With President Trump's tariff tactics now almost perfectly aligned with neocon-inspired sanctions against just about every nation associated with Russia, China, or Iran, the tariff regime is likely to fail just as badly as have the sanctions. Eventually, many countries will see doing business with the United States as unnecessary and costly.
The 50% tariffs imposed recently are a case in point. America actually has a trade surplus with Brazil, so imposing high tariffs on the country - purportedly to meddle in their judicial matter of Trump's friend, Jair Bolsonaro - is tantamount to shooting oneself in the foot.
Brazilian president Lula’s response has been measured, but firm: “Brazil’s trade with the U.S. makes up just 1.7% of our GDP. You can’t call these figures vital. We will look for other partners.“
In other words, Lula essentially told Trump to shove his tariffs where the sun don't shine. Other countries are likely to do the same. No country is totally reliant upon the U.S. for export revenue. If trading with other, friendlier countries is better for business, the U.S. will become a pariah, shut out of international trade altogether.
An example of how this works in practice can be compared to how electric utility companies bill their customers a monthly "customer charge" ranging from $25 to $50 a month. No wattage is delivered for that money spent. It's only a fee charged for the privilege of being a "customer" of the utility. That's all well and good when electricity is difficult to produce on one's own, but take it from the growing number of off-grid preppers who derive all of their electricity from solar, wind, small hydro, or propane-driven generators.
If the utility is charging $40 a month, that comes to $480 a year. Taken over the life of solar panels - roughly 15-20 years - it adds up quickly. And that's just the customer charge. It doesn't take a math whiz to understand that if one can provide one's own electricity for an initial investment of $10,000 or less (actually a lot less for small households) and the system will be operational at almost no continuing cost for at least 10 years, saying bye-bye to the utility company is not a flight of fancy. Many off-gridders have already done the math and live well without a monthly utility bill. The same is true for wood-burning or coal-burning stoves for heat. Who needs natural gas when all the logs out in the woods can heat a home just as well.
The United States, via its proposed tariffs of 10%, 20%, 30% and more, will be viewed as excessive by many businesses located in countries from which they are exporting. Many will cease exporting to the United States. Those that continue, and pay the tariffs, are likely to pass the added cost along in higher prices or sub-standard goods. Either way, the American public is going to pay while the government collects. It's as if the federal government sees taxpayers as dollar mules, useful only to fund the rapacious, capricious wishes of the almighty federal government of "we the people."
It's not going to work. While the government may collect more revenue, does anybody expect them to stop overspending and balance their own budget? Not in this lifetime. The government, from the President and Congress down to the massive bureaucracy is not about to downsize itself. Anybody thinking that Trump's campaign promises - most of which he's already broken - are going to be upheld by congress and the deep state is simply naive.
The ultimate disaster of runaway hyper-inflation, followed by a deep depression, is bearing down upon the American people, most of whom cannot or refuse to see it coming.
As far as today's economic events are concerned, transporter J.B. Hunt (JBHT) saw earnings per share of $1.31 and revenue of $2.93 billion in its 2Q report delivered after the bell Tuesday. While roughly flat from a year ago ($1.32, $2.83 billion), both were a bit higher than anticipated and the stock is higher by about 1.5% mid-afternoon.
Pinnacle Financial (PNFP), reported $2.00 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $1.91 by $0.09. Shares are up more than one percent on Wednesday.
Financial giants Bank of America (BAC), Goldman Sachs (GS), and Morgan Stanley (MS) reported before the open. Bank of America missed on the bottom line, the stock down slightly. Goldman Sachs (GS) unsurprisingly said they made a ton of money on their trading desks, and the stock is rallying, though up only a half percent. Morgan Stanley (MS) had a solid second quarter, but is being punished, down two percent, as expectations may have been too high.
Johnson & Johnson (JNJ) non-GAAP EPS of $2.77 beat by $0.09; revenue of $23.7B beat by $840M, but it was their forward guidance and hefty dividend that has led to a massive six percent spike on the day, helping to lift the Dow Industrials.
ASML (ASML), the Dutch chip-making equipment manufacturer delivered a solid quarter but its guidance has left Wall Street agape. The stock is trading down more than eight percent mid-afternoon Wednesday, as tariff issues cloud future growth potential.
PPI was largely a non-event prior to the open. In June, a 0.3-percent advance in prices for final demand goods offset a 0.1-percent decrease in the index for final demand services. After all, these are American producers being gauged, a group which has little to nothing to do with tariff policies. If anything, input costs should be rising as tariffs become more prevalent. Inability to source materials at reasonable prices may become more difficult as tariffs take their tolls on foreign providers.
Look for PPI to rise over coming months, fueling even more inflationary fears.
Stocks are doing their usual melt-up on nothing, because there’s so much money just sloshing around within the financial community.
At the Close, Tuesday, July 15, 2025:
Dow: 44,023.29, -436.36 (-0.98%)
NASDAQ: 20,677.80, +37.47 (+0.18%)
S&P 500: 6,243.76, -24.80 (-0.40%)
NYSE Composite: 20,374.38, -207.07 (-1.01%)
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