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Markets, bouncin as the Trump administration signals a deal could be reached to relieve tariffs on Mexico and Canada joining US now is the man behind the negotiations, the forty first United States Secretary of Commas, Howard Lantnik missed the Secretary before we get go in a warm congratulations from the team here at Bloomberg Surveillance on your confirmation.

Markets, bouncin as the Trump administration signals a deal could be reached to relieve tariffs on Mexico and Canada joining US now is the man behind the negotiations, the forty first United States Secretary of Commas, Howard Lantnik missed the Secretary before we get go in a warm congratulations from the team here at Bloomberg Surveillance on your confirmation.

Oh thanks so much.

Oh thanks so much.

It wasn't last night's speech amazing. I really I could have been more proud of President Trump.

It wasn't last night's speech amazing. I really I could have been more proud of President Trump.

We'll get into the niceties on that in just a moment. Let's kick it off, sir with a question about your comments yesterday when you suggested that maybe there could be a compromise on trade between the United States, Mexico and Canada and maybe we'd hear more about that today. Has the President confirmed that is that still the plan?

We'll get into the niceties on that in just a moment. Let's kick it off, sir with a question about your comments yesterday when you suggested that maybe there could be a compromise on trade between the United States, Mexico and Canada and maybe we'd hear more about that today. Has the President confirmed that is that still the plan?

Well?

Well?

I think what happened is you have the trade ministers and all the people from Canada really working hard with our homeland security people.

I think what happened is you have the trade ministers and all the people from Canada really working hard with our homeland security people.

Remember, this is not a trade war. This is a drug war.

Remember, this is not a trade war. This is a drug war.

We've got fentanyls still pouring into the country, and it's got to stop.

We've got fentanyls still pouring into the country, and it's got to stop.

So what's happened is they're showing us even more.

So what's happened is they're showing us even more.

Ways to try to stop the floor of fentanyl and if they can stop the floor of fenyl. The President is open minded. There are going to be tariffs, let's be clear. But what he is thinking about is which sections of the market that can maybe maybe he'll consider giving them relief until we get to, of course, April second, But I don't want anybody to forget. April second is the day that we announced our reciprocal tariffs around the world, and so April second is coming.

Ways to try to stop the floor of fentanyl and if they can stop the floor of fenyl. The President is open minded. There are going to be tariffs, let's be clear. But what he is thinking about is which sections of the market that can maybe maybe he'll consider giving them relief until we get to, of course, April second, But I don't want anybody to forget. April second is the day that we announced our reciprocal tariffs around the world, and so April second is coming.

But this is about fentanyl this month.

But this is about fentanyl this month.

Got that. Just want additional clarity, Just to be very clear on this. Yesterday when you said I think the President's going to figure out you do more and on meet you in the middle, we're probably going to announce that tomorrow as in today, can we no longer respect that announcement?

Got that. Just want additional clarity, Just to be very clear on this. Yesterday when you said I think the President's going to figure out you do more and on meet you in the middle, we're probably going to announce that tomorrow as in today, can we no longer respect that announcement?

No, no, no, no, I didn't say that.

No, no, no, no, I didn't say that.

I said, is it in is listening to the offers from Mexico and Canada. He's thinking about trying to do something in the middle. He's thinking about it, We're talking about it. We're going to what I leave here, I'm going to go talk about it with him, and I think early this afternoon or this afternoon, we expect to make an announcement. And my my thinking is it's going to be somewhere in the middle, So not one hundred percent of all products and not none, somewhere in the middle, because I think Mexico and Canada are trying the best and let's see where we end up. So I do think somewhere in the middle is a likely outcome.

I said, is it in is listening to the offers from Mexico and Canada. He's thinking about trying to do something in the middle. He's thinking about it, We're talking about it. We're going to what I leave here, I'm going to go talk about it with him, and I think early this afternoon or this afternoon, we expect to make an announcement. And my my thinking is it's going to be somewhere in the middle, So not one hundred percent of all products and not none, somewhere in the middle, because I think Mexico and Canada are trying the best and let's see where we end up. So I do think somewhere in the middle is a likely outcome.

When you say somewhere in the middle, do you mean somewhere in the middle on tariffs, as in somewhere between zero and twenty five or do you mean that certain groups, certain industries will just get a carve out. And would that carve out be say the autos, because the President mentioned last night he'd spoken to the auto's CEOs. It carve outs we should be thinking about here.

When you say somewhere in the middle, do you mean somewhere in the middle on tariffs, as in somewhere between zero and twenty five or do you mean that certain groups, certain industries will just get a carve out. And would that carve out be say the autos, because the President mentioned last night he'd spoken to the auto's CEOs. It carve outs we should be thinking about here.

Yeah, I think I think it's by product and by regent. Remember the USMCA, right, the United States, Mexico and Canada agreement set up some policies that said you've got to have a certain amount of US content in your products to be USMCA compliant. So I think he's thinking about those categories. The USMCA compliant and does not make sense to you. Right, if you complied with the agreement, then maybe you avoid tariffs. And if you didn't comply with the agreement, well you did so at your own risk.

Yeah, I think I think it's by product and by regent. Remember the USMCA, right, the United States, Mexico and Canada agreement set up some policies that said you've got to have a certain amount of US content in your products to be USMCA compliant. So I think he's thinking about those categories. The USMCA compliant and does not make sense to you. Right, if you complied with the agreement, then maybe you avoid tariffs. And if you didn't comply with the agreement, well you did so at your own risk.

You knew you.

You knew you.

Weren't complying, and therefore it seems likely that's a place where the President will go. Again, the President gets to make the decision. I'm there talking with him about.

Weren't complying, and therefore it seems likely that's a place where the President will go. Again, the President gets to make the decision. I'm there talking with him about.

It, and so is the team.

It, and so is the team.

But our expectation is that it'll be categories. It will be twenty five percent, but it'll be there will be some categories left out. It could well be autos, could be others as well. USMCA go look at that. That was the agreement we made with US, Mexico and Canada saying those products are exempt.

But our expectation is that it'll be categories. It will be twenty five percent, but it'll be there will be some categories left out. It could well be autos, could be others as well. USMCA go look at that. That was the agreement we made with US, Mexico and Canada saying those products are exempt.

Everyone who didn't.

Everyone who didn't.

Live under those terms and did so at their own risk knew they were doing it at their own risk.

Live under those terms and did so at their own risk knew they were doing it at their own risk.

Always.

Always.

Secretary Latna, good morning. Would you say right now that you think that US autos like GM and Ford are compliant under USMCA.

Secretary Latna, good morning. Would you say right now that you think that US autos like GM and Ford are compliant under USMCA.

That is my understanding is the Big Three say they produce cars that are compliant under US MCA, which means they have sufficient US content in them to be part of the US MCA agreement. So I think that's part of our discussion and the president's really thinking about that.

That is my understanding is the Big Three say they produce cars that are compliant under US MCA, which means they have sufficient US content in them to be part of the US MCA agreement. So I think that's part of our discussion and the president's really thinking about that.

So it's fair to assume then, especially given the constituencies of auto workers that the President was able to pick up in this past election, that it is the auto industry that can potentially get that exemption later this afternoon.

So it's fair to assume then, especially given the constituencies of auto workers that the President was able to pick up in this past election, that it is the auto industry that can potentially get that exemption later this afternoon.

It's not really the deceemption, remember, it's it's we're trying to end fetanyl.

It's not really the deceemption, remember, it's it's we're trying to end fetanyl.

Coming into the country.

Coming into the country.

So we're trying to set a message that fetanyl has got to end coming in from Mexico and and it just has to end. And they've done a reasonable job on the border, and they're going to do a better job on the border.

So we're trying to set a message that fetanyl has got to end coming in from Mexico and and it just has to end. And they've done a reasonable job on the border, and they're going to do a better job on the border.

But this is memory.

But this is memory.

It's a key about fentanyl for this month April. Second, we could talk about the rest, but this month it's about fentanyl, and the President's trying to give.

It's a key about fentanyl for this month April. Second, we could talk about the rest, but this month it's about fentanyl, and the President's trying to give.

Mexico and Canada some statement, some move.

Mexico and Canada some statement, some move.

Forward because they are doing they are trying their hardest, and we believe they're trying their hardest. But the fact is that we're got to put something on because deaths in America have not decreased in a way that is sufficient.

Forward because they are doing they are trying their hardest, and we believe they're trying their hardest. But the fact is that we're got to put something on because deaths in America have not decreased in a way that is sufficient.

Deaths of in America many families will sympathize with this, remarks me myself, I know families who have been at the end of the suffering when it comes to fentanyl. But yesterday though, the President questioned the fairness of Canadian banks, So what is it about. Is it about Canada's banking system or is it really about fentanyl?

Deaths of in America many families will sympathize with this, remarks me myself, I know families who have been at the end of the suffering when it comes to fentanyl. But yesterday though, the President questioned the fairness of Canadian banks, So what is it about. Is it about Canada's banking system or is it really about fentanyl?

So this month, right now, is about fentanyl. When we talk about April second, we will talk about the bigger trade picture between our trading partners Canada and our trading parts of Mexico. So April second, I'll be happy to come on and talk to you about our thinking and our thoughts about a broad trading model. But right now it's about fentanyl. This is a drug related issue. Drugs coming into the United States of America have got to stop the border. It's got to remain closed. That's the key of how you treat your great trading partner. You treat your great trading partner with respect, and you stop letting fentanyl into the country. So my view is the President is thinking about it. He's thinking about autos, he's thinking about USMCA. He's going to come up with a plan. This afternoon, We're going to announce that plan. I think it's going to be in the middle somewhere. There's going to be twenty five percent tariffs. It's not the middle as in a number. I think it's a middle in terms of USMCA, not USMCA. But the President will decide that this afternoon and then we'll go on from there.

So this month, right now, is about fentanyl. When we talk about April second, we will talk about the bigger trade picture between our trading partners Canada and our trading parts of Mexico. So April second, I'll be happy to come on and talk to you about our thinking and our thoughts about a broad trading model. But right now it's about fentanyl. This is a drug related issue. Drugs coming into the United States of America have got to stop the border. It's got to remain closed. That's the key of how you treat your great trading partner. You treat your great trading partner with respect, and you stop letting fentanyl into the country. So my view is the President is thinking about it. He's thinking about autos, he's thinking about USMCA. He's going to come up with a plan. This afternoon, We're going to announce that plan. I think it's going to be in the middle somewhere. There's going to be twenty five percent tariffs. It's not the middle as in a number. I think it's a middle in terms of USMCA, not USMCA. But the President will decide that this afternoon and then we'll go on from there.

But think about that.

But think about that.

If you were compliant with USMCA, you did with President Trump asked in his last term, and if you weren't compliant, you did that at your own risk.

If you were compliant with USMCA, you did with President Trump asked in his last term, and if you weren't compliant, you did that at your own risk.

Secretary Lutnik, I just want to make sure that I understand this correctly. You're talking about the idea that this all has to do with the drug wars, and at the same time, some people have speculated this could lead to a renegotiation of USMCA that would lead all around to even lower tariffs than before. Are you saying that's off the table. The tariffs are still part of this at the twenty five percent level.

Secretary Lutnik, I just want to make sure that I understand this correctly. You're talking about the idea that this all has to do with the drug wars, and at the same time, some people have speculated this could lead to a renegotiation of USMCA that would lead all around to even lower tariffs than before. Are you saying that's off the table. The tariffs are still part of this at the twenty five percent level.

Well, remember April second, we begin our reciprocity model, which is how you treat us as how we treat you, and that is going to be part of this exception part of his tarr policy. And then he's got industries, autos, semiconductors, pharmaceuticals, steal and aluminum and copper lumber. These issues need to come home. We need to help our domestic industries grow and flourish, and so we called out those product sets for extra focus.

Well, remember April second, we begin our reciprocity model, which is how you treat us as how we treat you, and that is going to be part of this exception part of his tarr policy. And then he's got industries, autos, semiconductors, pharmaceuticals, steal and aluminum and copper lumber. These issues need to come home. We need to help our domestic industries grow and flourish, and so we called out those product sets for extra focus.

But that's April second.

But that's April second.

So on April second, our reciprocal trade policy will come out. In twenty twenty six, we renegotiate USMCA with Canada and Mexico, and we're going to have really clear analysis and clear focus on how that changes. But right today, let's be clear, today is about fentanyl.

So on April second, our reciprocal trade policy will come out. In twenty twenty six, we renegotiate USMCA with Canada and Mexico, and we're going to have really clear analysis and clear focus on how that changes. But right today, let's be clear, today is about fentanyl.

We heard from last night the President. He said that he was fine with a little disturbance, but going forward there will be all of these gains realized. Secretary Lutnik, are you concerned about the level of uncertainty express not just in markets, but just even from people who you used to work with, where they're saying, we don't have a clear sense of what the goal is. And I understand you're saying it'll come on April second, but in the meantime people are just putting all plans on hold.

We heard from last night the President. He said that he was fine with a little disturbance, but going forward there will be all of these gains realized. Secretary Lutnik, are you concerned about the level of uncertainty express not just in markets, but just even from people who you used to work with, where they're saying, we don't have a clear sense of what the goal is. And I understand you're saying it'll come on April second, but in the meantime people are just putting all plans on hold.

Well, I'm not seeing all plants at all. In fact, I'm seeing the opposite. Right, we saw Apple commit to five hundred billion dollars. We saw open Ai an oracle commit to five hundred billion dollars of investments. TSMC just the other day saying one hundred billion dollar investment in America. Sawt Bank two hundred billion dollar investment in America.

Well, I'm not seeing all plants at all. In fact, I'm seeing the opposite. Right, we saw Apple commit to five hundred billion dollars. We saw open Ai an oracle commit to five hundred billion dollars of investments. TSMC just the other day saying one hundred billion dollar investment in America. Sawt Bank two hundred billion dollar investment in America.

So a trillion, three hundred billion dollars.

So a trillion, three hundred billion dollars.

And you think people are waiting on the sidelines, We feel it every day. All these companies are coming, they're building in America, they're committing to America.

And you think people are waiting on the sidelines, We feel it every day. All these companies are coming, they're building in America, they're committing to America.

We agree April second is coming.

We agree April second is coming.

We have to do our work before we announce our plans on April second. Of course, we have to do our work and do it properly and do it thoughtfully.

We have to do our work before we announce our plans on April second. Of course, we have to do our work and do it properly and do it thoughtfully.

But in this period of time, America needs.

But in this period of time, America needs.

A president to protect people from fentanyl that shouldn't be killing people in our country. China still has fentanyl as a highest list of subsidies.

A president to protect people from fentanyl that shouldn't be killing people in our country. China still has fentanyl as a highest list of subsidies.

Subsidies.

Subsidies.

They subsidize the production of precursors, the ingredients to fetanol. They send it to Mexico and Canada and into the country it comes. So our president has said enough already, enough already, and that's why he's come up with this tariff plan today. April second will be a fairness plan, and fairness plan is not that hard to figure out if.

They subsidize the production of precursors, the ingredients to fetanol. They send it to Mexico and Canada and into the country it comes. So our president has said enough already, enough already, and that's why he's come up with this tariff plan today. April second will be a fairness plan, and fairness plan is not that hard to figure out if.

You have a look it.

You have a look it.

Can I jump in there on the on the fairness plan, is that an initial, partial assessment and response or will tariffs actually hit on April second?

Can I jump in there on the on the fairness plan, is that an initial, partial assessment and response or will tariffs actually hit on April second?

Well, there are a whole variety of laws in the United States of America that we will follow with precision.

Well, there are a whole variety of laws in the United States of America that we will follow with precision.

Some tariffs will come on right away, and then some.

Some tariffs will come on right away, and then some.

Tariffs will go be registered and they will take three weeks or four weeks, and they will come on in due course.

Tariffs will go be registered and they will take three weeks or four weeks, and they will come on in due course.

So there's a process for tariffs in America.

So there's a process for tariffs in America.

But we will announce them and we will be negotiating with all these countries thereafter, and then they go into effect over a period of months, so basically April second. No, we'll announce them and then they come in.

But we will announce them and we will be negotiating with all these countries thereafter, and then they go into effect over a period of months, so basically April second. No, we'll announce them and then they come in.

Because there's months of studies, massive report, public opinion. This can take a very long time. So legally there's no law that's short enough really to put tariffs in place on the second. So how long between April second till the tariffs actually hit do you think we'll see?

Because there's months of studies, massive report, public opinion. This can take a very long time. So legally there's no law that's short enough really to put tariffs in place on the second. So how long between April second till the tariffs actually hit do you think we'll see?

As I said there, we launched our studies on January twentieth, so April second, those studies are done. Some tariffs can come straight away, some can come weeks later, some can some can take over a month or two to come online.

As I said there, we launched our studies on January twentieth, so April second, those studies are done. Some tariffs can come straight away, some can come weeks later, some can some can take over a month or two to come online.

But it will be very, very.

But it will be very, very.

Thoughtful, very organized, and we begin on April second. We've announced it from January twentieth that April second was the day. We're sticking with our day. We're sticking with reciprocity. It is time for America to be treated fairly. And that's what the President Trump is going to do. He's going to make sure we are treated fairly. He's talked about it last night. He's made this clear. So Mexico and Canada is about fentanyl today for the month of March, but on April second, it's about fairness. And yes, that is a process that comes in that is strictly specific to the laws, but it'll.

Thoughtful, very organized, and we begin on April second. We've announced it from January twentieth that April second was the day. We're sticking with our day. We're sticking with reciprocity. It is time for America to be treated fairly. And that's what the President Trump is going to do. He's going to make sure we are treated fairly. He's talked about it last night. He's made this clear. So Mexico and Canada is about fentanyl today for the month of March, but on April second, it's about fairness. And yes, that is a process that comes in that is strictly specific to the laws, but it'll.

Take over a month or two months to come in.

Take over a month or two months to come in.

But once it's in, they will stick, which is treat us fairly, treat us properly, or don't trade with us.

But once it's in, they will stick, which is treat us fairly, treat us properly, or don't trade with us.

Miss the Secretary, I was a man of my word. I am a man of my word, and I promise we'd come back to the address last night. So let's finish there. The President of the United States talked about a big, beautiful drop in interest rates. A lot of people in this market are curious whether the president is no longer sensitive to the deadI girations of the equity market. The focus, the emphsis now is on the bondom market. Is that the shift is that the way to understand things.

Miss the Secretary, I was a man of my word. I am a man of my word, and I promise we'd come back to the address last night. So let's finish there. The President of the United States talked about a big, beautiful drop in interest rates. A lot of people in this market are curious whether the president is no longer sensitive to the deadI girations of the equity market. The focus, the emphsis now is on the bondom market. Is that the shift is that the way to understand things.

Well, I think that is too specific.

Well, I think that is too specific.

I mean, let's face it, if we balance the budget of the United States of America, interest rates are going to come smashing down. And I don't mean ten basis points, I mean one hundred and fifty basis points. You're going to have an explosion in the housing market. You're going to have an explosion in the equity markets. Because this is not a manufactured cut in the interest rates like you saw last time with this huge money supply which created the vast inflation.

I mean, let's face it, if we balance the budget of the United States of America, interest rates are going to come smashing down. And I don't mean ten basis points, I mean one hundred and fifty basis points. You're going to have an explosion in the housing market. You're going to have an explosion in the equity markets. Because this is not a manufactured cut in the interest rates like you saw last time with this huge money supply which created the vast inflation.

This is the right way to do it.

This is the right way to do it.

You stop printing money, you stop running deficits, You balance the budget of the United States of America. You smash interest rates down, you produce enormous amounts of energy, drive those prices down, and you will see the greatest equity market and the greatest economy in the United States of America. Now, remember this president is worried about the United States of America. Sometimes I can asked questions about am I worried about Canadam I worried about Mexican And am I worried about the EU? My president is worried about the United States heats of America. And you are going to see the greatest equity market and buyd markets under President Trump.

You stop printing money, you stop running deficits, You balance the budget of the United States of America. You smash interest rates down, you produce enormous amounts of energy, drive those prices down, and you will see the greatest equity market and the greatest economy in the United States of America. Now, remember this president is worried about the United States of America. Sometimes I can asked questions about am I worried about Canadam I worried about Mexican And am I worried about the EU? My president is worried about the United States heats of America. And you are going to see the greatest equity market and buyd markets under President Trump.

Well, let's you.

Well, let's you.

Worry about the American data right now because equities have rolled over just a little bit, you know, the market. Well, I won't make a big deal of it. We're just a bit softer at the back of this data from ADP, which is a downside surprise at seventy seven K. The estimate was one forty. So with sub one hundred, we'll see what we get on the m later on this morning and on payrolls on Friday. But as you know, mister Secretary, the data over the last few weeks hasn't been great. The survey data has been softer, and a lot of these companies in these surveys have pointed to tariff uncertainty. Do you accept that the business community needs some clarity or whether it's twenty five, fifteen, ten, whatever, the number is going to be that the volatility around the trade story, the cumulative effect of persistent uncertainty is starting to wink into this economy a little bit.

Worry about the American data right now because equities have rolled over just a little bit, you know, the market. Well, I won't make a big deal of it. We're just a bit softer at the back of this data from ADP, which is a downside surprise at seventy seven K. The estimate was one forty. So with sub one hundred, we'll see what we get on the m later on this morning and on payrolls on Friday. But as you know, mister Secretary, the data over the last few weeks hasn't been great. The survey data has been softer, and a lot of these companies in these surveys have pointed to tariff uncertainty. Do you accept that the business community needs some clarity or whether it's twenty five, fifteen, ten, whatever, the number is going to be that the volatility around the trade story, the cumulative effect of persistent uncertainty is starting to wink into this economy a little bit.

No way.

No way.

I mean, the President spoke about him last night. He said Biden left them a pile a poop. He left him allows the economy that he's trying to fix. You're looking at data that's Biden data. Do not try to besmirch my President Trump with Biden's nonsense.

I mean, the President spoke about him last night. He said Biden left them a pile a poop. He left him allows the economy that he's trying to fix. You're looking at data that's Biden data. Do not try to besmirch my President Trump with Biden's nonsense.

Do you hear the manufacturing number is Biden data? I just want to be very clear, that's your opinion. You're entitled to it. You think that's his dates, not your my opinion.

Do you hear the manufacturing number is Biden data? I just want to be very clear, that's your opinion. You're entitled to it. You think that's his dates, not your my opinion.

Okay, what possible could change? Seriously, we are in early March. My president took over January twentieth.

Okay, what possible could change? Seriously, we are in early March. My president took over January twentieth.

You think economic data coming out in early March is Donald Trump related data?

You think economic data coming out in early March is Donald Trump related data?

Monthly?

Monthly?

MISSUS Secretary? Are you okay? Are you suggesting we don't have to get into an argument about it? You suggesting so when bone yields drop in a market that's worth trillions of dollars and investor's place bets off the back of that economic data, that that data doesn't count front of think that that data somehow misleading.

MISSUS Secretary? Are you okay? Are you suggesting we don't have to get into an argument about it? You suggesting so when bone yields drop in a market that's worth trillions of dollars and investor's place bets off the back of that economic data, that that data doesn't count front of think that that data somehow misleading.

I think that.

I think that.

Data is leading you to understand. If Joe Biden was still in charge, you'd be in trouble. But you have a new president. There's a new sheriff in town, and I would bet, I would bet on the economic growth that is coming from Donald Trump.

Data is leading you to understand. If Joe Biden was still in charge, you'd be in trouble. But you have a new president. There's a new sheriff in town, and I would bet, I would bet on the economic growth that is coming from Donald Trump.

You see the investments. You see it already.

You see the investments. You see it already.

There's trillions of dollars of manufacturing moving to America. It's moving to America. That means the cavalry is coming. For every trillion dollars that invests in the United States of America, that produces one percent of GDP growth, imagine that you have a president bringing GDP growth directly to his economy.

There's trillions of dollars of manufacturing moving to America. It's moving to America. That means the cavalry is coming. For every trillion dollars that invests in the United States of America, that produces one percent of GDP growth, imagine that you have a president bringing GDP growth directly to his economy.

That's amazing.

That's amazing.

Mister Secretary. We appreciate your time and your opinion. As always, Sir, the US Commerce Secretary, how would love maca on the economic data, financial markets, and what's going to happen with trade

Mister Secretary. We appreciate your time and your opinion. As always, Sir, the US Commerce Secretary, how would love maca on the economic data, financial markets, and what's going to happen with trade