Squawk on the Street SOTS 2nd Hour: China Trade Deal Latest, Drug Prices EO, and Live: New Trump Remarks 5/12/25
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May 12, 2025 Roger Altman, founder of Evercore and former deputy treasury secretary, provides valuable insights on the recent U.S.-China trade agreement to cut tariffs, describing it as ‘encouraging.’ He discusses the cautious optimism in the market and urges careful consideration of the details. The conversation also dives into President Trump’s executive order aimed at lowering drug prices, exploring potential effects on pharmaceutical stocks and broader economic implications. Altman emphasizes the need for strategic adaptations in a complex geopolitical landscape.
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China Tariff Pause Is Preliminary
- The 90-day tariff pause between the U.S. and China is an encouraging but preliminary step in trade talks.
- The core issue remains China's subsidized exports distorting markets, which will be hard to resolve.
China Market Opening Skepticism
- China has repeatedly promised market openings but failed to deliver substantive changes.
- The current trade talks reset progress to where it was four years ago, with tough industrial policy issues still unresolved.
Europe Shares U.S. Concerns on China
- Europe shares concerns about Chinese dumping similar to the U.S., so unlikely to embrace China as a reliable partner easily.
- Xi Jinping's reassertion of state-controlled industrial policy limits chances of major trade concessions.