up anywhere near the same percentage. It will go up. Inflation is going to drive the cost of everything up.

But as investors realize how bad inflation is going to be and how long it’s going to be here, they’re going to keep bidding up the price of gold. So, again, these stocks are the great buys. And I still think the best way to buy gold is to buy gold mining stocks.

So you got another gift on Monday or Tuesday whenever to go buy these mining stocks, to buy the gold while it’s still in the ground. You know, if you didn’t read my special report on your pack dot com, the best way to buy gold. Go to your pack dot com, download it, read it or just take my word for it and buy these stocks.

And if you want, buy my gold fund because we’re loaded up on the juniors and they’re even more undervalued than the big stocks. And so we I think we make even more money there. We still have the bigger companies in the Euro Pacific Gold Fund.

We just have a big overweight to the small companies. And those are the ones I think that are going to give you the most bang for your buck. And so the symbol on my gold fund is E.P.G.I.X. That’s the no load version of of of the of the gold fund.

Now, speaking about gold, you know, fool’s gold. Bitcoin also rallied quite a bit. It was up nine percent on the week.

Pretty much the same as a NASDAQ, right up eight and a half micro strategy up 14 percent. Right. A big winner.

But, you know, earlier in the week, everybody was saying, aha, Bitcoin is decoupled from the NASDAQ. How is it decoupled? They’re pretty much traded just like the NASDAQ. Well, that decoupling was supposedly based on the fact that the NASDAQ got killed the previous week and Bitcoin didn’t.

Well, so what? I mean, what is what is a week? Especially because Bitcoin got killed before the NASDAQ. So Bitcoin went down more faster and then it kind of went sideways as the NASDAQ caught up. That’s all that happened.

And now they both rally. Right. Bitcoin is doing the opposite of gold.

When did Bitcoin finally rally? When gold went down? If gold resumes its rally, which I believe it will, then Bitcoin is going to resume its descent because Bitcoin is the anti gold. It is the opposite of gold. And, you know, again, the president’s the administration’s fixation on crypto and Bitcoin and trying to make the U.S. the crypto capital of the world, the U.S., the Bitcoin superpower.

All of this is at odds with the president’s other goal of reindustrializing America, of of of shrinking our trade deficits, of bringing our factories back, because if we’re going to waste money becoming a crypto superpower, then we’re not going to be able to have that money to build factories and the infrastructure. So we’re going to have to import more stuff that we need if we keep focusing on crap we don’t need in the crypto space. So if we really want to build factories, we’ve got to stop all this nonsense in crypto.

So he’s got these mutually exclusive goals. But that, you know, brings me to, you know, segue into what I want to talk about, you know, which is a. A talk that Scott Bassett gave, and even before I get into that talk, I want to mention that earlier today I saw the approval ratings for Donald Trump because he’s now been president for 100 days. And his approval rating, Trump’s approval rating is.

The lowest. Of any president at 100 days in like the 80 years that they’ve been they’ve been doing the they’ve been doing these surveys. And his approval rating is down to 39 percent.

Now. The record that he just broke was the one that he set himself in 2017, where his approval rating after 100 days was 42. That was the lowest.

It’s now lower. Now, why is Trump so unpopular? Well, first, you know, there’s a large segment of the population that is going to hate Trump no matter what. Right.

He’s a very polarizing figure. But if you recall, I warned about this. Trump promised.

The moon. He promised an immediate economic boom. He set the bar very high and he raised everybody’s expectations.

He didn’t talk about short term pain for long term gain. He didn’t talk about sacrifice. He didn’t say it’s going to get worse before it gets better on the campaign trail.

He didn’t even say that in his inaugural. He talked about the golden age of America beginning right now. So he really set expectations high.

Inflation was going to crash. The economy was going to boom. And that has not happened.

What’s happened? The trends that were in place before Trump was elected, the bigger macro trends remained in place. So the weak economy that he inherited got weaker, which is what I said was going to happen. And so now the public is disappointed.

And of course, the media, right, the mainstream media is spinning this the way I said they would. They’re saying Trump inherited a great economy and he’s already ruined it. Right.

Which isn’t true. He inherited a lousy economy and it just got worse. And of course, it would have got worse under Harris.

Now, I know people are saying, well, no, because Harris wouldn’t have imposed the tariffs. Yes, she would have. She’d have done other things that are bad.

But the bottom line is the economy is not weakening now because of the tariffs they just started. I mean, we haven’t even seen the negative impacts of the tariffs yet. That’s coming.

I mean, we’ve seen some of it in the markets, but the markets could have gone down anyway. In fact, if Harris won, they’d probably be lower right now than they are because because Trump won, we had a big rally in the markets. We’ve just given some of that back.

If Harris would have won, maybe the markets would have gone straight down. So the markets would be even lower. But, you know, they can say whatever they want in the media.

I blame everything on Trump and on the tariffs. You know, if anything, the tariffs may have given a little boost to GDP in the short run at the expense of weaker GDP down the line, because consumers are rushing to buy stuff before it gets more expensive. Right.

People are trying to buy, you know, cars now because they’re going to get so much more expensive and other things. So that may actually boost the GDP a bit. So the real damage hadn’t even happened from the tariffs.

It’s just the trend that was in motion has remained in motion. And I think people are upset that they haven’t seen a turnaround. Now, I know there are people, you know, and I see this on my ex when I post stuff, anything critical of Trump, people jump all over me.

Right. And again, Trump derangement syndrome works both ways. Right.

The Trump haters and the Trump lovers both suffer from it. Right. Either he’s Adolf Hitler or he’s, you know, God on Earth.

Right. You know, there’s a lot of room in between for what Donald Trump really is. But, you know, you’ve got to accept what’s what’s actually going on here.

So there are people that are saying, well, yes, the economy is getting worse because, you know, Trump is ripping the Band-Aid off and it’s about time. You know, he’s got to he’s got to correct four years of damage. And so there’s going to be some pain.

If that were true. Yes, that would be good. But Trump is not ripping off the Band-Aid, not even close to ripping off the Band-Aid.

And the damage to the economy. Isn’t the last four years under under Biden? Trump is talking about the trade deficits. We have had a trade deficit in this country every single year since 1975.

Right. Most of my audience wasn’t even alive the last time we ran a trade surplus. So how is this the fault of Biden? Yes, the trade deficits got worse under Biden.

So he can share in the blame, along with all the presidents that came before him since 1975. But it’s not Biden. And that includes Donald Trump.

He was president for four years as the trade deficits got worse every year he was president. And so it’s not about Biden. That’s not why we have these big trade deficits.

And he’s not pulling the Band-Aid off because. Deficit spending is going up. The budget that Trump is helping to shepherd through Congress increases government spending, increases deficits.

And what is Trump trying to get the Fed to do? Lower interest rates. Why do we have these problems? Artificially low interest rates and, you know, too much spending, too much consumption. What is Donald Trump trying to encourage? More of the same.

That is not ripping off the Band-Aid. Donald Trump wants to continue all of the policies that are responsible for the problems that he says he’s trying to solve. Now, Trump is saying, well, the reason that we have all these problems is because of foreigners cheating.

Right. And that’s what’s been happening for the past 50 years. The world has been screwing us over.

They’ve been cheating us. They’ve been playing us for suckers. We’ve been the patsies and we’re mad as hell and we’re not going to take it anymore.

And I’m the guy that’s going to put a stop to it. Right. That’s what he’s claiming.

And so people think, hey, we’re solving our problems with these tariffs. We’re not solving any problems with the tariffs. You can’t solve a problem by going after a symptom.

It’s like you can’t cure a disease by trying to cover up the symptoms. Right. That’s what we’re trying to do.

We’re trying to put a Band-Aid on the symptoms, not rip it off the actual sore or whatever the disease is. And and that was really echoed. By Jerome, by Secretary Bessett in this talk that I heard him give a couple of days, a few days ago.

And in which he basically said a lot of the same things that I’ve been saying, stuff I wrote about in my books. He’s saying that stuff now. Right.

He’s saying that America’s industrial base has been hollowed out. Yeah. I was a big part of the real crash and crash proof.

He said that our critical supply chains have been undermined. Yeah. Yeah, they have.

And he said that the hollowing out of our manufacturing and the basic decimation of our supply chains has put our economic security at risk. Yeah, it has. Why do you think I’ve been so worried? What do you think I’ve been warning about the unsustainable nature of these deficits? And I’ve always focused on trade deficits as the indication of America living beyond its means and us enjoying false prosperity, prosperity that has been paid for by foreign subsidies.

Right. But then after he finishes talking about all that, he then says or he blames all of this on unfair trade practices coming from the rest of the world. Right.

The rest of the world is taking advantage of us. And he said that has to end. The world has to change.

Right. So in other words, the world needs to solve our problems. But the world didn’t cause our problems.

Look, even if every country that has tariffs went to zero, including America, because we got a lot of tariffs, too. But if the whole world went to zero tariffs today, it would barely move the needle on our trade deficits. I don’t even it may not move it at all.

It is a small part. I mean, most of the tariffs really impact our agriculture. So how much more soybeans and corn are we going to sell? I mean, I don’t know.

But tariffs are not part of the part of the problem. Look, one of the negotiations they’re doing now is with South Korea. Right.

They were talking about, oh, we’re really close to a deal with South Korea. Right. So I looked up the average tariff rate in South Korea on American goods coming into the country.

It’s point seven five percent, not even one percent. So you’re telling me that our trade deficits with South Korea are the result of a tariff rate that’s less than one percent. Right.

Somehow that’s priced us out of all the South Korean markets that that one percent tariff, which is lower than our sales taxes by far. And you know what our tariffs were on Korean goods? I mean, before we slapped them with a 10 percent tariff plus a 25 percent reciprocal tariff right before Trump launched the trade war. Our tariffs right on South Korea averaged three point three percent.

So we were tariffing imports coming in from South Korea at like four times the rate that they were tariffing our imports. So by Trump’s own standards, we were ripping off them. We were cheating them.

We were the ones that weren’t playing fair because we had higher tariffs than they did. And so the whole thing is nonsense. So what what is what are we going to win? Right.

So is South Korea going to say, OK, Donald Trump, we’re going to take our tariffs down from point seven five to zero? Is that really a major victory for the Trump administration? And then, OK, then we’re going to get rid of our 35 percent or 38 percent tariffs. I mean, are we going to get rid of the three point three percent tariffs we had before? Because if that’s the case, if we have to get rid of three point three percent tariffs to get them to get rid of point seven five, doesn’t that mean they won? And we lost the way Trump looks at it. Right.

Because tariffs are good for the country that imposes them. So if we have to give up our higher tariffs to get them to remove their tiny tariff. You know, wouldn’t they have out negotiated us? I mean, so Trump is such a shrewd negotiator.

We’re going to give up this huge advantage to get next to nothing. Right. So it’s all ridiculous.

You know, India, they’re talking about, oh, we might get a deal with India. India’s tariffs are a little higher. I think they’re about three percent or something like that.

But these are low tariffs. And of course, they only affect, you know, a handful of goods because a lot of this stuff goes in tariff tariff free. So Bessett’s whole speech.

Was the world is screwing us over. And the world needs to solve these problems, but the world can’t solve the problems because, again, if they eliminated their tariffs, nothing would change because the trade deficits aren’t from the tariffs. And, you know, Donald Trump posted something else on on social media and people read read into it.

I think the wrong message. He he posted the golden rule. He who has the gold makes the rules.

And there were people that were thinking, oh, aha. You know, that means that he he likes gold. He wants, you know, the U.S. to buy more gold.

It had nothing to do with actual gold. I think he was talking metaphorically about the trade negotiations and that Donald Trump thinks he has the gold. And the gold that he believes he has is the American consumer.

That’s what they keep saying. The American consumer consumer is the holy grail of the global economy. Everybody wants access to the American consumer.

Therefore, we can call the shots. We have the gold. We have the cards.

Right. In these negotiations. And the Trump administration thinks that the American consumer is so valuable to the world.

Right. That the world will either relocate their factories to America in order to have access to our markets or they will just eat the tariffs that they want to sell goods to us so badly, even if they have to lose money to do it, they’ll do it. Right.

That’s how important we are. Even if you lose money selling to us, they’re going to want to do it. Right.

Because we’re so special. Right. This is nonsense.

None of this is going to happen. The foreigners aren’t going to move their factories here. Yeah.

Just because they mentioned a couple of factories that will probably get to come here anyway. The vast majority of the factories are not coming to America because they won’t be profitable in America. The reason that Americans want to buy all these goods is because they’re manufactured outside of America.

The minute we try to manufacture them here, they’re going to be too expensive. That’s why we’re not manufacturing them here now. So there’s no way to move the factories here and they’re not going to eat the tariffs.

That’s nonsense. These are private businesses. They’re not operating at a loss on purpose.

Come on. So they’re just going to use the factories for something else. Right.

They’re going to trade with other people. They’re going to consume themselves. So Americans are not going to get the factories.

They’re just going to get higher prices. So either you pay the tariff or you go without the good. That’s what’s going to happen.

And it’s going to have a devastating impact on our economy. And the government is, you know, sugarcoating this. I was listening to Austin Goldsby, who is the president of the Federal Reserve Bank of Chicago.

So he’s an important guy. And in fact, he used to chair the president’s Council of Economic Advisors under Obama, which is another reason I’ve said that we don’t even need these advisors. Right.

We didn’t even have it until after the Second World War. And America had a much stronger economy when the presidents had no economic advisers. I mean, we made it as a country from 1789 to like 1946 with a president that had no economic advisers and we had a stronger economy.

So we got to get rid of economic advisers, especially guys like Austin Goldsby, because Goldsby said, oh, we don’t have to worry about the tariffs because imports are only 11 percent of our economy. So it’s like no big deal. Yeah.

It’s like the most important 11 percent. You take that 11 percent out and there is no economy because that’s almost all the stuff that we consume. Right.

What would goals be is not looking at is all of the economy. That relies on those imports. So he’s just taking the dollar value of the imports themselves.

And comparing that to the dollar value of the economy, but there’s a lot of other jobs. Like I was reading an article about the trucking industry and how they’re already seeing a big slowdown because they don’t have as many products to ship. And that’s just getting started.

Think about all the truck drivers. What’s the number one job in America for men? It’s truck driver. Right.

It’s millions of those guys. What are they driving around in all these trucks? They’re driving products made in China. So if we can’t import these products anymore because they’re too expensive.

Well, there’s a lot less stuff to truck around. So we don’t need as many truck drivers. So recession in the trucking industry.

But where are all these trucks going? They’re going to stores. Right. Or a lot of them are going directly to people’s homes.

Right. They bought the stuff on Amazon. But a lot of the merchandise is going to stock the shelves of stores.

Well, what’s going to happen if the stores have no goods to put on the shelves? Well, a lot of them are going to shut down because they don’t have any merchandise. A lot of companies are going to go out of business. Now, what happens to their workers? They get fired.

See, this is not part of the 11 percent that Austin Goldsmith said. Oh, well, it’s only 11 percent because it’s imports. Yeah.

But without those imports, all these jobs in retail where people were selling imports. Well, now they go away. But now you have all these unemployed truckers.

You have all these unemployed, unemployed people who work in retail. So what happens to them? Well, you know, they don’t have as much money. So now they can’t spend money on on other goods or services that maybe have nothing to do with the tariffs, nothing to do with imports.

Gee, I can’t afford to get my hair cut as much because I lost my job, you know, at Wal-Mart. All right. Well, you know, now the hairdresser doesn’t make as much money.

I mean, it’s going to ripple throughout the economy to just say that, oh, it’s it’s not going to go beyond this 11 percent. So it’s no big deal. Again, that’s the same thing is when these idiots were saying subprime is contained.

Now, do they really believe this nonsense? I mean, I don’t think Austin Goldsmith thinks he’s part of the Trump administration. I mean, far from it. So, I mean, he just doesn’t even understand that that basic part about economics.

I mean, looking at how interconnected all all of this stuff stuff is. So this is a huge recession. And again, this is not the pain before the gain.

This is just the pain before more pain. Because it’s not going to work. Trump wants to, again, continue all of the policies, more deficit spending.

Trump wants to cut Social Security taxes, right? Cut taxes on tip, cut taxes on overtime. This is just more Keynesian stimulus, right? More demand stoking, pump priming so we can go out and spend more money. Well, what do we spend money on? We spend money on imports.

That’s what we spend it on. But now, of course, if those imports get really expensive, well, we’ll just spend the money domestically, which means prices are really going up because the import prices will go up for the stuff we don’t buy. And then the price of everything we do buy is going to go up, too.

So we have massive inflation. The only way that domestic prices don’t go up is if we all pay the tariffs. See, then we pay the tariffs and we pay a lot more money to import stuff.

And that leaves less money left over to buy other stuff. But that, too, impacts the economy. There is no way this massive tax increase is not going to have a huge impact on the economy.

And it’s not, again, it’s not all a tax increase because a lot of the tariffs will never get collected because the tariffs are so high that people aren’t going to import. And if you don’t import, the government doesn’t collect the tariff. But the price of the good goes up.

It’s just nobody buys it. So the government doesn’t get the money and the consumer doesn’t get the good. But you have a recession.

But what does Trump, again, not only does he want more deficit spending, he wants the Fed to monetize it. He’s demanding we need to cut rates. I want to power the lower rates.

That is how we got into this mess in the first place. Years and years and years of artificially low interest rates, encouraging and enabling the country to live beyond its means, allowing the hollowing out of our manufacturing base and the decimation of our supply chains. We keep exporting our high paying jobs and replacing them with low paying service sector jobs.

But how do these low paying job holders, how do they keep spending money? Well, they borrow it. They take out loans on their credit cards. They take out a home equity loan.

So it’s fueled by credit. So instead of having a good job where you can save and afford to buy stuff, we have a low paying job. And so we make up the difference by going into debt.

So we’ve leveraged up the whole economy. All the households are levered up. And what are we borrowing all that money for? To finance our trade debts.

It’s to pay for all this stuff that we didn’t produce and we can’t afford. And Trump wants that to continue. Now, maybe he believes that we’re going to just get all this tariff revenue, but we’re not going to get that.

Maybe he believes the rest of the world is going to build factories here. They’re not going to. We have to build our own factories here.

But that can’t happen. Not with the current regulatory environment that we have or the tax environment that we have or the massive government spending, because if foreigners aren’t going to be shipping us all this stuff, they’re not going to be buying all these treasuries anymore. And that means that we have to finance our own deficits.

Domestically, and if we have to finance two, three, four trillion dollar a year deficits, how do we do that and finance the build out of our manufacturing and our infrastructure and our supply chains? We can’t. It’s either or. Government spending has been crowding that investment out for decades.

That’s why we become more and more reliant on foreign production, because our government has grown so big that we’re spending all our money supporting government and we don’t have enough left over to actually make stuff. And so we rely on the rest of the world to make the stuff for us. And we’ve been exploiting the dollar’s role as the world’s reserve currency.

So it’s the opposite of what Scott Bessett alleged. We have been taking advantage of the global economy. We have used the dollar’s reserve status to live beyond our means.

That is the reality. And we’re the ones that have to change, not the rest of the world. They’ve just been taken for a ride by us.

They should have, you know, kicked us out of this arrangement years ago. But but they didn’t. You know, and maybe we finally, you know, you know, slap some sense into them.

And maybe they’re going to do what they should have done a long time ago. But, you know, when people are critical of me because they say, hey, Trump is finally doing the right thing. You should just be applauding him.

He’s not finally doing the right thing. That is my point. Yes, he’s talking about problems that in the past nobody but me discussed.

We have real serious problems. But instead of actually solving them, which would be very politically unpopular, he wants to scapegoat China and the rest of the world and demand that they fix our problems and say that by doing that, he’s ripping off the bandit when he’s not even coming close to doing that. So in the meantime, I think you fade this bear market rally.

You buy the dip in gold, even more so in the mining stocks. You sell the dollar. You keep moving assets out of the US.

I think the day of reckoning here is close at hand. Oh, before I forget, I’m almost actually done with the podcast. But I wanted to mention.

So my wife, you know, I talk about her, her songs. This is her fifth song just came out on Friday. Love is on fire is the fifth song.

So you can listen to it. Laughing Cats on Spotify. I think we’re going to put a link up on this to her latest song.

But, you know, if you haven’t heard the other four songs, listen to all of them. I mean, they’re all good. I mean, they’re all a bit different and there’s more coming.

I mean, I think my some of my favorite ones she hasn’t even released yet. But but, you know, these are good, good songs, you know, a little bit different style on each one. So if you don’t like one or, you know, maybe you like another one even more.

But but listen to the latest one and then go back and listen to all of them again. It’s Laughing Cats is on Spotify. She’s got a video that’s going to be coming out, too.

She’s been working on it for Love is on Fire. And so when that’s out on YouTube, I’ll let people know and they can go and they can look at it on YouTube. A couple of other things just to that I meant to mention.

We’ve got existing home sales from March came out this week. The weakest March since the 2008 financial crisis. What is that telling you? And home sales are getting a lot weaker.

Also, I saw that refi’s 42 percent of the most recent refi applications were rejected. That’s the highest since 2013. And it may be higher for many years before, because the chart that I saw only went back to 2013.

And this was the highest. So people are trying to refinance out of desperation because the rates are not actually very low. I can’t imagine that many people refinancing now and getting a lower rate than the one they got.

So they’re probably trying to do a cash out refinance, even though it’s a higher rate, because that’s how strapped they are. They need money and the banks are not approving these these loans. So that is that that is a very bad sign, I think, for for the for the economy, because banks want to make loans.

Right. They love doing a refi. But the fact that they’re turning these down must mean that they’re really worried about the credit quality and they don’t they don’t want to do it.

Right. So and people are desperate. They try and everything they can to try to keep their economic heads above above water.

And again, don’t forget Shift Sovereign. We’ve been putting out some phenomenal content on the Shift Sovereign site. We got a free newsletter worth every penny, but the premium one is only about nine bucks a month.

And that’s that’s worth it, too. There’s a lot of good stuff at Shift Sovereign. So at least try out the free newsletter by just signing up.

But, you know, I think I think the premium is you get a lot for your money so you can you can start that out. It’s monthly. So if you don’t like it, you could always you could always stop paying and just take take the free content and keep following me on X. You know, I’m constantly posting.

If you’re not following me there, there’s so much fake news coming out. I’m trying my best to disseminate the truth on all of my social media platforms. Again, if you like today’s podcast or you’re watching on YouTube, like it.

Give it the thumbs up. Leave me a comment. I try to respond to some of those.

Anyway, have a great week, everybody. And I’ll be back again with another podcast sometime next week. Bye for now.