Global Trade This Week – Episode 196
What’s going on in Global Trade this Week? Today Pete Mento and Doug Draper cover:
3:06 -USPS Announces New Postmaster General
7:03 -EU Trade War? Not Really, But Still Interesting
11:08 -Halftime
22:41 -Tariffs, Uncertainty, and Global Economic Growth
27:32 -MSC Sending Ships Through the Suez Next Month
-
[Keenan Brugh]
[upbeat music] You're watching Global Trade This Week with Pete Mento and Doug Draper.
[Pete Mento]
Hello, everyone, and welcome
[Pete Mento]
to another exciting edition of Global Trade This Week. You feel me building the drama, Doug? You feel that?
[Doug Draper]
[laughs] I love it.
[Pete Mento]
Yeah. Uh, very excited to have my partner and, uh, co-host, the co-hostess with the mostess, Doug Draper, with me. Uh, Doug, in a radical change of events, I am in ho- I'm at home in Virginia, and you are in beautiful California, where I hope you're getting the best California spring weather ever. We're old, we talk about weather. Get over it, people. So I, I hope it's gorgeous there.
[Doug Draper]
[laughs]
[Pete Mento]
Kinda early though, but I'm, you know, I'm sure it's gorgeous there.
[Doug Draper]
Yeah, not, not, not too shabby. I, uh, was flyi- so some of our listeners, uh, watchers may have been impacted by the storms on Memorial Day, so I spent eight hours in a, in an airport yesterday. Um-
[Pete Mento]
Okay
[Doug Draper]
... bad storms in Denver, finally got out. Here we are, the most important time of the week is, uh, with our listeners and Pete, you, and, uh, pontificating on what is going on in global trade. So it doesn't matter, I'm here, the wonderful city of Fresno, California.
[Pete Mento]
I, I would like to mention, Doug, that, uh, when I was in New Orleans, a lot of people asked me, same thing at ICPA, "You call him, you call Keenan like he's a kid. How old is Keenan really?"
[Doug Draper]
[laughs]
[Pete Mento]
And for the most part, when people ask me that question, I say that he's 19.
[Pete Mento]
And, um-
[Doug Draper]
Love it
[Pete Mento]
... and, and I, I, I, like, stick to it. I'm like, "Yeah, his uncle is some big wig at the company he works for." And he clearly had, like, an Xbox, um, addiction and they had to get him away from his gaming console. So they said, you know, between classes at the senior high school, 'cause he's a couple years behind, uh, you know, "Could you, could you do this, this job for us?" And they're like, "Really?" I'm like, "Yeah, he's only 19. I mean, he does an incredible job for a guy that young. And, uh, we don't have to pay him, which is even better. I mean, he does an amazing job for somebody we don't pay." And I keep that up, and I've never told anyone the truth. So for those of you who, who have asked me that question live, um, I think Keenan's... Is Keenan even 30? I don't think he's even 30, is he?
[Doug Draper]
Uh, I have no idea.
[Pete Mento]
I don't think he is. Yeah-
[Doug Draper]
I've known him for probably a decade.
[Pete Mento]
Y- everybody-
[Doug Draper]
Maybe he started at 19?
[Pete Mento]
That's how little we care about him. Neither Doug or I has ever asked him his actual birth-
[Doug Draper]
[laughs]
[Pete Mento]
[laughs] When we get off, Keenan's gonna, like, give us the whole-
[Doug Draper]
I love it
[Pete Mento]
... "I was born in 1987 in a small hospital in, in Goat Butte, Colorado." Yeah, we're gonna hear all about it when we get off of this thing, I'm sure.
[Doug Draper]
Yeah. Yeah. That's it. So.
[Pete Mento]
All kidding aside, Keenan does an amazing job, and we, we absolutely love the guy. And, um, we couldn't do it without him. So that's it. That's my moment of sincerity. I'm done with it. From here on out, I'm done.
[Doug Draper]
Yeah. 90% hack, 10% sincerity, so that sounds about right.
[Pete Mento]
[laughs]
[Pete Mento]
All right, man. You're, you're up first this week, pal.
[Doug Draper]
I love it. I love it. I got two topics that I'm excited about. This one, Pete, haven't brought in the post office, the great US Postal Service.
[Pete Mento]
Damn right I am.
[Doug Draper]
But I'm not gonna bash it. I'm, I'm gonna bring it hard. I'm gonna bring it hard. I don't know if you saw that, uh, there is a new-
[Pete Mento]
It is
[Doug Draper]
... postmaster general that's coming on board, the 76th US postmaster in the history of our country. Um, I think early July, uh, is when things go into effect. It's, uh, David Steiner, right? Um, couple things about this guy. He was the CEO for Waste Management for 12 years, which absolutely love that, right? All the, I don't know if a pon would be the right word, but he came from Waste Management and now he needs to manage waste in the,
[Doug Draper]
um, US government, right? So that's awesome. He's worked his way up. And, uh, he is actually currently on the board of FedEx, uh, Federal Express. He'll be, um, resigning from that board as soon as he takes the position. But I love this, Pete. I know I badmouth the post office or act as a, like a, a big brother telling a little brother that, "You're kinda doing a good job, but you need to be doing a little bit better and you have so much potential, yada, yada, yada." But I think this is, um, this is awesome, man. I'm excited. Get some new blood in there. This guy's been successful. He's got the, the shipping background. He's got the high level, 'cause he was on the board at FedEx. He wasn't in the weeds, which is great for vision, which is what the post office needs. And there's so much shakeup going on with
[Doug Draper]
UPS, um, dwindling their engagement with Amazon, FedEx increasing their engagement with, with, uh, Amazon on some really crappy business, which I still do not understand. But, but I'm stoked, man. I think this is really gonna happen, and I really hope, and I think this will happen, is that there's some good stuff coming down the pike. It may not be in 2025, but I don't know. Things are moving so fast in global trade and logistics nowadays that maybe he'll come out guns a-blazing and we'll see some changes for, uh, for Q4. But I'm excited about it. Um,
[Doug Draper]
I don't know. Uh, it's, uh, it was a pleasant surprise. I just kinda heard about it a couple weeks ago. I think it was announced, like, early May, but I, I don't know. So hey, post office, I know I give you a hard time. Little brother, you can do a little, you can do better job. You have so much potential. I think David Steiner's gonna make it happen.
[Pete Mento]
Yeah, I'm waiting for you to tell me, like, surprise, or you're punking me, 'cause you're saying something nice about-
[Doug Draper]
[laughs]
[Pete Mento]
... my beloved postal service, and I, I-
[Doug Draper]
No, man. Let's, let's do this thing
[Pete Mento]
... want to be mad. Okay, well, um, excited for this new CEO, because as you said, he came from Waste Management, which is one hell of a company. Uh, uh, I think as Americans, most of us take for granted that once a week or twice a week, for most of us, we put our, put our bins on the, on the sidewalk or at the end of the driveway and someone comes and takes our stuff away.It's really hard work, uh, uh, to manage that, to manage under all the regulations and all the expectations and the costs that go along with it. To manage that business, it's not easy.
[Doug Draper]
Yeah.
[Pete Mento]
So the fact that Waste Management has done such an incredible job of rising to that task, and being a, a, a really profitable enterprise for its shareholders, I am, I too am hopeful, um, that this is going to end up resulting in a, a postal service that Doug can be proud of. I'm already proud, right? So will this create a waste, uh, uh, a Waste Management? Will this create a, a post office that Doug can be proud of? I think there's a lot standing in the way of one person making sweeping changing at the, at the postal service. But hopefully, you know, fresh of breath air-
[Doug Draper]
Yeah. No
[Pete Mento]
... and some enthusiastic leadership can do something here.
[Doug Draper]
Yeah, awesome. Same page there. Uh, we'll wait and see, but, uh, w- we're excited. All right, my brother, what you got for your first topic?
[Pete Mento]
So my three friends that I have a, a group Teams chat with at work, uh, Carol, Robert, and Nelson and I, we, um, we have a running joke. Do you know the boards when you, when you go into like a warehouse or, um, a manufacturing site, and it says blank days since an industrial accident? You know, the 300-and-something days or whatever. So we've, we've got a joke now where it's like zero days since a radical change to US tariffs. You know, like every, every day we take the one off and we put another zero on because things have gotten weird. Last week, before we all ran off on our long weekend, the president went out on his social media and said, "I'm gonna whack Europe with a 50% tariff starting on June 1st. They're not trying, they're not putting the effort in." Et cetera, et cetera, et cetera. Um, and of course, what happens next, Doug? What happens, man? Everybody goes, "Waaah." We all flip out, you know? It's like the downward crash of the roller coaster. Everyone's screaming with their hands up in the air. And a few days later he's like, "You know what? We talk. Yeah. We, we talk. That threat apparently got someone's attention, and now we're gonna push it out to July 9th, the original date of the 90-day pause, and we're gonna hopefully get something done here in time." Well, between
[Pete Mento]
Friday
[Pete Mento]
and Sunday, everybody lost their minds. And it, oh my, we're gonna go to the trade war. This is gonna be awful. Uh, burn the villages down. Get your pitchforks and your torches. Let's go storm the castle, right? Um, but ultimately what happened was patience played out and won again. For the umpteenth time during this trade war, calmly looking at the situation and managing it for what it was turned out to be okay, and I think ultimately, that's how this is gonna go. So for everyone fearmongering a trade war with Europe, I don't know how to break it to you. Not this time. I think it's gonna end up being just okay, but it's gonna take a while for us to get there.
[Doug Draper]
Yeah, for sure. It always seems to happen over weekends, right?
[Pete Mento]
[laughs]
[Doug Draper]
Weren't, weren't we in like the shortest trade war with Columbia on a-
[Pete Mento]
On, on Sunday
[Doug Draper]
... Sunday. Like-
[Pete Mento]
Yeah, on Sunday. Yeah.
[Doug Draper]
Literally, I, I think it was during a football game.
[Pete Mento]
Yeah, it-
[Doug Draper]
It kicked off and it was over by the end of the game.
[Pete Mento]
Yeah, 81 minutes. 81 minutes. 81-minute trade war.
[Doug Draper]
Yeah.
[Pete Mento]
Shortest in history. Yeah.
[Doug Draper]
Yeah.
[Pete Mento]
And my phone j- just absolutely was buzzing left and right. It was nuts. So-
[Doug Draper]
Yeah
[Pete Mento]
... I've said it many times, but I'm gonna say it again: patience is less expensive than panic. So-
[Doug Draper]
Yeah
[Pete Mento]
... deep breaths when this kind of stuff happens.
[Doug Draper]
Yeah, yeah. Well, I'm gonna touch a little bit that on my next topic, but, um, yeah. So a lot of my second topic is in response to that, so I'm gonna hold off-
[Pete Mento]
Okay
[Doug Draper]
... just so we have content on both sides. But it is, it is, um... Yeah, it's just...
[Doug Draper]
Anyway, I'm gonna wait and, and hold out, Pete. So I don't have any other comment than observing what you said and agreeing.
[Pete Mento]
I see, I see. How very academic of you, Doug.
[Doug Draper]
Yeah. Yes.
[Doug Draper]
Uh, ve- very stoic in my response, right?
[Pete Mento]
Very.
[Doug Draper]
I hear ya.
[Pete Mento]
Very stoic, very stoic.
[Doug Draper]
So anyway, that brings us... Man, I'm kicking into it. Uh, um, bringing it to half-time, one of my favorite parts of the show 'cause we can just talk about whatever the heck we want. And thanks to Keenan, um, and, uh, CAPP Logistics for giving us this platform, uh, week in and week out. Um, much appreciated. All right, Pete-
[Pete Mento]
You don't know my topic, Doug?
[Doug Draper]
... half-time, what do you got? Th- this...
[Doug Draper]
What's that?
[Pete Mento]
You d- you didn't get to see my topic for half-time? I'm actually excited to talk about this one.
[Doug Draper]
No, no. This is... So to our audience, right, I mean,
[Doug Draper]
maybe 10 minutes before the show, we were like, "Here's what I'm talking about. Here's what I'm..." I... Pete just forgot to send me anything.
[Pete Mento]
Oh no.
[Doug Draper]
So everything that he's talking about-
[Pete Mento]
I know, Doug. Check your texts. I absolutely sent you my topic.
[Doug Draper]
No, it's not there.
[Pete Mento]
You're gonna make me do this, aren't you? You're gonna make, make me have a spat with you on air. That's fine.
[Doug Draper]
No, no, no. Look, I... Anyway, I'm not gonna show my phone in front of the camera. I do not have it. You forgot to hit prep. No. Uh, uh, uh, uh, uh, uh. Anyway, this is, this is good. This is genuine banter back and forth. So, uh, what's up with your half-time?
[Pete Mento]
Like many Americans this weekend, uh, a lot of my free time was spent in front of a pellet smoker with a friend of mine, really making some beautiful things. Uh, and I, I can't take credit for the work that my friend, Sean, did. But we had brisket. We smoked some really nice chicken thighs. We made these things called, um, um, pork shotgun shells. It was like, uh, andouille sausage stuffed with cheese and jalapenos, wrapped in bacon.
[Doug Draper]
Ooh.
[Pete Mento]
I mean, just amazing stuff. Uh, I had my first-ever hardwood-smoked cheeseburgers. I mean, just fabulous stuff, right? And oddly enough,
[Pete Mento]
no one was really thinking about the sides. Now, I spent most of my formative years in, in, uh, Texas, and much of my life in the South, and that is absurd. I mean, the, the sides are such a big deal, and who's bringing what, and is, you know, is Carol bringing that amazing potato salad she makes? And, and I really hope that Tony brings that, you know, pasta salad that he does. So Doug, I, I'm gonna ask for a couple of things here. When you're at a barbecue, whether your own just at home, or if you go to a barbecue, what are you, what are your must-have sides?... and then what do you wish was not on the sides table? So what are your favorites? What are your least favorites? And then I will tell you mine.
[Doug Draper]
Mm. So, um, a mustard potato salad.
[Pete Mento]
Mm-hmm.
[Doug Draper]
Right? No eggs in it.
[Pete Mento]
Yep. Yep.
[Doug Draper]
Just, you know, a little zing and some potatoes. And then, uh, baked beans on any kind. If you're gonna dump 'em out of the can, put a little zing into it, right? Put s- whatever. Onions, a little spee- uh, little spice and some heat. Um,
[Doug Draper]
yeah, so those would be the two favorites. And then the absolute worst, uh, deviled eggs. If somebody comes out with a plate, I gotta, like, move 20 feet away from that nonsense. Not a fan.
[Pete Mento]
Okay.
[Doug Draper]
Um, yeah, so potato salad, baked beans, yay. Deviled eggs, just, um, I would probably throw up if I was, uh, had to sit next to those things or serve them out to people.
[Pete Mento]
Wow.
[Doug Draper]
That... Yeah, that's it.
[Pete Mento]
I'm a, I'm a f- I like deviled eggs.
[Doug Draper]
What about you?
[Pete Mento]
I like deviled eggs, Doug. I mean, they're not a must-have, but I do like 'em. I like 'em with, you know, with a nice piece of crispy bacon on top of it. And, I don't know, it's, goes very well with the 28 beers I'm probably gonna drink at the barbecue.
[Doug Draper]
[laughs]
[Pete Mento]
Uh, but my, my two go-to's, 100% baked beans, buddy. Like, I could not agree with you more. And I know it's a sloppy thing to put on a paper plate. I don't care. I really like, like, a Crockpot that someone brought that's sitting on the side table, and it, it's, you can smell the molasses in there. Big fan of baked beans. Uh, I don't think that they're brought to the, the barbecue enough.
[Doug Draper]
Mm-hmm.
[Pete Mento]
I think that happens when you're at home, right? And then, uh, as far as potato salad, this is truly, like, people in back East and people on the West Coast don't get how much potato salad can drive a meal if you're from the Midwest or the South. When I was in Minnesota, people took potato salad to a whole new level. But again, I'm gonna have to go with Doug on this, on the potato salad. Uh, don't get too cute, okay? We get it, you're creative. You watch a lot of Gordon Ramsay. We g- we get you, all right? But things I don't ever wanna see in potato salad ever again, eggs. How dare you? That's like a war crime. That's an abomination. It's not called egg salad. It's called potato salad.
[Doug Draper]
Yep.
[Pete Mento]
The next idiot that puts raisins in a potato salad, [laughs] I'm probably gonna dump their face in the bowl of the potato salad. But for me, aside from, from beans, the one that I really love to see at a barbecue that, uh, but probably isn't happening enough for me, I really love a nice, um, like orzo or, or pasta salad. Like, a pasta salad, little vinegary on the bottom of it. You know, some, some crunch to it too. Maybe some, some onions, some onions and some peppers in there. Uh, you'll note that with all of these sides, Doug, none of them are in any way healthy for you. It's not like someone just brought a, a batch of broccoli, you know? This is junk covered in mayonnaise and dressings for the most part, and that's what makes it so wonderful. Uh, I'm sure there's other things that people have that they're excited about, but potato salad and, uh, pasta salad and hell yes man, baked beans are awesome.
[Doug Draper]
Yep.
[Pete Mento]
We need to bring them back on the American lexicon.
[Doug Draper]
Love it.
[Pete Mento]
And now things I never wanna see.
[Pete Mento]
But come to your barbecue-
[Doug Draper]
Yeah, I lo- I love it. Yeah, we're in agreement. We have similar palates.
[Pete Mento]
I- if, if I come to your barbecue and your only side is a bag of off-brand rippled chips, I'm, I'm going straight to Harris Teeter and buying something else because that's not right. It isn't right, okay?
[Doug Draper]
Yeah.
[Pete Mento]
Another side that does not belong as a side is salad.
[Pete Mento]
Salad. Just, like, a bag of something that came from the grocery store and they put some ranch on it, and they're like, "Here you go."
[Doug Draper]
[laughs]
[Pete Mento]
"Here's, here's our side." You know what? Don't invite me next time. How about that?
[Doug Draper]
Yeah.
[Pete Mento]
Don't even ask me over. That's not a side. How dare you, man?
[Doug Draper]
Yeah. That's a chopped salad. Holy shit, I forgot I was supposed to bring something. Swing by the grocery store.
[Pete Mento]
Exactly. Completely. Yeah, yeah, and just grabbed a bag. No tomatoes. No, no, you know, all that extra stuff that would make it a nicer salad. Some croutons and some nuts maybe, some cheese. Nope, it's just a bag of salad and whatever leftover ranch dressing was in the refrigerator door. Whoever does that, they should be ashamed of themselves. They really should.
[Doug Draper]
Yep. Yeah. Good.
[Pete Mento]
All right, Doug, what do you got for your halftime buddy?
[Doug Draper]
Uh, all right. Well, I saw this pop up on my feed this morning. This is the 100th anniversary of the Scripps National Spelling Bee starts today, right? Um, now, apparently they didn't do it during COVID and they didn't do it during World War II, so as far as engagement, this is the 97th year. Um, but it's been around since 1925. And, um,
[Doug Draper]
most of it's, uh, kids from the US, and you can't be over 14. This is stuff that I-
[Pete Mento]
[laughs]
[Doug Draper]
... found out today. You can't be over 14 or pass the eighth grade, right? And then for some of our younger viewers, Scripps [clears throat] was a newspaper. That's how things got started, uh, you know,
[Doug Draper]
oh, 100 years ago. So, um, pretty excited. I, I think it runs for several days. I don't really know how many people start out. I would imagine it's a lot. And, um, so I was like, okay, what are some of these hard words, right? Um, like...
[Pete Mento]
[laughs]
[Doug Draper]
... what's the hardest word that's ever been, uh, presented at the spelling bee? And there was a whole bunch of 'em that they came up with. I didn't really know what any of 'em meant. Uh, I didn't have time or interest really to, uh, get the definition. But there was one that, uh, the d- the definition is incredibly simple. It's basically, uh, a lung disease caused by inhaling very fine ash or sand. Dust, right? So ash or dust. And I'm looking at my computer 'cause I don't know if I can pronounce this correctly, but it is pneumo-ultra-microscopic silico-volcanicism-iosis.
[Pete Mento]
Wow.
[Doug Draper]
It's a freaking word, right? [laughs] If you're a 14-year-old kid that's up there and you know how to spell that...Um-
[Pete Mento]
W-
[Doug Draper]
... can you use the word in a sentence?
[Pete Mento]
Yeah.
[Doug Draper]
Yeah, this guy's got, and then whatever the word is, right? I mean, I would keep it so bland. My uncle at one time went to Hawaii and got this condition, yada, yada, yada. Um, it's crazy. So I decided to come up with like, let's come up with a definition for something related to us, right? And I started playing around with ChatGPT on this one, so I can't take all the credit, but, um, I'm gonna give this a shot. Um, Opodai Castropholic Onomaniac, and that is really a die-hard podcast listener whose passion is about shipping container trivia, customs compliance nightmares, and debates about free trade zones. So I'll put it in the, uh-
[Pete Mento]
We're gonna have to change the name of the show.
[Doug Draper]
What's that?
[Pete Mento]
You gotta change the name of the show.
[Doug Draper]
[laughs] To what? That?
[Pete Mento]
Yeah, I guess. Uh, we can't even pronounce it, let alone put it in the show.
[Doug Draper]
Yeah, O- uh, I don't know. Opidai. Now this, the name of it came from ChatGPT, right? But you gotta have the prompt. The prompts are what's makes the, uh, uh, the end result, um, powerful. So I'll put it in the show notes, so to speak, um, but yeah. I thought that was kinda cool. So 100th anniversary of the Scripps Spelling Bee Contest, and we'll see who emerges victorious at the end of this week.
[Pete Mento]
I'm a terrible speller, Doug, and I always have been. Um, I can spell hard words when I'm writing and typing, but I'll screw up there and there and gotta look at it again to make sure it's right. It's very embarrassing. Uh, and I can remember, you probably do too, when they would ask people in school when you were little, "Do you wanna be in the spelling bee?" And I would just sink into my chair like, "Good God, no. If you're looking for volunteers, I'm not the guy." Um-
[Doug Draper]
Yeah
[Pete Mento]
... two things about it. Uh, y- you said, so it's like a, use it in a sentence. What's the etymology, like where does it, where does it come from, you know? Uh, what's the root of the word? Like-
[Doug Draper]
Yeah
[Pete Mento]
... they ask those questions. Like, that wouldn't help me at all. I wouldn't have any idea. Um, but the two things I wanted to bring up was, first of all, if you haven't seen the 25th annual Putnam County Spelling Bee, it's a musical,
[Pete Mento]
but it's really, really funny. I mean, it is, it, it's laugh-
[Doug Draper]
Hm
[Pete Mento]
... out loud funny because it goes into all of the crap that we're talking about. And second of all, for those of you who've never watched the last rounds of the Spelling Bee, I think they show it on ESPN now, don't they? Like, I think they show it on, as a, it's a competition, they show it-
[Doug Draper]
Yeah
[Pete Mento]
... so m- the anxiety, the tension, 'cause I think there's some real money in this if, in scholarships if you win. These kids are under a- they're under it. And I remember one kid passed out a while ago while he was trying to answer a question. So for those of you who think that it's just silly, I can see you up there in front of a global television audience trying to, trying to, uh, you know, spell otolaryngologist correctly or whatever the question is that they ask. Uh, lot of respect, lot of respect to the kids-
[Doug Draper]
Yeah
[Pete Mento]
... that's
[Speaker 3]
... in the Spelling Bee. God bless 'em.
[Doug Draper]
Yeah. Yeah, for sure. You, you mentioned, it's a lot of stress. If a bunch of yahoos like us are excited, or talking about it on ESPN, you got some kid up there that's on a, like you said, a global stage. So kudos to those guys and gals.
[Pete Mento]
Like you said, they're young too, right? You're putting a 14-year-old up there. That can't be easy.
[Doug Draper]
No.
[Pete Mento]
You know some nerd's gonna write into the show and talk about how they made it to the state final and, and blew it at the... Do they do the final the same place every time? It's probably, like, in Iowa or something.
[Doug Draper]
No, it's actually outside of DC. It's right, kinda right on your corner.
[Pete Mento]
Oh. Wow. Okay.
[Doug Draper]
Yeah.
[Pete Mento]
Well, we're not going, but that's nice to know.
[Doug Draper]
[laughs]
[Pete Mento]
Yeah.
[Doug Draper]
Yeah, for sure. So, cool. All right. Well, that was Halftime, brought to us by CAP Logistics. Uh, we appreciate them. And as Pete said multiple times, we don't work for these guys. Um, you know, Keenan, uh, is kind enough to let us jump on, but it's fun. They give us a platform, and we appreciate it, whether it's Halftime or just supporting the whole show, so it's good.
[Pete Mento]
And freedom, Doug. Have they ever told us not to talk about something?
[Pete Mento]
Have they ever, like, sent "shut up"?
[Doug Draper]
No. That's a very, very good point.
[Pete Mento]
Yeah. They've never s- they've never gotten in the way of anything. If we think it's important, they let us talk about it, so thanks to the folks at CAP.
[Doug Draper]
Yeah. That's very valid. We have no censor.
[Pete Mento]
Uh-oh.
[Doug Draper]
It's great. Well, hey, let me jump into my second topic, 'cause it was related to your first topic, right? With... Here's the gist, the tariff uncertainty, um, do you think that is driving... And I'm gonna ask you this question, but I'm gonna make my comments first. So is tariff uncertainty, which you spoke to, 24 hours later, things change, a day and a half later, a weekend, a football game, um, is that driving global economy growth outside of the US and people are done with the nonsense, and other countries are starting to partner more together and say, "You know what? This is a global trade. It's not a US trade, albeit a very important cog in the wheel"? But I- I'm getting the feeling that people are like, "I'm- I'm done with this stuff," right? Um, "I'm moving in a different direction until things settle down in the US," right? Uh, it's just paralyzing decision-making with, um-
[Pete Mento]
Yeah
[Doug Draper]
... American businesses. And I've seen reports that Asia to European, um, traffic is expected to skyrocket here in, in Q4. Um, and then the other thing is restricting, and you can speak to this one, Pete, restricting Chinese access to advanced semiconductors, right? Um, and we saw that with, um, God, what was... Oh, Deep Seek, right? "Hey, if you're not gonna give us the ability to have these, uh, you know, powerful chips, uh, from the video or whomever, we're just gonna do it ourselves," right? "And then we're gonna sell to other countries around the world, and we're gonna do our thing over here, and we're gonna continue to grow and evolve and become a stronger trading partner with the world, not specifically to America," right? So you got Deep Seek-Um, being from California where I am right now, agricultural products, hey, we're just gonna buy stuff from Brazil and Argentina and
[Doug Draper]
Canada, even Russia in some degrees. So, our trade policies having the opposite effect with, "You need to partner with us. You need to focus on us," meaning America. And countries are like, "Hey, man. We don't have time to deal with the, the flux, uh, the wild pendulum swing, and we're just moving in a different direction." Do you think that's happening and, uh, is it good or bad?
[Pete Mento]
I do think it's happening, so let's start with that. I think there are parts of the world I can point to, Doug, that we already know it's having an impact at least on American trade. So Canada, as an example. You know, a lot of American liquor is no longer available on shelves in Canada. The, um, in Europe, there are people who are not buying bourbon. They're not buying Am- American products. So, I do believe that it is that. I don't have any numbers that I can point to yet. I'm sure we will soon. I think that, uh, another thing, it's reported in the media a lot, right? China is selling their goods to other countries other than the US. They're finding markets in Europe. They're finding markets throughout, uh, the rest of Asia, the Indian subcontinent. So that's certainly there, too. The, the problem with this, again, from an anecdotal standpoint that I have, is saying to you this isn't a problem, because right now, China's biggest economy they export to is us, and we're the largest consumer of everything. And when we shut you out of the party, it's gonna be hard to continue to party if, if you're not in our party, and right now, they're not. And they're desperate to get back in. All the economic indicators that we've been able to gather so far show that the lack of exports to the US have had a real serious economic impact on China. But for other parts of the world, like Canada, I mean, for them, it's personal. It's personal, it's political, it's emotional. We showed up at the party. A friend of mine put it this way. He said, "We're like the cousins that come to all the cookouts and all the parties. And then one day, you know, our aunt marries some jerk and we go to knock on the door and he slams the door in our face-"
[Doug Draper]
Mm-hmm.
[Pete Mento]
"... and says, 'You can't come in anymore.'" And that's, that is, I think a pretty accurate metaphor for what's happening right now. And I think it will have some long-term impact, too, on the way that we all get along together. But really, Doug, I don't think it's stopping trade completely from happening. I do hope that, where possible, Americans do consider purchasing things made here, made in Mexico, made in Canada, because our regional economy is in our best interest.
[Doug Draper]
Yeah, good points, good points. I wanna keep an eye out for that. Maybe it's just a knee-jerk reaction to what, uh, to the ebbs and flows of what transpires here-
[Pete Mento]
Sure
[Doug Draper]
... in the United States, but I have a feeling that it's like, we got... It's the world. There's seven billion people or whatever the number is, nowadays.
[Pete Mento]
Yup.
[Doug Draper]
Um, US is part of that, but it's a global, uh, global trade. But, you know, we are
[Doug Draper]
the elephant in the room, so to speak, uh, the powerhouse, so good points.
[Pete Mento]
We-
[Doug Draper]
All right.
[Pete Mento]
... you-
[Doug Draper]
Bring us home, my brother. Hey, you're, like, off camera for me. I don't know. Are you doing that for a reason?
[Pete Mento]
Yeah, see, my- my- my camera's off, but my beautiful dulcet tones are still coming across.
[Doug Draper]
Good.
[Pete Mento]
So I think we'll be okay. Um-
[Doug Draper]
All right.
[Pete Mento]
Yeah, the, um, the... My last topic is one I think... I never would've thought it would've taken us this long to bring up, Doug, but it looks like MSC is going to be putting container ships through the Red Sea again and using the Suez Canal again next month. And where one goes, I imagine many more are gonna follow. So it's been, what, a year and a half at this point-
[Doug Draper]
Mm-hmm
[Pete Mento]
... I'd say, yeah, since we've really seen that going on, and, uh, been able to have that as a, as a reliable passage for cargo. Um, so some things I kind of wanted your opinions on, Doug. Do you, do you think that the danger's over? Would you feel comfortable and confident putting your containers through that part of the world knowing that there are still large organizations of people who really don't want to see that cargo go through it? Um, second of all, you know, I've got this opinion that-
[Doug Draper]
Well, I think it would speak... So, to answer that question-
[Pete Mento]
... that r-...
[Pete Mento]
Go ahead.
[Doug Draper]
No, that's cool. So, I think that that, [clears throat] to my point earlier, that, hey, there's other, uh, entities out there that we can do, uh, trade with, another country. Let's open up this, uh, this trade lane, right, literally the, the Red Sea, and, uh, let's see how it goes, 'cause we need to get product to other parts of the world beyond, um, beyond, beyond the US. So, as far as safety, I've not been close enough to know what's transpired recently, but you haven't seen any
[Doug Draper]
issues, uh, that have made at least, uh, international headlines or here in the United States, as far as security procedures. So, you know, is it gonna revert and go back? Let's kick some vessels through there and see what transpires. But I think more it's a let- let's open up another trade line so we can get product to other parts of the world quickly, efficiently, and- and keep our economy, our economy meaning other company, or excuse me, other countries' economies, i.e. China-
[Pete Mento]
Mm-hmm
[Doug Draper]
... and, uh, let's just keep this thing rolling. And we, we need a fast, reliable, uh, way to get to other parts of the world.
[Pete Mento]
I think also it's gonna lower prices globally, too, if we have that way of managing it. I don't know for certain, but I would imagine that now that we're not going around the cape, it's gonna cost less, too.
[Doug Draper]
Yep.
[Pete Mento]
That's it for my end, Doug, so why don't you take us home, buddy?
[Doug Draper]
All right. And I'm looking at the clock. We're gonna hit this thing under thir-, under 30 minutes, my friend. So, hey, I wanna thank everybody for joining us on Global Trade This Week. It is a, uh, unusual thing to have Pete in his home and me on the road. So, it's good to have you, uh, uh, at home, Pete. You look, um, the beard's a little more gray, but you seem to have a little pep in your step, so I'm glad-
[Pete Mento]
Yeah
[Doug Draper]
... you're getting some, uh, some time, uh, at, at home. And like I said, we appreciate CAP Logistics for, uh, facilitating, making all this happen. And if it's happening in global trade, Pete and I are gonna talk about it every single week, and we can't thank you enough for listening. So share this with your friends, and, uh, we look forward to seeing you next week. Pete, have a good one, my buddy.
[Pete Mento]
Thanks, buddy. Take care. See you next week.
[Doug Draper]
All right. See you. [instrumental music]