Latest / The Paul Barron Crypto Show / Tariffs Over?🚀China Deal Surprises Markets!📈
Transcript
- 0:06Speaker 1: The China tariffs now look like they might be over.
- 0:08Speaker 1: Of course, all of this is going to break down today.
- 0:10Speaker 1: We'll give you the details and what this is going
- 0:12Speaker 1: to do to the crypto markets. My name is Paul Barrow.
- 0:14Speaker 1: Welcome back into tech path. Let's get started. Coinbase is
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- 0:41Speaker 1: down below to get started. Let's go a couple into
- 0:44Speaker 1: the headlines, and of course, the biggest headline over the weekend,
- 0:47Speaker 1: as we started to see ethereum and bitcoin both move
- 0:51Speaker 1: is the United States is now cutting tariffs on the
- 0:53Speaker 1: Chinese goods from one hundred and forty five percent to
- 0:56Speaker 1: thirty percent for ninety days.
- 1:00Speaker 2: Now.
- 1:00Speaker 1: If you look at that, because remember it's been like
- 1:02Speaker 1: forty five percent as a standard, the fact that they
- 1:05Speaker 1: went down to thirty percent tells me a lot. What
- 1:08Speaker 1: that does for the Chinese if you're on the other
- 1:10Speaker 1: side of the negotiation table is it tells you that
- 1:13Speaker 1: the other party is serious about getting a deal done.
- 1:16Speaker 1: They're willing to forego a little bit of gain to
- 1:20Speaker 1: be able to push that. And what is what happens
- 1:23Speaker 1: with that, Well, China lowered its tariffs on the US
- 1:27Speaker 1: from one hundred and twenty five percent down to ten
- 1:30Speaker 1: percent in ninety days. Over the next ninety days, so
- 1:33Speaker 1: all of this has been very good. This will be
- 1:35Speaker 1: very good I think for the markets in general, and
- 1:37Speaker 1: I think it's also going to have maybe some effects
- 1:40Speaker 1: around how the market responds, not only in the crypto
- 1:43Speaker 1: side of things, but within securities as well as maybe
- 1:47Speaker 1: avoiding a recession. I want to go to this clip
- 1:49Speaker 1: real quick with Scott Besstt. He kind of explains it all.
- 1:52Speaker 3: Take a look, we have the two largest economies in
- 1:55Speaker 3: the world. We were firm and we move forward. We
- 2:00Speaker 3: tried to identify shared interest. We came with a list
- 2:05Speaker 3: of problems that we were trying to solve and I
- 2:08Speaker 3: think we did a good job on that. And again,
- 2:12Speaker 3: this is a ninety day, paulse the April second tariff
- 2:16Speaker 3: level for China was thirty four percent, so we have
- 2:21Speaker 3: moved that down from thirty four to ten. We still
- 2:25Speaker 3: have the twenty percent fentanyl tariffs that were put on
- 2:30Speaker 3: in February, so we just in twenty twenty five we
- 2:35Speaker 3: have added thirty percent. And again one of the most
- 2:39Speaker 3: important things that we're doing. We do not want a
- 2:42Speaker 3: generalized decoupling from China, but what we do want is
- 2:46Speaker 3: a decoupling for strategic necessities.
- 2:51Speaker 1: All right, So a lot of what Bessen is going
- 2:53Speaker 1: at is that there is a bigger strategy that has
- 2:56Speaker 1: been at play here by the Trump administration. The interesting
- 3:00Speaker 1: point is that China is willing to negotiate. And of
- 3:03Speaker 1: course all of this goes down to one key thing,
- 3:07Speaker 1: and that is, how do we as the United States
- 3:10Speaker 1: companies and services get a chance to actually transact over
- 3:15Speaker 1: in China. Well, Trump says China will open up to
- 3:18Speaker 1: US businesses, this will suspend trade barriers, this will be
- 3:21Speaker 1: a big deal. And he kind of points that this
- 3:23Speaker 1: may be the most important thing right there that could
- 3:27Speaker 1: come out of this. And I would agree that if
- 3:29Speaker 1: China does open up to give at least the market
- 3:32Speaker 1: a chance to do some business in China. Then it's
- 3:35Speaker 1: going to do two things and Beson has talked about
- 3:38Speaker 1: this before. It's going to create consumption, which is going
- 3:40Speaker 1: to help the Chinese economy, and it's going to create
- 3:45Speaker 1: value and benefits for American make goods. That is something
- 3:49Speaker 1: that has never happened, at least in our lifetime. So
- 3:53Speaker 1: this could be a big leap forward with this agreement.
- 3:57Speaker 1: But I want to get into the point that Trump
- 3:59Speaker 1: is making around the importance of what we might get
- 4:02Speaker 1: in terms of open trade. Take a look.
- 4:05Speaker 4: The biggest thing that we're discussing is the opening up China,
- 4:08Speaker 4: and they've agreed to do that. But it's going to
- 4:10Speaker 4: take a while to paper it. You know, that's not
- 4:14Speaker 4: the easiest thing to paper because if you think about it,
- 4:16Speaker 4: we opened up our country to China, they we don't,
- 4:20Speaker 4: I mean, have very few restrictions, and they didn't open
- 4:23Speaker 4: their country to us. Never made sense to me. It's
- 4:25Speaker 4: not fair. And they've agreed to open China, fully open China,
- 4:30Speaker 4: and I think it's going to be fantastic for China.
- 4:33Speaker 4: I think it's going to be fantastic for US. And
- 4:35Speaker 4: I think it's going to be great for unification and peace.
- 4:40Speaker 1: This could really change things on a geopolitical scale if
- 4:44Speaker 1: those statements are accurate and correct that Trump is talking about,
- 4:48Speaker 1: and a lot of times he kind of manifests things
- 4:50Speaker 1: through deals that maybe hasn't been completely locked out. So
- 4:53Speaker 1: let's wait and see how this does go out in
- 4:56Speaker 1: the future. But when you look up about the potential
- 5:00Speaker 1: impact of an open CCP and really a new market
- 5:05Speaker 1: that could go everything from tourism to hospitality, all sorts
- 5:09Speaker 1: of goods and services that could make their way into
- 5:11Speaker 1: the Endo China and maybe open up a new trade
- 5:15Speaker 1: deaton that would be good for both countries in building
- 5:20Speaker 1: their infrastructure as well as what we're going to see
- 5:22Speaker 1: here in the United States as far as building new businesses.
- 5:25Speaker 1: So I'm very optimistic about it. I'm not overly optimistic
- 5:30Speaker 1: because always you have to worry about these deals falling apart.
- 5:33Speaker 1: The fact that this is going on right now, the
- 5:35Speaker 1: ninety day pause is in act. Here's Scott Besse that
- 5:39Speaker 1: says what happens after that.
- 5:40Speaker 5: Take a look.
- 5:42Speaker 3: We had a plan, we have a process. Now we
- 5:45Speaker 3: have a meeting mechanism. We loosely christened it the Geneva mechanism.
- 5:50Speaker 3: So I don't know where we'll meet again. A very
- 5:53Speaker 3: agreeable meeting here. We got a lot done over two days,
- 5:58Speaker 3: so I would imagine that in the next few weeks
- 6:01Speaker 3: we will be meeting again to get rolling on a
- 6:05Speaker 3: more fullsome agreement.
- 6:08Speaker 1: Good for them, I mean the fact that they turn
- 6:09Speaker 1: this around in forty eight hours over the weekend. I
- 6:13Speaker 1: don't think everybody was really anticipating that kind of impact,
- 6:17Speaker 1: and maybe the markets will start to see a little
- 6:19Speaker 1: bit of that today. We will show some charts here
- 6:21Speaker 1: in a minute, so stick around for that. But here
- 6:24Speaker 1: is one of the analysts kind of breaking down what
- 6:26Speaker 1: we know for sure and kind of how this is
- 6:28Speaker 1: going to affect markets overall.
- 6:30Speaker 5: Take a look. What we know for sure is the
- 6:33Speaker 5: first thing you've heard is whatever your probability of FED
- 6:35Speaker 5: cuts was, now it's fewer cuts and later. And what
- 6:39Speaker 5: we know for sure is that economic activity over the
- 6:42Speaker 5: next ninety days will be higher than it would have
- 6:44Speaker 5: been otherwise, if only because people want to exploit a
- 6:47Speaker 5: short term window. Beyond that, you have all sorts of
- 6:51Speaker 5: questions that have to be resolved. You have to figure
- 6:53Speaker 5: out not just the economics but the politics and the
- 6:55Speaker 5: national security implications of all this. So the inflation impact
- 6:59Speaker 5: is ambiguous. So beforehand we had a total embargo on trade,
- 7:02Speaker 5: a total embargo on trade with China, and the result
- 7:06Speaker 5: of that is that a lot of activity wasn't going
- 7:09Speaker 5: to take place. Now you're going to have some activity
- 7:11Speaker 5: taking place, good for growth, but it will be taking
- 7:14Speaker 5: place at a higher price, bad for inflation. This is
- 7:17Speaker 5: why there's so many different forces in play. I think
- 7:21Speaker 5: the major question you have to ask yourself is if
- 7:24Speaker 5: you were a CEO Joe, what would you do if
- 7:27Speaker 5: you had to have a major decisions? What would you
- 7:30Speaker 5: do right now? When I was here last time, I
- 7:32Speaker 5: told you we are on a very bumpy journey to
- 7:35Speaker 5: two destinations. One is fragmentation and the other one is
- 7:39Speaker 5: the US is stronger in a ferry trading system. We
- 7:43Speaker 5: are now slightly higher on the second probability, but it's
- 7:46Speaker 5: a fifty to fifty situation. I would agree.
- 7:49Speaker 1: I think that the US is slightly stronger in a
- 7:52Speaker 1: new trade position. And Trump seems to be working from
- 7:56Speaker 1: a variety of angles right now in terms of trying
- 7:58Speaker 1: to attack some of the issues that are facing Americans.
- 8:01Speaker 1: One of the things he hits on is all around
- 8:03Speaker 1: prescription drugs. This is another deal that if it were
- 8:06Speaker 1: to go through, this would be a pretty big deal.
- 8:09Speaker 1: What it boils down to is this right here, prescription
- 8:12Speaker 1: drugs and pharmaceutical prices would be reduced almost immediately by
- 8:16Speaker 1: thirty to eighty percent. Now, there have been many, many
- 8:21Speaker 1: politicians who have attempted this and have failed. If this
- 8:25Speaker 1: does actually happen, this would be a huge win for
- 8:27Speaker 1: the Trump administration. Plus, if we actually get a deal
- 8:31Speaker 1: with China that opens up potential interlocking trade that in
- 8:36Speaker 1: itself could possibly be one of the greatest economic booms
- 8:40Speaker 1: that we could ever see.
- 8:41Speaker 3: Now.
- 8:41Speaker 1: Granted, I think the analyst was right is that many
- 8:44Speaker 1: of these things are still kind of in limbo and
- 8:48Speaker 1: until we really see the impact because there is going
- 8:50Speaker 1: to be a little bit of impact on higher cost
- 8:53Speaker 1: goods because of the relationship to some tariffs. But I
- 8:56Speaker 1: think it also opens up the opportunity for business growth.
- 9:00Speaker 1: If you look at the recession possibility here in twenty
- 9:02Speaker 1: twenty five, it has dropped dramatically from this high back
- 9:06Speaker 1: on May first, of almost sixty six percent down to
- 9:09Speaker 1: where we are right now, hovering in around thirty nine percent,
- 9:12Speaker 1: So a lot of this could be short lived. And
- 9:15Speaker 1: you know, Mohammed kind of hit on that point, is
- 9:18Speaker 1: that there's going to be a lot of economic activity
- 9:20Speaker 1: just because of people taking advantage of the ninety day window. Yes,
- 9:23Speaker 1: everybody's going to be looking at trying to make trades.
- 9:26Speaker 1: Maybe you should look at I won't say timing, but
- 9:29Speaker 1: definitely be aware of how to play this out within
- 9:33Speaker 1: your own portfolios out there. Whether you're in traditional assets
- 9:36Speaker 1: or digital assets doesn't really matter. I think what we're
- 9:38Speaker 1: seeing right now is some very good activity in the markets.
- 9:42Speaker 1: Bitcoin also all time high queues come in as the
- 9:45Speaker 1: China deal sends the Dixie to a one month high.
- 9:48Speaker 1: And when you look at the Dixie, because I think
- 9:51Speaker 1: this is one of those things that we still have
- 9:53Speaker 1: not completely had our full hand around, and that is
- 9:57Speaker 1: how does the US dollar correlate to what's going to
- 10:00Speaker 1: happen on the global macro side of things. If China's
- 10:03Speaker 1: deal comes through, this will probably put a lot of pressure.
- 10:06Speaker 4: On the EU.
- 10:07Speaker 1: The EU is playing a little bit more heartball, which
- 10:10Speaker 1: surprised me, but it is a very interesting position. Now
- 10:13Speaker 1: where this could go with the market is you got
- 10:16Speaker 1: to look at this moving averages retests suggests that we
- 10:19Speaker 1: could see another all time high. Remember around one oh
- 10:22Speaker 1: six to one oh eight. That's a number that is
- 10:24Speaker 1: well within reach right now on bitcoin. And if that
- 10:27Speaker 1: does occur my predictions, we'll probably see a three k
- 10:30Speaker 1: ethereum that could come very quickly. And then really after
- 10:34Speaker 1: that is the big question because this is so early
- 10:37Speaker 1: in the cycle. When I say cycle, this ninety day cycle,
- 10:40Speaker 1: this could be a very interesting time ahead. Let's take
- 10:43Speaker 1: a look just quickly. Xorp is actually moving right now,
- 10:46Speaker 1: nice little movement here. We'll probably try to get a
- 10:49Speaker 1: video up for you guys today, but I want to
- 10:50Speaker 1: show you something on the Dixie just to show you.
- 10:53Speaker 1: Let's go take a look at SBX so up nicely
- 10:56Speaker 1: on the daily. You go in and look at the
- 10:58Speaker 1: two hour. You can see the trend definitely coming up
- 11:02Speaker 1: right now on the S and P. But when you
- 11:05Speaker 1: get into the Dixie, this is the kind of movement here.
- 11:08Speaker 1: Let me go back to the daily chart. This is
- 11:09Speaker 1: the kind of movement that these trade deals represent because
- 11:13Speaker 1: it does strengthen the US dollar around the world. When
- 11:17Speaker 1: you see these kind of scenarios play out right now,
- 11:20Speaker 1: other things that are happening. Of course, you've got institutions
- 11:22Speaker 1: doubling down a bitcoin US ETFs also hit a record
- 11:26Speaker 1: high at sixty to two point nine billion in cumulative inflows,
- 11:31Speaker 1: and then the ETFC about one point eight in inflows,
- 11:34Speaker 1: making three straight weeks of gains. So still very strong.
- 11:39Speaker 1: Institutional all in likelihood is sailor and strategy is going
- 11:44Speaker 1: to continue to push hard, probably around that one oh
- 11:47Speaker 1: three to one oh two range. My question is do
- 11:50Speaker 1: we get under one hundred and if so, how many people,
- 11:54Speaker 1: how many institutions are going to be buying in because
- 11:56Speaker 1: remember this is very early on that ninety day zone
- 12:00Speaker 1: we could be talking about for economic activity coinbas Institutional
- 12:04Speaker 1: is really one of the key things right now. When
- 12:07Speaker 1: you look at ETFs versus SPOT take a look at this.
- 12:11Speaker 3: It's both.
- 12:12Speaker 6: I mean, I'm sure, but a percentage basis so based
- 12:15Speaker 6: on this onslaught of inflows, I don't have the percentage
- 12:17Speaker 6: numb for you right now. It's probably going to be
- 12:19Speaker 6: the overwhelming majority is going to be ETFs, but I
- 12:21Speaker 6: don't have exact data. The one pointant thing to remember
- 12:24Speaker 6: about these these ETF inflows, not just the surge we've
- 12:27Speaker 6: seen recently, but since the beginning because it's been an
- 12:29Speaker 6: absolutely phenomenally performing ETF. And this is a very important
- 12:33Speaker 6: point that's overlooked. This is being done with the asset
- 12:37Speaker 6: managers not allowing their salespeople, their financial advisors to recommend it.
- 12:41Speaker 6: So that's extraordinary. That's like a shoe salesman not being
- 12:44Speaker 6: able to recommend Nike, right. So that's going to change
- 12:47Speaker 6: at some point, and I'll sort of leave it to
- 12:49Speaker 6: your viewers to determine what happens when that thundering herd
- 12:52Speaker 6: of brokers can actually pick up the phone and recommend
- 12:55Speaker 6: the CTF.
- 12:56Speaker 1: I think that is a point that you do have
- 12:59Speaker 1: to take into conscer iteration that along with not only
- 13:02Speaker 1: the bitcoin ets but other digital ETFs out there that
- 13:05Speaker 1: are coming, and we know that it could be XRP
- 13:08Speaker 1: likelihood obviously with the Ethereum METF that could also benefit
- 13:11Speaker 1: from this. All of this is flowing into one next
- 13:15Speaker 1: major move by the Republicans and the GOP, and that
- 13:19Speaker 1: is where does this tax bill go? Because we saw
- 13:21Speaker 1: the of course the stable bill fail last week. That
- 13:25Speaker 1: was kind of a little bit of a hit, but
- 13:27Speaker 1: overall the market didn't really respond to it the same way.
- 13:30Speaker 1: So do we see a stable coin bill come through. Sure,
- 13:33Speaker 1: most likely we'll see something come back to the floor
- 13:36Speaker 1: very soon. But the one to watch right now is
- 13:39Speaker 1: the tax bill, the big beautiful bill. It has not
- 13:43Speaker 1: been highly popular. It is talking about eight hundred billion
- 13:46Speaker 1: in cuts, largely to medicaid. That's a one that is
- 13:51Speaker 1: not very popular and the likelihood is going to be
- 13:53Speaker 1: a lot of pressure right now on the Democrats. Now,
- 13:56Speaker 1: Trump came in and talked a little bit about this,
- 14:00Speaker 1: but one thing he has done is he stayed away
- 14:02Speaker 1: from it. I'll get to that in a second, but
- 14:04Speaker 1: I want to go to this clip real quick because
- 14:07Speaker 1: they're trying to reach a deal and this is what
- 14:09Speaker 1: they're up against. Take a look.
- 14:10Speaker 2: It would take an enormous push from President Trump if
- 14:13Speaker 2: he had come out on truth social and really double
- 14:15Speaker 2: down on what he said privately to the speaker and
- 14:18Speaker 2: push them to do it. You know, Trump can move
- 14:20Speaker 2: mountains in this party. He's taken over the party for
- 14:23Speaker 2: all intents and purposes. But his ambivalent truth social posts
- 14:27Speaker 2: really makes me think this thing is dead. That being said,
- 14:30Speaker 2: I think the President does have good political instincts. It
- 14:32Speaker 2: would play well. The biggest attacks from Democrats will be
- 14:35Speaker 2: this is a billionaire tax cut funded by cutting medicaid
- 14:40Speaker 2: for the poorest, and that's going to sting them in
- 14:43Speaker 2: the midterm elections, I predict, But I don't think the
- 14:47Speaker 2: President's going to be able to get that rate increase.
- 14:49Speaker 4: What's the likelihood that these markups currently scheduled for Tuesday
- 14:52Speaker 4: get punted again?
- 14:54Speaker 2: You know, I'm anticipating, for example, ways it means is
- 14:56Speaker 2: going to meet at two pm on Tuesday. They may
- 14:58Speaker 2: go all night to the world it's completely exhausted, and
- 15:02Speaker 2: then spring some compromise deal that we can barely understand,
- 15:07Speaker 2: super complex, full of all kinds of loopholes. I also
- 15:10Speaker 2: think the House could vote on it in May, and
- 15:12Speaker 2: we could see it fail and then come back. There's
- 15:15Speaker 2: going to be a lot of fits and starts in
- 15:17Speaker 2: this because it's going to be very, very hard to
- 15:18Speaker 2: get the near unanimity that they need to pass this package.
- 15:23Speaker 1: All right, So how does this play out? There's a
- 15:25Speaker 1: couple of routes that this could take. This was a
- 15:28Speaker 1: clip before Trump actually did tweet or post on truth
- 15:33Speaker 1: social and here's some key things that he highlighted that
- 15:36Speaker 1: I highlighted that he talks about here when I return
- 15:39Speaker 1: to the Middle East, great things are happening for America.
- 15:41Speaker 1: Will work together on any and all outstanding issues, but
- 15:44Speaker 1: there shouldn't be many. So that tells me that he
- 15:47Speaker 1: is leaving a window open for some negotiation on this bill.
- 15:51Speaker 1: Could he back off of the Medicaid. If he does,
- 15:54Speaker 1: then that could possibly get this through. But what he
- 15:56Speaker 1: says is we must win. But now the tremendous drug
- 16:00Speaker 1: pharmaceutical cuts plus massive incoming tariff money, So there's some
- 16:04Speaker 1: key things here that are almost being thrown out there
- 16:08Speaker 1: to distract you. And I look at it this way.
- 16:12Speaker 1: Pharmaceutical cuts would be huge as well as what we're
- 16:15Speaker 1: already seeing with the tariffs. These are big wins. And
- 16:19Speaker 1: if they use that in a way to try to
- 16:22Speaker 1: negotiate the tax bill as long as I think they
- 16:25Speaker 1: maybe I won't say full but if they possibly negotiate
- 16:30Speaker 1: out more of the issues around medicaid, maybe this is
- 16:33Speaker 1: where Trump is leaving this open. Again. Remember this is
- 16:36Speaker 1: a post that he did after that clip, so they
- 16:39Speaker 1: are all expecting Trump to kind of support this, but
- 16:42Speaker 1: he doesn't look to me like he's supporting it in
- 16:44Speaker 1: its current state. So he has left the window open.
- 16:46Speaker 1: We'll see how that goes.
- 16:48Speaker 3: Now.
- 16:48Speaker 1: We got to look at bullish issues right now, and
- 16:51Speaker 1: of course Ethereum moving like crazy. Over the weekend, Eth
- 16:55Speaker 1: flips Ali Baba and Coca Cola in market cap. I
- 16:58Speaker 1: want you guys to kind of set back, and if
- 17:00Speaker 1: you're a traditional stock trader, imagine a company or any
- 17:05Speaker 1: entity actually coming in and flipping two of the biggest
- 17:10Speaker 1: companies out there. And this, of course is a big,
- 17:12Speaker 1: huge forty percent rally that we've been talking about here
- 17:15Speaker 1: for a while on the show. We've said get ready
- 17:17Speaker 1: for Ethereum. It is here now. Crypto SITS is a
- 17:20Speaker 1: thirty ninth position in the global market cap tallies, trailing
- 17:24Speaker 1: behind Bank of America and approximately by approximately seven billion.
- 17:27Speaker 1: Likelihood is we're going to see ETH make its way
- 17:30Speaker 1: up the charts pretty quickly. I anticipate that Bank of
- 17:34Speaker 1: America and maybe even IBC could be coming in next.
- 17:38Speaker 1: In terms of this asset class going forward, that's going
- 17:41Speaker 1: to open it up. I think to a lot more
- 17:43Speaker 1: people that are looking at Ethereum maybe for the first time.
- 17:47Speaker 1: If you guys have never purchased it, this might be
- 17:49Speaker 1: your entry point last up. Of course, if you've got
- 17:53Speaker 1: to look at eth as out performing Bitcoin again, and
- 17:55Speaker 1: this is another indicator that we could get into utilities.
- 18:00Speaker 1: The idea is all coin season starting to really see
- 18:03Speaker 1: some movement here, and if you're trading eth against Bitcoin
- 18:07Speaker 1: right now is the season to be doing that as well.
- 18:09Speaker 1: A lot going to be happening. I think this week,
- 18:11Speaker 1: this next two to three weeks could be very active
- 18:15Speaker 1: for the crypto markets. Make sure and stay tuned right here.
- 18:17Speaker 1: If you're not subscribed to the channel, make sure and
- 18:19Speaker 1: do that. And if you're not in the diamond circle,
- 18:21Speaker 1: get in right now. It's a free place where you
- 18:23Speaker 1: can get additional email from us, and of course you
- 18:26Speaker 1: can always reach me out there on x at Paul Baron.
- 18:29Speaker 1: We'll catch you next time right here on Techpath