Mr. Trump was essentially rebuffed by Mr. Putin with his refusal to enter into a cease fire in the Ukraine and apparently loading up with more demands. Obviously, Mr. Putin believes he has the upper hand, and it would appear that he does. Mr. Trump is now many months into his term after a promise to end the war on day one without any indication that the war is winding down. In fact, the Russians are pounding the Ukraine even harder, essentially thumbing their nose at Mr. Trump.
Mr. Trump’s approach to the Walmart CEO not to raise prices due to tariffs is a pure political move to hide what everyone else has known, and that is that tariffs cause price increases, as they are, in some measure, passed along to US consumers. Mr. Trump does not want to be called out and initially fought the disclosure of the tariff costs by Amazon, but Walmart seems to be a bit more pragmatic and running their business as they should. There is no reason for Walmart, or any other retailer, to take the hit for Mr. Trump’s obvious lack of understanding of how tariffs work. I wonder when Trump voters will wake up.
At a meeting on May 21st, Mr. Trump made false claims to the South African President who pushed back asserting that those claims of genocide were false. This is another example of Mr. Trump acting in a bullying fashion because he thinks the individuals with whom he is dealing are incapable of pushing back. I guess he got an education. It was later disclosed that the pictures that he showed were not of South Africa, but of Congo. So, he not only embarrassed himself with his comments to the President of South Africa, but he also essentially lied.
The market is responding to a number of factors, including tariffs, and interestingly enough, Mr. Trump’s Big Beautiful Bill, because of the belief it will drive up the deficit and debt even further since it never really achieved the kind of savings in other areas that was needed to offset the reduction in taxes. There are two issues that are tied together and create less than optimal conditions for the market and potentially our economy, and that is the weakening of the dollar, and the rising interest rates on government issued debt. The latter is particularly troubling because that will increase the deficit and debt as interest rates rise and the cost of borrowing increases. You will note that no one in the Trump administration is talking about these issues. Why? Because it is countered to their narrative and they have no real mechanism or solution for addressing those issues.
If you note in the news other than the announcement of the agreement with Great Britian and the arrangement, hardly an agreement, with China to reduce tariffs for a short period of time, there has been no other movement on the tariff issues and no other agreements. I suspect that Trump really does not intend to negotiate real trade agreements with anyone, and to simply announce sometime in the next couple of months that tariffs did their job and we are now going back to, if you will, regular order. It will be interesting to see how the rest of the world responds as they may not be anxious to deal with a chaotic and irrational US government.
In a recent ruling, the Supreme Court seems to indicate that Mr. Trump cannot fire Mr. Powell at the Fed which is good news and maintains the independence of that organization which is most important to our monetary policy and our economy in general.
President Trump hit out at Harvard again and again, essentially taking them out of the program that allows them to enroll foreign students who have visas and then to redirect some of their grants to other areas. There may be an out for Harvard relative to the international students, at least on a temporary basis, and that is to create on-line courses just like those used during Covid and at least save some of their student population. In reality, the government can certainly stop the granting of visas, it can’t stop online activity or any other activities that Harvard may creatively come up with to get around this assertion by Mr. Trump.
The GOP Big Beautiful Bill will hit hard at low income and poor members of our society. One of the big questions is – are they people who will vote in the next mid-term election or Presidential election, or in reality are they disenfranchised, and the negative impact on them will not be registered at the ballot box. Democrats clearly need to be taking aim to rally these groups while focusing on middle class values and issues, staying away from the more esoteric issues, and there is plenty of ammunition to fire away at Mr. Trump when one looks at the fact that inflation has not been tamed and appears to be going up, tariff costs are being passed on to consumers, the war has not ended in the Ukraine, the war has not ended in Gaza.. There have been very few real accomplishments. The only area that he has seen some success is immigration, but that has really not hit the population which he said he was after, which is the criminals, as they seem to be scooping up whoever is at hand.
The Republicans are having difficulty with the Big Beautiful Bill, although they did pass it in the House. As it moves to the Senate I think there is more trouble ahead. If the Republicans lose in essence four votes, then the bill will not pass. If they only lose three then it can be in effect passed by Mr. Vance breaking the tie. This will be an interesting week of activities.
We also see that Prince Charles has arrived in Canada over the past weekend, which apparently is a display of sovereignty for Canada and meant to, if you will, put a stop to the nonsense of Canada becoming the 51st state.
I’d also note on the Canadian front that advertisements are appearing on US channels and particularly for those of us who live along the Canadian border, during the Stanley Cup Playoffs, with the message of “bring Stanley home”. They are referring to the Stanley Cup, which is the symbolic evidence of the winner of the Cup, and somewhat entertaining when given all of the factors that Canada is facing in their interactions with us. There only remains one Canadian team, the Oilers, and it looks like the Oilers are moving forward to the Finals, and I certainly will be rooting for them.
Bill Owens is a former member of Congress representing the New York 21st, a partner in Stafford, Owens, Piller, Murnane, Kelleher and Trombley in Plattsburgh, NY and a Strategic Advisor at Dentons to Washington, DC.
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