Global Trade This Week – Episode 175
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Unknown Speaker 0:00
You're watching global trade this week with Pete mento and Doug Draper,
Doug Draper 0:10
hello everybody. Welcome to a another edition of global trade this week. I am Doug Draper, I'm only half of the show. There's actually two other folks that make this thing happen. One is my co host. The other one is Keenan that pushes the buttons. Pete, I'll let you tell the audience where Keenan is and how this is truly a global trade discussion today. That's
Pete Mento 0:33
a good point. Keenan is up in Alberta, I believe, in Canada, and we were just having a conversation about the confusion that comes as an American being, you know what, like, hours away from home, and suddenly you have to understand Celsius and kilometers. And I told him that my that my conversion rate was, I don't care, I'm American. I didn't use those words. I use much stronger language. So, yeah, you know, I feel bad for him. He doesn't know how high to turn up his heat, because there's Celsius. He doesn't know if he's speeding because it's kilometers. I would just, I would just show the police officer the Constitution and say,
Doug Draper 1:14
Yeah, I love it. When he was talking about that, I was reminiscing back to when I was when we were in elementary school, and US was going to go metric, and you were taught all the metric conversions, and that lasted maybe a blink of an eye. And America was like, Nah, we'll stick with this ultra confusing Weights and Measures, approach to to things. So anyway, that's the first thing when he was talking about Celsius and Fahrenheit. I'm like, you know,
Pete Mento 1:49
it's crazy. Let's just be honest, bud. When, when Reagan came into office, right? It all that touchy feely, the Jimmy Carter, happiness, let's all get along and work it out. Just went right out the window and it was, hey, listen, unless you want to fight the Cold War, don't tell us what to do. We're good. Thank you. And everything stayed with miles and pounds, and I didn't really think again about any of that stuff until I went to the academy, and then it came rushing back to me like a fever dream, and I had to learn it all over again. But then it was like, What's a knot? I'm like, Oh my gosh, a knot. Like, how fast, how far is a knot? And that would be on tests and, you know, convert kilograms to pounds and pounds to kill kilograms. And it was madness, but I had to learn it all over again. So I'm, I hate to admit this after saying what I just said, Doug, but I'm actually pretty adept at the whole metric to English version. Okay, nice,
Doug Draper 2:45
yeah, seafaring measurements are a whole nother level, like nautical miles. I don't know. Is it longer, shorter, longer? Is that a good thing? I don't know. Yeah, I think it is longer. Is that what you
Pete Mento 2:56
said it is, yeah, it's longer, yeah. And not only is it longer, but because the ground underneath you is moving for a long time, you weren't really 100% sure. So thank God for GPS coming out. When I went to college, or I probably wouldn't have graduated, it definitely helped a lot. I mean, I went to school to learn how to figure out where I was by taking a sextant and pointing it at a star or sun or whatever, you know, and then looking at your watch and setting it to GMT, and hopefully it's exactly right. There was this guy, so I don't know if he listens to the show. I still talk to him a great deal. His name is Tom Ashton, and Tom Tom was like a savant at celestial navigation. The guy would go up on the bridge, and you wait till the sun's just about to set. We call it nautical twilight. And so you can, you can see the horizon, and the stars are bright. And then we all knew the stars back then it was crazy, like sometimes it still pops in my head, and you, you'd find the star, and then, using these mirrors on a sextant, you'd, you'd do this to make the star at the angle just barely touch the horizon, and then somebody would click the time of exactly what time it was. Well, that's one star. Now we got to get at least two more. And then you have the angle of those stars, and where they cross on a map is your position at latitude and longitude. And there's something very cool about it, because you're, you know, this is, this is what John Paul Jones used. This is, you know, Blackbeard did this kind of stuff. And when you were right all the time, like, Tom was, it was, it was wonderful to see it happen. But you hated him so much because he was so good at it, you know. It's supposed to be a perfect pinwheel. Mine's got, like, a big square in the middle where it's not I gotta, kind of like, you know, thumb it up there, you know. But then GPS came out, I'm like, Hey, Tom, Tom, watch this. Here's where we are. Yeah, go up, jump on the bridge wing for an hour and go work that out. I'm just going to sit here and press a button. I'll be drinking coffee and working down cigarettes while you do other stuff. Have fun, pal. Yeah. And they have another type called inertial Doug where, where it actually says is exactly where I am with the GPS. And now. Well, it measures the ship's movement with using a gyroscope. They're like, crazy, crazy accurate. Navy ships have those. So that was even better, because it said you have to even press a button. It was just on a readout. Newsprint was fabulous
Doug Draper 5:16
technology. I'm sure AI is going to come in there at some point and just tell you where to go, grab the controls and tell you guys to drink more beer and have some smokes. So Well,
Pete Mento 5:25
Doug, do you know why AI will never be a good sailor? It's very easy. Doesn't get drunk, can't back you up in a fistfight at a bar. Won't lie to your wife what you were doing, you were in Port. These are, these are all very important things to a seafarer. So yeah, it will never be the perfect seafare. I'm sorry.
Doug Draper 5:42
Yeah, yeah, good point. And that's a hell of a transition to get into our show. Pete, I think we'll just leave it at there. We're going down this path that's designed for another show. But hold on a second. I kicked it off, man, so you
Pete Mento 6:00
let it rip. Well, a quick insight. I am in California at the moment, so I'm in Redondo Beach, my second favorite of the beaches. I really love hermosa a lot. But I was woken up this morning about 345 I slept with my door open at my hotel the outside, you know, the balcony door to a cacophony Doug, a cacophony of sea lions going over and over and over again. And it was kind of cool for the first five minutes, and now I just want to go out there and scream at him to shut the hell up. But yeah, so I can recommend the Shade Hotel. It's very nice, but if you come, definitely bring your earplugs. So my first topic is something that since the election, Doug, I have been on calls, usually starting at four o'clock in the morning, East Coast time, going all the way till seven, eight o'clock at night, every night. And it's the same thing. Are these are these tariffs going to happen? What are they going to apply to? Are there going to be exceptions? What countries do you think they're really going to apply to? And for the most part, I have to say, I don't really know, right? I don't know, but here's what every indication is kind of pointing to, and just be prepared based on that. But one question I love getting is, what's the point all this, and particularly with China, like, why are we doing all this? And that we can't answer, and that's, uh, it's been kind of the same expected outcome that we've wanted, going all the way back to Clinton. So when Clinton allowed China into the World Trade Organization, what we've really wanted is a stable relationship with China that would allow them to economically flourish and hopefully bring them closer into the global organization of states. Because the more connected we are, the less likely we are to have conflict amongst nations, right? And this particular President kind of got the ball rolling on what he wanted. So right before COVID, I think we talked about it a few times on the show. The US and China had come to a bit of a, you know, basic deal. It was a draft of a deal. And that draft of a deal for the first phase actually got accepted by both parties. So it's a three phase agreement that the President wanted. Then in 2019 The first phase was a massive expansion of exports of American agriculture. We are Doug and I are unabashed, like unashamed, big fans of farming and agriculture, and we are in America, incredible at producing food, absolutely incredible. But one of the biggest markets in the world has hamstrung our ability for our farmers to sell their goods there. So President Trump had greatly expanded by hundreds of billions of dollars the exports of goods to China from American farms. And it was corn, it was sorghum, it was wheat, it was beef, it was pork, it was chicken, it was everything that we make here. And it would have had an incredible impact on the lives of farmers in America, and would have allowed them to sell their goods to a country that really needs them. The second was the opening up of American financial providers like American Express, Merrill Lynch, you know, these, these big financial service firms to Chinese consumers at the individual level, as well as large financial concerns, being able to work with local businesses, which, right now, they don't have as much access as they would like. And the third was, there's some other ones. These are the big ones. Was access to large project operations and opportunities for American companies who want to build big projects in China, the biggest being like, new ports, new ports for natural gas, airports, these sorts of things. American companies were always kind of, yeah, you can you can try to bid, but come on, we all know you're not going to get it. So they wanted to have some clarity on that. And the fourth one, which is big but wasn't really talked about last time, was the. Preferred status of American natural gas being exported to China. So those are pretty big. And in 2019 everything looked like it was on track, you know. And then bam, you know, somebody got the sniffles, and the whole world got sick, and everyone kind of forgot about it, and this phase one agreement just sort of sat there collecting dust. So when people ask me, what the point of this is, it hasn't changed. The President wants to see us re embrace the Phase One agreement, and if China will do that, I think all this goes away. Phase Two has to do with intellectual property and coming up with ways it's addressed in the phase one, but phase two is addressing this in a very real way, and for there being consequences for either part of the US or China walking away from this. Also a framework on forced labor. And then the third phase, pardon me, the third phase would be focused on trying to find ways to make more and more products to be free between the two countries. So Doug, we already know what they want, and China already knows what we want, and it sounds like in the past, they were even amenable to it. So there is a chance, buddy, that this could go away if China decides to play ball. And right now, I think that's in both of our best interests that they do. Yeah,
Doug Draper 11:10
well, those are all amazing points. Pete, as usual, your background knowledge on this topic is phenomenal, right? And I just kind of sprinkle in my two cents. I'm just going to roll into my topic. I'm going to comment using my topic as well, because it was related to the tariffs tag team. This one, you know, you
Pete Mento 11:31
know what? When I love tag team and the love this stuff, go ahead. Doug,
Doug Draper 11:35
yeah, for sure. So, yeah, all that. I guess the bottom line with your details is, I think it's a little bit of posturing to kind of dumb it down absolutely. And I think it's all about the negotiation. The new president wrote a book about it, you know, the art of the deal. And I think it's just setting the stage. And there is some brilliance, may be a top word, but to have this, I mean, when was the last time you heard about Biden really doing anything right? Maybe a couple of sprinkles here and there, and pardoning his son. But as far as, like, what is going on in global trade, it all revolves around the new President Trump, and that's a great way to get the runway started, right. I mean, he is setting expectations and defining, you know, calling his shot before it even gets started, you know, as far as his presidency. So I think it's some posturing, some negotiating tactics, but I think that those, you know, three or four bullet points that you said, I think intellectual property is super important to certain folks. But I think the other things that you spoke about are going to are really going to trump that, no pun intended for what's important during this agreement. So, yeah, I guess the bottom line is, I think it's posturing a little bit of negotiation, or a lot of negotiation. I think it'll really shake out. And the good thing is, things move quick with Trump, right? And we'll, we'll know what's going down. We spoke about it a couple weeks ago. All this will shake out in the first quarter of his presidency, for sure. So yeah, it'll, it'll be interesting. The last thing on this, Pete, those items that you spoke about, are those going to be front and center, and are those going to be the reasons for the negotiation, or is it simply just we want to crush our competitor? It'll be interesting to see how that plays out. If those logical initial reasons for why are we doing this come back to the forefront? Yeah,
Pete Mento 13:33
I would say that they're absolutely front and center. And I think that there's not going to be okay. This is Pete talking, and I don't have any insight into this. I worry that President Trump knowing that the stakes are higher for China now he may try to include more things in the phase one, right? That's just a negotiator negotiating. It's like, I know, I know you're up against the ropes. I know that you need more, probably than than that's already in here, out of us. So I want some more back. How far can I push this? And I think also just being pragmatic, it's unlikely the President could get all three phases done in one term. It's just unlikely. So could he try to push more of it, to try to get more of it under his name as a legacy? And I think legacy is very important to this President, to all presidents, but this one in particular. So I would imagine it wouldn't be ridiculous to think he would try to take things out of phase two and three of the old approach, try to include them in phase one. You know, we'll see. I forget other Chinese should think it's important for us to mention they're in a period of like ultra nationalism right now, where businesses and individuals, they're very proud of the fact that they've become such a dominant economy, and we can't. We can't, as Westerners, overlook the fact that they have their own desires, their own goals, globally and their their goals are 100 year 200 year goals. They're not four year goals like a president, so they'll be thinking much more long term than I think President. Uh. Trump will be with his administration?
Doug Draper 15:01
Yeah, yeah, good points, and certainly not the last time we'll talk about this one man. I
Pete Mento 15:07
hope it is, I hope, like next week, everything's taken care of before he even goes into office. And then we're done talking about this, because I haven't had more than three or four hours of sleep in, what, three weeks now, and it's starting to get to
Doug Draper 15:18
me, and it's the same discussion, you could just hit autopilot. I'm sure some of the discussions that you've had, but they are important
Pete Mento 15:25
to get the word out. Doug, I am sick for the first time, and I don't know how long, like, like, it's not, it's not a stomach bug or something, but just, I'm worn down, brother, so I'm I need four or five days to just lay in bed, and maybe I'll binge Battlestar Galactica, I don't know. Drink, drink a lot of electrolytes. Get my crap back together, buddy. Yeah. Well,
Doug Draper 15:49
you don't sound too bad for me, which means you're putting on your game face, and I appreciate that so well. Hey, that takes us to halftime and brought to you by CAP logistics, who are global and worldwide. With Keenan being up in Calgary, he's unfortunately not going to be able to do any skiing up there. It's all business, no pleasure. But we thank cap for giving us the opportunity, and Keenan being in another country, making this thing happen today. So check out cap logistics.com.
Pete Mento 16:17
Hold on Hold on Hold on Are you telling me that Keenan is on a business trip and actually has to do business like an adult, like an adult, like a man losing his hair, that that has bills to pay and people that depend on him and a boss that has expectations, wow, like, like, when you and when you're in Fresno, and when I'm in I don't know, Like, like like, wherever in Alabama, like those kinds of trips. Yeah, we should send them a care package. We should send them some gummy worms and maybe a new game for a switch, some coloring books to try to get them through it. Yeah, yeah.
Doug Draper 16:53
Well, it's pitch black and everything's in Celsius, so the guys in the world are hurt, all right. So halftime. Very good. Pete, I'm going to go first because I'm like, I'm excited about this one, right? So this is the time of year where it's always the year end, the Person of the Year, things of that nature. What you know, the big events that have happened in 2024 and one of those is defining the word of the year. So Oxford came up with the word of the year, and before I get in to tell you what it is, apparently there's 37,000 votes. Now I don't know how they selected. Maybe here's the top five that you vote for. There was global discussions and analysis of language data. I'm not really sure what that means, but it's a big term, but here little drum roll, the Oxford word of the year is brain rot. It's actually two words, but I don't think there's a hyphen in there, but brain rot, and it's like the deterioration of a person's mental intellectual state. I'm kind of looking here, viewed as a result of over consumption of material, particularly online content, considered to be trivial or unchallenging. So basically it's the mind just scrolling, swiping, swiping, swiping through whatever it is, Facebook, Reddit, you name it. So I don't know what's your take on the word of the year being brain rot.
Pete Mento 18:34
Think it dumb. I think it's very dumb. So we can start there. Doug, first, I'll talk about this idea of word of the year. It's, it feels to me like the Oxford Dictionary. People said, Hey, what? They got some young marketing consultant, and I can see what they look like in my brain, because I've met so many of them. And this young marketing console is like, we got to make you relevant. We got to make it part of today. And he looks over at his team, who are somehow even younger than he is, right? And they're, they're like, they're all, they're all very stylish. Like, how about a word of the year? Like, all that, right, in all the Oxford English Dictionary, people say that really doesn't sound on brand for us. No, no, no, this is going to be perfect. We'll get you on the tick tocks. Well, we'll have you all over Instagram with your Word of the Year. We'll, um, we'll have, we'll have Regis and Kelly actually don't even there anymore. It's how old I am. We'll have the people on the people on the Today show talking about it while we talk about the word of the year, damn it. Doug, it worked right? Every year. This becomes like a thing at the end of the year that's widely publicized, and we all end up talking about it. I don't like that at all. Okay, old man. Thing aside, brain rap. I really hate this concept even more. Like pick up a book, you idiot. You know, pick up a book, grab a magazine, open your iPad and download the economist for a year, if you're in this business, and read a couple pages every night before you go to bed, before next week turns up, you get a brand new economist. You know, you. Write something journal, do something with your brain that's going to make it better, instead of watching tick tocks of puppies and baby goats and pajamas and whatever the hell else it is that you do now, there's, there's a part of that. It's healthy, you know, let your brain wander. But damn it, whatever happened to reading a book you know, at night? Whatever happened to having a conversation with someone before you go to bed. Take a warm shower. Drink a warm glass of milk, watch the mat lock, get over it so brain rot as a concept, I think it's just a nice way of saying getting dumber, not challenging yourself, not trying to find ways to better yourself academically. Knock it off. Take some night courses. Let's face it, like you can take a class for next to nothing if you don't want college credit on it from any university, and you can do entire university courses for free on YouTube, work on yourself instead of sitting there and taking a look at Instagram crap all night long. Sorry, Doug, you're, I'm, it's gonna be, it's gonna be a Get off my lawn morning for me, and it's
Doug Draper 21:01
already there. I'm picturing you with the holiday right behind us. I'm picturing you that old man on the porch in a rocking chair, yeah, and you're the grandfather, and the daughter in the family comes to visit, and the mom is making the teenage kids go out and talk to you. They're reluctantly and then you talk about all this, get off my large stuff, and they're kind of listening because they're trying to check their phone at the same time, and all grandpa Pete, whatever he's talking about, I'm going to go back inside. So that's the visual I have when you were talking about
Pete Mento 21:32
two things. I got to add to that. Okay, so a friend of mine at Thanksgiving, he had all of his kids home. So this guy's got six kids, and he's 54, years old, and one of them started talking about the election, and he grabbed his spoon and He covered it in mashed potatoes, you know that move, and he hit his his son in the face from like across the table. He said, The next person that brings up the election is going to get the whole bowl. We're done. We're not doing it, right? I really respect that kind of aggression. And then the second thing I wanted to bring up with all that is when I moved to Maine, and I'm living on 40 acres, and there's a please don't, please don't come in doormat, right? There's going to be like, phone goes on the charger, and there's no there's no phone. Phone. You come to visit me if you want to come visit me on coastal Maine and have lobster bakes and hang out with me. Great. But your phone goes on the charger in the house, and you can check it in the morning, check it at night. Give anybody who needs you the home phone number for the landline. But no, there's no phones, buddy, we're done. We're done with that. You're reading books. You're reading books,
Doug Draper 22:43
and you have a perpetual bowl of mashed potatoes and a spoon in there
Pete Mento 22:48
ready to go. Or maybe I'll get one of those super soakers, and that will be the first warning, and then I'll just turn the hose on you for the second one. Yeah,
Doug Draper 22:55
I love it, all right, so we'll continue this great banter and positive outlook on life with your halftime topic. Pete, so
Pete Mento 23:03
whatever. That's worse. It's much worse. Doug, so I know that's why I said that things that are driving me crazy at the moment, and I'm I'm trying really hard to be a nicer person about a lot of things. Okay, so one that's making me crazy, Doug, is the American obsession lately with having conversations with people on FaceTime in public without headphones on. So I'm at an airport trying to listen to the overhead, you know, trying to get work done. I'm constantly on my laptop trying to get work done. And there's some young person, generally, and young to me, is like anybody under 35 at this point. Okay, there's some young person who has their their face time on having a conversation with someone. And here's the way, don't get dug they're not looking at their phone. It's not like this. The phone's down here. The other person on the other line isn't paying attention either, and they're having a full on conversation about things that don't matter to me or anyone else, like, what? Why are you having an argument with your significant other for everyone to hear? Or, why are you talking to me about whatever you know, personal issue you have with someone? I don't care. I don't I don't care. Send them a text, write them an email, put it on a carrier pigeon, but leave me out of your personal conversations. So what I've taken to doing recently Doug is I pick up my phone and I have a it's not a real conversation, and I just taught start talking about things to make people uncomfortable. You know, I'll say, Yeah, I'm gonna have to go see the doctor again, because, well, you know, I think I'm impacted, yeah, it's been weeks, nothing's happening, yeah? So I'm probably gonna have to get flushed out or whatever. Oh, it's gonna be awful, yeah, you know, I think one of the nurses gonna have to hold my hand, uh huh, yeah. Oh, it's terrible, yeah? Or I'll start talking about, you know, yeah, when they pulled the gauze out of my nose, you wouldn't believe the color of the stuff that was come like, I will do whatever i. I can to get them to take it off. I gotta call you back. This guy's out of his mind. The other thing I cannot stand is the the complete lack of respect for public spaces. So whether it's people who are clipping their toenails on planes, Oh, seriously, right, really, or the number of times this week, Doug, just this week that the person behind me on a plane has wedged their toe in between the two seats behind, you know, they're behind me, so they wedge their foot between me, and I look over and there's someone's raw foot just sitting there, you know? So you know what I do now, Doug, I tickle him. I tickle them. If you, if you put your toes and your foot squeeze in between to put them on my armrest, I'm going to tickle you. And when you scream at me, I'm going to say, What are you talking about? I just I saw a foot there. I figured that's why you had it there. You wanted some creepy old man to tickle you on a flight. So I don't know any other reason why you put it there. That makes me nuts. But we're going to end it with this one. Doug, Okay, last night, I'm in I'm in LA. I'm at a very nice sushi restaurant having a wonderful client dinner. Everything's going great. Excuse myself. Go to the men's room. And while I'm in there, there's a gentleman in the stall having a conversation with his wife on speaker. There are certain places that a phone should never be used. Ready church, you should never have your phone out for any reason at church, number two, funerals and weddings, right? And number three, with a bullet is any toilet. Let's just, let's not be gross and creepy and weird. That's a place I'm already embarrassed to have to be in. I don't need everything being recorded. So Doug, the the transition of me into my grandfather has happened. I am. I have gone from being the kid he was named after, who was light and full of joy, you know, to the old man who more or less detests everyone and everything it happened.
Doug Draper 27:04
And you you have years to go. You have miles to go. My friend, I can't even imagine what it's going to be 1015, years down the road.
Pete Mento 27:10
I'll be in Maine, and when I'm in my 60s, and you know the the great trade Gods finally tapped me on the shoulder and say, Thank you for your service. You've done enough. I'm going to go to Maine, and if you want to talk to me about trade, you'll have to show up in person, and you better be invited. Yeah, don't, don't, don't turn up without an invite. That will not end well for you. Yeah, so that's that's going to be done. Nice,
Doug Draper 27:35
nice. All right. Well, there you go. Very positive and joyful halftime, brought to us by CAP logistics.
Unknown Speaker 27:42
Was it positive and joyful? No, it wasn't.
Doug Draper 27:44
That's why being it wasn't at all. It was Pete getting on his soapbox and getting pissed at the
Pete Mento 27:51
world. Yeah, yeah. It was, wasn't it? I love it, all right.
Doug Draper 27:55
Well, back to the topic. So I'm going to hammer through my one. So my second topic is about the Port of New York and New Jersey, right? There's a lot of activity that is about to happen. It was in the news. Was it a month and a half ago, whenever there was a potential strike and they worked through the wage cycle of that now, mid January, they're going to talk about the automation piece of it. So that's not what this topic is about, but the Port of New York and New Jersey are trying to leverage their position to claim some of the the booming profits of the global shipping industry. We've talked about that before, where they are just crushing it. I think two or three weeks ago, we talked about, you know, the astronomical profits that these steamship lines had rivaling what transpired in COVID, right? So they're basically saying, hey, we want to cut of that, right? And so they're trying to leverage access to the US, and using their ports to create that leverage, so requiring tenants to do some investment, right? So they're like, hey, steamship lines, if you want to come in here, we need you to we need you to foot the bill on some of these investments. We need you to provide some some relief on infrastructure. And it sounds great, and you know what? There's enough money there that it'll happen to some degree. But the thing I'm concerned about Pete, and you can appreciate this, is that those terminals service a lot of other entities and industries related to smaller companies, smaller operations and business that is not of the magnitude of these steamship lines. And what happens when the infrastructure is paid for by a multinational, multi billion dollar company, and I'm the little guy that still uses those you know that infrastructure, those terminals, those services, am I going to get squeezed out, or, you know, literally squeezed out, or financially squeezed out, because the larger steamship lines are going to have leverage. So I don't know how that's going to happen. It may be another wrinkle into the fact of this negotiation. Conversation with the port that's going to happen in January, which I'm sure we're going to talk about in a couple of weeks. But anyway, it caught my attention. I thought it was apropos, if you will, to say, hey, everybody's making money. We're the entry point to the US. You wouldn't be able to unload your goods without us. Where's our cut, right? It's very mafia ask, if you ask me, but we'll see how that plays. Did you hear about it, and what's your take on that?
Pete Mento 30:25
Yeah, I'm I've been saying to a lot of people, I would not be at all surprised. I don't want to say I'm expecting, but I would not be at all surprised if they struck again for a short period of time, because the big question Doug is really still about automation. Yes, they want to make their money, but I think they're still very concerned that we haven't addressed widely the topic of automation in the ports. And when this month, you're able to go out and buy your Tesla robot, you know, I mean, you start looking at what's going on in these ports with the level of automation now outside the US, and there's a very real concern for these people on how they're going to feed their families, if, or their future, their future members if more and more automation comes in. I think automation is inevitable, you know? I think it's a question of when inevitable arrives. So I'm concerned that they are going to strike for a short period of time to try to push out as much automation as possible to continue this, this dominance of human beings being engaged in loading and loading freight. Yes, it has a lot to do with money, sure, but it sounded like they had that part sorted out. But when you give people time away from negotiation table to talk, you know those voices of well, maybe we should be asking for more. Certainly could go out there. I've never been involved in negotiation in a what do you call a collective bargaining has never been something I've had to be involved in, but I'm very much a part of the people kind of guy. So I hope that they get paid, certainly, and I hope that that whatever work stoppage that they do is a short one, but I am concerned Doug that there will be another one, and I think that there are too many unaddressed topics, including pay, but mostly automation, that I think are going to force them to have to rattle their cage again a little bit to get their attention. Yeah,
Doug Draper 32:08
it's a precursor of what's to come. So, yeah, yeah,
Pete Mento 32:13
and they're doing it right, doing it right before presidential inauguration. I know
Doug Draper 32:16
that is just about to say that, right. I mean, literally, it's like five or six days beforehand. So all right, now, you got a chunk of water. Let's bring this thing home. What's your final topic? Yeah,
Pete Mento 32:27
buddy. So President Trump now tells us what he plans to do using truth social. And I'm not on true social, but usually a couple seconds later, someone I follow on Twitter, I'll get them. You know, there's only a couple people. I get announcements for it be like, Oh no, he's done something again. Then I go on it. So it's over Thanksgiving, and last weekend, he goes on through social and says, any of the BRICS nations that are thinking about dropping the US dollar for global trade can expect 100% tariff on other goods. And this is one of those, you know, Keenan, we were talking about this pre show. It's one of those things where people like bricks, tariffs, the US, dollar, whatever. We're paying attention. This is a very impactful statement. So bricks started off with Brazil, Russia, India and China. And these were the quote, unquote, emerging economies. Well, none of those economies are really emerging anymore. They're very important, and it's a tie to how first petroleum in energy is sold around the world. If you're one of these massive oil companies, and you're you're doing, you know, $20 billion in sales a year, just for one part of the world, if you had to convert currencies all the time, you could lose a lot of money in the conversion process. So they do it with dollars. And then in our world, Doug, if you look at most, not all, but the significant portion the internet says 80% I don't know. We'll see if that's true or not, but about 80% of the international sales that happen are done with the US dollar. So I get a, I get an invoice from from a company in China, and I'm expected to pay that in US dollars, for generally, the same reason you want to have a stable currency that's not going to go wacko. You know, the ship leaves, and in two weeks it gets here. Then that two weeks, some crazy political thing happened. Like, I don't know, the new president of South Korea says martial law and goes to crazy on the you know. So they use US dollar. And for years and years and years, most of us in trade looked at it as well. This is just something to make it easier on us. You know, it's a convenience thing, but the US dollar being used for all those things makes it a very stable currency. And when the world begins to stop doing that, it could wreak havoc on the stability of the dollar. Well, the BRICS nations have really grown. So these are all the countries. Only take a minute all the countries that are considering being members of the BRICS nations, Algeria, Angola, which. Tina Fauci Cameroon, Central African Republic, Congo. Congo, DR Congo, Equatorial Guinea, Ghana, Kenya, Libya, Mali, Namibia, Nigeria. Senegal, South Sudan, Sudan, Tunisia, Uganda, Zimbabwe, Bolivia, Colombia, Cuba El Salvador, Nicaragua, Peru, Venezuela, Afghanistan, Bahrain, Bangladesh, Indonesia, Iraq, Kazakhstan, Kuwait, Laos, Malaysia, Myanmar, North Korea, Pakistan, Palestine, Saudi Arabia, Sri Lanka, Syria, Thailand, Uzbekistan, Vietnam, Yemen, Azerbaijan, Belarus, Serbia and Turkey, okay, it's a lot of countries. What do most of them have in common? They're petroleum producing nations, and the BRICS have come up with a new currency. That currency is a combination of market basket of the value of gold, which makes about 40% and then a number of other BRICs nation currencies, like the RMB from China. I believe, I believe, I'm not positive, but I believe that the Indian currency is also in there, and they're saying, we're going to use this, and we encourage all of you amongst one another and with other countries. And they're calling it the unit, right? Not the bricks dollar, not, not the bricks currency, the unit which I can't laugh hard enough about, Doug, That's the silliest thing I've ever heard. So by doing so all those countries, it would really, really impact the strength of the dollar. So President Trump has said, F around and find out if you do this, all of those countries, many of whom are overly reliant on American trade, are overly reliant on American aid, are going to find themselves with 100% tariff, and that is not getting the attention that it ought to. Doug, because I think politically, he'd have a lot of support for this to bring the hammer down, because there aren't too many members of the Congress or the Senate that do not have some fiscal relationship with energy companies, Doug, I'm watching this really closely, and the timing works out. They're talking about doing this in the first quarter 2025, and the President's going to be taking office on the 20th this could be an unholy hellscape if this actually happens.
Doug Draper 37:18
Wow, there's a lot to take in on that one, right? I that that list that you fired off, I don't even know how many that was, 2040, you don't have to answer that question. So this is going to be typical American comment, right? Probably 20% of those countries I maybe have heard of once, right? The one commonality that meaning that their power is somewhat minimal, to be very frank with you, right? On any level, even with, you know, energy generation, that's the one thing that's intriguing, right? Like you said, all of those, if you add them up in the production of petroleum and oil, that's the one thing that they all have together. That's the common value and and we'll see if that's enough. But drill, baby. Drill right? The energy independence of the US. So energy independence is something that we can all rally around, in my opinion, and don't mess with the US dollar, because we need the stability across the world in which that represents. I think it'll bubble up. I don't think anything's going to really transpire with it, but it will. What am I trying to say here? I guess bubble up would probably be the best bet, right? It's going to percolate. It'll make some headlines, and then there will be gone, right? So it's interesting. We'll see what happens to the unit. It may not be the last time we hear about it, but a lot of those countries don't have a whole tremendous amount of power as it relates to the United States. But the commonality is, is, is oil and petroleum? So is that enough? I don't know. I don't think so.
Pete Mento 38:56
Well, Doug, let me put it to you this way, right? That we call this a call back in comedy. We're just talking about collective bargaining. One longshoreman says, I don't want these damn robots taking their jobs. Okay, you know, it's one voice in the wind when all of them together say, I don't think so. When they all decide, when China says, okay, when China says, Trust me on this. We got you don't worry about it. We got you, do what you got to do. Let's get their attention. Don't worry about it. It's going to be okay. That's pretty powerful. So that's, you know, outside political forces working with with collective bargaining saying we got you, we're supporting you here. Do what you got to do. That makes it a little easier for them to say, why not? Absolutely. Why not? Let's give it a shot. So I'm not as a couple of years ago, Doug, I would have agreed with you. I don't. I don't know that. I disagree with you as much as I say. We could find ourselves really suffering from hubris. If we don't take this seriously, then I think that we ought to, because China is not backing down from any of the US threats right now. And. And maybe this is one of those things that gets rolled up in our conversations with them as as the negotiations keep going. Yeah,
Doug Draper 40:07
all right, about global trade is its global peak. We talked about a lot of different things that are all intertwined, and they all could have in first quarter at 25 so it'll be interesting to see how all that mixes together.
Pete Mento 40:17
Absolutely and thanks everyone for listening and watching. Telling your friends we'll be back here next week, of course, and thanks to Keenan back in the booth in Canada, freezing his patoot off. But remember, if it happens in global trade, we'll be talking about it next week on global trade this week. Thanks. Doug,
Doug Draper 40:34
excellent. All right. Take care.
Transcribed by https://otter.ai