What tariff pause and increased China focus means for markets

President Trump announced a 90 day pause on tariffs with the exception of China.

Transcript

00:00The fact that Trump has paused all tariffs for 90 days except for China is really showing

00:05that he's singling out China specifically. And it's very interesting because they are

00:10our largest trading partner. Obviously, they bring us most of our goods. We're an import

00:15nation. We're a service-based economy, importing everything mostly from Asia.

00:19However, China is a very unique case because they were admitted to the World Trade Organization

00:242001, and they garnered most favored nation status. So a lot of the trade policies that

00:30apply to America don't apply to China because they have this most favored nation status.

00:36And being the second largest economy in the world, and in some cases they outsize U.S.

00:41economy, they're the first largest economy in the world in some cases, that means that

00:46they probably don't deserve most favored nation status and not having all of the rules that

00:51apply to all industrialized nations apply to China.

00:54So the fact that Trump has carved out China, he is signaling that he is directly head-to-head

01:00dealing with this Chinese problem.

01:01For the whipsaw effect that Trump has just announced, this 90-day pause, you can see the

01:08market is taking off. And that is because they have pulled back substantially thinking,

01:12we have this tariff policy coming. This is going to impact prices. And it's at a time where

01:18the consumer is not super strong. And we've had inflation these last couple of years. So

01:22the tariff policy really did spook the markets. Trump has decided to pause that for 90 days and

01:28really singularly focus in on China. So I think that the market's initial reaction is going to be

01:33very, very positive. And I think that it's going to be a TBD, a 2B determined, until we see directly

01:39how the direct focusing on just the singular country of China does impact the broader markets.

01:45The Trump administration just got into office on January the 20th. So we are still in the spring

01:50in a very, very fresh time into this new administration. We need more stability. Trump

01:55pausing the tariff policy for 90 days is him literally trying to calm things down and get a

02:00little bit more stability and then focus solely on China. But the biggest point for investors to know

02:06is don't sell out in fear. You could be right to sell. I'm not saying that that's not the right

02:11advice. I don't know everyone's individual perspective, but you just don't want to make

02:15that decision in the middle of a fear type of environment because that's when you're really

02:19making the wrong decision.