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00:00Looking at the structure of things, what Donald Trump called reciprocal tariffs seem to have been based on the trade deficit with various countries.
00:08But is trade deficit such a bad thing? Doesn't it just indicate that your goods and services are being consumed?
00:16You're absolutely right. First of all, the tariff formula that the White House used is essentially to say countries run a surplus with the United States because they had unfair trade practices.
00:28They set up the trade barriers. So we need to tariff them in order to lower the trade deficit.
00:35So the formula itself, if you ask any economist, right, it's based on a very false assumption that somehow the trade imbalance is because of a trade barrier.
00:45There are actually many, many reasons for why the U.S. has been running trade deficit, you know, for the past five for the past 50 years.
00:52Right. With over 100 countries. So this whole idea of trade barrier cannot really explain that.
00:57And as you can see, the tariff rate on various countries are really very arbitrary, right, including, you know, the Heard and McDonald's Islands, where no one actually lived on it.
01:09And still they are charged a 44 percent of tariff rate.
01:12And still they are charged a 45 percent of tariff rate.
01:13And still they are charged a 45 percent of tariff rate.
01:14And still they are charged a 45 percent of tariff rate.
01:15And still they are charged a 45 percent of tariff rate.
01:16And still they are charged a 45 percent of tariff rate.
01:17And still they are charged a 45 percent of tariff rate.
01:18And still they are charged a 45 percent of tariff rate.
01:19And still they are charged a 45 percent of tariff rate.
01:20And still they are charged a 45 percent of tariff rate.
01:21And still they are charged a 45 percent of tariff rate.
01:22And still they are charged a 45 percent of tariff rate.
01:23And still they are charged a 45 percent of tariff rate.
01:24And still they are charged a 45 percent of tariff rate.
01:25And still they are charged a 45 percent of tariff rate.