RiskReversal Pod Panic to Policy: Peter Boockvar on the China Trade Deal
May 14, 2025
Peter Boockvar from Bleakley Financial Group lends his macroeconomic expertise to discuss the evolving China-US trade deal. He delves into the implications of tariff rates on various markets, the challenges of the U.S.-China relationship, and how these dynamics shape corporate strategies. Insights about China's tech advancements and their global economic effects are shared, alongside concerns about the future performance of the S&P 500. The conversation wraps up with thoughts on gold's rising significance amid market uncertainty.
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Tariff Rates Remain Punitive
- The U.S. and China trade tariffs are still high, with a baseline 10% stuck on China imports and additional tariffs up to 30%.
- This causes significant cost pressures on U.S. companies importing from China and complicates economic relationships.
China’s Tech and Manufacturing Leap
- China has significantly advanced its technology and manufacturing capabilities since 2018, dominating EVs, robotics, and solar sectors.
- This evolution makes a stable bilateral trade relationship even more vital given China's global manufacturing influence.
High Tariffs Disrupt Trade Dynamics
- A sustained tariff over 20% on imported goods is generally unfeasible for U.S. businesses, especially small businesses relying on China.
- Many companies will rush to stock up inventory within the 90-day tariff reprieve, causing shipping and cost disruptions.