MARY REICHARD, HOST: Coming next on The World and Everything in It, the Monday Moneybeat.
NICK EICHER, HOST: Make it four straight losing weeks on Wall Street. The major stock indexes seemed to be cruising last week. They appeared on course to break the losing streak when President Trump took to Twitter on Friday.
China fired a new salvo in the trade war: announcing a doubling of taxes on American products, and the president Friday afternoon fired back. He responded with the threat of a 50 percent rise on one set of anti-China import tariffs, and a 20 percent hike on a second set.
But what he did earlier in the day provoked a good bit of confusion: Trump said on Twitter that American companies are “hereby ordered to … start looking for an alternative to China.” This was about 10 o’clock in the morning.
Can he do that? Well, yes and no. No, companies don’t have to comply with a Twitter directive to start looking for an alternative to China. But technically, if the president were to declare an emergency under the International Emergency Economic Powers Act of 1977, they might have to.
He says he has no plans to declare that emergency, but he does have the power unless Congress overrides him. And he excoriated the news media for mocking him over the controversy.
REICHARD: Friday night, the president left the White House for the G7 summit of western industrialized countries. He paused for news media questions under the loud roar of the Marine One helicopter. He referred to the trade war as “a little spat with China” and he emphasized his authority to cut U.S. business ties under that 1977 law.
But he reserved his most critical words for Federal Reserve bank chairman Jay Powell.
Earlier that day, in a speech in Wyoming, Powell provided nonspecific assurances that the Fed would act to sustain the nation’s economic expansion. The Fed recently cut interest rates a quarter point, but the president’s pushing for at least a full percentage-point reduction.
In his speech, Powell suggested the Fed has limited authority to deal with self-inflicted economic damage from the trade dispute. That irritated Trump. In response to a question about whether he wanted Powell to resign, the president said, his words, “I wouldn’t stop him.”
TRUMP: No, I’m not happy with Jay Powell. I don’t think he’s doing a good job at all. I don’t think he’s much of a chess player. But I’ve got him, so, you know, that’s what I have. That’s what I have. What can I tell you? He’s not much of a chess player.
EICHER: At the G7 in France, the president did receive some ever-so-slight criticism for his hard line with China. UK Prime Minister Boris Johnson, probably Trump’s closest European ally, said he’d like the tariffs dialed back.
It’s difficult to hear because the prime minister is so far off mic.
JOHNSON: Just to register the faint, sheeplike note…
Just to register the faint, sheeplike note of our view on the trade war, Johnson says here, we’re in favor of trade peace on the whole.
Johnson’s treading lightly. He’s on the brink of a no-deal Brexit and he’s urgently working for a trade pact with the United States, fearing lost trade in the European Union, when the UK leaves at the end of October.
And that is today’s Monday Moneybeat.