원문 보기
Before we talk about our market action on Friday and over the course of last week, let's welcome on board Mr. Ed Yardini, the president and chief investment strategist at Yardini Research. And Ed, hi morning. Pleasure to be chatting uh with you uh Monday morning. Give us your sense of the tariff announcement that we've seen on EU 30%, is this a number that you were expecting because the street was largely pencil penciling in a number around 20%, but 30% has slightly shocked the European markets given the move we've seen uh Friday.
So, what's your take on the 30% tariff? Well, this almost seems like Liberation Day two, right? Liberation day one was on April 2nd when the president introduced a whole bunch of tariffs on uh all of our trading partners around the world. And then he postponed it on April 9th and said that uh he would u push the deadline out to uh July 9th.
And then a few days ago, he announced that now the new uh deadline is August 1st. And then he kind of went back and through all of these uh tariffs at various countries. And so we're kind of where we were when we started with the uh the April 2nd Liberation Day tariffs. The markets seem to be much calmer about it because I think the perception is that the president changes his mind that what the president is doing is negotiating.
It isn't a very pretty thing to watch, but uh hopefully this thing will be resolved by the uh by the end of the summer and I think that's what the markets are anticipating. Hi um Ed, this is Shishi also joining in. So Ed, yes of course uh post that uh April 2nd announcement and now no major changes is what we are seeing barring a few in terms of the percentage of tariff on major geographies.
But Ed, how do you believe that the markets will digest this over the course of period because for now this seems to be a much calmer but we have all witnessed that what happened back in April and then in May not just the US markets but even the emerging markets were definitely reacting to that. So do you believe as and when the markets digest the kind of impact these tariffs going to have on the global economy the markets can react in a negative way?
Well, sure. I mean, if uh if this continues to be an escala, a reescalation of the trade war, it is a negative for the global economy. It's a negative for the US economy, and it's a negative for global stock markets. But I think the perception is that this is we're still very much in a negotiation phase.
The president is somewhat frustrated that he couldn't get his 90 deals in 90 days. That's what Peter Navaro's trade advisor was uh touting as a possible scenario, but uh so far they've only been two deals. Uh and um there's still plenty being dis discussed. So it's a very fluid situation. And on top of all that, uh Trump said that I think on Monday he's going to be announcing what he's going to do about Russia.
He's not happy with Russia's response to his attempts to create a ceasefire with Ukraine. And there's some talk about him imposing some pretty severe tariffs on countries that buy Russian oil. Obviously, that implies that applies to India. It applies to to China. So, it's all getting quite messy and quite confusing.
Uh but the markets have uh learned to cope with it. Uh, and I think the markets are betting and I agree with the view that uh, this isn't going to last for many more months. Uh, uh, Trump really can't afford to have a recession later this year going into next year when the midterm election next November could very well cost him the Republicans very thin majorities in both houses of Congress.
Uh so I I think the market is right that this issue will pass and that uh he'll move on to other things like uh campaigning for Republican candidates for the midterm congressional elections. Ed appreciate that view. Before we let you go, just want to um get your sense on where do you think this number could stabilize going ahead?
Because the April tariff on EU was 25%. Right now it's 30%, this largely seems like a negotiating tactic. Do you believe it could come back to 25 or maybe even go below the 25 levels to let's say 20%. Is there is that a possibility that you're penciling in right now? It's very it's very hard to uh make a conclusion based on what Trump says because he obviously does say a lot of things and they aren't always the same day after day that can change.
And so right now he's actually suggested that even that 10% base in uh tariff that everybody's supposed to pay might be raised to 15 to 20%. He's obviously very happy with the amount of revenues that are coming in as a result of the 10% tariff. Uh the risk is that he becomes a little bit u too uh too aggressive in his perception of uh how much money tariffs can raise without fully disappreciating the extent to which this creates uh lots of trade frictions, lots of trade problems and uh exacerbates a trade war which isn't good for anybody.
Indeed. But Ed uh lastly help us understand that how are you tracking um the cues that we are getting from gold as well as uh dollar index because uh gold is once again seeing a bit of a surge. Do you believe that more is yet to come and along with that what's your take on the dollar index? Well I've been bullish on gold ever since it rose above 2000.
It looked like a an important breakout to uh to towards new highs. We're are we have been making new highs. We're over three $3,300 now per ounce. I've been bullish on gold to fundamentally because u the foreign central banks of countries that we don't get along with that don't like us, don't like our uh way of doing things.
Uh they've decided to buy a lot of gold ever since Russia invaded Ukraine and we froze the assets of the of the Russians. And so there's been a lot of demand from central banks. Uh but then of course the geopolitical situation, the trade war, all these things have uh benefited gold. And the flip side of that is that's been a negative for the dollar.
But I I'm not that negative from here. It's the dollar's down basically 10% so far this year. I think that's uh about it. I think there's still a a lot of demand for for uh for dollars from foreigners uh who continue to do a lot of business here as well as recognize that our capital markets are still the most liquid probably safest capital markets in the world.
Maybe you know if you want to be really safe you go to Switzerland but that's a a fairly limited currency. Okay, Ed, thank you so much for joining us this morning and sharing your take on everything that we're seeing on the tariff front. Thanks once again for joining us.
Comments 0