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Authored by Lance Roberts via RealInvestmentAdvice.com,

While coming in much stronger than expected, the latest employment data confirmed what we already suspected: the economy is slowing. The reason the employment data is so important is that without employment growth, the economy stalls. It takes, on average, about 200,000 jobs each month to keep up with population growth, which ultimately keeps the economy growing. That is because, as discussed in last week’s #BullBearReport, the consumer comprises about 70% of economic growth. To wit:

“There is currently no evidence that the economy is slipping into a recession. However, if you want to know if an economic decline will evolve into a recession, there is one key factor to consider: consumer spending. Consumer spending comprises nearly 70% of the GDP calculation, and everything else, from business investment to imports and exports, is a function of the consumer’s “demand.” In other words, if the consumer is slowing down or contracting spending, businesses will not “invest” in expansion projects, increasing employment, or buying more products for resale. That relationship is shown in the chart below, which compares PCE to employment and private investment.”

However, most crucially, consumers can not consume without producing something first. Production must come first to generate the income needed for that consumption. The cycle is displayed below.

Here is the most critical point. Not all jobs are equal.

“For a household to consume at an economically sustainable rate, such requires full-time employment. These jobs provide higher wages, benefits, and health insurance to support a family. Part-time jobs do not.”

While the media touts the ‘strong employment reports,’ such is mostly the recovery of jobs lost during the economic shutdown. However, the reality is that the full-time employment rate is falling sharply. Historically, when the rate of change in full-time employment dropped below zero, the economy entered a recession.

Notably, given the surge in immigration into the U.S. over the last few years, the all-important ratio of those employed full-time relative to the population has dropped sharply. As noted, given that full-time employment provides the resources for excess consumption, that ratio should increase for the economy to continue growing strongly. However, full-time employment has decreased since the turn of the century as automation, technology, and offshoring have risen. While President Biden recently touted strong employment growth in his SOTU address, full-time employment as a percentage of the working-age population failed to recover to pre-pandemic levels.

Notably, sharp downturns in full-time employment have been coincident with recessionary onsets.

No Recession, But Slower Growth Coming

The latest employment data put to rest recession concerns, at least for now. Employment growth remains strong enough to support economic growth and quell concerns that CEOs are withdrawing from the job creation process. However, compensation continues to decline as economic demand slows.

As is always the case, as the economy slows down, employers begin to change the most costly aspect of any business – employment. Cutting full-time jobs is the most efficient way to protect earnings and profitability. However, employers tend to hang on to employees as long as possible, as good employees are expensive to train and hard to replace. Eventually, if the demand falls too much, full-time employees are sacrificed to protect profits. As such, a reasonably predictable cycle continues until exhaustion is reached.

While we are seeing declines in full-time employment as the economy slows, we are now also seeing cuts in temporary help, which, as shown, is consistent with slowing growth. The reason is that cutting temporary employment is the first step by business owners to reduce employment costs while hanging on to full-time, and mostly crucial, employees. However, as noted above, once temporary workers are exhausted, the next step will ultimately be full-time employees.

The latest employment data did not provide much support for the “recession” crowd in 2025. As such, Wall Street analysts are quickly reversing their recession calls for this year, and are becoming more focused on slowing economic growth. However, that assessment can certainly change promptly if personal consumption expenditures take a turn for the worse. As noted above, nearly 70% of economic growth is derived from consumption; therefore, if consumption declines, employment falls, reducing consumption and further employment declines. When it accelerates, that cycle is the foundation for recession outcomes.

Indicators We Are Watching

As noted, while the employment data is weak, there are certainly indicators we are watching closely to confirm whether “job loss” is accelerating. First, we pay attention to the Conference Board’s measure of CEO confidence. Since the October 2022 lows, CEO confidence has continued to improve, and as of Q1, it rose to 60 from 51 in Q4 of 2024. That confidence increased full-time employment as the outlook for economic growth was improving heading into 2025. However, this is a lagging indicator, and the results of the Q1 survey were taken in February before the market decline and tariff announcements. Later this month, we will get an update to see if sentiment has changed, which could give us clues about future employment reports.

The second indicator we are watching is the NFIB small business confidence index. Specically,.it is their “plans” to increase employment versus what they do. Notably, employment by small businesses, roughly 50% of the total employment in the U.S., has remained stagnant since the pandemic. However, small business owners were very optimistic about hiring post-pandemic, expecting sharp improvements in sales. However, that optimism is fading quickly.

The reason is that, as discussed at the opening of this discussion, employment is a function of the demand for goods and services that businesses supply. As shown, expectations for sales surged following President Trump’s election, but given that actual sales have failed to materialize, that optimism is fading rather quickly. Expectations for business owners are one thing, but without actual increases in sales, which drive revenue, there is little reason to increase full-time employment, which is why it has remained stuck at lower levels since 2020.

Conclusion

Given the importance of consumption in the economy and that employment (production) must come first in the cycle, attention to employment data, particularly full-time employment, is crucial to determining economic risk. The risk of a recession remains very low; however, that can change if something causes consumption to contract quickly. Aside from an unexpected, exogenous impact, investors should expect economic growth to continue to slowly weaken to a longer-term trend slightly less than 2% annually. Unfortunately, while not recessionary, that growth rate will make it hard for corporate profitability to remain at record levels.

Eventually, a valuation adjustment in the financial markets will reflect the reality of a slow-growth economy. However, that isn’t today. However, the risk of a decade of low returns as markets normalize for a slow-growth economy is steadily increasing.

Just something to consider.

Authored by Matthew Vadum via The Epoch Times,

Supreme Court Justice Sonia Sotomayor told a lawyers’ conference that amid escalating criticism in the nation of some federal judges, lawyers need to “stand up” and “fight this fight.”

Sotomayor made the comments during an on-stage conversation on May 8 at an American Bar Association conference at the Smithsonian Museum of African American History and Culture in Washington.

The remarks by Sotomayor came after President Donald Trump, members of his administration, and Republicans in Congress have repeatedly criticized court rulings in recent months that have blocked or delayed the president’s agenda. Trump and some lawmakers have accused some judges of overstepping their authority through such rulings and called for them to be impeached.

Several federal judges have said the Trump administration has not complied with various court orders on immigration enforcement, federal spending, the firing of government employees, and foreign aid. The administration denies that it disobeyed the orders.

Sotomayor did not identify Trump or other officeholders who have criticized judges’ rulings by name.

“Our job is to stand up for people who can’t do it themselves. And our job is to be the champion of lost causes,” said the associate justice who joined the Supreme Court in 2009 after being nominated by President Barack Obama.

“But right now, we can’t lose the battles we are facing. And we need trained and passionate and committed lawyers to fight this fight.”

“With all the uncertainty that exists at this moment, this is our time to stand up and be heard. For me, being here with you is an act of solidarity,” Sotomayor added.

Sotomayor also praised “diversity,” which she said “is important for its own sake because it inspires everyone to believe that it’s possible for them to be in a position to help others.”

“I am more grateful that in my role as a public servant, I can continue to serve all communities and represent America as the very best version of itself,” she said.

Sotomayor’s comments came after two of her colleagues on the high court had also recently made public statements directed at the criticism of judges.

On May 7, Chief Justice John Roberts said an independent judiciary was needed to check the power of the president and Congress.

Roberts did not mention Trump or other officeholders by name during his comments that came during a visit to his birthplace of Buffalo, New York.

Judicial independence is “the only real political-science innovation in our Constitution,” said Roberts, who became chief justice in 2005 after being nominated by President George W. Bush.

In the Constitution, “the judiciary is a co-equal branch of government, separate from the others, with the authority to interpret the Constitution as law and strike down ... acts of Congress or acts of the president,” he said.

“And that innovation doesn’t work if ... the judiciary is not independent. Its job is to ... check the excesses of Congress or of the executive, and that does require a degree of independence.”

Roberts also said, “impeachment is not how you register disagreement with [judicial] decisions.”

“That’s what we’re there for,” he said, in reference to the appeals process.

On May 1, Justice Ketanji Brown Jackson said that recent criticisms of judges are “attacks on our democracy.”

Jackson was apparently commenting on Trump’s rhetorical barrages against some judges, although she did not specifically mention the president during her speech and instead spoke about “the elephant in the room.”

“The attacks are not random. They seem designed to intimidate those of us who serve in this critical capacity,” Jackson said at a judicial conference in Puerto Rico.

“The threats and harassment are attacks on our democracy, on our system of government. And they ultimately risk undermining our Constitution and the rule of law.”

Jackson took her seat on the high court in June 2022 after being nominated by President Joe Biden.

Authored by James Rickards via DailyReckoning.com,

The battle between the Trump administration and the federal courts on the topic of deportation is intensifying.

The outlines are clear. Biden and his corrupt cronies left the U.S. southern border wide open for four years. Estimates vary but it’s likely 8 million illegal aliens crossed the border. But the actual number could be 10 million or higher. Of course, some just came for a better opportunity, but many were murderers, terrorists, rapists, sex traffickers, Chinese spies and every sort of violent low life you can imagine.

It’s nearly impossible to find and deport 8 million people. Biden made sure of that by ignoring the procedures for tracking and documenting the alien invasion. Trump’s policy of “remain in Mexico” while immigration cases were pending was abandoned by Biden. Many of the illegals got court dates, but those were scheduled years in advance. The expectation was that the court notices would be thrown in the trash, the illegals would not show up in court, and no enforcement action would be conducted.

Trump has launched a major deportation effort despite these handicaps. In any situation where you can accomplish part of the task but not all, the first move is to prioritize elements so you can devote resources to the best effect. Trump has done that also. He has prioritized the worst of the worst – criminals and terrorists – for early deportation. That reduces crime and violence in the U.S. and gives Immigration and Customs Enforcement (ICE) a chance to hone their techniques for the larger task ahead.

The New Obstacle – The Courts

Now, Trump has encountered a new obstacle. It’s not the illegals, the Democrats or the media. It’s the federal court system, especially rogue district court judges appointed by Biden and Obama. To be clear, the rogue judges don’t work in a vacuum. The plaintiffs are hand selected to create sympathy in the media (although there’s little sympathetic about a rapist) and are represented in court by lawyers backed by well-funded NGOs and activist organizations.

It’s not as if the illegals have the resources to appeal cases to the Supreme Court on their own. They don’t need them. From Soros on down, the fight against deportation is well-funded and skillfully lawyered. The lawyers present everything the judges need to tear down Trump’s agenda.

There are hundreds of cases involving thousands and potentially millions of illegal aliens now pending in the courts. Trump has been losing most of these cases at the district court level, but it’s reasonable to expect some success at the circuit court and Supreme Court levels. But that takes time.

Rather than review the docket case-by-case and issue-by-issue, it may be useful to step back and look at the forest instead of the individual trees. The radical neo-Marxist lawyers don’t care about the individual defendants. They don’t care about blocking individual deportations. They don’t even care about the law. What’s going on is far more pernicious and damaging to Trump and the country.

There’s a lot of talk about the Constitution, but a pure illegal does not have full constitutional rights. The courts have afforded them some limited rights such as freedom from torture and freedom of religion. The difficulty with the pending Trump deportation cases is that radical lawyers are concocting status arguments that allow the illegals to upgrade their status.

The Goal Is Not Justice – It’s Delay

This legal upgrade can be based on asylum claims, pending immigration court dates, and some blanket grants for temporary residence. Some illegals are married to legals, etc. Once you’re in one or more of those categories as a plaintiff, you receive more rights including due process and habeas corpus, even if not full constitutional rights.Alexjandro Mayorkas knew what he was doing when he opened the border under Biden. He wanted the illegals to have a one-way ticket and made it extremely difficult to deport any.

Here’s the point. What the left is trying to do is to create a set of rulings that will force Trump to litigate every single case. No mass deportations. No deals with foreign countries to take plane loads of illegals for incarceration in local prisons. Instead, each case will be heard individually. Each claim will be raised in a separate proceeding. Each due process argument will be heard in a separate trial.

This approach will do more than delay deportations. It will jam the court dockets. It will overwhelm the judicial branch. It will prevent the smooth functioning of a range of government functions.

Now imagine this technique expanded beyond deportation. You can apply this court-jamming massive litigation approach to the closing of government agencies, the termination of government employees, the cuts in government spending and the entire Trump agenda. Don’t just litigate. Grind the entire system to a halt. That’s the plan.

Do individual legal victories in certain cases help Trump? Not necessarily. The activist lawyers and their armies of illegals just file a new lawsuit in a different jurisdiction with slightly varied facts and start the process all over again. Is there any end to it?

Three Solutions To The Problem

One is for the Supreme Court to issue a definitive ruling that district courts cannot issue nationwide injunctions, can only issue orders for the plaintiffs in the case and not the entire class of illegals, and that the courts have almost no jurisdiction over the conduct of foreign policy. Those rulings would empower Trump’s deportation programs.

The second way is for Trump to ignore the courts and proceed as planned. Critics will scream this is “unconstitutional”, but it’s just as unconstitutional for courts to ignore their limitations and intrude on the power of the executive branch. It’s an outcome the courts will have brought upon themselves.

The third way is to abolish the district courts, or at least some of them. That’s not as radical as it sounds. The Constitution clearly gives Congress the power to structure the court system any way it likes with the exception of the Supreme Court. Congress created the district courts and Congress can abolish them as well.

If one of those three paths is not taken, then the left wins. In that case, the country loses. We already have four Supreme Court votes to support Trump’s program (Alito, Thomas, Gorsuch and Kavanaugh). It only takes one more vote to win. Roberts and Barrett are the two swing votes. Let’s hope they lean the right way when the crucial case arrives.

French media are on the defensive after journalists unexpectedly entered a train carriage carrying French President Emmanuel Macron, along with the German and British Prime Ministers, en route to Kyiv on Friday, which sparked a firestorm on social media with allegations of cocaine use by the top leaders.

"They [social media users] cite videos that allegedly show Emmanuel Macron discreetly hiding a strange white bag on the table," the French daily newspaper Libération said, adding, "And according to these accounts, Friedrich Merz even had a straw to use to take drugs. These conspiracy accusations fit with the narrative that Western elites are depraved and approach war unconsciously." 

When reporters entered the room, Macron was meeting with German Chancellor Friedrich Merz and UK Prime Minister Keir Starmer on a train ride from Poland to Ukraine. 

The video.

NEW: French media is shutting down social media rumors that French President Emmanuel Macron was caught with a bag of cocaine during a trip to Ukraine.

The moment was caught during a train ride from Poland to Ukraine when reporters entered the room.

Macron was meeting with the… pic.twitter.com/RMoKQ5VkUt

Libération rushed to the defense of Macron and the Western leaders:

Several internet users, sharing posts favorable to Vladimir Putin, have claimed that the three men had used cocaine together. "Coke will decide World War III," one of them feigned concern.

Libération even suggested:

High-quality photographs and videos, such as those taken by the AFP or AP news agencies , show that the mysterious bag of white powder is actually a handkerchief rolled into a ball that was placed on the table before Keir Starmer arrived and the cameras entered the booth, where Macron and Merz were already seated. The straw looks more like a stirrer or a toothpick, which the German chancellor is said to have been fiddling with. This explains why the two leaders do not want these objects immortalized in the images of the meeting.

Maybe Libération's defense of Macron and the other Western leaders is accurate — perhaps it really was just a 'handkerchief' and a 'toothpick.' But the real red flag is the leaders' abrupt and suspicious behavior as they scrambled to cover up whatever was on the table when journalists unexpectedly entered the train carriage. 

Cocaine allegations come as no surprise, considering the leaders were inbound to visit this guy... 

Zelensky is visibly high as hell on MSNBC…

How much longer are we going to let this clown show go on?

This man is coked out of his mind while getting asked about the war he is losing. This is the guy Congress wants to give another $60 billion of our money to… pic.twitter.com/K0m06ZvRE9

This song seems appropriate... 

Cocaine or no cocaine. The optics here are not good. 

*  *  *

Just a few hours before cutoff!

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Authored by Kevin Rusher via CoinTelegraph.com,

It’s a volatile world out there. This year, we’ve seen stocks take a wild ride as gold has pumped and crypto has been caught somewhere in the middle. Investors have dumped risk assets and scrambled for safe havens. Gold is leading the charge.

While gold is safe, it is not very hard-working. Unlike cash and treasuries, the yellow metal does not generate income. Now, more than ever, investors need to be able to earn yield on gold — particularly in the decentralized finance (DeFi) sector.

The only way to make money from gold is to buy low and sell high. Most investors don’t tend to buy gold like this. That’s for good reason — over the long term, gold’s performance is typically consistent, if not without a few peaks and troughs here and there, as we have recently seen.

For example, after the 2008 financial crisis, the price of gold soared 148% but stagnated for nearly a decade before the COVID-19 pandemic triggered another rally, and it's likely we will see gold hold, if not fall from it's new record high once markets revive. While it remains an excellent hedge, gold’s long-term track record is not a growth story.

Investors prefer US Treasurys or high-yield savings accounts as part of a balanced portfolio. While gold may outperform these assets in uncertain times, it offers a better balance of security and predictable income over the long term. 

The DeFi solution 

This is where DeFi brings innovation to the world’s oldest asset. DeFi can significantly modernize gold investing, offering the speed and transparency of blockchain-based transactions and the ability to earn returns.

Currently, though, most tokenized gold is much the same as holding it in an exchange-traded fund (ETF). Stablecoin giants like Tether and Paxos have launched gold-backed tokens, which they say are fully backed by physical, audited gold reserves, yet offer no yield.

Most DeFi investors prefer liquid, tradable assets like cryptocurrencies and stablecoins, which can generate attractive returns. Many would rather, for example, buy Tether’s USDt stablecoin and stake it, earning rewards while still maintaining ownership.

Perhaps this is why the market capitalization of gold-backed tokens remains modest. Tether Gold, the world’s most significant gold token, has a market capitalization of just under $835 million, for example, while Paxos Gold sits at around $799 million. Combined, this is equivalent to just 1% of the market cap of USDT. 

Unlocking income from the world’s oldest asset 

To unlock gold’s full potential, we need to take tokenization a step further by creating a DeFi ecosystem where tokenized gold is actively put to work — borrowed, lent and integrated into yield-bearing strategies.

One possibility is for companies such as gold miners is to issue tokenized versions of their reserves that can be turned into stablecoins that can then be staked to earn a yield. Leveraging protocols whose liquidity mechanisms enable the trading of stablecoins and real-world asset (RWA) tokens, holders could take advantage of further yield opportunities throughout the DeFi ecosystem.

Beyond the benefits of yield opportunities, blockchain technology means investors in tokenized gold can benefit from the flexibility of 24-hour trading, near real-time price discovery and near-instant settlement without compromising the stability of the asset. 

The future of gold investing

It is, perhaps, ironic that — just as governments worldwide are starting to put their stamp of approval on digital finance — gold is becoming a highly desirable commodity again. The public’s interest in it will grow as governments essentially ratify digital finance. At the same time, the appetite for gold in these uncertain times will also increase. 

DeFi could bring these trends together and kickstart a natural evolution in gold ownership that provides a solid bridge between traditional and digital finance. While gold inside traditional markets attracts investors looking for stability, DeFi brings opportunities that don’t compromise that stability, as it presents new and unique yield opportunities. 

Gold has captivated humanity for thousands of years. It’s the foundation of myths, the standard of wealth and the ultimate hedge against uncertainty. But in today’s financial world, it needs an upgrade.

Through integrating gold into the DeFi ecosystem, we could unlock its true potential — not just as a store of value but as an income-generating asset. The world’s oldest safe haven asset is finally on the brink of a digital evolution.

By Ted Dabrowski of Wirepoints

Illinois and Chicago politicians have made a mess of opportunities for blacks in Chicago. In preparation for my Chicago Tonight’s Black Voices appearance last week – more on that later – I pulled together several key facts on how Chicago blacks were fairing vs. the nation’s other big cities. The data, straight from the U.S. Census or the U.S. Bureau of Economic Analysis, is dismal.

Chicago is stuck in a vicious spiral, where too much spending has led to too much debt, including massive pension debts. Taxes, as a result, have become increasingly punitive. Pile on top of that failing schools and crime, and that’s chased out people and businesses, driving down job creation and investment. Based on the data, minorities are paying a big price relative to their peers in other big cities.

At the core of Chicago’s failure is a lack of economic growth. The metro area’s GDP, after adjusting for inflation, has grown only 4% since 2019. That’s the worst economic growth among the nation’s 15 largest metro areas. 

It’s quite the opposite for cities with pro-growth, pro-business policies. The economies of booming metros like Dallas, Seattle, Miami and Phoenix have all grown 17% or more. That’s more than four times the growth rate of Chicago.

Unsurprisingly, jobs are a problem. At 12.3%, Chicago’s black unemployment rate was the highest among the nation’s 15 biggest cities, according to the latest data from the U.S. Census Bureau.

Jacksonville’s black jobless rate was half that of Chicago’s, and Charlotte’s was just a third.

A less dynamic economy also means lower paying jobs. The median income for black households in Chicago is just $44,413 after adjusting for cost of living. That’s the third-lowest amount among big cities.

Chicago’s black poverty rate also leads among the nation’s 15 biggest cities. Over 26% of black Chicagoans are below the poverty line – nearly 200,000 people.

And then there’s government dependency. Nearly 57% of black Chicagoans are enrolled in the food stamp program SNAP – the 3rd-highest percentage among America’s 15 big cities.

Despite the above, my fellow panelists on the Chicago Tonight show called for even more spending and tax hikes in the 2026 Illinois budget in the name of supporting the black community. 

One panelist laid out a long string of programmatic spending he wanted to see, including money for schools and healthcare and early childhood and transit funding. The other panelist laid out how to pay for it. A CTBA staffer, she called for a 1.5 percentage point hike in Illinois’ personal income tax rate to 6.45%, and if not that, then an expansion in the sales taxes to include services. A link to the segment is here. 

If I’m generous about their ideas, yes, tax increases in the short term can generate more money for more social programs. But more spending and tax hikes will only exacerbate the downward spiral Chicago is already in, creating even more dependency.

Chicagoans need the opposite. Instead of more spending and the tax hikes that go with it, lawmakers need to obsess about jobs, investment and economic growth. 

Businesses and investment will only return when lawmakers tackle what makes the city so costly. Its massive $53 billion in pension debts need major reform. Chicago Public Schools can bring down its $30,000 per student spend by closing near-empty schools and cutting back on its bloated bureaucracy. The city’s transit agencies need to stop running near-empty trains and buses and instead right-size their operations. And the public unions, in particular the teachers union, need to be de-powered. 

The problem is that our current leaders wear as a badge of pride how many people they can get on Medicaid and food stamps. They ignore the fact that people, no matter their color, can’t thrive without good jobs and good pay.

Illinois needs a new set of lawmakers that will prioritize economic growth over government dependency.

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President Donald Trump said late on Saturday that "great progress" was being made in ongoing U.S.-China talks over tariffs menacing the global economy, and even suggested a “total reset" was on the table as tariff negotiations are set to continue Sunday in Switzerland.

No major breakthrough was announced in discussions that lasted over 10 hours between U.S. officials, including Treasury Secretary Scott Bessent, U.S. Trade Representative Jamieson Greer, and a delegation led by Chinese Vice Premier He Lifeng. Still, Trump struck an upbeat tone.

“A very good meeting today with China, in Switzerland. Many things discussed, much agreed to. A total reset negotiated in a friendly, but constructive, manner,” the president wrote on his Truth Social platform. “We want to see, for the good of both China and the U.S., an opening up of China to American business. GREAT PROGRESS MADE!!!”

He gave no further details, and officials at the White House also offered little information during and after the opening day of discussions.

Trump's post followed reports that talks would continue Sunday, after extending late into the day on Saturday. Talks have been shrouded in secrecy, and neither side made comments to reporters as they left.

Several convoys of black vehicles left the residence of the Swiss ambassador to the UN in Geneva, which hosted the talks aimed at de-escalating trade tensions between the world’s two biggest economies. Diplomats from both sides also confirmed that the talks took place.

The opening day of negotiations were held in the sumptuous 18th-century “Villa Saladin” overlooking Lake Geneva. The former estate was bequeathed to the Swiss state in 1973, according to the Geneva government.

The Chinese delegation has left for the trade talks with the U.S. to be held today and tomorrow in Geneva in a bid to deescalate tensions, triggered by U.S. tariff wars. pic.twitter.com/eMS1cubnCJ

Trump's assessment aside, while prospects for a major breakthrough appeared dim when the talks opened there is hope that the two countries will scale back the tariffs they have slapped on each other’s goods, a move that would relieve world financial markets and companies on both sides of the Pacific Ocean that depend on US-China trade.

Trump last month raised U.S. tariffs on China to a combined 145%, and China retaliated by hitting American imports with a 125% levy. Tariffs that high essentially amount to the countries’ boycotting each other’s products, disrupting trade that last year topped $660 billion.

And even before talks got underway, Trump suggested Friday that the U.S. could lower its tariffs on China, saying in a Truth Social post that “ 80% Tariff seems right! Up to Scott″ Bessent.

Sun Yun, director of the China program at the Stimson Center, noted it will be the first time He and Bessent have talked. She doubts the Geneva meeting will produce any substantive results: “the best scenario is for the two sides to agree to de-escalate on the ... tariffs at the same time,” she said, adding even a small reduction would send a positive signal. “It cannot just be words.”

Goldman Sachs expects both sides to cut tariffs by more than half when negotiations are over.

Since returning to the White House in January, Trump has aggressively used tariffs as his favorite economic weapon. He has imposed a 10% tax on imports from almost every country in the world.

But the fight with China has been the most intense. His tariffs on China include a 20% charge meant to pressure Beijing into doing more to stop the flow of the synthetic opioid fentanyl into the United States.

The remaining 125% involve a dispute that dates back to Trump’s first term and comes atop tariffs he levied on China back then, which means the total tariffs on some Chinese goods can exceed 145%.

Total US tariffs on Asian countries in context are shown below.

During Trump's first term, the U.S. alleged that China uses unfair tactics to give itself an edge in advanced technologies such as quantum computing and driverless cars. These include forcing U.S. and other foreign companies to hand over trade secrets in exchange for access to the Chinese market; using government money to subsidize domestic tech firms; and outright theft of sensitive technologies.

Those issues were never fully resolved. After nearly two years of negotiation, the United States and China reached a so-called Phase One agreement in January 2020. The US agreed then not to go ahead with even higher tariffs on China, and Beijing agreed to buy more American products. The tough issues - such as China’s subsidies - were left for future negotiations.

But China didn’t come through with the promised purchases, partly because COVID-19 disrupted global commerce just after the Phase One truce was announced. As a result, America's trade deficit with China came to a staggering $263 billion last year.

The fight over China's tech policy now resumes.

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