US stocks sell-off as investors digest President Trump's 145% tariffs on imports from China. Raymond James managing director Ed Mills joins Julie Hyman and Josh Lipton on Market Domination to take a closer look at what he calls the two teams in Trump's administration: "team tariff" and "team econ."
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Well, tariff turmoil may leave its mark on short-term and possibly long-term investments. We're all left wondering whether to look to Washington policy or pure economics for more insight to help us understand which way the winds are indeed blowing. We're joined now by Raymond James Managing Director Ed Mills. Ed, it's always great to see you. Um, let me ask you this, Ed. Um, you know, when we saw that Trump tariff pause, there was immediately a lot of talk, Ed. And I'm sure you were you were hearing the same question. Okay, who does that what does that tell us, if anything, about who's in pole position inside this administration, whether it's team Bessant or team Navarro? I'm wondering if you have a view there, Ed. And to the extent you do, you know, let's say it was team Bessant, what are the possible policy implications that flow from that, Ed?
Yeah, Josh. So what we're telling folks here at Raymond James is to think about it as team tariff, which is Navarro, that's Ludnick, that's Jameson Grier, the US Trade Representative, and team Econ, uh, Scott Besant, Kevin Hassett at the chair of the National Economic Council. Uh, it's been very clear to us at Raymond James that for the last month or more, team tariff has been completely in charge. And we've heard some reports that, uh, team Econ and others within the White House was surprised when they saw the chart that Ludnick brought up to the podium in the Rose Garden, because I don't think that was the plan. Um, that plan has set off a lot of economic and market reaction that's been very negative. And so what we saw yesterday with Besant being at the podium, with Besant taking charge of some of these negotiation, is that team Econ is back in charge. Now, I don't know how long Econ is going to be in charge. There's going to be this push and pull. Uh, there is a team of rivals that have been employed by Donald Trump. But I look at this and say, whoever is in charge, that's going to dictate the market reaction here, Josh.
Well, and Ed, um, to some extent, obviously, this is sort of palace intrigue and, you know, but obviously, it has real implications too. We've seen that play out in the markets. So just just sort of be reductive about it, I guess. Is team Econ better than team tariffs when it comes to to market reaction? I mean, we're still even if we're still writing team Econ, the markets are down big today.
Exactly. Yeah, so, um, I think team Econ is better for market reactions, but I think you're absolutely right because when you think about this, um, back after the election, if I told you we were going to put a universal tariff of 10% on across the world, that the tariff on China was going to be 145%, that wouldn't necessarily be something that, uh, folks would say that, oh yeah, that's a great outcome here. Uh, we calculated it here at Raymond James and then, uh, last week, the announcements were about almost $600 billion worth of tariffs. Now, if you do 145 for China and 10% across the world, holding everything constant, which it won't be, it goes up to almost $850 billion. So even though we had relief, it is still about a 40% on a dollar weighted average, the highest tariffs that we have had in a hundred years or more. Um, so there's still a lot of wood to chop here before we get to a level where the market will be okay with that. Hopefully in this next 90 days, we'll get some of that certainty. If