Trump Tariffs Escalate with August 1st Deadline

In today's video, I want to give you a status update on the Trump tariffs, which are going to go into effect on August 1st. And today's video is a very big update. A lot has been going on. Okay, so here's a situation. April 2nd was supposed to be Liberation Day. That's the start of the reciprocal tariffs, right? But the thing is that these tariffs, they caused major disruption in the bond market. And President Trump and Treasury Secretary Scott Besant reacted by delaying the tariffs until July 9th. And ever since then, President Trump's team, and a lot of this is coming from Howard Lutnick, who's the Secretary of Commerce. They've been saying that they put a pause on the reciprocal tariffs because they're negotiating with so many countries on tailored deals. So basically, customized trade agreements country by country. So they've been saying that countries are at our doorstep begging to make a deal. Okay, so listen, we have over 100 trading partners and Trump's team has only made a deal with the United Kingdom and Vietnam. So I don't know if you want to call China a deal. I would say that's more of a de-escalation. Anyways, President Trump was focused on the passage of his one big beautiful bill. And now that it's passed, he's refocused on trade policy and tariffs again. And the July 9th extension, it was approaching with no further deals. So ultimately, countries were not at our doorstep begging to make a deal with us. So President Trump, he walked away from the negotiations and he said that he's just going to do another extension. So President Trump and the White House said that the new deadline is now July 31st, and that the reciprocal tariffs are going to go into effect on August 1st. Now, I want to show you a video clip of President Trump explaining what happened with all the negotiations since Liberation Day. So please take a look. President and tariffs, what happened to 90 trade deals in 90 days? Oh, we've spoken to everybody. We know everything. It's all done. I told you, I told you, we'll make some deals. But for the most part, we're going to send a letter. We're going to say welcome to the United States. If you'd like to participate in the greatest, most successful country ever. I mean, we're doing better than ever. We have I don't think you're going to see these numbers. So we've never had numbers like this. We've never had investment like this. We have more than 90. We're going to have much more than 90. But most of those are going to be sent a letter. This is exactly what I said. Now we've made a deal with United Kingdom. We've made a deal with China. We've made a deal. We're close to making a deal with India. Others we've met with and we don't think we're going to be able to make a deal. So we just send them a letter if you want to. If you want to play ball, you have to this is what you have to pay. Okay, so President Trump has been sending out letters to other countries telling them of their new tariff rates. So he started sending out the letters on Monday. So that day, he sent out 14. And now the count is above 20. So I'm sure there's going to be more. So here's what the letters look like. So this was the one that was sent to Japan. Now I want to show you the new updated tariff rates that begin on August 1. And I know that this is hard to see, especially from a cell phone, but I'm going to highlight the bigger trading partners. So these were the original reciprocal tariff rates that President Trump set for April 2 on Liberation Day. And they were high, of course. You know, if you can see them, most of them are in the 20 to 30 percent range. And some countries, like take a look at Cambodia, it's at 49 percent. Now what I've highlighted here are their new reciprocal tariff rates, which if you compare them, they're similar to the original ones. But some are actually much higher. So if you take a look at Brazil, so that's one example. President Trump originally set a 10 percent tariff rate on all Brazilian imports, and now the new rate is at 50 percent. So if you take a look at Japan, that was originally set to 24 percent, and the new rate is 25 percent. South Korea was originally set to 25 percent, and that remains at 25 percent. And I just want to say that these are not small trading partners. Okay, so we are going to have a 50 percent tariff on Brazilian imports. And we imported 44 billion dollars worth of Brazilian goods last year in 2024. So this includes minerals, metals, agricultural products, and machinery. Okay, so now we're going to have a 25 percent tariff on South Korea. We imported 135 billion dollars worth of goods from South Korea last year. So this includes chemicals, rubber, equipment, appliances. And we're going to have a 25 percent tariff on Japan. And look how big of a trading partner that they are. We imported 152 billion dollars worth of goods from them last year. So this includes machinery, equipment, auto parts, electronics, medical instruments, and more. Now our four top trading partners. I mean we're going to see what happens. We already covered the Canada-Mexico situation. And who knows what's going to happen with the China trade war. How that's going to develop and or even escalate. And for Germany, the EU tariff rate that's expected to be released shortly. Okay, now let's answer this very important question. How are these tariff rates determined? And for that one, I'm going to let President Trump do the explaining. Please take a look. Yes, please. Sir, can you explain how you calculated your latest round of tariffs? Was there a formula that was used? And do you expect any of these countries to face tariffs as well? The formula was a formula based on common sense, based on deficits, based on how we've been treated over the years, and based on raw numbers. And we're going to have a couple of more coming out today. Brazil, as an example, has been not good to us. Not good at all. Okay, now let's answer this question. Are these new tariff rates final or are they subject to modification or change? And for that one, again, I'll let President Trump do the answering. Please take a look. Mr. President, are the tariff letters that you sent today final offers or are they negotiable? More or less final offer. So South Korea, Japan should take it? We're always subject to negotiate something that's fair. But we've talked to most of the countries and pretty much they've had their way for many, many decades, as you know. And it was time that we just wanted fairness. Now, here's something that you should know. Not all of these countries are going to take it so well. Some of these countries are expected to respond with retaliatory tariffs, which would, of course, hurt U.S. exporters. So listen, what President Trump is doing cuts both ways. So I want to explain. If we impose tariffs on other countries, then importing from other countries is going to become more expensive, right? And that's going to promote products that are made in America. Okay, so if that happens, then we as Americans, we would be making more stuff here in the U.S. and that's going to create more jobs for the U.S. economy, right? But other countries, they can respond by imposing tariffs against us as well. And then if that happens, our businesses here that export products to other countries, they're going to suffer and we're going to lose business and then we're going to see job losses. So that's why I'm saying that it goes both ways. But what you end up with is Americans making products that we can't make as efficiently as other countries and other countries making products that can't make it as efficiently as us. But I want you to keep this in mind. So in these letters that were sent out, it says, which I've highlighted here, if for any reason you decide to raise your tariffs, then whatever the number that you choose to raise them by will be added to your tariff. Okay, so President Trump, and this is an example, President Trump wants to charge a 50% tariff on Brazil. So if Brazil retaliates by imposing a 30% tariff on U.S. products, then President Trump's going to respond by bumping up the tariff against Brazil from 50% to 80%. Now, the Federal Reserve is saying that we're going to see inflation from the tariffs in the months ahead. And for that reason, the Federal Reserve has been holding off on cutting interest rates. And of course, that's been really upsetting President Trump. But if these tariffs do go into effect, I mean, it's definitely going to have a major impact on the Federal Reserve's decision on when they're going to start cutting interest rates again. And if these tariffs do go into effect, we're going to see how the bond market reacts, whether it's going to be a repeat of what happened back in April. So regarding this, I'll tell you two things. So the first thing is that in April, the bond market didn't start to sell off until a few days after the Liberation Day tariffs took effect. So what I'm saying is that if these tariffs go into effect on August 1st, if the same thing happens, then don't expect the bond market to go sour right away. Just give it a few days. And the second thing is that if there's trouble in the bond market, then there's going to be trouble spreading into the stock market as well. If bonds go down and yields go up, then the stock market's most likely going to negatively. Now, there's always the possibility that President Trump is going to chicken out again and extend the August 1st deadline, or he's going to let the tariffs go on for a few days and then extend it again. But I'll tell you what, if these reciprocal tariffs do go into effect, then the Trump administration, and especially Scott Besant, they're going to be really paying attention to the bond market, and so will I. Now, if you're going to ask me for my opinion, what is Trump going to do? I have no idea what Trump is going to do. I mean, you tell me your best guess, and that's just going to be as good as my guess at this point. But all I can tell you is that these tariffs are accelerating the de-dollarization process around the world. So that's the process of the US dollar losing its reserve asset status. And that's ultimately going to lead to faster inflation and higher interest rates, especially on the long end. Anyways, that is your tariff update, August 1st. That's the big deadline. That's the day to look forward to. Let's see how other countries respond as well. Please subscribe. I thank you for the support, and I wish you a very nice day. Take care.