We said it during the leek soup this morning. The best way to understand what is behind the Trump turning point on mutual duties, with the reverse and the suspension of 90 days, has to read the Wall Street Journal. Many believed that the imposition of such arbitrary rates had a more negotiation and real purpose. And in part it is so. But perhaps behind the announcement of the US President last night, who only a few hours earlier had claimed that he had a row of world leaders ready to “kiss him the c ***” to find an agreement, there is also the other.
Trump admitted that he thought of this solution “in the” last days, but that he had come to the conclusion on Wednesday morning “very early”. Then he acted from Trump: or impulse. “We did not use lawyers, we wrote it with the heart: We have been talking about it for a while, we decided to press the trigger And we did it today. And we are happy. We do not want to damage countries that do not need to be damaged, and everyone wants to negotiate. “
The economic context
“It took a week because the collapse of the equity and bond markets, together with a campaign supported by managers, legislators, lobbyists and leading leaders, pushed Trump to revoke an important element of his large tariff plan for 90 days,” writes the American newspaper which thus summarizes the numerous pressures received from the White House after the duties had made the financial markets run in the Russian mountains. Many, including the CEO of JP MorganJamie Dimon, had publicly expressed fears that the raising of customs rates would lead to a “recession”. “The episode was a Trump classic: he made a drastic decision, carefully monitored the reaction, kept advisors and allies on the thorns and then changed course”.
Everything in his style. For better or for worse. Among the inspirers of this turning point there would be the secretary of the treasure, Scott Beesent, and that of trade, the Howard Lutnick trade. “He and I had a long conversation,” Beesent said in front of a crowd of journalists. “This has always been his strategy.” As if to say: The moves of The Donald seem crazy, but it is a lucid madness. It is difficult to say that Beesent is “covering” Trump’s errors or if his is a real conviction of a risky strategybut with a purpose that have good in mind in the White House. In summary: yesterday’s was not a “capitulation” in the face of the pressure of the markets or a back march, because the US now have the opportunity to conclude many positive agreements with the 75 countries that would have contacted them to treat.
In short, Besent would be the keystone of the “new” Trumpian strategy. The Treasury Secretary flew to Florida, spoke to the president, and in the end he was authorized to make public statements about the agreements. Which, writes the WSJ, has “encouraged many people close to Trump, convinced that he could have found a way out”.
On the other hand, Peter Navarro, ideologist of the duties, the only one of the circle absent at the Mezzogiorno meeting on Wednesday in which the final decision was made. With Trump there were, as seen, Lutnick and Bassent, but not Navarro. And this is a significant sign of the turning point made to the president.
What Trump convinced
A factor that would have pushed Trump to loosen the moratorium on the duties, writes the American newspaper, “it was the fact that many countries are in negotiations with the administration”. Not only that. “Trump was also influenced by the performance of the share market and from the parade of corporate leaders who expressed concern for the duties. In the last few days, managers and lobbyists had flooded the phone of the head of the staff of the White House, Susie Wiles “. The message was: find a way out.” Trump kept his hidden cards – explains the WSJ – he told his advisers to be willing to accept ‘suffering’ “but he would also have” admitted in private that his commercial policy could trigger a recession “.
To bring Trump to multiple mild advice would also have been several republican parliamentarians, in turn encouraged by numerous bank managers. “Trump was also listening to the newspaper – writes the newspaper – in the last few days he asked friends and councilors information on the trend of the markets, and has declared that he was observing them carefully”. On Tuesday evening on Fox, at the Sean Hannity program, a group of republican senators has publicly expressed its concern And he invited the president to deal with those who showed themselves willing to do so. Trump reflected us all night, then the next morning he spoke to the president of Switzerland and listened to Jamie Dimon’s famous interview on the possible recession that would convince him. From there he convened Lutnick and Basent to discuss the details.
The negotiating way
The Donald himself basically in recent days had realized the growing “discomfort” on the bond and equity markets, despite the reassuring posts and the invitation to exploit “the excellent time to buy”. “Bessent and other collaborators of the White House have described Trump’s move as part of a negotiating strategy in which Trump adopted a maximalist approach to force the world to the negotiation table,” writes the WSJ. Also Ted Cruz, al Washington Postrevealed that he suggested the president to take the right path to the crossroads in which he was. Two options: use duties as a negotiating leverage; Or insist and push commercial partners to adopt counter -nations. “The latter, I told the president, It would be a terrible and dangerous outcome for the country And for Texas, “revealed Cruz.” I also encouraged it, as I had already done during the Hannity show, to quickly negotiate one or more commercial agreements “. We will now see if the president will really be able to tear advantageous agreements for the US industry.