Trump Floats China Tariff Cut… And Cargo Theft Threatens The Supply Chain 5/9/25

0:02Live from the Nasdaq MarketSight in the heart of New York City's Times Square. This is Fast money. Here's what's on tap tonight. We are counting down to trade talks between the U.S. and China. Stocks holding their breath as we await details. Will what we hear this weekend be enough to get the comeback back on track? We'll debate that. And searching for answers. Investors in Google Parent Alphabet want to know where the stock is heading. The chartmaster dives into the trends to get some answers. Plus, microchips seeing macro gains after earnings. Nuclear stocks getting powered up and breaks in the supply chain.

0:30Courtney Reagan investigates the criminal gangs disrupting U.S. retail infrastructure. I'm Melissa Lee coming to you live from Studio B at the NASDAQ. On the desk tonight, Tim Seymour, Bono and Eisen, Carter Worth, and Mike Coe. We start off with a kickoff of what could be a tariff game changer. High-level talks between the U.S. and China get underway this weekend. President Trump already taking to Truth Social, suggesting tariffs on China could come down. CNBC senior Washington correspondent Eamon Javers has got the latest. Eamon. They could come down, Melissa, and the president floated the number of 80 percent as being something he might be comfortable with earlier in the day on social media.

1:06But then we heard from the White House Press Secretary Caroline Levitt in the briefing this afternoon, who I wouldn't say walked that back, but kind of said, well, that's just a number he's putting out there. Here's what she said. The president still remains with his position that he is not going to unilaterally bring down tariffs on China. We need to see concessions from them as well. And again, that's part of the reason that Secretary Besant is going to talk to his Chinese counterparts this weekend. to start those discussions in person. As for the 80 % number, that was a number the president threw out there, and we'll see what happens this weekend.

1:40And we don't have any updates yet on Treasury Secretary Scott Besson's visit to Switzerland to meet with the Chinese delegation, but we do have an update I can give you on his meeting with the Swiss delegation. The Treasury Secretary is on the ground, and along with Jameson Greer, the trade advisor here, USTR here, they're saying both sides agreed to accelerate negotiations on reciprocal trade, that is the United States and Switzerland. USTR looks forward to continuing our negotiations over the next several weeks. So some progress, I guess, in terms of meeting with the Swiss. We'll see about progress in terms of meeting with the Chinese.

2:17And one more item for you, Melissa. The president has just called the press pool into the Oval Office. He was expected to sign a couple of executive orders. That was going to be closed press. Now it's open, so we may be hearing from the president here over the next couple of minutes. Back to you. All right. You better get going. Eamon, thank you. Eamon Javers at the White House. He floated 80 percent on Truth Social. The Wall Street Journal had a report saying 60 percent, even beyond that. NEC Director Kevin Hassett has said 24 deals are close to resolution. Where are we? How are we set up? Well, you know, we're calling these de-escalation talks.

2:50So that tells you where we are. We're not necessarily even calling them trade talks. But I'm not sure. It was an important week. to speak to the obvious in terms of trade frameworks. OK, a Fed that we got a little more direction on. I think the things that we're getting from Washington right now, I continue to believe it's time to maybe have a little more tough talk with the toughest of the trade adversaries here. This really was always about China. So for them to come in soft here, why would they? I expect the rhetoric to be aggressive. What's fascinating about this round of chats with China, because even over the years, when we've accused China of currency manipulation and all the other things, China's never really pushed back verbally in the global press.

3:31And I think China has definitely been, as to me, acerbic back to the U.S., if not more so in terms of their tone that I remember hearing out of China. What does that mean? Who knows if it means anything. But I don't think the White House is going to back down here. I think if I get back to the markets, which look like they're struggling at some really important levels. It doesn't mean, though, it hasn't been a heroic run. And again, the letter V looks a lot more appropriate if we're saying, hey, what's that shape of this recovery? It's not a U. It's not, you know, an S. It's, you know, all these little things that Carter's probably grown up with these things.

4:04I'm sure he's got a view. I'll just say, going into next week, we've got CPI, but we also have 90 % of the S &P having reported. So we're almost through earnings season and the headlines that were kind of distracting us from all this other stuff. And I wonder if that's bad news. Yeah. A steep 10 % climb since April 21st. That's the V. What shape? I mean, it has to be considered a V. I mean, if we're trying to which one of these things matches up. But, I mean, that is the nature. If you think about what's the precondition for an aggressive bounce, it's more off than not a preceding aggressive sell-off.

4:39This is the nature of the beast. So we get a 21 % sell-off in the S &P, and here we are up about 17%, 18 % off the low, and we're more than halfway back. And there are a lot of statistics that do argue if you climb more than halfway back, you go on and make new highs. But it's really not about that because that's too far out in the future here and now Monday morning or Wednesday is one leaning in and increasing exposure is one pulling back. My hunch is and we just heard it from the last person on that we've come to a difficult level and it's right to either hedge some of your longs or exit altogether.

5:13Let's pretend I'm telling you what the future is Bono in. That'd be amazing. Deescalation 80 percent tariffs cut from 145 to 80 percent agree to talks in another week. What does the market do? I think the market trades sideways, slightly up. I think, you know, the setup is, you know, Carter just mentioned the setup. I think the setup is that we're coming from this 145 that just seems like an albatross, right? So given that kind of relative positioning coming from 145 to 80, you know, you can't help but have somewhat of a positive bent. But I think once you start to kind of mix through those numbers, I think the initial reciprocal tariff as it was positioned was around 74, 75 percent.

5:48So that 80 percent is still even higher to the eye popping number that was delivered on, quote unquote, liberation day. So I think once you start to digest the true facts of what we're doing here, I think the market trades sideways and then starts to pull back, as Carter and Tim have both alluded to. I mean, it feels like the market reaction that we saw early this morning in S &P futures, as well as in overseas trading, Mike, really gave you the full read on what the reaction would be to a de-escalation to 80 percent. wow, that sounds great. And then, oh, 80 percent is really super high still and would probably be prohibitive to trade still.

6:23Yeah, I think the 80 percent number is a little bit high. I think the other thing we're really going to be looking for is probably not what the White House has to say about these talks, but what China does, because every single time we hear from the White House, oh, we're having talks and, you know, we're making progress. As far as China has been concerned, in many cases, they have refuted that. So I think the most positive thing that could come out on Monday would be, regardless of the number, you know, that we are making progress. If they say so, I think people will view that favorably regardless of what the headline number is.

6:53But if they don't, I have a feeling that we're probably going to bump our head here. Yeah, I think I agree. And I guess I get back to where are we in the economy now? And we had an interesting and a fun debate last night about hard data versus soft data. And I think the hard data is telling you that things are OK. And I think, you know, until otherwise, we know where sentiment is and we know how bad the soft data has been. But until the hard data starts to change, I realize that can change all at once. But that's that's kind of we've almost become, I think, like the Fed here. I mean, we really need to wait to see some change.

7:29I think investors have had an opportunity to rally this on back. I will say going into these next couple of weeks and certainly going into this weekend and people can ask themselves, did I do this? You know, the premium attached to protecting yourself and hedging downside hasn't been this cheap in a long time. The VIX closed today sub 22. And there is no premium to the downside versus the upside. And I think that's something that's very interesting. So Tim mentioned some of the United States hard data. I think, you know, that that trend holds up as well on the Chinese side. You know, if you look at like the 20, 21 percent pullback in terms of export to the United States, a bulk of that was made up, whether it be EU, LATAM, Africa.

8:04So, you know, both sides still probably likely need to see some pain before there is some capitulation from one side or the other. I think both have dug in their heels. I think politically there's a lot of incentive for both to come across as being tough dealers, as being, you know, large sovereign powers. And there needs to be a real catalyst there. And while the economic data is holding up on both sides, I think it's tough to kind of take that next incremental step without there being the proverbial shoe to drop. For more on the highly anticipated U.S.-China tariff meeting, let's bring in CNBC contributor Dwardrick McNeil.

8:38He's Longview Global's senior policy analyst and served in the Obama administration. Dwardrick, always great to see you. Great to see you, Melissa. I want to understand what your position is in terms of how China's position going into these talks. Bono had mentioned the export data. We saw the drop to the U.S., but an increase to other parts of the world. Xi Jinping also has the support of the Chinese people this time. And he went from, you know, Chinese people who are griping about the economic situation to people who are actually willing to withstand tariffs and not give in to bending to Trump.

9:15And so where do we stand? What's the likelihood that Xi Jinping has a temperament, has inclination to make a deal? Well, Melissa, I think it's absolutely clear that both sides need a deal. Both sides want a deal. And that includes Xi Jinping. But I think we're way premature to think that that deal will come this weekend. I think this weekend for the Chinese, let's just start there, is people, process, and issues and goals. By people, the Chinese are going to want to know who they're dealing with across the table. They don't know Scott Besson at all. They do know Jamison Greer. He was the chief of staff for Bob Lighthizer in round one of the 2018 trade war.

10:00So they have a good sense of him, but they don't know Scott Besson. So they're going to want to figure that out. They're also going to want to get some sort of process in place for how they negotiate. And then finally, and I think this is the most important piece that will come out of this weekend, are what are the issues that are being negotiated? Trump talked over truth about opening up China. We've heard fentanyl. We've heard buying more goods. So the Chinese are going to want to know what are we actually negotiating? If it's fentanyl and buying more goods, that's a very easy lift for the Chinese, Melissa.

10:31If it's opening up the market, buckle up. This is going to be a very long negotiation if that is where we're trying to go. Hey, Dwardric, Tim. So if The prevailing view on this side of the world is that China's got no leg to stand on. There's no negotiation. They're a trade exporter. We have a massive deficit. They lose. What can the Chinese do? What do you think is the greatest leverage? And what's the highest likely plan of attack, do you think? And maybe that's the wrong word. But what are they going to use? And people always question U.S. debt. We just had comments from at least the White House pointing out the Treasury Secretary talking about the debt ceiling.

11:08There's certainly some angst on this side of the market about the U.S. debt markets. Yeah, this is a great question. Look, you know, to use Trump's phrase in terms of not having the cards, neither side here have the cards in terms of the numbers. And so what you fall back on, unfortunately, is the pain point. Like who can really outlast the other with respect to pain points? And I think on this score, the Chinese do have a leg up, Tim. They've suffered a great deal from zero COVID period. So we've seen their people prepared to suffer for the national good. I'm not so sure how ready we are. You know, we're looking at four to six weeks, six to eight weeks, depending on who you talk to, before there are going to be some real shortages here in terms of stock on shelves.

11:56And so I think ultimately this comes down to, unfortunately, who can last longer in terms of the pain. The numbers don't make sense for either side. Yeah. That's pretty depressing. Dwardrick, thank you. Dwardrick McNeil, Longview Global. U.S. firms generate$1.2 trillion in revenue selling to Chinese consumers, according to Apollo. That's a lot on the line here in terms of what these trade talks are all about, Tim. What do you think would be a win? I mean, if they came away with some, you know, rare earth gains and a date for fentanyl talks? And I mean, is that enough for the markets? I don't know, because I mean, well, the social scourge of fentanyl is something we all care about.

12:41It's an easy headline and it's an easy one to at least go into this with. And I think there are U.S. companies that don't have access to China. Let's talk about an unfair playing field. I think there could be some big wins for some big U.S. companies, whether they could actually be follow through. I think those are things that are important. I think trying to get to a trade balance with China is not what we should be wanting to do. We should be caring about strategic sectors. And I think there are plenty of places we want to dig in. I think there are a handful of headlines you could be getting out of the technology space or out of, again, the consumer product space that would be big wins over here and begin to kind of break down what is really the problem here.

13:19It's not a trade balance with China. Meantime, Alphabet wrapping up a very, very tough week. The stock down nearly 7 percent, by far the worst performing stock in the so-called Mag7 since Monday. Is there any hope for a turnaround? We turn to Carter for the charts. Well, before we get to the charts, I mean, the one thing about Google is it's the only one of these great BMFs, whether you call them Magnificent 20 or Magnificent 2, forget all that stuff. It's the only one that trades below a market multiple. So one might consider it cheap. But let's look at the charts and try to figure it out together.

13:52We have three and they are identical. So the first here, You show the COVID low. There you are in the high. Obviously, it's been a great winter. And yet that drawdown in 2022, the bear market, it dropped 45 percent. The Qs dropped 37, so worse. And then the drawdown since this year's peak, again, down 32. The Qs down 25. So we're down to a critical juncture. I think we break trend as depicted there. Another way to draw the lines, a second chart would be this, that we have now fallen below the prior peak. That would be the 2021 peak that we entered into the 2022 bear market. So put them all together.

14:30Third chart, which is simply the first two combined. What we have is a stock that exhibits poor relative performance down again today. And the burden of proof is on the bull. The bear points to nothing other than the facts. It's not performing. It acts poorly, as the old-time technical expression goes. Mike, are you a bull on Alphabet, or has the narrative changed? I think the narrative has changed. And it's worth pointing out that this one was part of my acronym for the beginning of the year. It's the G in rising. And I actually wrote an article this week just talking about the fact that I think there is a different story going on here.

15:08The fact is, it wasn't just Apple coming out and saying that they were exploring AI on the search side, because I think that reality is essentially what the stock price has been indicating now for quite a while, which is that there's a big secular shift going on that's going to affect their core business. More than 70 % of the company's revenues come from the search side. So you can't make it up with YouTube. You can't make it up with cloud. They are trying to invest in that area, and they are trying to get basically the AI Gemini thing to go right into the search portion. And this was an area of strength of theirs.

15:40But unfortunately, when some of these other businesses start to get a toehold, it is going to be hard to claw that back, I think. People's habits sort of become entrenched if they like what they're experiencing. Yeah, I mean, clearly you speak to it. 70 % of revenue coming from search. I think Apple's comments there did create some concern, reasonably so. I will say you still have YouTube, you still have Waymo, you have other areas of potential revenue growth. And even on the search side, I don't think it's a zero-sum game. I think that there is an argument to be said that this company is trading at a cheap multiple.

16:20I think in the short term, clearly, when you see the rally that you've seen in the general market and on the tech side and you see the lagging effect, there's no reason for you to stick your neck out and jump in. With that said, if you have a longer timeline, you know, and you do believe, I don't believe that search is going away. So whether that's a 10 percent reduction and then you add in, you know, what is Apple's real incentive for the comments that they made? I would say that there's 20 billion dollars worth of incentive there. So So kind of parsing that, you know, I think that you will probably look back in hindsight and probably want to add to the position.

16:52Yeah, I tell you this. I think this is a place to jump in. I mean, I look at the rhetoric this week. I mean, what did we learn from from Q that actually was new? There was zero about competitive forces and zero about the dynamics that I think with with what we got even on Q, the quarter one dynamics with some of the data on Google. I just think also I would go back to the dynamic that Apple is really probably trying to, when on the stand, point out because they actually have a lot to gain here and I think a lot to lose by Google actually being taken someplace else other than the$20 billion that they pay on a quarterly basis.

17:28Right now, still Safari is default on Apple and Google is there. I don't see that changing. Carter's arguments are really compelling. That's the hardest part about this for me, because the fundamentals to me, Google's not going away overnight and it's wildly cheap relative to the market. All right. We've got a news alert out of the White House. President Trump just taking some questions ahead of this weekend's trade meetings. Let's get back to Eamon Javers. Eamon. Melissa, these were the president's final comments before those trade negotiations. He was asked in the Oval Office just a short time ago, you know, if you would be disappointed if Treasury Secretary Besson comes back from Switzerland without a deal.

18:05The president said no, he would not be disappointed about that. And he said, look, in his view, they have a great deal already. And the deal is we're not doing business with China right now. So from his perspective, he's fine staying pat where he is. But he also said he'd put out this number of 80 percent and we'll see where it goes. So the president sort of suggesting he's open minded going into these negotiations about where we end up, but not setting a bar for an expectation of a deal certainly this weekend. Melissa. Back over to you. All right. Eamon, thanks. Eamon Javers. You bet. Coming up is a new chip on the way from NVIDIA inside the company's latest efforts to stay in China's market and how their competition is planning to compete.

18:44Plus, could the Trump administration be about to power up the nuclear trade, the new suite of executive orders that could shake up the U.S. energy landscape right after this?

19:00Welcome back to Fast Money, a slew of headlines in the chip sector catching our eye today. NVIDIA reportedly planning to release a less sophisticated version of its H20 AI chip that meets requirements to ship to China. The stock has rebounded in May, but is nearly 25 % off its all-time high. Meanwhile, shares of Microchip posting their highest close in two months. After earnings last night, the maker of low-end chips raised guidance for the current quarter, with the CEO saying they've seen the bottom of a, quote, prolonged industry down cycle. And Taiwan Semi also higher after the company posted monthly, excuse me, record monthly sales in April with revenues up 48 percent from last year.

19:36A lot to chew on there. Mike, I don't know where you want to go. The NVIDIA news is sort of interesting because the administration basically changed the rules of the game. They had an export chip for China and then that wasn't they would have to get licenses to do that one. So they're making a new one. Yeah, they're doing that one. And of course, I do see people saying, oh, well, you know, it's 17 plus billion or so that went to China in terms of Nvidia's exports last year. But then you take a look at Singapore and Taiwan, and each of those are actually even bigger numbers, you know, in the neighborhood of 20 plus billion each.

20:09And I think, you know, a reasonable person would suggest that some of those sales have found their way to China. So they're sort of making a pit stop, if you will, in those other two places. So, you know, this is an interesting take because my curiosity now is, well, how are they going to feel about purchasing these sort of decremented chips relative to what it is that they actually want to purchase? And, you know, I think if you look at it from NVIDIA's perspective, it's hard to view this as a positive no matter which way you slice it, because it's going to increase competition from elsewhere.

20:39They might look for alternatives or they might look to try to, you know, increasingly channel stuff that they aren't supposed to be getting. I mean, a further downgraded chip could mean that the Huawei chip is actually more competitive in China. And again, we've seen what the Chinese can do with a lower powered chip. By the way, reminding also that semis outperformed the market by about 350 basis points on a rolling five day and they have outperformed the market. So I thought the microchip and we even heard from this this from Infineon that the cyclicality in auto and industrial chips is actually showing some signs of life.

21:11I mean, dare I say green shoots, but it's hard to think that given all the headlines in the auto space. But again, the inventory kind of correction and the clear out is something that they commented on. And that's they are the ultimate cyclicals. We forget that. It's not always about the headlines on ultra growth. So I'll take Taiwan. So maybe that's the last one that wasn't addressed. And I think that while it's a positive, I think you you kind of need to take this a bit with a grain of salt. Understanding that you do have the overhang of the tariffs, how much of this was pulled forward? And we've gotten to that debate around pull forward demand, whether it be around, you know, hard assets, whether it be about NVIDIA and chips.

21:45And now in this particular case, you just wonder how much of this is people trying to get ahead of any additional tariff-related pauses or supply constraints in the chip space. I mean, look, there's so many ways to... It's always... You can take the view that is personal to yourself that headlines read microchip surge is 13%. You could write the headline differently. Microchip was down 66 % from its 52 % high. It's now down only 48 % from its 52 % high. Listen, it's a big rally. in an otherwise damaged stock, I would fade it. All right. There's a lot more Fast Money to come. Here's what's coming up next.

22:19Going nuclear. The Trump administration considering new rules that would overhaul the country's nuclear energy landscape. The winners and losers of this high-energy trade next. And buckle up, because Coe and Carter are kicking it old school ahead of a huge week of earnings. The technicals and the options trade to get you ready for action. You're watching Fast Money, live from the NASDAQ market side in Times Square. We're back right after this.

22:54Welcome back to Fast Money. Shares of nuclear tech companies Cameco and Oklo getting a boost late in the day after a report the Trump administration is looking to speed up construction of power plants. According to The New York Times, the Department of Defense aims to quadruple the size of the country's fleet from about 100 gigawatts of capacity to 400 gigs by 2050. That would be a big leap, Tim. You need a lot of uranium. Look, I think nuclear fuel is a future. And I would say cheap, abundant energy or for electricity is one of the most important strategic objectives of this country right now.