The Middle with Jeremy HobsonOn this episode of The Middle, we ask how tariffs are affecting you - whether you're a small business owner or just feeling the pressure from price increases. Jeremy is joined by Financial Times business columnist and associate editor Rana Foroohar and financial analyst Juli Niemann. DJ Tolliver joins as well, plus calls from around the country. #tariffs #US #China #prices #gas #eggs #costofliving #UK #Canada #EU
Welcome to the Middle.
I'm Jeremy Hobson, along with our house DJ Tolliver and Taliver. I'm gonna start with a confession this hour, which is that until recently I always misspelled the word tariff. I thought it was two rs and one F. But now that we have to talk about it all the time, I know that it is actually tariff.
Wait, it's not a pH.
At the end, you win if you wish.
So this hour, we want to take advantage of our amazing middle audience and find out how the tariffs are being felt so far across the country. And it might be a little hard to tell because prices may not have trickled down to the consumer yet. In fact, Walmart today said people will start seeing increases later this month. But also the Trump administration has gone after companies like Amazon that wanted to tell consumers how much the tariffs were impacting prices. So we don't know exactly. But one thing I want to say to listeners is are you a business owner who's making business decisions because of the tariffs that you're already seeing, or are you not a business owner but you're being more cautious about what you're buying or maybe you don't want to quit that job that you hate because you have some uncertainty about the economy, or maybe you work in manufacturing and you're excited about the tariffs, or maybe you're a farmer. I definitely want to hear from a farmer this hour. In all those cases, you can call us at eight four four four middle. That's eight four four four six four three three five three. So Tolliver, let's just set the table, first of all, with what has happened. Help me out here.
February first, ten percent tariffs on everything from China, twenty five percent on Canada and Mexico, and February third, thirty day paws in Canada and Mexico. March fourth, okay, so make that twenty percent now on goodsome China, and March sixth another thirty day paws on Canada and Mexico. April second, you know, it's Liberation Day, one hundred and forty five percent tariffs on China and increase tariffs most other countries. And also April second, ninety day pause on the other countries after the bond market freaks out.
And finally May twelfth, Tulliver, Okay.
Make that thirty percent, not one hundred and forty five percent on most goods from China for ninety days. And listen, the day's not over yet.
Right right exactly today? Well, thank you Tulliver for that.
And here's President Trump earlier this week talking about that ninety day trade truce with China.
In addition, yesterday we achieved a total reset with China after productive talks in Geneva. Both sides now agree to reduce the tariffs imposed after April second to ten percent for ninety days as negotiators continue in the largest structural issues. And it doesn't include tariffs on cars, steel, aluminum, things such as that, or tariffs that may be imposed on pharmaceuticals because we want to bring the pharmaceutical businesses back.
So maybe watch this space on that. But given all that, how are the tariffs affecting you? Tolliver the phone number again, please?
Yeah, you can call us at eight four four four Middle that's eight four four four sixty four three three five three, or you can write to us at listen to the Middle dot com. I'm checking all the emails, so send them in. You can also comment on our live stream on YouTube.
Well joining me now, Rona Faruja, Associate editor and business columnists at The Financial Times. Rana, welcome to the.
Middle Hey, thanks for having me.
So before we get to the phones with all that back and forth Rona that we just re enacted, Are we in a different economy now than we were back in January? Is their substantial change at the end of the day.
Yeah.
Absolutely. You know, I was actually talking to a Princeton historian today and he was walking me through some of the biggest historical changes in the economy in the last one hundred years, and he put this one right up right up there. You know, it's it's there with World War One, it's there with the Great Depression. I mean, this is a rebalancing. I'm not saying that we've seen those kinds of results yet, but in terms of what Trump is trying to do, which is fundamentally overturn the Brettonwoods trading system and the Washington Consensus that was the idea that America was kind of setting the rules of the road. Free trade was one of them. You know, that's gone by the wayside. So ten percent seems to be the new normal. We're going to see how that's going to trickle out and it's going to happen at different rates in different industries and different parts of the country. But I don't think anybody could say that this isn't a pretty massive shift.
Are you seeing anything in the data yet? Are you seeing anything that shows you that consumers are feeling the tariffs already or even uncertainty because of the tariffs?
Oh, yeah, for sure you are. I mean, consumer confidence is at multi year lows. It hasn't been this low in quite some time. You have seen some price increases, I think, you know, go go look for a car these days, even a used car, and you know you'll see you'll see the prices have absolutely gone up. We've seen one off items, certain kinds of agricultural items. Walmart has already started raising prices, for example, on things like electronics and toys where you have a lot of components coming from China. Other products. It's going to take a while to filter through. But one of the things that's also happening that's quite fascinating to me is companies are waking up and as they, you know, kind of accept the reality of this, they're beginning to realize, oh gosh, we actually need that critical mineral from China that we can't access anymore, or that might be multiple times more expensive. You know, that component part that we thought was not a big deal is suddenly a big deal. Pharmaceuticals, I think you're going to start hearing about, particularly if we don't get a deal with India, because a lot of basic pharmaceuticals, generic pharmaceuticals, and inputs come from India. So imagine if we had, say another big unusual viral outbreak right now, and you needed certain kinds of medicine, and then suddenly the American public realizes, oh, wait a minute, we don't we can't get those with you know, and it's you know, you're back in COVID all over again. So that's the kind of thing that I think is probably going to be rolling down the pike.
So square that with the stock market, which seems to have rebounded mostly from what happened, you know, right after Trump announced Liberation Day and there was a huge collapse in the stock market, and it's kind of come back since then. Why are they not so concerned on Wall Street?
Well a few reasons. You know, let's speak, the stock market is not the best measure of the smart money. The smart money looks at the bond market, and the bond market is still saying blinking red. I mean bond deals have gone down a little bit, which means investors are kind of Okay, let's see what happens here. We're not really really upset, but we're but stock prices are up. That's because retail investors, who frankly aren't looking maybe as deeply as they should be at how permanent these changes are likely to be, are saying, oh, we got to deal with China, even though let's be clear, this isn't a deal. This is a ninety day pause, after which there could be more volatile right afterwards, there could be higher rates. So the market goes up. When if we hear something bad about tarots tomorrow, you know the market's going to go down. I would not take that as any indication that things have fundamentally stabilized. In fact, I personally think we're going to be in probably for a couple of years of this, if not more.
Wow, that's really interesting. Let me bring in our other guest for the hour, Julie Meeman, who's a veteran financial analyst joining us from Saint Louis. Julie, are you seeing any data right now, or you seeing consumers behaving differently because of the tariffs that exist, even if they're down from what they were.
Well, it's more of.
Those psychological things. And yes, everybody's already changing. They've already started doing the first key thing, and that's basically starting to pull back and substitute. So they're giving up some of their favorite brands and starting the substitute. They're watching to see what's going to happen to it. But we've already seen the prices going up here. I don't know who's doing the surveying. The prices have been going up for several months now, not dramatically. It's kind of like the slow boiling of water and you don't know you're getting cooked. But that's exactly what's going on with this now. Slowly but surely, the prices are all going up. So we are seeing a lot of people also starting to stop pile the things that they get that have our imports. So everybody's alert to this and they're doing something about it.
All right, Let's get to caller Pam, who's calling from Highland Park, Illinois.
Pam, welcome to the middle. Are you feeling the tariffs.
Yeah, absolutely, Hi there, how are you going?
Great?
Oh good?
My husband and I own a small bicycle shop in Winnetka, Illinois, so just close to where we live, and there is not one thing in our stores that won't be affected or hasn't been affected by the tarrat. We are receiving phone calls and emails every day for hours.
Pam, you's still there.
Oh I was so invested.
I really I want to hear Yeah, yeah, well totally. But but you know, Rona, that's that's that's interesting. I wonder if we're going to hear a lot of that this hour.
Well, I hope so. And frankly, I love that this is a woman with a small business who's speaking out. I mean, you mentioned earlier how a number of companies, Amazon being one of them, have been squashed by the President when they try to say, hey, this is this is a this is a thing where this is going to affect people. Surely he won't be able to get to every small and mid sized business to do this, and I think it's very brave for people to start talking about this.
It is real. Yeah.
By the way, you said, Ronna that you believe that ten percent is here to stay. That that's going to be the new normal for even years from now.
Yes, if you look historically at tariffs, once they go up, it takes decades for them to go down, and I think that that will be the case this time around, in part because and we have certainly not seen the full blow of this. The rest of the world is pissed at US. I mean they are really upset and that you know, they are figuring out what their next moves are. And let me tell you, I bet we're not done with what China may do in terms of retribution counteractions. Similarly, Europe is circling the wagons and realizing, Okay, the US is not going to defend us anymore. We're gonna need to defend ourselves. We're gonna we're gonna start maybe unifying more as a as a trading block our and as an economic block. They're they're in talks with countries like Canada that have been snubbed by the President and so you know, all that may end up having an impact that we'll feel down the line as well.
Well.
Stand by, Tolliver, I have very good news for you, which is Pam is back and we're going to go to her right after the break, so we can hear exactly what's going on there in Highland Park. But I said I can spell tariff. Now that's in portant because we just did a show a few weeks ago with former Treasury Secretary Larry Summers on this topic.
Yeah, and you asked them what advice you'd give to Trump if he were working in the White House right now, and on the issue of tariffs. Here's what he said.
You need to end this. You need to have there be a stable, non protectionist regime that's not pushing American prices way up, it's not hurting the competitiveness of businesses who can't get inputs. And you need to show people that you recognize have learned the lessons of the very painful experience of the last two weeks.
Maybe Trump was listening to the Middle last week, Tolliver, I'm pretty sure it was possible.
Favorite show.
We'll be right back with more of the Middle. This is the Middle. I'm Jeremy Hobson.
If you're just tuning in the Middle as a national call in show, we're focused on elevating voices from the middle geographically, politically and philosophically or maybe you just want to meet in the Middle. This hour, we're asking you how the tariffs are affecting you. Tolliver, what is the number to call in It's.
Eight four four four Middle. That's eight four four four six four three three five three. You can also write to us to listen to the Middle dot com. I'm checking all your emails or on social media checking all that. So reach out.
And I'm joined by Financial Times business columnists and associate editor Rona Farujar and financial analyst Julie Nieman. And let's go back to Pam in Highland Park, Illinois. Pam, Sorry we lost you there for a second, but you were about to say that you're seeing the tariff's impact just about everything in your store.
Yeah.
Absolutely. I think I was saying that we're getting emails and calls every day from our suppliers talking about what the potential impacts are going to be. They are registering the uncertainty. We've actually had one supplier already closed their doors, so you know, we're seeing this day to day and we have you know, when we try to talk with our customers about what it's going to be like, because they ask and the short answer is we don't really know. We have one supplier that has already decided not to import the smallest children's bikes because they don't think that they can justify the cost. And it is a primary large bicycle manufacturer. They are the largest bicycle manufacturer in the world, and they will not be importing twelve and sixteen inch children's bikes anymore.
So would you say, then, Pam, that really what you're seeing is a supply issue. It's hard to get the things. What about the prices being passed down to the consumers?
That is also going to happen. So what we're hearing now from our suppliers is, yes, some things are going to be harder to get because they have to make strategic decisions about what they think they can get through and what is going to provide the best opportunity for sale on a day to day basis. But all of those suppliers are also saying, we're going to have to pass these costs along to the to our buyers and our consumers. So those costs are going to pass on to us, and then we have to pass them on to the consumer as well.
And do you register your your unhappiness with this with your representatives. Are you Are you letting people in Washington know how you feel about these tariffs.
Absolutely.
As a matter of fact, we have a member of Congress who's one of our customers, so we talk regularly. Yeah, and he is equally he is equally frustrated. You know, there's there's only so much that can and be done. A lot of this has to do, though, with the uncertainty and the fact that we aren't really certain at this point if the tariffs are actually a strategic, long term issue or if they are in fact simply.
A whipsaw of chaos.
Yeah.
And the big differential for everybody in that is that if they are a long term strategic issue, first of all, it's way to too broadcasts.
There are good.
Ways to make strategic decisions about tariffs. This is not it, Yeah, but.
Long we've got it there. Let me let me go to our guest. Now, I really appreciate your call, but on the issue of the ultimate.
Goal here, Rona Faruhar.
You know, we've heard that the Trump administration is doing this because they want to stop fentanyl from coming into the country. Although then you would wonder why is the tariff the same, Why was it originally the same on Canada as on Mexico, that this is about bringing manufacturing jobs back to the United States. But if that's the case, why drop the Tariffact down to a lower level after some trouble in the bond market?
Do you see an overall goal here?
So I've got a couple answers to that. Let me let me if I can just do as a historical speed round, because I think it would help Trump one comes in and Trump one. You know, Trump got in politically, and I'm from the middle. I'm from Indiana. My my county went from you know, Clinton County seventy five percent Trump. He talked the right talk about manufacturing jobs and about workers in places that have been hollowed out there. The China shock is real. A lot of communities I grew up in one have, you know, have have really been hit hard. When he came into office. You then saw there Bob Leithheiser, the USTR at the time, who I really have a lot of respect for, had put very surgical tariffs on China on particular kinds of goods that I think was a good idea because it is true that the Chinese have very mercantilist practices and and a lot of countries would agree with this. Biden then comes in and says, all right, that's the away game, but we need a home game too, and we have to like build you know, build a chips industry, build a clean energy industry, and support businesses here. Now you've got Trump too, and there is a kind of a grand plan that's been articulated by Steve Miran, who's the head of the Council of Economic Advisors, to say, look, we've got to rebalance the global economy as a whole. The US dollar is making goods too expensive coming out of the US into other countries. It means that we lose manufacturing jobs. I think there's something to that, but but you have to do you have to thread that needle carefully. You have to work with allies, which is what Biden was trying to do, you know, cutting new deals with Europeans, reaching out to the Canadians. Trump comes in and puts tariffs on adversaries and allies alike, and people don't know what to think and we've lost trust. So I'm concerned about how that's going to play out.
Yeah, let's go to Kenneth, who's in Asheville, North Carolina.
Kenneth, Welcome to the middle.
Go ahead, Yeah, hello, Yeah, I'm in Ashville, North Carolina, and where my family and I are still displaced from Helene. Went through the whole FEMA experience, and then I lost my job in December. Ironically, I worked for a nonprofit trying to allocate emergency funds, and so when the tariffs happened and all of them were announced, we were still kind of an emergency mode. You know. We just bought our generator after the storm and all this stuff, so we were ready to like go out and buy a bunch of stuff we thought the prices would shoot up on. And then all the tariffs got taken out or you know, shifted and moved around, and I just felt like it was a bait and switch, and I felt like, oh, you know, I feel like they're trying to scare me into buying a bunch of stuff that, yeah, the prices probably will go up on. But I don't avoid not having gotten much from FEMA, you know, stilling a disaster zone. As far as I'm concerned, Am I really going to pour my money into this stuff? Even if I know the prices are going to go up because there's not Really it's not a great time to go on credit.
You know, right, Yeah, Kenneth, I really appreciate your call and best of luck with that, Julie Nieman. That is so interesting to hear just an individual who says I'm going to go out and buy things now because they might go up in price and then gets angry when they don't because the tariffs get taken away.
Well, he and everybody is the victim of total chaos in that three range surface in Washington, DC. Nobody knows how things work or what the implications are the fallout is, and when you start firing the people who know how things work, then the entire agency goes into chaos. So there's not one single agency that can give guidance. You don't have any kind of plan or a forecast at this point, CEO, those are giving up on it. It's just total chaos. The market, on the other hand, is paying no attention to that. They're looking for just the little signals here and there. It's a trading market. Blow it off, pay no attention to stock market. It is wrecking total chaos with the economy. Though, will it be a recession. That's really hard to see at this point. But if it goes on much longer, yes there will be.
Julie, you're in Saint Louis.
You don't have to drive very far to find farmers who make a lot of money selling things like soybeans to China. China put one hundred and twenty five percent tariff on imports from the US in response to the US tariffs on Chinese goods, which they have since reduced. But are you hearing from farmers or what are you supposed to do if you're a farmer right now?
Well, they've gotten the biggest insurance from Trump. That's he's going to get money out to them to compensate them for the big tariff that's coming in. Now. That isn't government money, that's money the taxpayers are providing. So we're going to be providing money on a tariff that never should have been put on. For one thing. You don't put tariffs on food. That is the most ridiculous thing in the world. You do it in strategic equipment, certain key things in trade, not on food. And that's where a lot of this is going and what's going to cause even more problems here. But if the farmers do get those nice the paychecks to cushion it, it's coming directly from the taxpayers, and we're paying for it, So we're continuing to pay for their screw ups.
Tolliver, I know some comments are coming in online.
Yeah, we actually just got one. A second new I love. This is Larissa. She says, I work in pharmacy. I wonder how many people understand that medicines are largely imported. Pharmaceuticals are supposedly exempt from tariffs. But I'm holding my breath, as are so many people, as so many people are saying it's the uncertainties that are making me lose sleep. There's some other ones, but I got to tell you they're pretty vitriolic.
For fun.
All right, if you'd all right, well, we'll keep it g rated for now. Let's go to Scott, who's in Houston, Texas. Hi, Scott, go ahead with your thoughts about the tariffs. Are you being affected by them?
Yeah?
Hi, everybody, you know, it's it's I feel kind of like we're all just sitting here waiting, you know. It's it's it's one day it's up, one day it's down. Whether it's the market, whether that's yeah, we're gonna have terair assess or no, we're not. But I know for us, you know, we're a family business. We're super lucky to have had the following we've had in Houston for twenty five years. But I mean we're still feeling the effects of what COVID brought, honestly, and you know, prices of goods from twenty twenty to where we are now. You pick any product that we use dairy proteins, which, by the way, if you eat Lamb and pretty much any restaurant in the United States or really anywhere in the world that's coming from New Zealand or Australia. So there you go, right there. And I mean that's that's gone up in upwards of fifty percent just for you know, Lamb stops right so you know.
It's and if you pass those costs onto consum.
So that's an interesting point I wanted to bring up. No, I mean, we we have now our menu prices since twenty twenty, we have jumped fifteen percent, and the biggest jump came about twenty two or twenty three, where we're just kind of sitting around looking like Okay, we've opened back up, but I can't get anything. Cost of goods are gone up. Those like everybody's trying to get the same container to pack food to go because that was still a majority of our business at the time. Hurricanes come through and rip out like factories in Lake Charles and Louisiana, and suddenly like plastics or other you know, products that would go for making these containers aren't even available. Forget the fact that we're in a worldwide pandemic or trying to come out of it at a time. So there's just so much going on, and that's that's it's just stacking on. It's just one thing after the other, you know. Yeah, and so yeah, I mean we yep, go ahead.
Well, no, that's it's a great And I want to ask ronof Rujer about that. When you hear Scott talk about prices going up for him and just coming out of the pandemic, but then not passing some onto the consumers, is that surprising?
Not really.
I mean, I think businesses of all sizes have been trying to eat as much as they can frankly of this because you know, they want to keep their customers happy. They don't want to lose business. They don't want to see people buttoning up their walllle as. I was concerned though, just recently to hear the CEO of Walmart say, you know what, We're just going to have to pass these costs on. They're too big, they're too broad, and when Walmart can't eat costs, you know that others are going to have a hard time eventually.
Well, I mean, I guess on the other hand, Walmart is so big that they may in many playss not have any real competitors except for maybe Amazon, so they don't have to think about things like a restaurant would, where you know, they might have another restaurant down the street that people say, oh, this one's getting too expensive, I'll go to that one instead. Walmart is in a sort of a category of.
Its own, well one hundred percent. But you're kind of proving my point that, you know, if they feel under pressure about this, that those that are, you know, in smaller and mid sized businesses, which, by the way, every economist I know says, sme, small mid sized businesses, family businesses, local shops, they're going to be hit much harder by this. And this was also the case in COVID. I will say, when COVID hit, you saw the biggest retailers, Amazon, Target, Walmart. Those folks were able to use their size and scale to you know, get faster container cargo shipping. They were able to cut deals. It's much much harder when you don't have that kind of size and scale to cope in an environment like this.
Let's go to Margaret, who's in Wilmington, Delaware. Hi, Margaret, how are you feeling the tariffs? I?
Hi, hello to everyone.
A couple of observations. I have been trying to get an electric blanket twin size for several months, and I was following Amazon, and when tariffs were announced, you know, they're just gone. They I guess everyone went and bought because they're thinking, well, you know, come next winter, they're going to be twice as much. So I haven't been able to get any of the ones that I was looking for. Walmart did have some on their website, but they're all undesirable colors again that I was looking for. Okay, if I want dark gray or some other weird color, yes, walmert das undisibles. But what I was looking for on Amazon, that was the best price it's gone. I ended up buying a different size because I'd rather have one than not none at all.
Right, yeah, you know.
You're seeing that. If I could just jump in, because you're seeing this in so many categories. You know, you're seeing it in clothing, you're seeing it in cars, and it's actually part this is a classic inflationary spiral because people see it is going to be more expensive, most likely next year, and so you you you get ahead of it, you you hoard that causes shortages, which then cause inflation.
Hmm, Margaret, thank you very I'm worry about that, but I also have, like you know, we open an occasional good bottle of champagne when it's somebody's birthday, and that's going to go up really much.
Absolutely, so we are concerned, you know.
Yeah, Yeah, it's very difficult.
It's just I mean, I don't want I don't want to offend any of our listeners. Maybe in the wine making industry in California, but it's just not the same. I once did a story about champagne versus prosecco versus sparkling wine, and.
It's just not the same.
Uh.
There's a reason you pay so much for the real thing. Let's go, let's get another collar in before the break.
Here.
Pam is in Malvern, Pennsylvania. Pam, how are you feeling the tariffs?
I'm not yet, But I was doing some research for myself today on the internet and I wondered where the tariffs that are collected go. Where does that money go? And what I read was that it goes to the United States Treasury, and I believe I also read that at that point the administration can do whatever it pleases with the money.
So interesting, that's that's it, you know, Yeah, because Pam, they we heard that. I think last month the Trump administration says they brought in sixteen billion dollars from the tariff from the customs collections because of the tariffs, Julie, do you know anything about about the about the money that comes in or do you think that that's a benefit of the tariffs?
Oh, that's a direct cause. This is why they want it, because that money is going to pay for renewal of all the height of the tech build that's going through that benefits the top one percent, and so that will be content. That's where the big benefits are. So the tariffs are going to pay for us to continue on what the tax bill that is currently being pushed to Congress, which only benefits top income earners.
RNA is right, RNA is there. Does the administration just they can they can they do whatever they want with that money.
Pretty much, pretty much, And that's correct that it is part of what they're hoping is going to offset this tax bill, which you know, the markets are not buying it. People are very, very worried about the debt and deficit levels that the tax bill is going to cause.
Yeah, well, Tolliver, We've been hearing from ordinary Americans this hour. But Trump's trade war has illicited reactions from some of the most important people in business and politics.
As an understatement, man, here's Chinese President Sheijen Ping, Massachusetts Massachusetts steel manufacturer Stephen Capone, JP, Morgan Chase CEO, Jamie Diamond, and Berkshire Hathaway CEO Warren Buffett.
Trade should not be a weapon. It's a big mistake in my view.
The tariff sound stiff. It's a tall task, but we need to do something to lower cost for our companies, for our workers.
I thought it was too large, too big, and too resumes.
Started, but it's okay, to save it's unfair. We want to fix it.
And China's President Xi Jinping is now responding to President Trump for the first time Fine Night, saying that China does not fear economic suppression, but adding there are no winners in a tariff war.
NBC's Peter Alexander they're playing the role of Shijinping Tolliver.
He did a good job.
He did a good job, better than I would.
Yeah, we'll be back with more of your amazing calls on the Middle. This is the Middle.
I'm Jeremy Hobson, and this hour we're asking you how the tariffs are affecting you. You can call us at eight four four four Middle. That's eight four four four six four three three five three. You can reach out it listen to the Middle dot com. My guests are financial analyst Julie Neeman and Financial Times business columnists and associate editor Rona Farujar. Such great calls. Let's get back to the phones. Mike is in Lake Forest, Illinois. Hi, Mike, how are the tariffs affecting you?
Well, they're destroying my business. I'm kind of a solo entrepreneur. I import mosquito net tents, for summer camps, and I take my orders and negotiate pricing in December, reduce the product in the spring, and it all sells during the summer. So if I don't get in by Junior May, I don't sell anything. And the terraffs were zero on my product originally, and then when I had to pay for the shipping, it's went to one. And it's funny now I kind of wish.
I was paying only eighty percent.
Yeah, by comparison, what are you going to do? Are you going to be able to stay in business?
I was going to eat.
I have to eat the colletscuse I can't change the price with my buyers. And I do sell some on Amazon, but I'm going to wait and see what my competitors do before I raise prices.
Mike, what do you make of the fact that the stock market seems to have rebounded from where it was? Do you think that they're just crazy on Wall Street?
I don't think the stock market it's very good indicator what's going on. People are just reacting day to day to get their money out and putting back in, and getting it back out and putting back in because nobody else to put it.
Yeah, Mike, thank you very much for that call. Uh ron A, what do you what do you think of that? Another business owner who is having to eat the costs of these tariffs and really scared about the future.
Well, I think two things. I mean, for starters, what an interesting product mosquito nets. Nobody thought that was going to get cut off, you know, cut off or caught up in.
This who ha.
And I'm hearing from people all the time with these kinds of problems. Just you know, I really think this pharmaceutical input issue is going to become very important. A lot of what goes in antibiotics comes from from India. There are rare minerals, but there are also things like mosquito nets, practical things that you know, you just don't think about that are part of this. I will also say that I agree with the caller about the idea that people are putting their money in and out of the market. They're pulling there, They're trying to time these dips. It's chaos. It's wrecking havoc with people's financial planning for their retirement, which is another side effect here.
I'm going to do a tale of two callers from Dallas, right, now, and we'll start with John, who's in Dallas. John, how are you feeling the tariffs or are you feeling them?
Well, not feeling the immediately. But I had a manufacturing business, plastic molding business, which I've sold, but I still worked there as a consultant and we worked generally with older machines, but those are gradually getting to the point where the need replacement. And unfortunately all the machinery now comes from China, so it would be hard for us to gear up production at our little factory because the machinery already was pretty much well out of reach to get new machinery, and now with the tariffs, it's going to make it very hard to increase any manufacturing at our little.
Planned And does that have an effect on jobs?
Well, yes, yes it'll. You know, you can't you can't hire more people to do the work if you don't have the machinery to make the parts. And it's fairly labor intensive work, so it's not the best jobs. They're not the highest paying and the most glamorous, but it is work for entry level people and we're not going to be able to supply that if we can't afford the machinery to ramp up and make more parts.
Okay, John, that's John in Dallas. Now let's go to Eric in Dallas. Eric, what are you feeling when it comes to the tariffs.
All of our everything comes probably sourced from outside. I don't know where all the products are made. I know some products are made in the US, but they coming containers.
What is it that you do, Eric, what's your business from I'm.
A hairstylist, so good luck when you go to get your hair done, because it's gonna go up. But most of the stylists in Texas are independent contractors. They work sole proprietors, so they they don't have an umbrella over them. They have to carry the cost all on their own backs. And so a pair of shears that we got in Japan that the cheapest pair that you can find would probably be around one thousand dollars. China's gotten some substitutions that were as good equality but not quite as good, but for remarkable less. Now that's going to go out the windows. So those tools that we rely on to make our our money are going away. And I am disabled, a fifty seven year old I have student loan dead and I've been disabled for fifteen years, so I there's no I'm under the poverty lot, right, I can't even on top of that, I'm getting double punched.
Yeah, it's ridiculous.
Yeah, Eric, I really appreciate your I really appreciate your people.
Yeah, I appreciate your call, Julie Neeman.
Such interesting perspectives from two different people and two very different businesses in Dallas.
Yes, it is, but it's a situation where of course small businesses are going to be the ones who suffer because they don't have to squarewith all the stay in business for a long period of time. You're talking. They were talking earlier about not being able to get to the things that they requested. Shipping is going to be the biggest problem. They're redirecting all their shipping to taking care to ship to other places. So there's a shortage of shipping coming into the United States now, and the costs have gone way up on shipping. So because of this, we're going to have delays, late deliveries. And then let's talk about Christmas here and toys. We're really going to have a big problem with toys. But then again, Trump said, you don't need thirty dollars.
You only need three, right right?
Let me But you know, Rona, when you hear that, you think about the dolls and what that focus has been on in the media on the tariffs. And we hear these perspectives from a person in a barber shop, from a person who's selling mosquito nets. This is so much more far reaching than what has been talked about so far.
Well, I'm so glad to be a part of this conversation, and here are these examples. It's so much richer and more important in a lot of ways because it's showing the depth and the breadth of what's going to happen. And by the way, the point about ships completely true. That actually happens to be the topic of my next book that I just sold a couple of weeks ago. It's about shipping. China has fifty five hundred ocean going vessels. The US has one hundred and eighty five. So if the Chinese want to put the squeeze on ships at a global level, they absolutely can.
Let's get to Debbie, who's in Manchester, Tennessee. Debbie, how are you feeling the tariffs?
Hi?
Jamy, Well, I just come from a consumer perspective. You know, I've noticed some price is going up, but I don't know if those were directly because of tariffs right now. But my main question that I'm calling about is if the guests have any insight on insurance premiums. I've had a conversation with someone today who said their homeown policy went up to five thousand dollars for a year on a home that's worth less than one hundred thousand dollars. So I just didn't know if that was something to think.
Yeah, I think I think I'm correct in saying that that they are going up, but not because of the tariffs. In this case, we can't blame that. Is that right, Rhano, We can't blame the tariffs.
It's true they are going up. They've gone up in the last two years across the board in some I don't know which date you're calling from. Tennessee, Tennessee, Well, actually yes, they in the South Tennessee has got flooding issues and that's that's one of the things that's raising premiums there. Of course, Florida has become almost uninsurable. New York we're having problems. I actually had to cancel our policy and get a cut catastrophic policy because we couldn't afford it anymore because we're in a flood zone in Brooklyn. So this is a national problem.
Yeah, let's go to autumn. Who's in Gainesville, Florida.
Autumn. How are you feeling the tariff?
Yeah?
So I wanted to talk about how Trump's caraff policies have impacted plant science research. These terrifts that didn't just hit farmers, They have disrupted the supply chain for essential materials and equipment used in agricultural research. Prices like lab instruments, grow chambers, greenhouse materials, DNA sequencing, and even fertilizers has increased due to the tariffs. A lot of people don't think about that side as well, not just the farmers, but the researchers are also getting impacted as well as collaboration. International collaboration has been affected by it as well.
And you're in Gainesville where the University of Florida is. Have you been unable to do research because of this?
I've heard of other researchers having complications, especially with other researchers in China and Canada.
Yeah, there's a lot of collaboration.
There is, and It's really sad to see this happen because any type of research that's happening with plant science is essentially us figuring out ways how to feed the world.
So well, Autumn, a very interesting Thank you for calling, and I'm going to do Keenan, who's in Salt Lake City. Keenan, how are you feeling the tariffs?
So there's a cottage industry in information security cybersecurity conferences of making tiny electronic statches. So this is basically a circuit board maybe a few centimeters on a side, a few LEDs, a resistor, maybe a micro controller, and of course all of these things are searched from China. So a bunch of these conferences normally have a big trading culture of there will be probably one hundred different people who have made their own badge, brought it to this culture, and so far seventy percent of those people this year or more, people who didn't serve it before the tariffs. They're out of the industry right now. And this would be these would sell for maybe five bucks, often had an offs, and they're gone now.
Wow. Yeah, I didn't even think about that. Julie Neiman.
I imagine that throughout your career, You've been to a lot of conferences. I mean, this is something I never even thought of that comes in from China. But an interesting point there.
Well, so many electronic components and everything we're using come in from China. I'm sitting here with my Apple computer, you know, so you can't get much more straightforward on that. Everything has Chinese components in it. And all they have to do is stop shipping to us and let's see what happens when we tried it on.
Run.
You know.
One of the big issues here is that the US has traditionally been the safe harbor when times get tough economically, people flocked to the securities the US treasuries, the safety of those We're seen as an as up and up as a trading partner.
Is that still the case, Well, it's.
More the case in some ways than it should be. And let me explain. I mean, countries that have the kind of debt and deficit pictures that the US does and the kind of political volatility that we have right now would typically be seeing a much weaker economy, would be seeing much higher borrowing costs, interest rates would be higher. But because the US dollar is the currency of last resort for the world. We get, you know, as they say, the exorbitant burden, exorbitant privilege. The Trump administration is focused more on the burden part. It does make American goods more expensive, and that's one of the reasons that you have this tariff paradigm. But there's another thing happening here, which is the rest of the world. China in particular wants to move away from the US dollar, and in fact, the Chinese and Russians and a number of other central banks around the world and the Arab world have been stockpiling gold really since before COVID. They want to start doing more trade in their own currencies or in digital currencies digital R and B, or in gold. They want to move away from the dollar, and I think eventually that will that will weaken the dollar and potentially lower US asset prices. It's a tough needle to thread right now. The Trump administration is trying to have it both ways. They want to do this reshoring, they want to bolster manufacturing, but they also want the US dollar to be the place of last resort. May not be able to have it both ways.
Levi is in Colorado Springs, Colorado, LEVI, how are the tariffs affecting you?
Yeah, I have a manufacturing company to make specialty hinges for you know, be able to hinge like bookcases and things of that nature, and there well, I was just in the early stages of my company doing prototyping back and forth with China and getting the parts. And I don't disagree with the terriffs and principle. I more disagree with how they are rolled out, how chaotic everything is, and it's basic priced me out of the market. So I've got twenty five thousand dollars into this, you know, startup company that I'm basically just going to take a loss on at this point because there's no way without manufacturing them in China that I will be able to make them at a price that people can afford.
But you still believe in the tariffs and principle.
I believe in some of the tariffs and principle. I don't believe I'm putting one hundred and forty five percent tariffs on right probably anybody you know. But I think that if you were to do this in a slow way, to try to balance the markets in a reasonable way where you let people know what's going so they have time to prepare and they have time to build up manufacturing here in the United States. I see that it could benefit us in some ways. Putting, you know, tariffs on islands that don't have any human inhabitants and things of that nature.
I don't see.
Anything from that.
There was there was an island that had known Thank you Levi, you know Taliver. I don't think we've ever had so many calls in the Aero Bephore, but this is just so much fun to go to these different people and here, what's going on with the tariffs. I'm going to do one more Phyllis in Western Arizona. Phyllis quickly tell us how the tariffs are.
Affecting you, Hi, Well, I'm definitely in the middle, and I work for a small business jewelry custom jewelry operation. The tariffs and combined with the rise in gold, I should say, the ups and downs of gold have created quite a conundrum within the industry, and not just for our business, but for many of the other jewelers across the country. And we talk to different people all the time. Just for an example, this time last year, two gold chains would run us maybe four hundred dollars and shipping. Now it's seven hundred and fifty plus the sixty dollars tariff plus tax plus shipping.
Wow, and yeah and so. And because we advertise buying gold at the daily rate, what we had was more people coming in to sell their old.
Gold wow merchant Yeah, yeah.
Yea for almost three months now. It's really bad.
That's amazing.
It reminds me actually of what was happening when when car price is really high and then people all of a sudden were able to sell their used cars at a much higher price because they wanted that.
We are running out of time here.
I just want to ask each of our guests, and I'll start with you, Rana, just a quick prediction about the economy for the rest of this year, based on what you know about these tariffs.
Well, I'm going to be watching the summer very carefully. It's going to We're that's going to be the tell. Are we going to slip into recession? Is the inflationary pressure going to be too much to bear? I would not be surprised if we saw a slow down by fall.
Yeah, Rana, thank you very much. And Julie, you know, let me ask you for your prediction thirty seconds. What do you think is going to happen in the economy the rest of this year.
Well, because the inflation we see is due to tariffs, we're not going to be seeing any cut in interest rates for the time being. That will be holding up even though underlying inflation is going down. We're also going to be seeing just from a chaos standpoint, no activity on anybody's part. You're not going to see companies expanding. They're going to be terminating a lot of plans for expansion. I see of recession coming.
Wow.
That is Financial analyst Julie Neeman, and we've been speaking also with Financial Times Business Comments and Associate editor Rona Farujar.
Thanks so much to both of our.
Guests, and don't Forget the Middle is available as a podcast in partnership with iHeart Podcasts on the iHeart Apple wherever you listen to podcasts. Coming to your feet in the next few days an episode of our weekly podcast Extra One Thing Trump Did. We're going to be asking what DOGE is doing with all of our data, and next week we'll be right back here asking if not DEI, then what can be done to ensure everyone has equal opportunity.
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