Trump’s Tariff, Trade Policy Ideas Get Renewed Focus

Note: Modified format today as I am in Nashville for a speech.

— Equities today: Asian and European stock indexes were mixed overnight, with Asian shares mostly weaker and European shares mostly firmer. U.S. stock indexes are pointed to higher openings. In Asia, Japan -0.7%. Hong Kong -1.0%. China -1.1%. India -0.6%. In Europe, at midday, London +0.4%. Paris +1.2%. Frankfurt +0.7%.

— Chinese stocks enter correction as stimulus disappoints markets. Chinese equities fell sharply, with the CSI 300 Index dropping over 10% from its Oct. 8 high, as investors were let down by Beijing’s lack of bold economic stimulus. The market response reflects skepticism over the government’s gradual approach to economic recovery, despite increasing loan quotas for unfinished residential projects.

U.S. equities yesterday: All three major indices finished in positive territory with the Dow hitting a new record. The Dow was up 337.28 points, 0.79%, at 43,077.70. The Nasdaq rose 51.49 points, 0.28%, at 18,367.08. The S&P 500 gained 27.21 points, 0.47%, at 5,842.47.

— Gold hits record high in flight to quality. Spot gold prices set an all-time high on Thursday amid a flight to quality given heightened geopolitical tensions and a potential sign investors don’t believe the war against inflation is over. Gold has soared 30% this year and is on the cusp of reaching $2,700 an ounce.

— WSJ survey: Economists grow more optimistic on inflation, recession, and growth in 2024. Economists surveyed by the Wall Street Journal (link) are increasingly upbeat about the U.S. economy, projecting steady GDP growth, moderating inflation, and a manageable labor market slowdown. The probability of a recession within the next 12 months has dropped, aligning with expectations of cooling inflation and further interest rate cuts. While forecasts anticipate the unemployment rate to hover around 4.2% by year-end, economists see job creation remaining steady at approximately 130,400 new jobs per month. Moreover, the economists predict that both inflation and the federal funds rate will decline faster than previously expected, reflecting the easing effect of the Federal Reserve’s September rate cut. The survey also explores which presidential candidates — Trump or Harris — would exert greater influence on inflation, interest rates, and the federal deficit.

— U.S. B-2 bombers strike Iran-backed Houthi weapons sites in Yemen. The U.S. launched precision strikes using B-2 stealth bombers against five underground weapons caches controlled by Iran-backed Houthi rebels in Yemen. The operation, ordered by President Biden, aims to curtail the Houthis’ ability to attack vessels in the Red Sea. Defense Secretary Lloyd Austin highlighted the action as a demonstration of U.S. global strike capabilities, with potential implications for Iran amid rising tensions in the region. CENTCOM reported no initial civilian casualties from the attack.

— Israel halts food import processing to Gaza, trade drops sharply. Israel has stopped processing food import requests to Gaza, with Gaza traders losing access to the Cogat system on Oct. 11, Reuters reports. This has reduced goods entering Gaza to their lowest levels since the war began, with only 29 trucks arriving from October 1-16, compared to a pre-war average of 175 trucks per day. The U.S. has warned Israel to ensure aid flows, threatening to withhold military support.

— Ag markets today: Corn, soybeans and the winter wheat markets faced price pressure overnight, while spring wheat traded mildly higher. As of 7:30 a.m. CE, corn futures were trading 2 cents lower, soybeans were 7 to 8 cents lower, winter wheat markets were 1 to 2 cents lower and spring wheat was 1 to 3 cents higher. The U.S. dollar index was more than 100 points lower, and front-month crude oil futures were around 25 cents higher.

Choice beef continues to surge. Choice boxed beef prices firmed another $2.30 to $319.13 on Wednesday. Choice beef has surged $22.76 since late September and is now more than $15.00 above last year at this time. Daily Livestock Report notes, “The value of the chuck primal, which is heavily featured by retailers in October, has surged due to reduced spot availability as packers cut back on slaughter.” Once that seasonal demand ceases, the beef cutout could decline.

Cash hog index posts new seasonal low, pork cutout remains choppy. The CME lean hog index is down 23 cents to $83.85 as of Oct. 15, marking a new seasonal low. The pork cutout firmed 45 cents to $94.85, holding well within the five-week choppy range from the September low at $92.91 to this month’s high at $96.31.

— Agriculture markets yesterday:
• Corn: December corn rose 3 1/2 cents to $4.04 3/4, closing nearer the session high.
• Soy complex: January soybeans fell 9 1/2 cents to $9.94 and closed at a 2.5-month low close. December soybean meal closed up $1.90 at $313.60. December soybean oil fell 77 points to 41.68 cents. All three markets closed nearer their session lows.
• Wheat: December SRW wheat rose 5 1/2 cents to $5.85, while December HRW wheat rose 5 3/4 cents to $5.88 3/4. December HRS futures rose 4 1/2 cents to $6.20 1/2.
• Cotton: December cotton rose 64 points to 71.26 cents and near mid-range.
• Cattle: Nearby October live cattle futures ended Wednesday having risen 32.5 cents to $187.05, while most-active December futures edged up 7.5 cents to $186.60. Expiring October feeder futures sagged 42.5 cents to $246.10, but that drop was easily exceeded by the 97.5-cent drop to $245.50 suffered by November feeders.
• Hogs: December lean hog futures rocketed $2.475 higher to $77.70, settling near session highs.

— Ag trade: South Korea purchased a total of 130,000 MT of corn in two separate tenders – all of which is expected to be sourced from the U.S. or South America. Taiwan purchased 65,000 MT of corn expected to be sourced from Argentina, Brazil or South Africa and 78,200 MT of U.S. milling wheat. Algeria tendered to buy up to 240,000 MT of corn from Brazil or Argentina and 35,000 MT of optional origin feed barley. Jordan tendered to buy up to 120,000 MT of optional origin milling wheat.

— Extreme weather threatens China’s worst corn harvest in decades. China’s corn production is set to decline by up to 7% due to heat waves and floods, marking the largest slump since 2000, Bloomberg reports (link). Despite the shortfall, slack demand and ample stockpiles are expected to limit immediate price impacts, though future import needs could rise if economic stimulus efforts succeed.

— Russia allows transit of Kazakh grain for export, bans imports. Russia has granted Kazakhstan permission to transit grain through its territory for export to other countries starting today, but imposed a temporary ban on Kazakh grain imports to Russia, its agricultural watchdog said. Transit of grain will be possible if Kazakhstan provides phytosanitary certificates for the final destination country and ensures trans-shipment of grain from railway cars directly into export vessels. Russian watchdog Rosselkhoznadzor had previously said that from Sept. 23 its systems would automatically block the issuance of phytosanitary certificates for grain, grain products, sunflower seeds, tomatoes and peppers from Kazakhstan.

— HPAI cases rise in dairy and poultry, impacting 2.76 million birds past 30 days. Highly pathogenic avian influenza (HPAI) continues to spread, with 97 dairy herd cases reported in California and Idaho over the past 30 days. On the poultry side, 2.76 million birds across three western states have been affected, including major outbreaks in Utah and Washington. Since the outbreak began in February 2022, HPAI has hit 1,180 flocks across 48 states, affecting 103.47 million birds.

— Overseas ballots targeted by GOP lawsuits amid key 2024 battleground stakes. Recent Republican-backed lawsuits in Pennsylvania, North Carolina, and Michigan are challenging overseas voting processes, which could impact crucial races. With 6.5 million eligible overseas American voters, including 1.6 million from battleground states, these ballots could prove decisive. In the 2020 election, over 1.2 million overseas ballots were sent, with nearly 890,000 counted. Donald Trump has also raised unsubstantiated claims of fraud involving overseas votes.

— Kamala Harris’ Wednesday interview with Bret Baier on Fox News was a contentious and significant event in the 2024 presidential campaign, with both frequently interrupting and speaking over each other. Highlights:

Immigration and border security. The interview began with a heated exchange on immigration, a central issue in the campaign:
• Baier pressed Harris on the number of undocumented immigrants entering the U.S. during the Biden administration.
• Harris defended the administration’s record, emphasizing that immigration has been a long-standing issue predating her tenure. “We’ve had a broken immigration system transcending by the way Donald Trump’s administration even before.”
• She again criticized Trump for derailing a bipartisan immigration reform proposal earlier in the year.
• Harris highlighted her background as a former attorney general of a border state, where she prosecuted drug, gun, and human trafficking cases.
• Baier questioned Harris about crimes committed by illegal immigrants, including specific cases like the murder of Laken Riley. Baier pressed Harris on the number of undocumented migrants who had entered the country in recent years, and confronted Harris with a video clip of a family member blaming the Biden/Harris administration for the death of a woman murdered by someone in the country illegally. Asked if she would apologize to that family, Harris responded that they were “tragic cases.” But she also insisted that Trump had stymied efforts to find a bipartisan solution to the problem, saying: “Let’s talk about what is happening right now with an individual who does not want to participate in solutions.”

Bottom line: Baier knows that immigration is a top issue for Fox viewers and millions of voters . He was persistent that Harris answer for the mistakes of the administration’s first three years, which she was unable to do.

Distancing from Biden. Harris made efforts to distinguish herself from President Biden:
• She stated, “My presidency will not be a continuation of Joe Biden’s presidency, and like every new president that comes into office, I will bring my life experiences, my professional experiences and fresh and new ideas.”
• Harris mentioned she would bring fresh ideas to issues like housing and small business support.
• Asked what voters should turn the page from — particularly with polls showing many unhappy with the direction of the country — Harris focused her response toward her opponent: “The last decade in which we have been burdened with the kind of rhetoric coming from Donald Trump.”
• In a back-and-forth over why Trump is polling so well despite Harris branding him “unstable” and “dangerous,” Baier asked the vice president whether she thought his supporters were “stupid” or “misguided.” Harris said: “When you listen to Donald Trump, if you watch any of his rallies, he is the one who tends to demean and belittle and diminish.”

Democracy and Trump. Harris reiterated concerns about the potential dangers of a second Trump term:
• She accused Trump of threatening to deploy the military against American citizens.
• Harris highlighted that many former Trump administration officials and some Republicans have deemed him unfit for office.
• Harris repeatedly pivoted to criticizing Trump, accusing him of threatening to deploy the military against American citizens and being a danger to democracy.
• Baier challenged Harris on her characterization of Trump’s statement.

Gender-affirming care: Baier asked about Harris’s support for taxpayer-funded transgender surgeries for federal inmates.
• Harris responded by saying she would “follow the law” and pointed out that such procedures were available during Trump’s administration as well.
• During the interview, Baier played an advertisement from the Trump campaign attacking Harris for statements during the 2020 presidential campaign in which she said she would use taxpayer dollars to pay for gender transition surgeries for prisoners. Harris responded by noting a recent New York Times report that federal prisoners had received gender affirming care during Trump’s administration. “I think frankly that ad from the Trump campaign is a little bit of like throwing you know stones when you’re living in a glass house,” Harris said. “I will follow the law, and it’s a law that Donald Trump actually followed.”

Of note: Harris defended Biden’s fitness for office when Baier pressed her on the president’s ability to do his job — then quickly pivoted.

Bottom line: The interview was marked by frequent interruptions and confrontational exchanges. Baier was eager to shake Harris off her usual talking points, including playing a Trump campaign ad and asking her to respond. Throughout the interview, Harris attempted to steer the conversation towards criticizing Trump and his policies, while Baier persistently tried to get specific answers on the Biden-Harris administration’s record and policies. The interview was part of Harris’s strategy to connect with independent and undecided voters, including conservative women. Harris’ supporters said the confrontational nature of the interview allowed Harris to demonstrate her ability to stand her ground in a hostile environment, which could be seen as a display of strength and readiness for leadership. When pressed on topics, Harris emphasized adherence to the law while attempting to redirect focus to what she considers more pressing issues for voters. On a political roundtable with Fox commentators, Baier said: “I tried to redirect numerous times without interrupting too much, but at some point, you kind of have to redirect to get back in the game,” he said.

Her aides declared themselves pleased with the results. “We feel like we definitely achieved what we set out to achieve, in the sense that she was able to reach an audience that has probably been not exposed to the arguments she’s been making on the trail,” Brian Fallon, Harris’ campaign communications director, told reporters on Air Force Two. “She also got to show her toughness in standing tall against a hostile interviewer.”

Of note: One moment during the exchange will likely become fodder in future campaign ads. When Baier defended Trump by saying the Republican didn’t actively advocate the treatment for transgender inmates, Harris said candidates had to take responsibility “for what happened in your administration.” The line could provide a convenient soundbite for Trump at a moment Harris’ campaign is seeking distance from Biden.

— U.S. offers conditional loans for two SAF projects in South Dakota and Montana. Gevo secured $1.46 billion DOE loan for Net-Zero SAF project in South Dakota. Gevo’s achievement marks a significant milestone in the development of sustainable aviation fuel (SAF) from corn ethanol. Details:

Project overview: Gevo, Inc. secured a conditional commitment for a $1.46 billion loan guarantee from the U.S. Department of Energy (DOE) Loan Programs Office for its Net-Zero 1 (NZ1) project.
• This is a groundbreaking development as it represents the first-ever large-scale alcohol-to-jet (ATJ) project to receive such a commitment from the DOE.

Facility details. The NZ1 facility will be located in Lake Preston, South Dakota, and is designed to:
• Produce approximately 60 million gallons of SAF annually
• Use 100% U.S.-sourced feedstocks
• Generate about 1.3 billion pounds of protein and animal feed products
• Produce approximately 30 million pounds of corn oil per year

The facility’s design, combined with Gevo’s business system, is expected to yield SAF with a net-zero carbon footprint on a lifecycle basis, including through the burning of the fuel.

This conditional commitment is crucial for several reasons:
• Technological advancement: It represents a major step forward in scaling up the alcohol-to-jet fuel technology, which converts ethanol into SAF.
• Economic impact: The project is expected to be the largest economic development project in South Dakota history, creating jobs and opportunities for the agricultural community.
• Environmental benefits: Depending on the ethanol feedstock used, the jet fuel produced from this process can reduce greenhouse gas emissions by up to 80% compared to petroleum-based jet fuel.
• Industry transformation: This project could catalyze the accelerated adoption of climate-smart agricultural practices and reinforce domestic energy security.

DOE also approved conditional funding of up to $1.44 billion to Calumet to support the expansion of its Montana facility to utilize vegetable oils, fats and greases to produce biofuels. If finalized, the loan guarantee would fund facility expansion to produce about 315 million gallons per year of biofuels, most of which will be SAF, DOE said.

Outlook. This development aligns with the growing demand for SAF and the aviation industry’s efforts to reduce its carbon footprint. The U.S. government has set ambitious goals through the Sustainable Aviation Fuel Grand Challenge, aiming to produce three billion gallons of SAFs by 2030 and meet 100% of U.S. aviation fuel demand with SAF by 2050.

Next steps. While the conditional commitment is a significant milestone, Gevo must still satisfy certain technical, legal, environmental, commercial, and financial conditions before the DOE can finalize the financing documents and fund the loan guarantee.

— Report: 2024 presidential candidates focus on food inflation, overlooking pandemic’s impact. Both major political parties have made food price inflation a campaign priority, though they downplay Covid-19’s lingering effects on supply chains and global inflation, according to a report (link) from the American Enterprise Institute. The report is written by Dr. Joe Glauber, a former chief economist at USDA, and Vincent Smith, an AEI senior fellow. While food prices have stabilized, with home food costs rising just 1% annually since 2022, dining out prices are growing at 3% per year. The pandemic led to a modest increase in household food spending, with low-income households seeing only a 1.3 percentage point rise in food budget share.

Pandemic impact and global pressures. As Smith and Glauber note: “Both candidates’ claims about the causes of higher food prices should be viewed with some skepticism, as their discussions largely ignore how the Covid-19 pandemic affected food supply chains and production costs.” This oversight fails to account for the complex factors that have influenced food prices in recent years.

Food price trends. The authors highlight two key trends in food prices:
• Food for home consumption: Prices increased sharply during the pandemic but have since moderated, rising at only about 1% annually since 2022 — slower than the general inflation rate.
• Food away from home: Prices followed a similar pattern but are now increasing at about 3% annually.

Impact on household spending. Contrary to some political narratives, the impact of food price inflation on household spending has been relatively modest: “The share of income spent on food increased modestly during the pandemic for all households, but by much less than some commenters suggest, even for low-income households, which only modestly increased the share of their income spent on food by 1.3 percentage points.” The authors say this data suggests that while food price inflation has affected households, its impact may not be as severe as some political rhetoric implies.

Political rhetoric vs. economic reality. The authors criticize both major candidates for their approach to the issue: “The campaigns have also focused disproportionately on the inflationary impacts of expansionary fiscal actions taken by both the Trump and Biden administrations to prevent the potentially catastrophic costs of a severe pandemic-driven recession.” This focus overlooks the global nature of the issue and the similar policies adopted by other developed countries to mitigate the economic impact of the pandemic.

— U.S. Labor Dept. probes underage worker claims at Tyson plants in Arkansas. The U.S. Department of Labor is conducting an ongoing investigation into claims of underage workers at two Tyson Foods plants in Arkansas. This comes after court documents unsealed in the Western District of Arkansas revealed accusations of child labor violations at Tyson processing facilities.

Specific allegations. A teacher at a school near the Rogers, Arkansas plant reported that a 14-year-old student discussed working at the Tyson facility for the summer. For the Green Forest, Arkansas plant, a mother overheard children between 11-13 years old discussing working night shifts from 11 PM to 7-8 AM. Investigators observed “multiple individuals whose appearance and body language indicated were potentially minor employees below the age of 16" at both locations.

Investigation details. The Labor Department requested inspection warrants in September 2024 for Tyson Foods plants in Rogers and Green Forest, Arkansas. Search warrants were executed at 3 AM on Sept. 11 at the Green Forest plant and around 7 AM the same day at the Rogers plant. Investigators included photographs of what appear to be teenagers entering and exiting Tyson plants in July. The investigation is seeking records related to the employment of minors at these facilities.

Tyson’s response. Tyson Foods has stated: “We do not allow the employment of anyone under the age of 18 in any of our facilities, and we do not facilitate, excuse or in any other way participate in the use of child labor. We take the enforcement of all labor laws very seriously, and we have procedures in place to verify the age of all team members.” The company claims to have fully cooperated with the Department of Labor investigation.

Of note: This is not the first time Tyson has faced such allegations. In 2023, a Department of Labor investigation found child labor violations at Tyson’s Arkansas and Tennessee plants, though these were employed by a contractor, Packers Sanitation Services Inc.

— Sen. Baldwin urges USDA aid for Wisconsin farmers after poultry plant closure. Sen. Tammy Baldwin (D-Wis.) has taken action to address the crisis facing poultry farmers in her state following the abrupt closure of Pure Prairie Poultry.

Background. Pure Prairie Poultry, an Iowa-based poultry processor, suddenly closed its processing plant in Charles City, Iowa on Oct. 2. This closure has severely impacted farmers in Iowa, Minnesota, and Wisconsin who were contracted to raise chickens for the company.

The shutdown has left Wisconsin poultry farmers in a dire situation:
• Farmers are left with thousands of chickens but no means to feed or process them.
• Some farmers are facing potential financial ruin, with costs of up to $20,000 per week to continue feeding the birds.
• At least six Wisconsin farms have resorted to giving away tens of thousands of chickens through social media posts.

In response to this crisis, Sen. Baldwin on Oct. 16 sent a letter (link) to USDA Secretary Tom Vilsack, urging the department to provide immediate assistance to affected Wisconsin farmers. Baldwin called on USDA to intervene and assist farmers facing extreme financial hardship. The senator pointed out that USDA had previously invested over $47 million in Pure Prairie Poultry less than two years ago. She expressed concerns about animal welfare and the potential for this situation to exacerbate the avian flu outbreak.

Baldwin asked USDA to take immediate action, including:
• Providing feed and financial aid to affected poultry growers.
• Addressing the urgent animal welfare concerns.
• Mitigating the potential spread of avian influenza due to the crisis.

Iowa and Minnesota have taken several steps to assist poultry farmers affected by the Pure Prairie Poultry closure:
Iowa: The Iowa Department of Agriculture and Land Stewardship (IDALS) obtained an emergency court order to take immediate care, custody and control of approximately 1.3 million broiler chickens on 14 Iowa farms. IDALS is coordinating with farmers to feed the chickens and is looking for financial reimbursement, including through possible legal remedies.
Minnesota: The Minnesota Department of Agriculture (MDA) has been working with six affected chicken farms to help feed, sell, or give away the birds. MDA stepped in to feed and manage approximately 300,000 chickens. The state was able to sell and give away some chickens before learning of the plant closing. Minnesota officials are exploring options to recuperate some of the accrued costs. The state has procedures in place for the government to intervene in situations like this, which allowed for a quicker response. Minnesota has also begun culling some chickens that cannot be processed or rehomed.

Of note: This situation highlights the vulnerabilities in the poultry industry’s contract farming system. Unlike crop growers or dairy producers, contract poultry farmers often lack access to the same types of insurance programs at the state and federal level. USDA’s response to this request could set a precedent for how similar situations are handled in the future, potentially influencing policy and support mechanisms for contract farmers in the poultry industry.

— Supreme Court allows EPA’s new climate rule to proceed. The U.S. Supreme Court declined to halt the Environmental Protection Agency’s (EPA) new climate regulation for power plants, allowing the rule to remain in effect while legal challenges continue. This decision comes despite opposition from Republican-led states and energy industry groups who sought to block the regulation.

Rule overview: EPA’s new rule, announced in April, requires coal plants and new natural gas plants to capture 90% of emissions believed to contribute to global warming.

Court’s stance: The Supreme Court denied an emergency request to block the regulation, with Justice Clarence Thomas dissenting. Justice Samuel Alito recused himself from the case. The case is currently under consideration in the U.S. Court of Appeals for the District of Columbia Circuit. Justice Brett Kavanaugh, joined by Justice Neil Gorsuch, provided insight into the court’s decision: They acknowledged that the applicants showed “a strong likelihood of success on the merits” for some of their challenges. However, they noted that immediate intervention was unnecessary as compliance work isn’t required until June 2025. They suggested that after the D.C. Circuit’s decision, unsuccessful litigants could seek relief from the Supreme Court if warranted.

This decision follows a June 2022 ruling that limited the EPA’s power to regulate carbon dioxide emissions without explicit Congressional approval. The court’s current stance allows the regulation to proceed while lower courts continue to evaluate its legality, potentially setting the stage for future Supreme Court involvement depending on the outcomes of ongoing litigation.

— BrucePac expands meat recall to nearly 12 million pounds over listeria concerns. The initial recall of approximately 10 million pounds has been increased by an additional 1,779,040 pounds, bringing the total to 11,765,285 pounds of recalled products. This expansion includes products produced between May 31 and Oct. 8, 2024, at BrucePac’s Oklahoma facility. The recall was initiated due to potential contamination with Listeria monocytogenes, discovered during routine product testing conducted by the USDA’s Food Safety and Inspection Service (FSIS). Subsequent investigation identified BrucePac’s ready-to-eat chicken as the source of the contamination.

The recalled items include a wide range of ready-to-eat meat and poultry products that were distributed nationwide to various establishments:
• Schools (a distribution list for schools is not yet available)
• Retail stores, including major chains such as Walmart, Target, Kroger, Trader Joe’s, and others

Products subject to recall may bear establishment numbers “51205 or P-51205" inside or under the USDA mark of inspection, though some may have different numbers due to further processing.

USDA’s FSIS has classified this as a Class I recall, indicating a high health risk. As of the latest reports, there have been no confirmed illnesses related to the consumption of these products. However, due to the long incubation period of Listeria, continued vigilance is advised.

— USTR opens portal for Section 301 tariff exemption requests on manufacturing machinery. The U.S. Trade Representative (USTR) launched an online portal (link) for companies to request exemptions from Section 301 tariffs levied on China on specific machinery used in domestic manufacturing. Opened on Oct. 15, the portal will accept requests until March 31, 2025. This follows USTR’s earlier exemptions for solar manufacturing equipment and highlights machinery eligible for further exclusions. Link to notice.

— WSJ: Trump’s proposed tariffs could reshape global trade, raising prices and risks. Donald Trump’s proposed trade policies for a potential second term could dramatically reshape global trade, potentially leading to the highest tariff levels since the 1930s. According to a Wall Street Journal article (link), Trump’s plans include an across-the-board tariff of 10% to 20% on all imports, with a possible 60% tariff on goods from China. The economic impact of these tariffs could be significant. As the Wall Street Journal reports: “Economists think the broader tariffs Trump has proposed would similarly raise prices and, on net, hurt growth. In a recent report, Morgan Stanley estimated that a 60% tariff on China and 10% on everyone else would boost consumer prices by 0.9% and cumulatively lower economic output by 1.4%.”

The long-term consequences of such policies are uncertain and depend largely on how other countries respond. The Wall Street Journal outlines several potential scenarios: “The outcome could be anything from an all-out trade war to a new trading system among U.S. allies united by their collective frustration with China.”

Trump’s advisers have suggested that these tariffs could be used as leverage in negotiations. As Clete Willems, a former Trump administration official, told the Wall Street Journal: “We’re going to enter a higher tariff environment, but all the design decisions are open to discussion. We’ve talked about Trump the tariff man. Let’s not forget Trump the dealmaker.”

Some experts warn that other countries are likely to retaliate if faced with higher U.S. tariffs. Jennifer Hillman, a Georgetown University trade law expert, drew parallels to historical events: “This is exactly the history of Smoot-Hawley. There was a presumption no one would dare raise their tariffs on us. And what happened? Everyone raised their tariffs.”

The implementation of these policies would likely face challenges, both from Congress and potentially in the courts. However, the Wall Street Journal notes that Trump has stated, “I don’t need Congress. I’ll have the right to impose [tariffs] myself.”

Of note: Treasury Secretary Janet Yellen, speaking two days after Trump laid out his case for greater trade protectionism if he wins next month’s election, is warning that sweeping, untargeted tariffs would hurt American households and businesses. “Calls for walling America off with high tariffs on friends and competitors alike or by treating even our closest allies as transactional partners are deeply misguided,” Yellen said in prepared remarks to the Council on Foreign Relations. Yellen defended the Biden administration’s approach to China, which is geared toward defending and ensuring national security without trying to hold back its main geopolitical rival economically. “Trade and investment with China can bring significant gains to American firms and workers and must be maintained,” Yellen said, adding that the two nations “must also have a healthy economic relationship based on a level playing field.”

— NWS outlook: Powerful Pacific storm to bring much colder temperatures and widespread mountain snow throughout the Intermountain West and Rockies over the next few days... ...Heavy rain and scattered flash flooding possible across the southern High Plains on Saturday... ...Above normal temperatures and gusty winds forecast across the central and northern Plains today, resulting in fire weather concerns.

(NWS)