never before has a novelty-sized cardboard sign
plunged the world into such chaos it’s chaos trump’s Liberation Day tariffs have liberated
trillions of dollars from the US stock market and funded its fear and greed index all the way to
four global markets reeled in terror at a tariff spreadsheet that looked like it was outsourced
to chat GPT but is this all part of the plan and if so why today we find out my name is Guy and
you are watching the Coin Bureau donald Trump’s tariff spreadsheet may have just changed the world
forever or not because the tariffs might be gone by the time you’re watching this or maybe they’ll
be higher it’s hard to say because US trade policy has become totally unpredictable in recent months
that said Trump campaigned on promises to tariff the whole world and he is delivering big time but
some of the objectives seem to be intention if the tariffs are a negotiating tool they’ll be removed
or reduced sooner or later but if the tariffs are a protectionist and revenue generating
measure they probably need to stay in place mixed messages have been coming from the White
House on how permanent or negotiable the tariffs are but the consensus in the administration
is that they are very good for America in any event and they certainly made a big impact when
they were announced so let’s remind ourselves of what happened on Liberation Day on the 2nd
of April Trump unveiled a sign showing new tariffs targeting more than 150 countries and
territories covering virtually all US trading partners and even including some islands without
human inhabitants he described the tariffs as retaliatory and specifically a retaliation
against quote cheaters and scavengers for quote raping looting and pillaging the US so the
US will bring them to justice by tariffing them up the wazoo something the American consumer
will presumably have to pay for in the end these tariffs are between 10% and 50% with the
highest reserved for exports from some of the world’s poorest countries 50% for Lutu and Sierre
and Mikolong 49% for Cambodia 48% for Laos 47% for Madagascar 44% for Myanmar that’ll teach them or
rather that’ll teach Americans to stop buying all that vanilla from Madagascar and grow their own
now assuming that these tariffs are here to stay they will force a permanent structural change
to the world economy they are the undoing of the 80-year project of trade liberalization
led and institutionalized by the US through the General Agreement on tariffs and trade the
World Trade Organization and the North America Free Trade Agreement among other organizations
and treaties trade liberalization was a boon for multinational corporations and the ruling class
it accelerated de-industrialization dismissing workers and closing production facilities in
wealthy countries like the US only to outsource the same labor and production to wherever in the
world had the lowest wages and the weakest labor and environmental protections for workers in the
US and elsewhere the cost of labor was transformed into a global race to the bottom for countries
on the sharp end of trade liberalization the structural adjustment programs of the World Bank
and IMF enforced a model of extractivism that would have made the British East India Company
blush globalists finance capital the ruling class whatever you want to call them the agents of this
change were not 150 odd countries and territories scavenging plundering or raping the US it was
the consensus of the business interests in the United States and other wealthy countries it’s
hard to ask for a better deal than having the world’s poor produce goods for your consumption in
exchange for a pittance now Trump wants Americans to stitch their own sneakers but what will they
cost when you have to pay textile workers the federal minimum wage of course if Nike Adidas and
the rest of the gang don’t move production to the US then their shoes will be tariffed heavily
on import so either way it seems tariffs will send prices soaring according to a projection by
Rosenblat Securities the price of Apple’s flagship iPhone for example could exceed $2,200 if Apple
passes increased costs onto consumers with some estimates being as high as $3,500 i mean it’s
a great camera and of course we all love Siri to bits but that does seem a bit on the steep
side doesn’t it a price shock of this magnitude implies significant supplyside inflation which
UBS has predicted will settle around 5% assuming Trump’s Liberation Day tariffs become permanent
high inflation is likely to cause a pullback in domestic consumption this combined with
retaliatory tariffs making American exports less competitive is a recipe for economic contraction
6 months of that and boom you’re in recession town and some now believe that this is the most likely
outcome jp Morgan for example now expects the US economy to shrink in 2025 and 2026 with the
recession expected to begin by the end of the year it’s the place to be when you’re in need
of amazing crypto deals and opportunities that the US now has on other countries represents
a more than 10-fold increase over 2024 when it was 2.5% the US hasn’t had tariffs this high for
almost a century and there aren’t many analoges in history for a country doing this to itself
but there is at least one in 1930 the Smoot Holy Tariff Act raised tariffs in all sectors
of the US economy to an average of around 20% this was intended to shield American industries
from foreign competition and encourage domestic employment production and consumption during the
Great Depression which had begun 8 months before more than a thousand of America’s top economists
pleaded with President Hoover to veto the bill henry Ford told him it was quote an economic
stupidity while the CEO of JP Morgan at the time said that he quote almost went down on his
knees to beg Herbert Hoover to veto the asinine Holy Smooth tariff their argument was that
the resultant trade war would pour fuel on the bonfire of the US economy rather than dampening
it history teaches us that this is precisely what happened next boycott of American goods and
threats of retaliatory tariffs were already underway overseas when the bill was passed in the
House of Representatives in May 1929 after Hoover then signed the bill into law dozens of America’s
trading partners including Britain France Germany and Canada followed through on these threats and
developed new trading partnerships and systems among themselves between 1929 and 1933 US imports
fell by 66% and exports by 61% and overall global trade fell by 2/3 the tariffs did not start the
Great Depression but the trade war they started was one of the reasons it was so dire smoot Holy
is now remembered as a disastrous self-own that discredited isolationist trade policy although
Trump did say on Liberation Day that the Great Depression was actually caused by tariffs not
being high enough so I guess we’ll never know but anyway back to 2025 now many have observed
that the US economy has enjoyed an unusually long period of almost unbroken growth and believe
that a recession is now in some sense overdue meanwhile the Federal Reserve has spent the last
3 years trying to rest post-pandemic inflation back under control with rate adjustments of just
the right amount and timing so as not to overdo it and tip the economy into recession this is
the fabled soft landing that most have been praying for and it looked as though the Fed was
just about to pull it off this is another reason why the plainly inflationary tariffs are such a
headscratcher it’s almost as though someone saw the soft landing coming and deliberately sabotaged
the landing gear at the last moment to engineer a crash well it sounds crazy but that might actually
be the plan so why on earth would the government deliberately try to start a recession well one
theory suggests that the administration’s real goal is to refinance its debt on the cheap by
forcing down interest rates for the Treasury this would be a good time to have lower interest rates
because the government has a large amount of debt coming to maturity that will need to be refinanced
this year as interest rates remain elevated from the 2022 inflationary environment repayments on
US debt are expected to cost close to $1 trillion this year or around 13.5% of the federal budget
for 2025 now this doesn’t bode well for the future because government debt is already more than $36
trillion and increasing at an alarming rate if it were only possible to have the Federal Reserve
reduce interest rates the US could refinance a portion of this debt at a cheaper cost and kick
the can a bit further down the road well if you don’t want to sit around twiddling your thumbs
waiting for the rate cutting cycle to play out you could take a more proactive approach if the
Fed’s motivation for cutting interest rates is a slowing economy then why not just go ahead and
slam on the brakes or you know just drive the vehicle straight off a cliff so if the tariffs
look like a car crash then perhaps we should believe our eyes after all the purpose of a system
is what it does the tariffs will tank the economy which will most likely prompt the Federal
Reserve to lower interest rates significantly investors can be expected to flee from risk
assets into the safety of US 10-year Treasury notes pushing down their yields and therefore
the size of the government’s debt repayments now evidence for this sequence of events includes
Trump’s frequent challenges to the Fed’s legal and operational independence he has openly criticized
and discussed firing Jerome Pal he has said that presidents should quote have a say in rate
decisions and cited his business credentials as superior to Fed officials expertise trump has
demanded Jerome Pal cut rates on at least two occasions this year he did so in a speech at Davos
and again 2 days after his liberation day tariffs announcement just minutes before the Fed chair was
due to give a speech Trump took to social media to demand he cut rates and quote “top politics in
all caps.” Now this theory might help to explain the puzzling formula that was used to calculate
the tariffs unveiled on Liberation Day they had been build as reciprocal tariffs based on tariff
rates charged by America’s trading partners plus non-tariff barriers but they were not the rates
Trump presented were quickly reverse engineered by observers including the economist James Suroviki
who noted quote for every country they just took our trade deficit with that country and divided it
by the country’s exports to us surviviki explained quote so we have a $17.9 billion trade deficit
with Indonesia its exports to us are $28 billion $17.9 billion over $28 billion equals 64% which
Trump claims is the tariff rate Indonesia charges us what extraordinary nonsense this is meanwhile
Thomas Samson associate professor at the London School of Economics said quote “The formula
is reverse engineered to rationalize charging tariffs on countries with which the US has a trade
deficit there is no economic rationale for doing this and it will cost the global economy dearly.”
The plot then thickened when it was discovered that free AI chat bots including ChatGpt Gemini
Grock and Claude all spit out some version of this formula with remarkable consistency when asked
for an easy way to solve trade deficits and put the US on an even playing field with its trading
partners we were also able to reproduce this on chat GPT and Grock on our first attempt although
we didn’t try Claude or Gemini anyway the possible outsourcing of US trade policy to a free chatbot
supports the notion that the tariffs are an act of self-sabotage if their purpose is to tank the
economy then the less care and thought that’s put into them the better really they should be as
hamfisted as possible to maximize fear uncertainty and doubt all in service of the greater good of
debt refinancing of course so the question is how much greater is that good inflicting a recession
on your country and perhaps the global economy sounds like a pretty high price to pay to get bond
yields down a bit now if you’re not convinced by this theory perhaps I can interest you in a
variation the so-called Mara Lago accord this is the nickname that’s been given to an essay by
the chair of Trump’s Council of Economic Adviserss Steven Miran in it Miran outlines a plan to
reschedu the US national debt by replacing outstanding Treasury bills with non-tradable
century bonds or perpetual bonds trump has also made reference to this idea while Treasury
Secretary Scott Bessant has said that NATO members who are not pulling their weight financially
should have to buy 50-year US government bonds any such rescheduling of the national debt would
be a generational karate kick of the can down the road but no independent country in their right
mind would agree to it especially not in the current climate of souring diplomatic relations
with Washington but perhaps they could be coerced into it using say tariffs now admittedly this
is not quite the same thing as the plan to use tariffs to cause a recession in order to achieve
low interest rates for debt refinancing however it is the same radical thinking that the second Trump
administration has shown it is willing to apply to stave off a national debt spiral well in any case
the tariffs appear designed to engineer maximum fear uncertainty and doubt and this is exactly
what they did days after Trump’s announcement the tariffs have activated a dip that just won’t
quit the tariffs were announced on weddednesday and by Friday $6.4 trillion had evaporated from
US stocks as trading volume on all US exchanges hit new all-time highs it was the worst week for
US stocks since the onset of the pandemic in 2020 the S&P 500 Dow Jones and Nasdaq closed between
9 and 11% down from weddednesday this put the Dow Jones in correction territory the Nasdaq
in a bare market meanwhile the S&P suffered its biggest 48hour drop ever the CBOE volatility
index which measures investor anxiety closed at its highest level since the beginning of the
pandemic swedish fintech firm Cler cancelled its upcoming US IPO which had been anticipated as
a catalyst for the recovery of the US IPO market on the bright side USDC issuer Circle may do the
trick with its recently announced IPO assuming of course it doesn’t also delay anyway in response
to the bonfire on Wall Street China said “The market has spoken and declined Scott Besson’s
request not to retaliate against the US for its new average tariff of 54% on Chinese imports
instead Beijing announced an additional 34% tariff on American imports cancelled a deal to sell Tik
Tok to the US and introduced new export curbs on some rare earth minerals.” English language news
media outlets in China have since been posting AI generated videos making fun of Liberation Day they
feature scared consumers and robots dancing to songs with lyrics like “You taxed each truck you
taxed each tire Midwest burnin in your dumpster fire and liberation day you promised us the stars
but tariffs killed our cheap Chinese cars.” You get the idea at the time of making this video US
customs agents have just started collecting some of the new tariffs although the full enforcement
should begin on the 9th of April vietnam has already got Trump to agree to negotiations for
a possible tariff removal which was impressively fast and this makes us wonder how long these
tariffs will last in general although there are now so many countries targeted that negotiating
with all of them could take years now amid all the doom and gloom BTC only dumped by 3.1% on
Liberation Day but things got worse on Monday morning as it plunged well below $80,000 and there
is nothing bullish about the BTC USDT chart at all right now BTC has been in a strong downtrend on
the daily time frame since the 20th of January and the fact that it’s shown relative strength against
US stocks has not changed this a liberation day bounce up to the descending trend line was sharply
rejected as you can see from the wick on the 2nd of April satoshi himself could not hold this
chart up for much longer and unless the high time frame trend is decisively broken it looks
like a slippery slope could be leading to the next significant zone of demand in the mid $60,000
range i would love to be wrong folks but you know what they say the trend is your friend until the
end so whatever happens take care out there and try not to get liquidated as this game of 2D chess
plays out in Washington we’ll keep you posted on the next moves in another video but until then
why not check out the breakdown of the biggest heist in crypto history and also human history for
that matter right over here that’s all from me for now though as always thank you for watching and
I’ll see you next time this is Guy over and out
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