Tariffs Are Already Working

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To investors,

The tariffs are working. Most people just haven’t realized it yet. And you definitely would not know it by reading the mainstream media headlines. They are telling everyone the world is ending, the economy is on the verge of the next global financial crisis, inflation will come raging back, and your portfolio is poised to lose big in the coming weeks.

None of that is true though.

In fact, the exact opposite has been happening. Inflation went from over 3% in December to under 1.4% this week, according to real-time alternative inflation measurement Truflation.

We have seen gasoline prices drop to a 4-year low. Egg prices have fallen off a cliff. If someone is worried about inflation right now, they should question whether they understand how the economy works. Our biggest issue at the moment is a potential economic slowdown, not an economic acceleration.

On top of that, we are now seeing foreign countries, such as Israel and Vietnam, drop their tariffs against the United States in anticipation of the Trump administration’s reciprocal tariff program that will be announced later today. This is the whole point of a reciprocal tariff — you are free to tariff us however you would like, but we are going to match you. If you don’t want us to tariff you, than make sure you aren’t hitting us with tariffs.

It is pretty simple.

The benefits don’t stop there either. The 10-year treasury yield, which the administration has explicitly said was a key metric for them, has been falling over the last few weeks. The 10-year yield has not broken below 4% yet, but I believe we are well on our way to that milestone.

The government needs to refinance trillions of dollars this year. Home buyers want lower mortgage rates. And businesses want cheaper capital available to them. We are going to get a lower 10-year treasury yield one way or another and tariffs are definitely helping the situation.

So to recap — what happened when the initial tariffs got announced? Prices went down, inflation went down, yields went down, and some countries took down their tariffs. This is what winning looks like.

And before people accuse me of being some partisan hack, it is important that I remind you I am not pro any political party. I am a registered independent. I take my allegiance to independence very seriously.

Each administration has pros and cons. There were good things done by the Biden administration and there were very bad things done by them too. Same will be true of the Trump administration. No administration can be perfect.

The current administration has strong economic policies that are good for American citizens in my opinion, but there will be plenty of things to disagree with them on for other issues. The world is not black and white, but rather gray.

With that said, you are going to hear lots of yelling and screaming from critics in the media about these tariffs. But that doesn’t change the facts. Tariffs are already working.

They are making America stronger and protecting the working class. They are creating an even playing field for international trade. And tariffs are a big reason why the United States has a potential path to refinancing our government debt at a lower interest rate this year.

Personally, I'll give up some short-term gains in my portfolio if it means that tens of millions of Americans have a better chance of finding stable work so they can feed their families, afford a home, and benefit from lower consumer prices.

Hope you all have a great day. I’ll talk to everyone tomorrow.

- Anthony Pompliano

Founder & CEO, Professional Capital Management

BlackRock’s Insanely Bullish Bitcoin Take Will Surprise You

John Pompliano and Anthony Pompliano discuss Larry Fink being a big bitcoin bull, tariffs, stock market, recessions, crypto assets, and is a recession coming?

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