THE S&P 500 ARE UP.
IT'S THE GOOD NEWS GETTING AK
SEN WAITED HERE.
GARY IS STILL VERY CAUTIOUS, DAN
MITCHELL AND THE WASHINGTON
EXAMINER REPORTER.
GARY, IF I CAN GO TO YOU AND GET
YOUR CONCERN.
TODAY'S GAINS NOTWITHSTANDING.
WHAT ARE THEY?
>> TARIFFS.
TARIFFS AND TARIFFS.
LOOK.
THAT IS A COST OF THE CONSUMER
IN BUSINESS AND IF IT CONTINUE
TO ESCALATE AND GETS RATCHETED
UP, IT WILL AFFECT THE ECONOMIC,
THE PSYCHE, AFFECTING EARNINGS
AND SALES AND EVENTUALLY THE
MARKETS.
THE GOOD NEWS ABOUT THE MARKETS
IS YOU STILL HAVE THE THREE
THINGS THAT WORK WELL FOR THEM,
MORTGAGE RATES DOWN AND ALL
LENDING RATES DOWN.
THE THREE GOOD THINGS ARE STILL
WORKING AND GOOD TO SEE THE
MARKET DOING WHAT IT'S DOING.
I HOPE THE PRESIDENT DOESN'T SEE
THE MARKET UP SAYING WE'RE IN
NEIL: WHAT'S INTERESTING ABOUT
THE MARKETS THOUGH.
WE'VE HAD OUR WEAR HICCUP DAYS,
IN FACT SEVERE TUMBLING DAYS.
BUT BY AND LARGE, NOTHING LIKE
THE REACTION OF THE ASIAN
MARKETS, SPECIFICALLY THE
CHINESE STOCK MARKET THAT'S
CAREENED INTO VARIOUS
COUPLE OF YEARS.
20-PLUS PERCENT.
WHERE NUMBERING STOCKS ARE 35%
OFF OF THEIR HIGHS.
NOTHING LIKE THE RELATIVELY MILD
REACTION WE'RE HAVING.
WHAT DO YOU MAKE OF THAT IN.
>> WELL I THINK THAT'S WHY YOU
HEAR THIS ADMINISTRATION
CONSISTENTLY SAYING THAT CHINA
HAS MORE TO LOSE THAN THE U.S.
IN A TRADE WAR.
AND THAT'S WHY THEY CONTINUE TO
PUSH THESE TARIFFS, REGARDLESS
OF THE RETALIATORY MEASURES THAT
WE'RE SEEING OUT OF BEIJING.
THEY FEEL AS THOUGH THE U.S. CAN
CONTINUE ALONG THIS PATH, THAT
IT'S SUSTAINABLE FOR A LONGER
PERIOD OF TIME THAN CHINA IS
ABLE TO WITH STAND.
THAT'S ONE OF THE REASONS WHY
PRESIDENT TRUMP MENTIONED LAST
NIGHT THEY'RE GOING TO CONTINUE
CHAI NOO'S
CHIN NOO'S
CHINA'OO'S
THAT IS NOT CONSISTENT WITH HOW
THE ADMINISTRATION VIEW THIS
TRADE DISPUTE AS THEY CALL IT
AND IT IS ONE OF THE REASONS WHY
PRESIDENT TRUMP IS CONTINUING TO
PUSH THIS ISSUE REGARDLESS OF
THE FEARS THAT SOME REPUBLICANS
ON CAPITOL HILL HAVE ON THE
IMPACT THIS COULD POSSIBLY HAVE
ON THEIR REELECTION CHANCES CHAC
ON THEIR REELECTION CHANCES CHAS
ON THEIR REELECTION CHANCES CHA.
NEIL: DAN MITCHELL, HOW DO YOU
FEEL ABOUT THIS?
>> LET'S START WITH SOME GOOD
NEWS.
COMPARED TO THE 1930 WE'RE
NOWHERE CLOSE TO THE TIT FOR TAT
PROTECTION WE HAD THEN PEP WHEN
RELATIVELY SMALL.
BUT THE CONCERN IS, IS WHAT IF
IT GOES TO, AS YOU WERE SAYING,
$200 BILLION OR 300 BILLION
DOLLARS AND WHEN OTHER COUNTRIES
START RESPONDING.
THE DAMAGE ISN'T JUST TO
CONSUMERS.
IT TO AMERICAN MANUFACTURERS WHO
USE IMPORTS AND IT'S DAMAGE TO
AMERICAN EXPORTERS WHO ARE
RETALIATING.
I JUST HOPE THAT KEVIN HASSETT
IS RIGHT THAT AT THE END OF THE
DAY THIS REDUCES TRADE BARRIERS.
BECAUSE IF WE REPEAT THE
1930s, THEN GOOD-BYE STOCK
MARKET.
NEIL: HOW WOULD KEVIN KNOW.
L.
HE'S NOT NEGOTIATING THE DEAL.
I'M LOOKING AT THIS -- AGAIN, AS
I SAY, THIS ALL STARTED WITH
ALUMINUM AND STEEL.
IF YOU LOOK AT WHAT WE'RE
TARGETING NOW, ELECTRICAL
EQUIPMENT, MANUFACTURING
EQUIPMENT, ELECTRONICS, GENERAL
MOTORS, MOTOR VEHICLES, OPTICAL
SAID AND DONE.
THAT SEEMS LIKE AN ESCALATION
THAT MIGHT BE DIALED BACK.
AND OF COURSE WE'RE NOT FACTORS
IN THE $16 BILLION IN IN
ADDITION TARIFFS WE'RE
CONSIDERING EARLY NEXT MONTH.
I DO WORRY.
IT SEEMS LIKE THIS STARTED WITH
ONE LITTLE RAINDROP AND THEN IT
STARTS TO DRIZZLE AND THEN IT
STARTS TO POUR AND THEN A
TORRENTIAL RAINSTORM AND THAT'S
THE BIG WORRY.
SO FAR ALL EVIDENCE IN IS THAT
NONE OF THESE COUNTRIES ARE
BACKING DOWN.
YOU KNOW, INDUSTRIES.
SOY BEAN FARMERS, CHINA'S
POLITICALLY ASTUTE.
THEY'RE GOING AFTER AREAS THAT
CAN AFFECT THE ELECTION.
IT'S REALLY HURTING THEM.
WHEN YOU SPEAK TO THESE PEOPLE,
THE ASSOCIATION ALREADY SAID 6
THEY CAN'T PLAN FOR EQUIPMENT,
FOR CROPS, YOU KNOW KNOW FOR
FUTURE CONTRACTS, NOTHING.
AND THAT'S HAPPENING TO A LOT OF
INDUSTRY AND THAT'S WHERE THE
WORRY IS, NOT WHAT HAPPENS TODAY
SAID, IF IT ESCALATES, ALL BETS
ARE OFF ON WHAT THE MARKET CAN
DO.
AND IF YOU LOSE THE MARKET, YOU
LOSE WEALTH EFFECT AND THEN YOU
CAN AFFECT THE ECONOMY AND THEN
HAPPEN.
I'M SAYING THERE'S ALWAYS
POTENTIAL FOR THAT TO HAPPEN.
I HOPE THEY GET IT LIGHT.
NEIL: THE MARKETS DON'T SEEM
PRESIDENT IS EXPRESSING THAT
THEY WILL COME TO THE TABLE.
TEMPTED TO DO THE SAME.
GABBY, HOW DO YOU SEE ALL OF
THIS PLAYING OUT?
WHO IS RIGHT, THE MARKETS
INVARIABLY LIKE TO BRAG THAT
THEY ARE BECAUSE
THEY ARE BUTAUSE
WRONG.
WHAT'S YOUR SENSE?
>> THE LONGER THAT WE SEE A
STEADINESS TOO THE MARKETS, THE
MORE THE PRESIDENT IS GOING TO
FEEL EMBOLDENED AND MOVE FORWARD
WITH THIS POLICY OF ENACTING
TARIFFS AND PLACING THESE
PENALTIES ON DIFFERENT
COUNTRIES.
BUT I DO THINK THAT THERE ARE A
LOT OF REPUBLICANS AND MEMBERS
OF HIS PARTY THAT IS GROWING
INCREASINGLY CONCERNED ON THE
IMPACTS THIS WILL HAVE
POLITICALLY IN NOVEMBER WHEN
WEAPON REACH THE
WEREON REACH THE
WEREAC REACH THE
WEREACH THE MTHE
WEREACH THE MIDE
WEREACH THE MIDTERM ELECTIONS.
THERE'S ONLY SO MUCH OF A
CUSHION THAT CAN BE PROVIDED
THAT WILL COUNTER ACT JOB
LOSSES, CONSUMER LAYOFFS THAT
WILL TARGET AND HURT THE RUST
BELT REPUBLICANS WHO HAVE GOING
TO BE NEEDED TO KEEP THE HOUSE
MAJORITY IN NOVEMBER.
NEIL: DAN, THE MESSAGE TO A LOT
OF FARMERS HAS BEEN BE PATRIOTS
FIRST, THIS WILL WORK OUT FOR
YOU.
A LOT OF FARMERS HAVE BEEN
PINCHED LONG BEFORE DONALD TRUMP
COMING INTO OFFICE, A LOT OF THE
PRICES OF THEIR GOODS COLLAPSING
ACCELERATED WITH THIS POTENTIAL
TRADE WAR BUT IN EFFECT LONG
NEVERTHELESS, IS THERE A SENSE
THAT THIS DOES REVERBERATE IN
THE MID DETERMINE ELECTIONS AND
THAT WE'RE JUST NOT SEEING IT
YET OR THAT PEOPLE CAN'T THINK
BEYOND SOMETHING THEY HOPE WILL
BE SHORT LIVED WHEN IN FACT IT
CAN BE MANY MONTHS 0 AND MAYBE
YEARS?
>> IN THE SHORT RUN I THINK
THERE ARE PLENTY OF PEOPLE,
FARMERS, FACTORY WORKERS AND
CEOs WHO ARE GIVING TRUMP
OTHER COUNTRY TO THE NEGOTIATING
TABLE AND GET BETTER DEALS FOR
AMERICA.
IF YOU HAVE FAITH IN TRUMP,
YOU'RE THINKING, OKAY, I'M
WILLING TO SORT OF BUCKLE DOWN
AND BEAR SOME COST TO GET THE
LONG RUN BENEFIT.
HERE'S MY CONCERN.
I DON'T THINK TRUMP UNDERSTANDS
TRADE.
EVEN THOUGH IT'S THE FLIP SIDE
OF A CAPITAL SURPLUS.
IT MEANS OTHER COUNTRIES ARE
INVESTING IN AMERICA BECAUSE
THEY THINK WE'RE A BETTER LONG
RUN BET THAN THEY ARE.
UNTIL TRUMP GETS THE PRINCIPLES
OF TRADE RIGHT I WORRY HE'S
GOING TO BE CONSTANTLY TEMPTED