Jun 5, 2019

Investors question the motive behind Trump's Mexico tariffs

Photo: Dan Kitwood/Getty Images

Though President Trump insisted he plans to follow through on his threat to add escalating tariffs to all goods imported from Mexico, suspicion is beginning to grow among asset managers.

What it means: The timing, lack of clarity and lack of policy action or precedent has some wondering whether the president's actions are less about punishing Mexico and more an attempt to get the Fed to cut rates in order to stimulate the economy ahead of 2020.

What they're saying: Mick Mulvaney, the acting White House chief of staff, said on "Fox News Sunday" that Trump was "deadly serious" about the tariffs, but acknowledged there was "no specific target" and no concrete benchmarks to judge whether Mexico was stopping the flow of migrants from Central America into the U.S. as Trump demanded.

The other side: Afsaneh M. Beschloss, founder and CEO of asset management firm RockCreek, said Tuesday at the Bloomberg Invest conference in New York that Wall Street is starting to wonder aloud about the president's intentions.

"Looking at what's going on with trade, one question some people are asking is why are there so many tweets and why so much attention to trade at this particular moment. Because we know the president is one of the smartest when it comes to politics."
"We're out of fiscal policy options, since it's unlikely Congress can come to an agreement, and we know that the Fed is independent. So is the causal effect here to push the news on trade to a point that it might impact interest rate decisions? Some people are starting to talk that way."

Go deeper: Trump's Mexico tariffs would constitute the biggest tax hike in 30 years

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Coronavirus dashboard

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  1. Global: Total confirmed cases as of 8 p.m. ET: 5,682,389 — Total deaths: 354,944 — Total recoveries — 2,337,385Map.
  2. U.S.: Total confirmed cases as of 8 p.m. ET: 1,697,459 — Total deaths: 100,276 — Total recoveries: 391,508 — Total tested: 15,192,481Map.
  3. Public health: Fauci says data is "really quite evident" against hydroxychloroquine — Nearly half of Americans say someone in their household has delayed medical care.
  4. States: California hospitals strained by patients in MexicoTexas Supreme Court blocks mail-in expansion to state voters.
  5. Business: MGM plans to reopen major Las Vegas resorts in June — African American business owners have seen less relief from PPP, Goldman Sachs says.
  6. Tech: AI will help in the pandemic — but it might not be in time for this one.
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Updated 39 mins ago - Politics & Policy

Top Senate Democrat says State Dept. is working on new Saudi arms deal

Secretary of State Mike Pompeo briefs reporters on May 20. Photo: Nicholas Kamm/pool/AFP via Getty Images

Senate Foreign Relations ranking member Bob Menendez (D-N.J.) wrote in a CNN op-ed on Wednesday that he learned that the State Department is currently working to sell thousands of additional precision-guided bombs to Saudi Arabia.

Why it matters: Democrats say that Steve Linick, the State Department inspector general who was ousted on Secretary of State Mike Pompeo's recommendation, was investigating the administration's previous effort to sell weapons to Saudi Arabia without congressional approval.

U.S. coronavirus death toll crosses 100,000

Data: Johns Hopkins University; Chart: Danielle Alberti/Axios

More than 100,000 Americans have died of the coronavirus, according to data from Johns Hopkins — a terrible milestone that puts the death toll far beyond some of the most tragic events in U.S. history.

By the numbers: The death toll from COVID-19 now stands at more than 34 times the number of people who died on 9/11.