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00:00Now, the problem with regard to the markets, remember that tariffs are bad news because
00:06they're taxes on international transactions, and at any time you put a tax on, you put
00:13a tax wedge on economic activity.
00:17So that means that the net that's left over after a wedge goes in is less than it was
00:23before.
00:24That means profits are going to be lower than they would before.
00:28And in the United States, this has always been a big deal.
00:32If you look back at the 1930s, the Smoot-Hawley tariff, which was something like we'll probably
00:40get from Trump, caused the stock market to crash.
00:45In anticipation of that, the stock market, the Dow Jones peaked out in September of 1929,
00:52and by the time July 1932 rolled around, what had happened?
01:01The market had lost 89% of its value.
01:04It had completely collapsed, and the reason for that was the tariff.