RiskReversal Pod The Art of the EU Trade Deal
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Jul 28, 2025 Dan Nathan and Guy Adami dive into the implications of a new EU-US trade deal, discussing how 15% tariffs could impact global growth. They analyze the market's reaction to recent earnings and highlight Nvidia's dealings with China. The conversation also sheds light on Treasury Secretary Yellen's debt strategies and looming interest rate risks. Additionally, they address the market’s high valuation metrics amidst ongoing economic uncertainties and the surprising stock performance of major tech companies like Google.
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Impact of EU-US Trade Deal
- The EU-US trade deal with 15% tariffs brings clarity but will drag global growth potentially by about one percentage point.
- Markets may be desensitized to trade deal announcements, diminishing their immediate impact on prices.
Trade Negotiations Strategy
- The trade negotiations start with extreme demands, knowing the final deal will be less severe, creating a negotiation pattern.
- The delay of a deal with China could be strategic, as the first tariffs were imposed in 2018 but phase one deal not until 2020.
Nvidia's Strategic Compromise
- Nvidia balanced national security concerns and profit by allowing scaled-down GPUs to China.
- This compromise allows China to innovate independently while limiting immediate AI supremacy loss.