Tariff Pain Already Priced Into Stocks, Citi's Moore Says

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00:00I just want to flag Scott Besson speaking to American media moments ago saying that

00:03he hopes that the Trump EU threat would light a fire under the EU.

00:07When you look at these sorts of things, is it a negotiating tactic or do you assume that these levels are coming?

00:13I think we should assume, and let me just start back and say,

00:16I think many people in the market assume that 10% was the level that we were going to arrive at by the time we get to September

00:22and that these reciprocal tariffs were not going to be a major issue.

00:26I think we should assume that ongoing tariff negotiations and threats are going to be the rule, not the exception.

00:33And so whether we're talking about Europe specifically or China or other countries or very specific goods or companies,

00:40I don't think we're going to get past the point of pain by the time we get to Labor Day,

00:44which in my view was sort of being priced into markets.

00:47Isn't this, I mean, just a continued gift to China and Russia?

00:50The fact that he causes this kind of global trade disruption for us makes them turn to them?

00:57Yeah, it's certainly going to accelerate the realignment of alliances, of global trade and relationships

01:03in a way that we would maybe not have forecast at the beginning of this year.

01:09I think what's going to be really important is to kind of to watch is that China needs to deal with a bunch of domestic policy as well,

01:14like how much stimulus they want to give to the consumer,

01:16what do they want to do to kind of increase confidence for foreign investors looking at investing in Chinese stocks,

01:21but also critically, how much do they then want to spend outside of China to deepen these relationships,

01:27which we've seen them do in other points of crisis in the past, right?

01:30Whether it's securing resources, whether it's securing supply chains, whether it's partnering with local governments.

01:36So I'm going to be watching Chinese policy very closely over the balance of this year.