Private blog posts are exclusively available to Socrates subscribers. To sign-up for Socrates or to learn more, please visit Ask-Socrates.com.
COMMENT: Marty, I have now heard it all. When I asked why the stock market crashed, I was not told it was tariffs. I was told that “Armstrong told his clients there would be a Panic at the end of March to the first week of April. All the huge wealth funds are Armstrong’s clients.” I guess they flipped a coin. Heads, Trump did it; tails, Armstrong did it. I don’t think you will ever escape blame.
We need another WEC, ASAP.
Joe
REPLY: Look, the computer from the start of this year pointed to the last week of March and the first week of April. That was well before the tariff announcement. Trump’s tariffs are opening doors, not closing them. Maybe the smart ones figured that out and turned to me. These people can blame me as always. I think the difference this time is that we have opened Socrates so the entire world can see it. BTW, while Tucker is blocked in China, we are not. Everyone knows this is not my personal opinion.
This is the ONLY fully functioning AI computer with over a 40-year track record. I have often heard that they may not do what we forecast, but they certainly do not want to be on the opposite side. We warned that the AI stocks had peaked. They just got overdone at the start of this year. The computer projected this crash, for as Maggie once said, It’s Just Time.
US/AMERICAS:
US Market Closings:
Canada Market Closings:
Brazil Market Closing:
I have said on various podcasts that a 10% tariff is really a tariff. Beyond that, it is political to force free trade. Most countries are dropping tariffs on US goods, creating what Trump actually was trying to create – FREE TRADE. The beligerent one is, of course, France. Macron has a Napoleon Complex, which is why he has been pushing for war, offering nukes to Germany, and trying to supplant the United States as the savior of Europe, being the 3rd largest nuclear power.
“The tariffs give us great power to negotiate. They always have,” Trump told reporters Thursday aboard Air Force One a day after his Rose Garden “Liberation Day” tariff announcement sunk the market to its lowest point since the COVID-19 pandemic.
I have received many inquiries about the US Reciprocal Tariffs announced on April 2, 2025. The justification for these tariffs can be found in President Trump’s Executive Order, which may be found here. I am not an expert in tariff law. Nonetheless, parts of the Executive Order are open to interpretation by experts, and the end result remains fluid from one day to the next right now. Therefore, it is important to consult with a customs broker before importing or exporting to the US. It is always a matter of interpretation.
Macron is beligerant and, like Carney in Canada and Democrats in the USA, whatever Trump does, he must do the opposite. Macron, according to sources, is urging fill retaliation against the Trump that the EU should block all US goods and push for capital controls to prevent money from flowing to the US. He already uses non-tariffs pretending it to be “quality” control outright blocking some products.
However, Macron is also pushing for war with Russia, offering Germany nukes to replace the US as the savior of Europe. He thinks war will elevate France to the leadership of Europe because of its nukes. Macron has always had a problem with sparkling wines in California being labelled Champagne. The French reinterpreted the label “Champagne” to be the origin rather than how it is produced. Champagne, made in France, is produced using the méthode champenoise. If that bottle is produced using the exact same method, anywhere else, it must carry a different name, but that was part of the Treaty after World War II, and it was meant to punish Germany. But the US never ratified that treaty, so it never applied to the United States.
Sparkling wines have been produced in California since about 1860, and they were introduced by European immigrants, including those from France. Since then, the term Champagne has been used to refer to the type of wine, not where it was made. Here is an advertisement from 1866 offering North American-produced Champagne. Macron does not care how it is made; he wants to redefine the word “Champagne” to mean France as the area where it is produced rather than the type. This is just an example of dealing with the EU.
First, keep in mind that these tariffs, broad as they are, are being levied under the President’s “Emergency Powers.” This means that the usual statutory exemptions for antiques and other collectibles, which are referenced in the HTS Codes, may not seem to apply, depending on who does the interpretation. Does this executive order overrule the statutory exemptions covering antiquities when, in fact, the purpose of the tariffs focuses on currently manufactured goods, not antiquities of more than 100 years old?
While executive orders are powerful tools for presidential action, they cannot override statutes. In cases of conflict, statutes prevail unless the executive order operates within constitutional or delegated authority. Courts serve as the ultimate arbiter, ensuring adherence to the separation of powers.
So what does it mean for antiquities? According to Section 2 of the Executive Order,
The additional ad valorem duty on all imports from all trading partners shall start at 10 percent, and shortly thereafter, the additional ad valorem duty shall increase for trading partners enumerated in Annex I to this order at the rates set forth in Annex I to this order. These additional ad valorem duties shall apply until I determine that the underlying conditions described above are satisfied, resolved, or mitigated. However, since an executive order cannot act unconstitutionally, it should not be interpreted as overruling a valid statute defining the exemption.
Moreover, according to Section 3,
a ) Except as otherwise provided in this order, all articles imported into the customs territory of the United States shall be, consistent with law, subject to an additional ad valorem rate of duty of 10 percent. Such rates of duty shall apply with respect to goods entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. eastern daylight time on April 5, 2025, except that goods loaded onto a vessel at the port of loading and in transit on the final mode of transit before 12:01 a.m. eastern daylight time on April 5, 2025, and entered for consumption or withdrawn from warehouse for consumption after 12:01 a.m. eastern daylight time on April 5, 2025, shall not be subject to such additional duty.
Furthermore, except as otherwise provided in this order, at 12:01 a.m. eastern daylight time on April 9, 2025, all articles from trading partners enumerated in Annex I to this order imported into the customs territory of the United States shall be, consistent with law, subject to the country-specific ad valorem rates of duty specified in Annex I to this order. Such rates of duty shall apply with respect to goods entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. eastern daylight time on April 9, 2025, except that goods loaded onto a vessel at the port of loading and in transit on the final mode of transit before 12:01 a.m. eastern daylight time on April 9, 2025, and entered for consumption or withdrawn from warehouse for consumption after 12:01 a.m. eastern daylight time on April 9, 2025, shall not be subject to these country-specific ad valorem rates of duty set forth in Annex I to this order. These country-specific ad valorem rates of duty shall apply to all articles imported pursuant to the terms of all existing U.S. trade agreements, except as provided below.
https://www.whitehouse.gov/wp-content/uploads/2025/04/Annex-I.pdf
Therefore, under Section 3 (b) (v) of the Executive Order, it is suggested that things like antiquities should be exempt under the Executive Order because they are generally exempt from tariffs under the Harmonized Tariff schedule. Furthermore, there is a statutory exemption for “informational” materials under 15 USC 1702(b). While this certainly applies to artwork and our reports, informational materials are exempt. Additionally, I should note that, for the time being at least, there is a separate exemption for low-value shipments under $800 under 19 USC 1321, which an executive order cannot nullify.
How did the Trump Administration come up with these tariff rates? Why would a nation like Madagascar, for example, with a small economy, be hit with a 47% tariff? Reciprocal tariffs were determined based on America’s trade deficit with other nations. They took each nation’s trade surplus with the US by total exports and divided that number by two, proclaiming we are asking them for half of what they have been charging the United States.
The assumption behind this method is that a trade surplus means one country is “taking advantage” of the other. However, trade imbalances do not function in such a cut-and-dry manner. The US runs trade deficits with some countries while running surpluses with others. The global economy is interconnected, and imposing arbitrary tariffs based on a deficit does not reflect the broader picture.
For example, China may have a surplus with the US, but it also imports raw materials from other nations to manufacture goods. If the US places a retaliatory tariff, it does not necessarily mean that China has been unfairly charging the US. China’s advantages of natural resources and lower production costs is part of the trade deal. There is a reason the US and China were one the largest trading partners, as China relied on American consumers the same way that America relied on cheaper Chinese goods. China was then investing in US debt, which it once viewed as a safe trade, but that is no longer the case, and America will suffer as a result. All of these measures are causing America’s trading partners to flee.
Look at Canada, where the population is far smaller than America’s, which is one of many variables. There is less demand overall and while Canada relied on the US for numerous imports, America was not subsidizing Canada. A trade deficit is not a subsidy! The US pays for Canadian goods and services with USD, which Canada then reinvests in the US economy. This is how global trade works; it is not a one-way street where Canada simply takes advantage of the US.
We cannot expect a complete balance in trading. Look at poorer nations—they simply could never purchase the same volume from America. Wages in these nations are far less than the US minimum wage, and thus, production is cheaper from a labor standpoint alone. For example, no one from Cambodia will be seeking an American-made car. A Cambodian factory will not move operations to the US to avoid the 49% tariff. They will look for alternative buyers outside of the US. Imbalances are a natural part of trade. Treasury Secretary Bessent said, “Let them eat flat screens,” but that is not the core of the issue. Americans did enjoy cheaper goods, but the bigger issue is that these tariffs make American investments LESS attractive as major companies cannot operate from a purely domestic standpoint.
The calculations do not factor in currency exchanges. Capital flows and currency values often influence trade deficits. If foreign capital flows into the US to buy Treasury bonds, real estate, or equities, it strengthens the USD, making US exports more expensive and imports cheaper. This is not a function of unfair trade practices but of the global demand for US assets.
By imposing tariffs arbitrarily, the cost of imported goods rises, which can negatively impact domestic industries who rely on those goods. Most American manufacturers rely on foreign goods to operate or finalize their “Made in America” products. Hiking up tariffs will cause the cost of production to soar. The workforce will shrink as profits decrease. Consumers bear the brunt of these policies through higher prices.
The assumption that tariffs should be determined by “half of the surplus” rule ignores the reality that trade wars are not linear. These tariffs are NOT “reciprocal” as the Trump Administration insists. They are not looking at the actual tariffs set by other nations. Those advising Trump believe that other countries will want to negotiate “tariffs” to permit free trade, but instead they are simply hoping to close trade deficits, and that simply cannot occur. Thursday’s sell-off is indicative of capital flowing out of the US. The Trump Administration basically told the world that America is closed for international business, and capital is responding to the threat. The real impact of these tariffs will soon come as we move deeper into a period of stagflation.
New York City Mayor Eric Adams, the man who fought tooth and nail to maintain sanctuary city status for migrants, has abandoned the Democratic Party. The Democrats have become so deeply unpopular that even Adams does not want to run for mayor under the DNC umbrella of madness.
“People often say, ‘You don’t sound like a Democrat, and you seem to have left the party.’ No, the party left me, and it left working-class people,” Adams touted. “We stopped talking to everyday New Yorkers and Americans. When I’m in the street talking to them, they’re not asking me, ‘Eric, tell me about fascism.’ They’re talking about finance. They’re not talking about Hitler, they’re talking about housing.”
Precisely. The people care about the ECONOMY first and foremost. Adams saw how quickly the law could turn against him when he faced his own inditement charges for bribery, wire fraud, and conspiracy. A right-wing Trump-appointed judge fought to drop his case, arguing it would interfere with his election campaign. Then a left-wing installed judge, Judge Dale Ho, insisted the charges remain in place as they felt the dismissal was “politically motivated” and would lead Adams to support Trump. The judge later dismissed the case with prejudice. Adams maintains his innocence and says he “trusted the wrong people” in his own party. As soon as he felt the injustice of New York’s legal system, Adams changed his stance on the Democratic Party dramatically.
This is the same man who once said, “New York is a city that shares Democratic values.” That was before Eric Adams saw the repercussions of progressive policies firsthand when his city became overrun with migrants and crime. Retailers were losing over $12 million daily in NYC due to looters not being arrested under light-on-crime blue policies. Housing is entirely unaffordable. Businesses are fleeing New York due to excessive taxation. Even Wall Street has begun to migrate to Miami since conducting business in New York is nearly impossible.
Adams expressed his concerns regarding the migrant crisis, unable to decipher why simple policies like deporting criminals were controversial. “The mere fact that we cannot share with ICE that this person has committed three robberies and this person is part of an organized gang crew; there mere fact we can’t say that and communicate, that is a problem for me,” Adams said, adding, “I don’t believe people who are violent in our city and commit repeated crimes should have the privilege of being in our city.” How is this controversial?”
Adams repeatedly told the media that his Democratic friends in Washington refused to take his calls. “I was told to ‘be a good Democrat’ when I criticized Biden’s handling of the crisis. We were getting Venezuelan gang leaders that were coming to the city, creating crimes,” Adams later admitted.
Environmental madness began spreading to New York as well. Restaurants and businesses were told to prepare to reduce emissions by 75%. This meant restaurants in business for over 100 years would be forced to change their coal and wooden oven methods, eliminating the city’s culinary destination tourism. New York state approved a ban on gas stoves under a $229 BILLION budget plan to combat nature. Building codes have been changed to bend to these climate initiatives. None of these progressive policies has helped the people of New York and has done far more harm than good.
“I firmly believe that this city is better served by truly independent leadership, not leaders pulled at by the extremists on the far left or the far right, but instead those rooted in the common middle, the place where the vast majority of New Yorkers are firmly planted,” Adams said. The media is now demonizing Adams, stating that he is attempting to align himself with Trump. That is the only issue the Democrats can align on—demonizing Trump as Hitler and writing off anyone who does not view him as an enemy. The Democratic Party is dying a slow death by its own hands and will eventually cease to exist.
QUESTION: I take it you agree with Putin that Zelensky is not legitimate and that Trump is wrong. Would you care to explain your position?
WG
ANSWER: I believe that Trump is being fed bad info regarding Ukraine, NATO, and Europe. Putin is absolutely correct, and Trump is dead wrong. No peace deal will ever be achieved as long as Zelensky’s dictatorship remains in place.
Boris Johnson ran to Kiev 3 days before the rare earth deal that was supposed to be signed in Kiev. Borris instructed Zelensky to insist on going to the White House, and the plan was to embarrass Trump on national TV to force him to fund the war. I passed on that info from my Ukrainian sources. That is why it appeared that Trump was prepared for the scheme. They always send Borris in to dictate to Zelensky. There was a peace deal, and it was Borris who flew to Kiev to inform Zelensky he was not allowed to sign any peace deal.
Zelensky is a piece of shit and that degrades shit because it is worse than that. He is a total fraud, and Putin is absolutely right: Zelensky is not the legitimate leader of Ukraine. Nobody in WWI or WWII used martial law to prevent elections. He is doing so because he is a fraud, and he would lose. The Ukrainian people voted for him because he promised peace when the previous government invaded the Donbas on the orders of Victoria Nuland et el and began this civil war to lure in Putin. The death toll when Zelensky took office was 13,000. It is now 1.1 million Ukrainians, and more than 8 million have fled to Europe because of him.
The day before Russia crossed the border, Zelensky declared he would rearm with nuclear weapons pointed at Russia. That was to make sure he would cross the border.
The Washington Post discovered that Zelensky KNEW when Russia would cross the border. They asked him WHY he did not warn his people, and he said it would have cost him $7 billion.
This latest attempt to renegotiate the deal to include NATO is to wage World War III and to invade Russia. He is taking his orders from the Neocons. Putin is absolutely correct. There will be no peace as long as this war criminal is in power.
There is only one way out of this mess. Putin should give the Ukrainian people 30 days to vacate Kiev and inform them that he intends to nuke the city and end Kiev once and for all. Europe will then threaten to nuke Moscow, and Putin will target every European city. Maybe then, the Western Press will stop the propaganda and demand peace. This is going to take Europe backing down and for the people to rise up and get rid of these insane leaders like Kaja Kallas and Merz, along with Starmer and Macron. These are the people behind the curtain telling Zelensky to resist Trump because they want to invade Russia. Perhaps then the military in Ukraine will turn on Zelensky and allow a real election by the people.
Zelensky has done nothing but try to drag the entire world into his war against Russia. And for what? A territorial grab where Ukrainians have never lived? Any politician who supports Ukraine and this deliberate attempt to create World War III should be barred from ever holding any public office, including a dog catcher or a sanitation worker cleaning toilets.
–
This guy is not interested in peace. Putin is right. My Ukrainian sources have said that if he were on fire, they would not urinate on him until he was dead. Trump is pissing in the wind. Wake the hell up. The enemy is both within and in Europe.
US/AMERICAS:
US Market Closings:
Canada Market Closings:
Brazil Market Closing:
Tariff concerns have heightened to such an extreme level that China and Japan are discussing deepening ties. Donald Trump may be awarded a Nobel Peace Prize for that one. Japan and China, along with South Korea, held their first trade discussions in half a decade where they agreed to navigate US tariffs.
One of the aspects that made the US economy great was consumerism. Other nations lined up for the opportunity to sell goods to US citizens. But now that tariffs will heavily impact the price of goods, nations are looking for new buyers.
The Regional Comprehensive Economic Partnership (RCEP) went into effect in 2022 to lower trade barriers between 15 Asian nations. However, ongoing tensions have caused the partnership to reach a stalemate of sorts. The alliance includes 10 ASEAN members (Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand, Vietnam) and five regional partners (Australia, China, Japan, New Zealand, South Korea). India withdrew from the alliance but the option to rejoin is on the table. This bloc covers 30% of GLOBAL GDP and includes 30% of the world’s population or 2.2 billion people.
“It is necessary to strengthen the implementation of RCEP, in which all three countries have participated, and to create a framework for expanding trade cooperation among the three countries through Korea-China-Japan FTA negotiations,” said South Korean Trade Minister Ahn Duk-geun, referring to the Regional Comprehensive Economic Partnership.
“The three countries exchanged views on the global trade environment, and as you can see in the joint statement, they shared their understanding of the need to continue economic and trade cooperation,” the South Korean trade ministry spokesperson said.
Breaking down America’s trade with these three nations alone:
China exported $143.5 billion in goods to the US in 2024, down 2.9% from the year prior. The US imported $438.9 billion to China, up 2.8% form the year prior. The nations have a $295.4 billion trade deficit, a 5.8% YoY increase. The top US imports were electrical equipment ($127.1 billion), machinery ($85.1 billion), and toys/games ($32 billion).
Japan exported $79.7 billion in goods to the US in 2024, up 5.4% from 2023. The US imported $148 billion to Japan last year, up 0.7% YoY. The trade deficit between the two nations fell by 4.3% on an annual basis to $68 billion. The top US imports were vehicles ($45.4 billion), machinery ($26.5 billion), and electronics ($20.7 billion).
South Korea imported %127.8 billion to the US in 2024, up 10.5% from 2023. US imports to South Korea totaled $135.5 billion. The two nations have an estimated $7.7 trade deficit. The top US imports were vehicles ($45.4 billion), machinery ($26.5 billion), and electronics ($20.7 billion).
Note that autos/vehicles account for a substantial portion of US trade with South Korea and Japan. China’s auto sector has been rapidly expanding. The government has been providing mass subsidies to manufacturers and China already has the materials needed to create vehicles without any reliance on the US or West.
Technology was reportedly in the spotlight during discussions. China is willing to import semiconductor raw materials to Japan and South Korea. Japan and South Korea are willing to sell chip products to China.
Now the RCEP was expected to add $186 billion to the global economy before the US announced tariffs. Again, this alliance accounts for 30% of the global population. China’s middle class continues to grow and nations are now realizing that there are buyers outside the US. America will lose its spot as the financial capital of the world to China, as the computer has been predicting, once the world begins lining up to sell goods to China instead.
