Sweet P

Yes, sir. the short-term pain of tariffs might be a deliberate strategy for long-term gain, but not in the way you think. With $7T of federal debt due in the next 6 months, the Trump administration is facing a refinancing crisis. They don’t want to refinance at 4%+ rates where the 10-year Treasury yield hit 4.8% earlier this year, which would be catastrophic for debt costs. To bring those yields down, the administration needs the market to show weaker growth, convince investors DOGE is working, and push the Fed to lower interest rates. How? By creating massive uncertainty, like tariffs. Tariffs spook equity markets, driving investors to sell stocks and buy bonds, which lowers yields. Lower yields mean cheaper refinancing for the government, and that gives the Fed room to cut rates, further reducing borrowing costs. Sure, conventional wisdom says tariffs are inflationary and should spike the 10-year yield—but the data shows otherwise. In 2018-2019, tariffs briefly tanked stocks while boosting bond prices, lowering yields. The Trump admin is betting on this short-term market chaos to stabilize long-term debt costs, even if it means higher prices and economic uncertainty now. So tariffs aren’t just about jobs or manufacturing; they’re a financial gambit to manage the debt crisis.