WH touts trade deals with EU, Japan as top officials hold talks with China

WH touts trade deals with EU, Japan as top officials hold talks with China

530 ON THE DOT HERE ON THE EAST COAST. 230 OUT WEST, I’M ALI VITALI. AND PRESIDENT TRUMP’S TRADE AGREEMENT WITH THE EUROPEAN UNION CAME JUST FOUR DAYS AFTER JAPAN ALSO AGREED TO 15% TARIFFS AND MAJOR INVESTMENTS IN THE UNITED STATES. BUT SOME ECONOMIC EXPERTS FEAR THE NEW DEALS ARE UNBALANCED AND COULD HURT ECONOMIC GROWTH. MEANWHILE, THE WHITE HOUSE IS MOVING ON AS THIS WEEK TOP OFFICIALS FROM THE TRUMP ADMINISTRATION ARE MEETING WITH THEIR CHINESE COUNTERPARTS FOR THEIR THIRD ROUND OF ECONOMIC TALKS. HIGH STAKES THERE. JOINING US NOW, SENIOR ECONOMICS REPORTER FOR AXIOS COURTNEY BROWN. COURTNEY. LET’S JUST START WITH THE RESPONSE TO THE EU DEAL. THE FACT THAT YOU’VE GOT COUNTRIES LIKE FRANCE NOW COMING OUT AND SAYING, WAIT A MINUTE, WHAT DID WE ACTUALLY GET HERE? THAT’S, I THINK, WHERE ECONOMIC ANALYSTS ARE COMING UP WITH THIS UNBALANCED IDEA. WHAT DO YOU THINK COUNTRIES ARE LEARNING ABOUT DEALING WITH THE TRUMP ADMINISTRATION, IF THEY’RE WILLING TO MAKE DEALS THAT OTHER COUNTRIES ARE SAYING, WELL, WHAT DID WE ACTUALLY GET FOR THAT? >> IT IS THE ERA OF ASYMMETRIC DEALS. WE’VE SEEN THIS WITH JAPAN. NOW EUROPE IS THE LATEST TO SIT BACK AND QUESTION, YOU KNOW, WHAT? WHAT IS IT THAT WE ACTUALLY GOT HERE? WHAT DID THE US CONCEDE IN THIS DEAL. BECAUSE IT SEEMS LIKE WE CONCEDED A LOT. AND YOU KNOW, IT REMINDS ME OF WHEN I WAS A TEENAGER AND I ASKED MY PARENTS FOR A NICE CAR. AND YOUR PARENTS SAY YOU’RE LUCKY YOU GET ANY CAR AT ALL. AND I THINK THAT IS WHAT’S HAPPENING HERE, BECAUSE I ASKED MY SOURCES, WHAT IS IT THAT THE EU GOT OUT OF THIS? AND MY SOURCES SAID, WELL, THEY THEY DIDN’T GET A TRADE WAR. COULD HAVE BEEN MUCH WORSE. 15% IS PRETTY GOOD CONSIDERING IT COULD HAVE BEEN 50 OR 30. YOU KNOW, SO I THINK THAT’S WHAT THEY HAVE TO SIT WITH. IT COULD HAVE BEEN WORSE. >> IT COULD HAVE BEEN WORSE. BUT THAT’S NOT NECESSARILY THE WAY THAT THE U.S. HAS EVER DEALT WITH ITS ALLIES WHEN IT COMES TO TRADE, ESPECIALLY WHEN OUR GLOBAL MARKETS ARE SO INTERTWINED. YOU KNOW, THE QUESTION THAT I ASKED THE U.S. TRADE REPRESENTATIVE, JAMISON GREER, WHEN HE WAS ON WITH US ON MORNING JOE YESTERDAY, WAS WHAT DOES THIS ULTIMATELY MEAN FOR CONSUMERS? AND CAN THEY GUARANTEE THAT PRICES WON’T GO UP? HE DID NOT GUARANTEE THAT. INSTEAD, HE JUST SAID, WELL, WE’RE LOOKING AT THE DATA AND WE DON’T HAVE A REASON TO THINK INFLATION IS COMING BACK. I WAS TALKING TO YOU ABOUT THAT IN THE BREAK. WHAT’S YOUR RESPONSE TO WHAT THEY’RE SAYING ABOUT THIS? >> WE ARE STARTING TO SEE SUBTLE SIGNS OF PRICES GOING UP FOR ALL OF THE GOODS THAT ARE SUBJECT TO TARIFFS THUS FAR. SO WE KNOW THAT THE INFLATION PRESSURES AREN’T INSANE, BUT THEY’RE STARTING TO BUBBLE UP. AND THIS IS THE WAY IT WOULD HAPPEN, RIGHT? IT WOULD START TO HAPPEN SLOWLY AS BUSINESSES START TO THINK, OKAY, I CAN’T TAKE THE HIT ON ALL OF THIS. I HAVE TO START TO PASS IT ALONG TO CONSUMERS. AND THAT’S WHAT WE’RE STARTING TO SEE IN THE INFLATION REPORT IN THE NEXT TEST IS, WELL, WHAT ABOUT THE BROADER ECONOMY? OUR BUSINESS IS SAYING, YOU KNOW, I’M GOING TO HOLD OFF ON HIRING. WE HAVEN’T SEEN THAT YET. BUT FRIDAY BIG JOBS REPORT FOR JULY. I THINK ECONOMISTS ARE GOING TO BE WATCHING EXACTLY FOR THAT. >> BECAUSE AGAIN, I THINK YOU AND I HAVE HAMMERED THIS BEFORE. THE IDEA THAT ALL OF THE CONSEQUENCES OF THIS TRADE WAR SO FAR HAVE REALLY BEEN DELAYED, IN LARGE PART BECAUSE THE DEADLINES AROUND WHEN THESE DEALS OR THESE PUNITIVE TARIFFS SNAP INTO PLACE HAVE REALLY BEEN SLIP SLIDING ALL OVER THE CALENDAR. AND SO BUSINESSES MAY NOT HAVE YET HAD TO CONTEND WITH THEM. INSTEAD, THOSE WHO SAW THE TRADE WAR COMING KIND OF STOCKED UP EARLY. AND NOW THEIR STOCKPILES ARE DIMINISHING. AND THIS IS REPLENISHMENT. THIS IS THE BIG. >> TEST, RIGHT? SO THEY RUSHED TO GET ALL THEY THOUGHT THEY WOULD NEED FROM OVERSEAS BEFORE TARIFFS TOOK EFFECT. AND YOU KNOW, THAT WAS A FEW MONTHS AGO NOW. SO THOSE STOCKPILES ARE RUNNING DOWN AS CONSUMERS BUY. THE SEASONS ARE CHANGING AND THEY’RE GOING TO HAVE TO IMPORT MORE THINGS AT THESE HIGHER TARIFF RATES. AND SO HOW DO THEY RESPOND. THIS IS A BIG QUESTION FOR THE FEDERAL RESERVE RIGHT. THEY ARE TRYING TO FIGURE OUT HOW MUCH OF IT IS GOING TO BE PASSED ALONG TO THE CONSUMER. HOW MUCH DO BUSINESSES EAT? HOW MUCH DO THEIR PROFITS TAKE A HIT, AND HOW MUCH ULTIMATELY HAS TO BE PASSED ONTO THE CONSUMER AND SHOWS THEM ON THE SHELF IN THE FORM OF HIGHER PRICES? >> SO YEAH, THAT’S GOING TO BE A LOT, I THINK, FOR US TO WATCH. ARE THERE MILE MARKERS THIS WEEK OR IN THE COMING WEEKS THAT YOU’RE KEEPING A CLOSE EYE ON? I KNOW YOU SAID JOBS REPORT FRIDAY. >> WHAT A WEEK. WHAT A WEEK IS SUCH. >> A WEEK. >> THIS IS ONE ECONOMIST I TALKED TO SAID THAT THIS IS THE BUSIEST WEEK IN HIS 25 YEARS OF BEING AN ECONOMIST. HE HAD VACATION ON THE CALENDAR. HE HAD TO CANCEL THAT REALLY QUICK BECAUSE OF SO MANY THINGS THAT’S GOING ON THIS WEEK. SO WE HAVE THE JOBS REPORT. AS I MENTIONED ON FRIDAY, WE HAVE THE FED’S GO TO INFLATION INDICATORS COMING OUT THIS WEEK. TODAY WE ARE GOING TO GET SOME FIGURES ON LAYOFFS AND QUITS AND HIRING ALSO CLOSELY WATCHED BY THE FEDERAL RESERVE. AND OF COURSE WE HAVE THE BIG FED DECISION ON WEDNESDAY. WE KNOW THAT THE FED IS PROBABLY NOT GOING TO RAISE RATES. BUT THE BIG QUESTION IS OR SORRY. YES, NOT GOING TO LOWER RATES. OH MY GOSH, I’M STUCK IN ANOTHER ERA. THEY’RE NOT GOING TO LOWER RATES ON WEDNESDAY. BUT THE BIG QUESTION IS HOW MANY MEMBERS OF THE FED BOARD SAY MAYBE WE SHOULD HAVE LOWERED RATES TODAY? THAT’S THE BIG THING TO WATCH. >> BIG THING TO WATCH BOTH FOR US AND THEN ALSO THE PRESIDENT, WHO’S BEEN URGING RATES TO BE LOWERED A LOT. COURTNEY BROWN, AS ALWAYS, THANK YOU VERY MUCH. AND I’M SURE IT WAS GREAT TO JUST GET ANY CAR IN

The White House is touting trade deals with EU, Japan as top officials hold talks with China. Axios’ Courtney Brown discusses.

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