Mike's Minute: Tariff backdown is a big win for NZ Inc.

Big win for NZ Inc. and a lesson for everyone who doesn’t understand tariffs. Donald Trump has cut tariffs on beef and the beneficiaries are largely New Zealand, Australia and Brazil. Brazil has had a 50% tariff so they will be thrilled. We are at 15% and it's 10% for Australia. We may not benefit as much but given we are “balling”, as they say anyway, anything that gives us a chance to sell more has got to be welcome. The latest figures show that we have had a fall off in volumes of beef to the U.S. What's helping us is the value. Volume is one thing, value is another. If the value offsets the volume you are still winning. Of course if the world only understood the true value of a tariff-free environment we would all be better off. But that debate seems, for now, to be losing ground globally as more and more economies retrench. Anyway, the reason Trump moved is because he is in trouble. He is in trouble on a lot of things and unless the tide turns this time next year in the midterms it's all going to come home to roost, and the Republicans will lose their ascendency, and if that happens, they will turn on the president and the latter part of the president's term will be what they call a "lame duck". In some respects it's been a surprise that his line of abstract economics has lasted so long. There is nothing particularly complex about tariffs, and to be fair to Trump, if China charges you 30% on something then a reciprocal tariff is not out of order. But the “slap them all” approach he used on a place like New Zealand and Australia, not to mention Switzerland that only just got sorted over the weekend, was bizarre, if not completely nuts. All that crap about importers and countries paying tariffs was never real and as Americans lined up at the butchers to pay more for New Zealand beef they got angry, and they got angry to the point trump has had to acquiesce So the tariffs fall and places like NZ Inc. cash in. It's good to be on the right side of the argument. LISTEN ABOVESee omnystudio.com/listener for privacy information.