WEBVTT 1 00:00:00.560 --> 00:00:03.839 It's Night Side with Dan Ray on w b Z, 2 00:00:04.320 --> 00:00:05.559 Boston's Radio. 3 00:00:07.160 --> 00:00:10.480 All Right, welcome back everyone. We're going to change topics 4 00:00:10.480 --> 00:00:14.359 here and we're going to welcome back to the program. 5 00:00:14.560 --> 00:00:19.719 Professor Greg Staller, he teachers at Boston University School of Business, 6 00:00:19.760 --> 00:00:25.480 the Questrum School of Business at Boston University. Professor Staller, 7 00:00:25.559 --> 00:00:27.079 welcome back to Nightside. How are you. 8 00:00:27.760 --> 00:00:30.000 Thank you, Dan, appreciate the opportunity to come back. 9 00:00:30.480 --> 00:00:33.960 Well, you were my go to guy here. We talked 10 00:00:34.000 --> 00:00:37.520 a couple of weeks ago about tariffs, which of course 11 00:00:37.560 --> 00:00:43.399 have royaled the stock market. The market today had a 12 00:00:43.479 --> 00:00:47.399 pretty good day. It was almost a mirror reflection of yesterday, 13 00:00:47.399 --> 00:00:48.759 which was a pretty bad day. 14 00:00:49.600 --> 00:00:52.439 That was absolutely correct. It was about two point seven 15 00:00:52.520 --> 00:00:55.840 percent today and it was down two point five percent yesterday. 16 00:00:56.399 --> 00:01:01.479 Yeah, and the future suggests it's opposed to open tomorrow 17 00:01:01.920 --> 00:01:06.359 a little higher, which again some people believe that some 18 00:01:06.400 --> 00:01:10.120 people don't. Well, we'll see how it works out. A 19 00:01:10.159 --> 00:01:13.680 lot of people are worried at this point. I guess 20 00:01:13.840 --> 00:01:17.920 what were the factors today that that perhaps helped quiet 21 00:01:17.959 --> 00:01:19.920 the market. The market down It was up around a 22 00:01:19.959 --> 00:01:23.480 thousand points middle of the day, and then in the 23 00:01:23.560 --> 00:01:27.200 early afternoon, it slid back down about six hundred, about 24 00:01:27.239 --> 00:01:30.439 four hundred points down into the six hundreds, and then 25 00:01:30.480 --> 00:01:32.799 it came back up and end of the day, I 26 00:01:32.799 --> 00:01:38.719 guess eleven hundred to the good. What was it the 27 00:01:38.760 --> 00:01:42.000 president's comments that he's not going to fire Powell? Did 28 00:01:42.000 --> 00:01:45.879 that make at least no plan scurrently to fire Powell? 29 00:01:46.319 --> 00:01:46.799 Is that much? 30 00:01:47.280 --> 00:01:49.799 Ballace bounced towards ballast towards the end of the day. 31 00:01:49.920 --> 00:01:53.159 I think what caused the markets to go up in 32 00:01:53.200 --> 00:01:56.359 the first part of the day was Trump gave an 33 00:01:56.359 --> 00:02:00.920 indication that maybe the China related tariffs that are up 34 00:02:00.920 --> 00:02:02.920 to one hundred and forty five percent at this point 35 00:02:03.280 --> 00:02:06.319 might be coming down. And I think he's also getting 36 00:02:06.359 --> 00:02:11.360 pressure from a variety of different advisors and constituents, and 37 00:02:11.400 --> 00:02:14.680 I think he is rethinking his approaching. 38 00:02:15.800 --> 00:02:20.400 Okay, now, of all the people who I know, nobody 39 00:02:20.439 --> 00:02:25.319 has been to China with as many students on as 40 00:02:25.360 --> 00:02:30.319 many trips as you have. You began this process how 41 00:02:30.400 --> 00:02:34.159 long ago in your career as a professor. 42 00:02:34.599 --> 00:02:38.360 As a professor, from my first first trip to China 43 00:02:38.560 --> 00:02:42.680 in two thousand and one, but as a civilian, if 44 00:02:42.680 --> 00:02:45.520 you will, my first time was in nineteen ninety four. 45 00:02:46.319 --> 00:02:49.280 Okay, so you got over there in nineteen ninety four. 46 00:02:49.639 --> 00:02:53.639 Now it's thirty years later. We're in twenty twenty five, 47 00:02:53.719 --> 00:02:57.840 so it's really almost thirty one years later. How substantially, 48 00:02:58.039 --> 00:03:02.800 since China is our big economic competitor, how substantially has 49 00:03:02.919 --> 00:03:06.400 China changed in the thirty years from the China that 50 00:03:06.479 --> 00:03:09.639 you first arrived at in nineteen ninety four to the 51 00:03:09.719 --> 00:03:10.520 China of today. 52 00:03:11.280 --> 00:03:16.159 Remarkably so. In the late eighties early nineties, there was 53 00:03:16.719 --> 00:03:19.759 something which is in Chinese called geigo kaifong or the 54 00:03:19.840 --> 00:03:22.639 reform and opening that you know. Again, this is not 55 00:03:22.840 --> 00:03:26.680 Nixon opening China with his historic trip, et cetera. But 56 00:03:26.800 --> 00:03:30.680 this is more of an economic perstroika of sorts. Is 57 00:03:30.879 --> 00:03:34.800 China decided that they wanted to embrace the West, and 58 00:03:35.000 --> 00:03:38.520 they ended up having a really great system where they 59 00:03:38.560 --> 00:03:43.319 would take foreign investor capital, and they would build factories, 60 00:03:43.400 --> 00:03:49.280 they would use labor, and they would export those goods 61 00:03:49.319 --> 00:03:52.159 and services to an extent, sort of like India did 62 00:03:52.159 --> 00:03:54.800 with business process outsourcing to the rest of the world. 63 00:03:54.879 --> 00:03:58.520 And everybody was happy until the wheels came off the bus. 64 00:03:58.800 --> 00:04:02.080 Okay, let me take get back to ninety four when 65 00:04:02.159 --> 00:04:05.599 did did China was? Was it at some point China 66 00:04:05.680 --> 00:04:09.639 granted Favored nation status by the World Trade Organization? 67 00:04:10.599 --> 00:04:16.920 Yes, absolutely, the favored trade status came in the early 68 00:04:17.000 --> 00:04:22.600 two thousands, and it u and I'm just checking the 69 00:04:22.839 --> 00:04:26.800 exact date on that. And the fact of the matter 70 00:04:27.000 --> 00:04:31.360 is that it further continued to let the good times 71 00:04:31.439 --> 00:04:34.879 keep rolling off in the sense that back back in 72 00:04:35.000 --> 00:04:38.839 ninety four, Dan labor rates were so cheap, and the 73 00:04:38.920 --> 00:04:43.000 Chinese weren't concerned at that point about clean water, they 74 00:04:43.000 --> 00:04:46.959 weren't concerned about providing living wages. They were looking at 75 00:04:46.959 --> 00:04:50.240 themselves as sort of a direct competitor to Japan in 76 00:04:50.279 --> 00:04:53.680 the in the in the decade of Japan inc. Produce 77 00:04:53.759 --> 00:04:56.279 it for low dollars and sell it off and make 78 00:04:56.319 --> 00:04:56.959 a lot of money. 79 00:04:57.839 --> 00:05:01.959 Okay. It also was a time, if I remember correctly, 80 00:05:02.120 --> 00:05:06.959 with there was some political reform. With economic reform, there 81 00:05:07.040 --> 00:05:10.399 was also some political reform. And actually I think that 82 00:05:11.199 --> 00:05:19.000 churches were allowed to Chinese citizens were allowed to exercise, 83 00:05:20.360 --> 00:05:25.120 you know, some limited form of free speech, and churches 84 00:05:25.199 --> 00:05:29.199 were treated a little bit better, you know, after all 85 00:05:29.199 --> 00:05:31.639 of the events of Tenement Square in nineteen eighty nine, 86 00:05:31.680 --> 00:05:34.959 et cetera. So there was there not just there was 87 00:05:35.040 --> 00:05:37.639 there was trade reform, economic reform, but there was also 88 00:05:37.639 --> 00:05:40.240 some what we would view as political reform. 89 00:05:40.439 --> 00:05:43.680 That's my one hundred and by the way, beyond most 90 00:05:43.720 --> 00:05:48.439 Favored Nation status they received they being China joined the 91 00:05:48.439 --> 00:05:51.879 World Trade Organization in December of twenty oh one. So 92 00:05:52.079 --> 00:05:53.959 you're right, it was the combination of everything. It was 93 00:05:54.000 --> 00:05:57.439 political reform, I think what I would call cultural reform 94 00:05:57.759 --> 00:06:00.800 and economic reform. And you know, to your point, we're 95 00:06:00.839 --> 00:06:05.439 talking about two decades ago, right, two decades ago, everything 96 00:06:05.560 --> 00:06:08.279 was coming. The United States was buying, the West was buying, 97 00:06:08.480 --> 00:06:10.480 and China was manufactured. 98 00:06:10.759 --> 00:06:13.959 And there was there was a lot of Western money 99 00:06:14.360 --> 00:06:19.959 that went into China to produce the manufacturing plants. And 100 00:06:20.040 --> 00:06:23.160 there's I'm sure you know this stuff cold, but there 101 00:06:23.160 --> 00:06:27.160 are a lot of American companies that took their manufacturing 102 00:06:27.720 --> 00:06:30.959 over to China because they felt it was beneficial to 103 00:06:31.000 --> 00:06:36.199 their stockholders and to their bottom line. 104 00:06:34.480 --> 00:06:38.920 One hundred percent. So if you think about just FBI 105 00:06:39.040 --> 00:06:43.399 foreign direct investments, and you think about where it started 106 00:06:43.560 --> 00:06:48.000 in the New millennium, it was forty billion US dollars. 107 00:06:49.040 --> 00:06:51.720 A little more than a decade later, eleven years to 108 00:06:51.759 --> 00:06:55.319 be specific it ballooned to one hundred and twenty four billion. 109 00:06:55.920 --> 00:07:01.920 So think about that, in eleven years it went literally, yeah, tripled. 110 00:07:02.160 --> 00:07:06.759 Okay, and we weren't worried about that at that time. 111 00:07:07.959 --> 00:07:11.920 I don't recalled. I remember in the nineties people talked 112 00:07:11.959 --> 00:07:14.959 about our trade in balance, but it was always our 113 00:07:15.000 --> 00:07:17.879 trade in balance with the world. There was no focus 114 00:07:17.920 --> 00:07:22.399 on China. It was we were we were buying too 115 00:07:22.480 --> 00:07:25.399 much and exporting too little. I remember that was a 116 00:07:25.439 --> 00:07:28.600 political issue. And then that political issue seemed to go away. 117 00:07:29.600 --> 00:07:34.079 I don't know why the lact way, but correct. Did 118 00:07:34.160 --> 00:07:36.720 we as the American public just lose interest in that? 119 00:07:36.759 --> 00:07:39.639 Did the politicians decide, hey, this isn't driving the votes, 120 00:07:39.680 --> 00:07:43.360 so therefore we'll, you know, we'll go off and highlight 121 00:07:43.399 --> 00:07:44.079 other issues. 122 00:07:45.000 --> 00:07:47.480 I think what shange good question. By the way, I 123 00:07:47.519 --> 00:07:52.519 think what changed is that in those eleven years, China 124 00:07:52.639 --> 00:07:56.360 kept improving its wages, that they moved from a living 125 00:07:56.399 --> 00:08:00.480 wage to actually, as I mentioned earlier, providing infrastry ructure, 126 00:08:01.279 --> 00:08:06.279 clean water, and opportunity for their citizens to not have 127 00:08:06.439 --> 00:08:09.319 to take a train for thirteen hours over Chinese New 128 00:08:09.399 --> 00:08:12.160 Year and live in a dorm like. Everything started to 129 00:08:12.240 --> 00:08:15.639 improve for the People's Republic of China. The problem with 130 00:08:15.759 --> 00:08:18.879 that is the labor rates that the West was relying 131 00:08:18.959 --> 00:08:22.879 upon in Western companies in terms of getting good margins 132 00:08:23.000 --> 00:08:26.480 steadily went down. And because they steadily went down, I 133 00:08:26.519 --> 00:08:30.360 think people said, the emperor no longer has the economic clothes, 134 00:08:30.720 --> 00:08:33.200 and why are we continuing to buy these products that 135 00:08:33.279 --> 00:08:37.480 the margins aren't so good. Let's talk about domestic manufacturing. 136 00:08:37.559 --> 00:08:40.480 And of course people said it's too expensive the United States. 137 00:08:40.480 --> 00:08:42.559 And then all of a sudden, as if a switch 138 00:08:42.679 --> 00:08:44.840 was flipped, people said, oh, by the way, we have 139 00:08:44.879 --> 00:08:48.879 a trade of balance, and the politicians just absolutely jumped 140 00:08:48.919 --> 00:08:50.840 on it like a shark who senses blood. 141 00:08:51.840 --> 00:08:55.639 Right. But I think this is something that President Trump 142 00:08:55.720 --> 00:08:59.480 has believed in for a long time. I think if 143 00:08:59.480 --> 00:09:02.159 you go back to his first term, you'll see there 144 00:09:02.240 --> 00:09:04.240 was some tariffs that were imposed. I don't know how 145 00:09:04.279 --> 00:09:08.360 successfully they resulted, But this is not his first rodeo 146 00:09:08.399 --> 00:09:09.399 in terms of tariffs. 147 00:09:09.399 --> 00:09:13.960 Correct, Oh, not at all, not at all. In you know, again, 148 00:09:14.000 --> 00:09:19.440 if you think about history. Right back in twenty nineteen, 149 00:09:20.080 --> 00:09:26.080 the CDP, the Customs and Border Protection Office, raised seventy 150 00:09:26.159 --> 00:09:29.840 three billion in tariff revenue that was in the fiscal 151 00:09:29.919 --> 00:09:33.600 year of twenty nineteen. To put that into perspective, since 152 00:09:33.720 --> 00:09:38.320 January twentieth of this year, they've raised twenty one billion dollars. 153 00:09:40.879 --> 00:09:45.440 So on a percentage on a on a basis, it's 154 00:09:45.519 --> 00:09:46.080 almost the. 155 00:09:46.039 --> 00:09:48.360 Same one hundred percent, correct. 156 00:09:48.559 --> 00:09:52.960 I mean if they raised seventy three billion in tariffs 157 00:09:53.000 --> 00:09:58.559 in twelve months, that's six billion a month, which sounds 158 00:09:58.600 --> 00:10:03.279 like a lot of money. But compared to you and 159 00:10:03.720 --> 00:10:07.360 you said, it's twenty one billion and we're almost four 160 00:10:07.399 --> 00:10:11.639 months in, that's about six billion. It's the same. What 161 00:10:11.720 --> 00:10:14.759 was it? What was it in the interregnum, if you will, 162 00:10:14.799 --> 00:10:17.080 when Biden was in the White House? That did tariff 163 00:10:17.080 --> 00:10:20.840 stay pretty much this where Trump had placed them. 164 00:10:20.440 --> 00:10:24.720 Or tariff stayed the same, Yeah, stayed the same. 165 00:10:25.000 --> 00:10:31.759 So so now he the president, with his you know, 166 00:10:31.919 --> 00:10:38.960 conversation about Liberation Day, he's dramatically increased the tariffs correct 167 00:10:39.559 --> 00:10:40.440 across the globe. 168 00:10:41.159 --> 00:10:45.399 Correct his bowl is And again you know me, Dan, 169 00:10:45.519 --> 00:10:48.639 hopefully your listeners know me. I'm always trying to be objective, 170 00:10:48.919 --> 00:10:52.919 so I can speak in support of President Trump's approach. 171 00:10:53.240 --> 00:10:57.000 I can speak against President Trump's approach in support of 172 00:10:57.039 --> 00:11:01.480 his approach. He's hoping that number is two billion a day. 173 00:11:02.559 --> 00:11:05.960 I don't think we're getting anywhere close to that. Again, 174 00:11:06.279 --> 00:11:11.639 according to CNBC, as I said earlier, we might be 175 00:11:11.720 --> 00:11:14.720 at around two hundred and fifty million a day. But 176 00:11:14.879 --> 00:11:17.279 last I checked my map, two hundred and fifty million 177 00:11:17.399 --> 00:11:20.600 is a lot different than two billion dollars. 178 00:11:20.879 --> 00:11:24.080 Yeah, even if you get two hundred and fifty million 179 00:11:24.200 --> 00:11:28.919 a day, that that's maybe two billion a week. You're 180 00:11:28.960 --> 00:11:35.519 now at eight billion a month roughly, so correct, you know? Obviously? Well, okay, listen, 181 00:11:35.799 --> 00:11:37.679 don't want to get too deep into the weeds. When 182 00:11:37.679 --> 00:11:40.679 I come back, I want to ask you about your 183 00:11:40.720 --> 00:11:45.559 most recent trips there and what you're hearing, what China 184 00:11:45.679 --> 00:11:47.879 is thinking. I want to put you in the position 185 00:11:47.960 --> 00:11:51.679 of interpreting for us what China is thinking. At this point, 186 00:11:51.759 --> 00:11:54.720 I don't think China has budged. I know that that 187 00:11:54.799 --> 00:11:58.600 President Trump says he has a great relationship with Chairman 188 00:11:59.080 --> 00:12:02.840 g Presidents. I get all of that, but I haven't 189 00:12:02.879 --> 00:12:08.759 seen them moving. And at this point, I don't know 190 00:12:09.480 --> 00:12:14.120 how long the President can hang with this without some 191 00:12:14.519 --> 00:12:19.840 significant results. And I don't think we've seen the results 192 00:12:19.879 --> 00:12:22.279 that he had hoped for this quickly. We're about a 193 00:12:22.279 --> 00:12:25.440 month in not quite a month, and. 194 00:12:25.360 --> 00:12:27.120 I would agree with that. And by the way, to 195 00:12:27.200 --> 00:12:31.200 prepare for tonight, I have read multiple articles in Mandarin 196 00:12:31.559 --> 00:12:33.039 in the Chinese business press. 197 00:12:33.200 --> 00:12:38.639 I all interview I understanding is you speak seven languages. 198 00:12:39.279 --> 00:12:42.960 Yes, that's correct. I also talked with the Chinese journalist. 199 00:12:43.399 --> 00:12:45.960 So I would like to believe that I have a 200 00:12:46.039 --> 00:12:49.919 little bit of insight into what China is thinking right 201 00:12:49.960 --> 00:12:53.559 now in response to the reciprocal tariffs that have been 202 00:12:53.799 --> 00:12:54.600 placed upon them. 203 00:12:54.879 --> 00:12:57.159 All right, that is exactly what we're going to talk about. 204 00:12:57.200 --> 00:13:00.759 If you would like to ask my guests. He's a 205 00:13:00.799 --> 00:13:05.039 great friend. He's been on this program many many times 206 00:13:05.120 --> 00:13:08.000 over the years. Uh, he is really one of my 207 00:13:08.159 --> 00:13:11.840 go to guests on anything. Oh, he is my go 208 00:13:11.879 --> 00:13:16.159 to guest on China. Professor Greg Styler with the Questum 209 00:13:16.240 --> 00:13:21.039 School of Business at Boston University. He has led delegations 210 00:13:21.039 --> 00:13:25.159 of students, both undergrads and on graduate students to China 211 00:13:25.919 --> 00:13:29.039 dozens of times. We'll get to all of that, and 212 00:13:29.120 --> 00:13:31.440 your phone calls six one, seven, two, five, four to 213 00:13:31.480 --> 00:13:33.480 ten thirty. If you really want to talk to someone 214 00:13:33.519 --> 00:13:38.120 who has spent time in China, who understands China's view, 215 00:13:39.240 --> 00:13:42.279 they are not as impetuous. I think, as we are 216 00:13:42.399 --> 00:13:45.679 as a society, we look for a turnaround within forty 217 00:13:45.720 --> 00:13:48.559 eight hours. They think of a turnaround, I think in 218 00:13:48.639 --> 00:13:50.840 terms of a short term turnaround, in terms of like 219 00:13:50.879 --> 00:13:54.120 forty eight years. We'll get to that as well with 220 00:13:54.240 --> 00:13:58.519 my guest professor Greg Styller right after this break six one, seven, two, five, four, 221 00:13:58.639 --> 00:14:01.399 ten thirty or six months seven nine three to one, 222 00:14:01.600 --> 00:14:06.120 ten thirty. Great opportunity for you to ask a question 223 00:14:06.159 --> 00:14:09.360 of someone who will give you a straight answer about 224 00:14:09.399 --> 00:14:11.480 a very complicated issue. 225 00:14:12.120 --> 00:14:17.799 Night Side Thought with Dan Ray. I'm WBZ Boston's News Radio. 226 00:14:18.879 --> 00:14:22.399 My guest professor Gregg Staller. He is with the Boston 227 00:14:22.480 --> 00:14:28.559 University's Master lecturer at the Boston University Questrum School of Business. 228 00:14:29.600 --> 00:14:32.879 How many times have you taken students to China over 229 00:14:32.879 --> 00:14:33.279 the years. 230 00:14:34.080 --> 00:14:36.639 I've been to China over fifty times. 231 00:14:37.399 --> 00:14:40.559 Okay, in many of those with accompanying students. We can 232 00:14:40.559 --> 00:14:43.519 talk about that a little bit so so from China's perspective. 233 00:14:44.320 --> 00:14:48.840 I know you sent me a little summary which I 234 00:14:48.879 --> 00:14:52.039 really appreciated. The time you spent today you were checking 235 00:14:52.120 --> 00:14:57.039 out China television news, financial times in China, and in 236 00:14:57.120 --> 00:15:02.279 another website called Caxon, which I'm not familiar with. That 237 00:15:02.440 --> 00:15:06.080 is a Chinese based newspaper or. 238 00:15:06.559 --> 00:15:10.799 Is it a correct It's in Chinese, it's pronounced I seen, 239 00:15:11.039 --> 00:15:15.519 and it is the probably equivalent of Yahoo Finance here 240 00:15:15.519 --> 00:15:16.039 in the States. 241 00:15:16.039 --> 00:15:21.200 Gotcha? Okay? Perfect? Okay? So so they obviously representing many 242 00:15:21.399 --> 00:15:25.480 their articles represent the philosophy of the government more so 243 00:15:25.559 --> 00:15:29.159 than say, the New York Times and ABC and yeah, 244 00:15:29.200 --> 00:15:33.279 you know, Yahoo Finance represents the philosophy necessarily of the 245 00:15:33.279 --> 00:15:37.679 incumbent administration here. So when you read them, you're really 246 00:15:37.720 --> 00:15:40.000 reading what the Chinese government believes it. Am I correct 247 00:15:40.000 --> 00:15:41.679 when I say that? Or is that too correct? 248 00:15:41.879 --> 00:15:44.799 And obviously you know we can we can split hairs. 249 00:15:44.840 --> 00:15:48.240 I'm not necessarily sure that all three of those articles 250 00:15:48.240 --> 00:15:51.080 are direct mouthpieces for the Chinese government, right, not I 251 00:15:51.559 --> 00:15:53.759 but I but I think they are directionally correct. 252 00:15:53.960 --> 00:15:59.159 Yes, okay, and so so cumulatively, what do you think 253 00:15:59.279 --> 00:16:02.279 Chinese position here is when when when President Trump sits 254 00:16:02.279 --> 00:16:04.360 down with his advisors and he says to them, you 255 00:16:04.399 --> 00:16:06.879 know what's going on? What are they thinking? How come 256 00:16:06.919 --> 00:16:09.200 they haven't folded their tent here? We'll hit him with 257 00:16:09.240 --> 00:16:12.559 one hundred and tariff of one hundred and forty five percent. 258 00:16:13.480 --> 00:16:14.200 What's going on? 259 00:16:14.879 --> 00:16:18.480 Would I tak Yeah, I would tell them that there 260 00:16:18.480 --> 00:16:22.080 are three things going on. One is they are displaying 261 00:16:22.080 --> 00:16:26.639 a show of confidence. Second is that they are displaying 262 00:16:26.799 --> 00:16:30.399 a show of pragmatism. And third is they are calling 263 00:16:30.440 --> 00:16:36.080 President Trump's bluff, saying that he overestimated his bargaining approach 264 00:16:36.120 --> 00:16:36.919 on the terifficient. 265 00:16:37.679 --> 00:16:42.840 Okay, so how long are they willing to to steer 266 00:16:42.919 --> 00:16:47.360 him down? At what point does either side give or 267 00:16:47.399 --> 00:16:49.440 could this go one now for months? 268 00:16:49.840 --> 00:16:52.679 So that was the epicody that I had as I 269 00:16:52.720 --> 00:16:55.200 finished my third article and actually checked this with a 270 00:16:55.279 --> 00:16:58.879 Chinese national to make sure that my translation was correct. 271 00:16:59.240 --> 00:17:02.799 There are in the process of rejiggering their supledging. They 272 00:17:02.799 --> 00:17:07.279 are already in advanced discussions with German companies in China. 273 00:17:07.599 --> 00:17:11.200 They're already in discussions with Latin American companies in China. 274 00:17:11.559 --> 00:17:14.279 And they basically said, we gave the United States, for 275 00:17:14.319 --> 00:17:17.640 all intents and purposes, a right of first trading refusal. 276 00:17:17.680 --> 00:17:19.519 We love working with the United States. We worked with 277 00:17:19.559 --> 00:17:23.200 the United States since you know they got into the 278 00:17:23.240 --> 00:17:25.799 World Trade Organization in twenty oh one. But if times 279 00:17:25.799 --> 00:17:28.799 are going to change, and a direct translation from the article. 280 00:17:29.039 --> 00:17:31.920 If the US is proving to be unreliable, we still 281 00:17:32.000 --> 00:17:32.920 have a job to do. 282 00:17:34.799 --> 00:17:39.759 So in in layman's terms. In Layman's terms, what is 283 00:17:39.799 --> 00:17:45.359 the impact on us if that is not a bluff, 284 00:17:45.440 --> 00:17:47.960 but that is what they really believe in, what they 285 00:17:48.039 --> 00:17:49.720 really intend to follow through with. 286 00:17:50.920 --> 00:17:54.519 I think to your point before you went into a break, 287 00:17:54.920 --> 00:17:58.920 that the Chinese perspective of time is a lot different 288 00:17:59.079 --> 00:18:01.759 than we have it here in the United States, so 289 00:18:01.799 --> 00:18:05.240 they're in no particular rush. I think that President Trump 290 00:18:05.359 --> 00:18:09.079 was hoping for a quick turnaround on this, and it 291 00:18:09.200 --> 00:18:12.039 certainly is not happening as quickly as he would like. 292 00:18:12.480 --> 00:18:15.839 So I think that China is taking the pack of 293 00:18:16.640 --> 00:18:20.319 We'll keep talking and hopefully we can broker some sort 294 00:18:20.319 --> 00:18:23.920 of settlement, but we're not going to rush the process. 295 00:18:24.039 --> 00:18:27.079 And if you guys aren't making a decision, we are 296 00:18:27.119 --> 00:18:29.519 going to rejigger our supply chain. And it's sort of 297 00:18:29.519 --> 00:18:32.160 the game of musical economic chairs, and we hope the 298 00:18:32.240 --> 00:18:34.359 United States still has a chair when the music stops. 299 00:18:35.599 --> 00:18:39.119 Okay, when we get back, I'd like to talk about 300 00:18:39.599 --> 00:18:44.680 what is it that we so desperately need from China 301 00:18:44.799 --> 00:18:47.319 that that would would be a pressure point. 302 00:18:47.680 --> 00:18:48.839 Great, great question. 303 00:18:49.160 --> 00:18:57.119 Yeah, and how long can we do without before a 304 00:18:57.160 --> 00:18:59.759 real crisis. I mean we're in a crisis now, but 305 00:19:00.400 --> 00:19:03.839 the crisis intensifies, that will be where we'll start on 306 00:19:03.839 --> 00:19:05.680 the other side of the news at the bottom of 307 00:19:05.680 --> 00:19:07.559 the hour. My name is Dan Ray. This is Nightside 308 00:19:07.720 --> 00:19:13.039 listening to my guest, Boston University professor at the School 309 00:19:13.079 --> 00:19:15.720 of at the School the Question School of Business. He's 310 00:19:15.759 --> 00:19:19.000 a master lecturer there. I was stunned that you speak 311 00:19:19.039 --> 00:19:24.680 seven languages. Greg. I've known you and I have a 312 00:19:24.680 --> 00:19:27.599 tough time speaking one and I'm the talk show host. 313 00:19:28.279 --> 00:19:30.920 Well, I'll keep in mind there. I stick at sports 314 00:19:30.960 --> 00:19:33.519 and I don't do hold improvement on the weekend, so 315 00:19:33.559 --> 00:19:35.000 I need something to keep myself. 316 00:19:34.720 --> 00:19:34.960 In the. 317 00:19:37.000 --> 00:19:41.680 Professor Greg Staller, the Boston University Question School of Business. 318 00:19:41.680 --> 00:19:44.839 If you'd like to join the conversation, you have the numbers, 319 00:19:45.240 --> 00:19:49.079 love to hear your questions. I'm trying to think of 320 00:19:49.160 --> 00:19:51.359 the best questions I can come up with, but I'm 321 00:19:51.400 --> 00:19:53.960 sure you have some better questions, So feel free to 322 00:19:54.079 --> 00:19:56.799 join our conversation at six month seven two five four 323 00:19:56.799 --> 00:19:59.799 to ten thirty six month seven nine three one tenth 324 00:20:00.000 --> 00:20:03.079 Already Professor Staller was telling me that it was with 325 00:20:03.160 --> 00:20:04.920 us just two or three weeks ago. I can go 326 00:20:04.960 --> 00:20:06.960 back and find the date. He said that he never 327 00:20:07.079 --> 00:20:10.960 had such response in all his times here on Nightside 328 00:20:10.960 --> 00:20:14.079 to this topic, which is in very large part why 329 00:20:14.160 --> 00:20:16.640 I want him to come back tonight and stay with 330 00:20:16.720 --> 00:20:20.400 us on a regular basis, because I think, just as 331 00:20:20.480 --> 00:20:24.519 COVID was the story of twenty twenty, this my instinct 332 00:20:24.680 --> 00:20:27.319 political instinct tells me this is the story of twenty 333 00:20:27.400 --> 00:20:30.240 twenty five. We'll be back on Nightside right after the 334 00:20:30.279 --> 00:20:31.480 news at the bottom of the hour. 335 00:20:34.519 --> 00:20:41.839 You're on Nightside with Dan Ray on WBZY, Boston's news radio. 336 00:20:41.960 --> 00:20:44.400 You are indeed on night Side with Dan Ray, but 337 00:20:44.480 --> 00:20:48.119 you were also on with Professor Greg Staller. He is 338 00:20:48.200 --> 00:20:52.440 a master lecturer at the Boston University Questum School of Business. 339 00:20:53.079 --> 00:20:56.519 It's been back and forth to China dozens of times 340 00:20:56.839 --> 00:21:01.440 in the last thirty years. Knows that economy as well 341 00:21:01.480 --> 00:21:05.680 as anyone I could imagine. So Greg, the question we 342 00:21:06.079 --> 00:21:09.400 left with on the other side of the break was, 343 00:21:10.160 --> 00:21:15.039 we're a We're an impatient We are impatient people in America. 344 00:21:15.119 --> 00:21:20.160 We want things done quickly and effectively and efficiently. At 345 00:21:20.200 --> 00:21:22.799 what point is this going to start to. Right now, 346 00:21:22.799 --> 00:21:26.240 we're worried about the fluctuations in the stock market, and 347 00:21:26.279 --> 00:21:28.640 people to worry about their fro one ks and their 348 00:21:28.680 --> 00:21:32.839 iras and all of that sort of stuff, their wroth accounts. 349 00:21:33.400 --> 00:21:38.720 They're worried about the value of their investments. When does, 350 00:21:39.599 --> 00:21:42.359 when does this get better anytime soon? And how do 351 00:21:42.440 --> 00:21:47.920 you see it getting better? Let's look positively, does the 352 00:21:47.960 --> 00:21:52.880 President Trump announced deals with sixty or seventy five major 353 00:21:52.960 --> 00:21:58.440 nations and isolate China or the China just hang out 354 00:21:58.640 --> 00:22:06.799 and effect make us uh so uncomfortable that that we're 355 00:22:06.880 --> 00:22:11.000 missing medications or we're missing computer chips. So whatever, what 356 00:22:11.079 --> 00:22:12.400 how does this end? Do you think? 357 00:22:13.400 --> 00:22:13.640 Again? 358 00:22:13.720 --> 00:22:16.279 Good question, Dan. You you might think I know a 359 00:22:16.319 --> 00:22:18.440 lot about China. You know more about politics than I 360 00:22:18.480 --> 00:22:22.160 could ever know in probably two lifetimes. It's my understanding 361 00:22:22.160 --> 00:22:26.200 at that's true, Uh, Craig if I'm wrong, but I 362 00:22:26.279 --> 00:22:29.279 believe that a number of elections, either at the local, 363 00:22:29.319 --> 00:22:32.599 the state or the national level, are often decided by 364 00:22:32.680 --> 00:22:35.799 people in terms of the impact of their pocketbook. And 365 00:22:35.839 --> 00:22:38.400 I think if if I think, if it's and you 366 00:22:38.440 --> 00:22:40.880 can you know, give all of the statistics that you 367 00:22:40.920 --> 00:22:43.400 want as a political candidate of how well you've done, 368 00:22:43.440 --> 00:22:46.599 But if the economy isn't humming along, people are going 369 00:22:46.680 --> 00:22:48.880 to use that against you. That's my understanding, right. 370 00:22:50.200 --> 00:22:54.200 And there are special elections that have come up recently. 371 00:22:54.279 --> 00:22:57.799 Even though the Republicans held two congressional seats in Florida, 372 00:22:58.240 --> 00:23:02.000 the margin of victory in those seats are pretty disquieting 373 00:23:02.000 --> 00:23:05.119 for the Republican Party because these were districts that in 374 00:23:05.200 --> 00:23:09.480 northern Florida, which President Trump carried by some thirty two 375 00:23:09.599 --> 00:23:13.960 or thirty four points, big, big, big victories, and they 376 00:23:14.000 --> 00:23:18.400 were within March, they were within ten point margins, huge difference, 377 00:23:18.960 --> 00:23:21.440 trending in the wrong way for the Republicans. So those 378 00:23:21.759 --> 00:23:23.920 would be a couple of canaries in the coal mine 379 00:23:24.000 --> 00:23:27.640 for the Republicans. And you know, at some point there'll 380 00:23:27.680 --> 00:23:32.359 be more of this, so that you know the politics 381 00:23:32.480 --> 00:23:35.440 very well as well. I'm more interested in the economic 382 00:23:35.759 --> 00:23:36.400 impact here. 383 00:23:36.480 --> 00:23:41.759 So the economic impact is that, according to a number 384 00:23:41.839 --> 00:23:44.400 of sources that I've been reading for the past three 385 00:23:44.519 --> 00:23:48.240 or four weeks, this could represent this being the tariffs, 386 00:23:48.559 --> 00:23:52.319 a loss of almost five thousand dollars per household if 387 00:23:52.359 --> 00:23:54.359 things continue unchanged. 388 00:23:55.920 --> 00:23:57.960 Is that worst case scenario. 389 00:23:57.920 --> 00:24:01.400 That is worst case scenario, and even though he's put 390 00:24:01.440 --> 00:24:05.480 a pause on it for ninety days, multiple outlets have 391 00:24:05.599 --> 00:24:08.640 reported that it could go anywhere from a low of 392 00:24:08.839 --> 00:24:11.680 three thousand to a higher seven thousand. I splewit the 393 00:24:11.680 --> 00:24:15.279 difference at five as the worst case scenario, and it 394 00:24:15.319 --> 00:24:16.079 could be a problem. 395 00:24:17.079 --> 00:24:23.400 Okay. Meanwhile, China sits back and there's nothing that we 396 00:24:23.640 --> 00:24:28.519 have or that they need that they now cannot afford. 397 00:24:28.640 --> 00:24:32.000 I mean, I assume that's part of the White House strategy. 398 00:24:32.400 --> 00:24:36.160 Right, I mean, the White House strategy is saying, let's 399 00:24:36.359 --> 00:24:39.559 have this be a test of wills, and let's outstair 400 00:24:39.680 --> 00:24:42.920 one another and hopefully one side will blink. I mean 401 00:24:42.960 --> 00:24:45.759