Treasury Secretary Scott Bessent: Tariffs, TikTok, & A Duel 9/16/25

0:00Bring in show music please. This is Squawk Pod from CNBC, and I'm producer Cameron Costa. On today's episode, Treasury Secretary Scott Besant on the legal snags for the president's tariff agenda. I'm confident that the Supreme Court will rule in favor of the administration. I think the law is on our side. I think historically that the Supreme Court is very reluctant to overrule a president's signature policy. But a trade deal with China on the horizon, maybe as soon as this week. I anticipate we have a framework for a deal. And I anticipate on Friday, when President Trump has a phone call with party chair Xi, that the two of them will agree on a final deal.

0:50And what is going on inside the White House? Treasury secretaries dating back to Alexander Hamilton have a history of doing Besant comments, kind of, on reports of a spar between himself and Bill Pulte. With President Trump's team, just like any great sports team, you can argue in the locker room, but we get out in the field and do the best for the president and the American people every day. Kind of like Squawk Bucks. Yeah, exactly. That big interview, plus the SEC is considering changing the earnings report schedule for public companies. And President Trump is suing The New York Times in a$15 billion defamation lawsuit.

1:43It's Tuesday, September 16th, 2025, and Squawk Pod begins right now. Stand back to bye in 3, 2, 1. Cue it, please. Good morning, everybody. Welcome to Squawk Box right here on CNBC. We're live from the Nasdaq market site in Times Square. I'm Becky Quick along with Joe Kernan. Andrew is off today. If you look at the markets, unless there's something amiss and something that, you know, some undercurrent that's going to make things, I don't know, look better than they appear, The markets have shrugged off just about everything in terms of tariffs and worries about the labor market, which we now know with the revisions was half of what we thought.

2:30But we also know that may not be terrible news because you've seen less immigration. You've seen people leave the country. And so maybe it's a reflection of a supply issue. Maybe it's productivity. Maybe it's productivity enhancement. You don't need as many workers. You can maintain your profit margins as the administration tries to reset global trade with the tariffs. We have a long time, if we want, with the Treasury Secretary. We want. We do? Yeah. We want a half hour? I think that might be possible if we're nice or not nice, if we're good, if we're good. Yeah, there it is. Might talk about this with Secretary Besant.

3:13The Fed's going to kick off its latest interest rate meeting today. Economists widely see a cut coming tomorrow, with most expecting a quarter of a percentage point. The central bank will have a new member last night, the Senate, confirming White House Council of Economic Advisors. Chair Stephen Myron to the Fed's Board of Governors. The yeas are 48, the nays are 47, and the nomination is approved. Under the previous order, the motion to reconsider is considered made and laid upon the table, and the president will be immediately notified. The vote was 48 to 47. Just let you know, that was largely along party lines.

3:57Does that surprise you at this point? No, it was exactly basically along, except for this is not surprising. Alaska Republican Lisa Murkowski joined Democrats in opposing Myron's confirmation. Myron said that once he's confirmed, he'll take an unpaid leave of absence from his job at the Council of Economic Advisors. But so far, stopped short of agreeing to resign from that politically appointed post altogether. But he's only he's only doing this for four months and he would have to be confirmed like one, two, three. It wouldn't happen. I would be shocked if this doesn't extend. This term can extend beyond four months.

4:35I don't think it is going to extend because I think he said I think he wants to keep the other job. You know, I was looking into it. I thought his his the job that he has at the White House is not one that needs to be confirmed. It's at the president's a good one. It is a good job. I don't know that you need to keep it if you can go right back to it without being confirmed in that position. And I will say I was not a fan when Lael Brainard went from the Fed to the White House. I was not a huge fan when Secretary Yellen went from the Fed to the White House. Why? She was always. But she was always like that.

5:06Nothing changed with her. Well, I don't know. It does make you wonder about the Fed's independence. All of these jobs being linked back to the White House and back. And I raised it at the time. I said it at the time about Lael Brainard and the rest of it. It's not great for the Fed's independence to have that revolving door between the White House and the Federal Reserve. Well, at least you pointed out two Democrats that have basically would be open to the same criticism. You might not see that all the time in the news. We're going to talk more about the Fed interest rates and trade next hour with Scott Besson.

5:43As of now, Fed Governor Lisa Cook will also be allowed to participate in this week's Fed meeting and rate decision. A federal appeals court saying last night that the president's attorneys have not satisfied the requirements for a pause of a lower court ruling that prevented Cook's firing. The president moved to get rid of Cook last month for cause, citing allegations of mortgage fraud. That claim coming under some new scrutiny. The property tax authority in Ann Arbor, Michigan, telling Reuters that Cook hasn't broken rules for tax breaks on her home there. that's not related to mortgage fraud, but it would show that she was trying to milk the system at both ends if you were applying for property rebate taxes in multiple places, too, because you have to be a primary resident in order to get those things.

6:30But again, this is going to play out in the courts in multiple ways, not just with her court case, but potentially if the Department of Justice decides to bring charges against her in the mortgage fraud case, too. And 21 attorneys general. I saw. In the race. Yeah, siding with President Trump. Republicans. In the race to be the next chair of the Federal Reserve, former St. Louis Fed President James Bullard says he spoke last week with the job, about the job with Treasury Secretary Scott Besson. He's one of our personal favorites. We're non-denominable. We love all our children, but Bullard's smart and been on many times.

7:12I've been in St. Louis. Now he's at Purdue. Yeah, now he's at Purdue, so there's a lot of reasons. In an interview with Reuters, James Bullard said he told Besant that he would be interested in the Fed's top position under the right set of conditions. He said, I'd be willing to take the job if we're set up for success. Success means that we want to defend the reserve currency status of the dollar. We want to keep inflation low and stable. And we want to protect the independence of the institution. Those are all things that probably don't, you know, knowing the way things are working, that the president might go, hmm.

7:54Never mind. Yeah, exactly. In the interview, Bullard said he thinks markets should price in 75 basis points of rate cuts by the end of this year. And he agreed with those who say tariffs will be a temporary, just a temporary contributor to inflation. And I would just point out to Jim that the Reds just walloped the Cardinals last night. He's a big Cardinals thing. But they're still two games back from the Mets. The Mets lost 9 out of 10. They lost 8 straight games, and the Reds were swept by the Athletics, which aren't even called the Oakland Athletics. No one even wants the Athletics. I shouldn't say that, but they're just called the Athletics, and they play up and over and over again.

8:40But now they're two back. I think there's like 12 games left. I mean, it's possible. It's getting interesting. Knowing the Mets, knowing the Mets, there might be a chance. Yeah. But knowing the reds, they might not, you know, hopeful. You've been crushed too many times? The reds, I have warm feelings because I go back far enough. No, but you've had a lot of people. 92, 91. Yeah, but the Bengals, yeah. Now it's a turf turf. He's out for maybe. You ever heard of turf toe? I've heard it. I have no idea what it means. I don't want to bring up your feet with the weirdos we have watching. What is it?

9:17He had to have surgery. I didn't realize it was a surgery. It can be bad. It can be bad. So they say maybe. Can you believe there's doctors that specialize in feet? I think that's weird. You question what's going on with them? No, I think it's probably preferable to a couple of other specialties. Yeah. That I can think of. Exactly. Where the sun doesn't. Right. President Trump says he is bringing a$15 billion lawsuit against the New York Times. The president is alleging defamation and libel and accusing the outlook of being, in his words, a virtual mouthpiece for the Democratic Party. What? He threatened last week to sue The Times after it published articles related to a sexually suggestive note and drawing that was given to disgraced financier Jeffrey Epstein for his 50th birthday in 2003 and appears to have been signed by Trump.

10:07Trump and his aides have denied that he was involved in the creation of that note. In a recent social media post, the president accused The Times of making false statements about him, his family, and his business. And by the way, that same letter was the reason behind the president suing The Wall Street Journal, Dow Jones, Rupert Murdoch, in those same things because of an article that popped up in The Wall Street Journal. Big article today, too. And what's great is about the president and the family's crypto operations. But the family certainly is doing well with crypto coming up. But, you know, I don't know whether that violates anything.

10:47If there's no there are certain things that have gone on with foreign countries that have invested. And there are certain positive things that have happened policy wise with those countries. But you can't say this happens as a result. This happens unless you've got poof. But it certainly raises, you know, any time that any family member of a president. does well, you raise questions about it. Yeah. You can go back to Billy Beer with Carter. Yes, you can. All the way back. I don't know how, that didn't sell that well, I don't think. No, but I remember. You got a six pack intact. It's worth a lot.

11:25Now. On eBay. The SEC is now looking into allowing public companies to report results every six months instead of every three months following a Truth Social post by President Trump yesterday. In a statement to CNBC, an SEC spokesperson said at President Trump's request, Chairman Atkins and the SEC is prioritizing this proposal to further eliminate unnecessary regulatory burden on companies. In his social media post yesterday morning, President Trump made the case that a six month reporting basis would save firms money, allow managers to focus on properly running their companies and help America better compete with China and that country's longer term view of business development.

12:08We discussed this yesterday morning on the program. And yeah, you want a long-term focus on this. It's been something that a lot of people picked up later in the day. Warren Buffett's talked about. He and Jamie Dimon wrote an op-ed many years ago. Let's see, it would have been 2018 where they said short-termism is harming the economy. And that's a valid point. But in that op-ed, what they laid out was really a request for companies to stop issuing earnings per share guidance on a quarterly basis, that that is too hard to hit that number every time around. I think we'd probably like to see some disclosure from companies to see what they've done in the last three months.

12:49I think if you can get away from this short-term guidance, that would be fantastic. You do want companies that think longer term, and probably Amazon is the best example of that. They lost money for forever. And Jeff Bezos, in his very first letter to shareholders, told investors, we're not in this for the short term. We are in this for the long haul. And that's going to mean we're going to spend a lot of money at times and maybe even lose money. Rather than taking the profits now, we're trying to build big. And it's obviously worked out very well for that company. He was looking for shareholders that agreed with him in that mission.

13:20And he found it because he was clear about that from the very start. But the I mean, when you're trying to forecast earnings per share, you have no idea. I mean, you look at all the charges and that's why we back everything out. We never do gap. We never do GAP. And I don't know how many times in the past we've said, wow, the big miss on revenues. And the company says we've got these things that are in the pipeline. And, you know, they're reporting. Let's say they're reporting at the beginning of August and the quarter ended on July 31st. They can say on August 3rd, a lot of these things that we thought came in.

13:55Right. And we thought they would have been going to come in in the July quarter, and they didn't. So, you know, we pushed back. But there they are. And the stock sells off because they miss their revenues. And it's kind of, you know, they call it lumpy. You never know when certain deals that you close are actually going to come in. The same would be true on a six-month basis. It would, but it would only happen twice a year instead of four times a year. I guess. I don't have a super strong feeling about it. I understand the idea that you want probably more information from companies, not less. But I do think you don't want short-term projections.

14:30You like reporting on, like, J.P. Morgan earnings every three months? You know it excites us. You do, too. Does it? Okay. Let's go back. We had to celebrate our 30-year anniversary, 30 times 4. 120 earnings. It's 120 earnings seasons times at least 500 companies. There are thousands of companies in the S &P 500. That's what someone once said. But there are a couple thousand we probably bought. We used to. Used to cover more. But it meant more because people didn't have any other way of getting some of it. Now it's so democratized. That's right. Andrew did bring up a valid point that if you're only doing it every six months, then these investor conferences and meetings with IR would get much more important.

15:15and it does raise the question of the opacity and the democratization of that information. But yeah, a long-term focus is absolutely something that we want to focus on. Another thing to ask the Treasury Secretary. I know, I'm keeping a list. Are you? Yeah. Good. Still to come. We've got a half hour. We want to make sure we get on the top. If we do. Cheese will be next. Still to come, Treasury Secretary Scott Besant. He's on the ground in the U.K. for the president's second state visit. But tariffs, China, and our domestic economy are still front and center. The U.S. bond market is performing very well because of the revenue from tariffs.

15:57Tariffs were supposed to destroy the U.S. bond market. And instead, we're going to take in hundreds of billions of dollars this year to pay down the debt. Squawk Pod will be right back.

16:16This is Squawk Pod. You're watching Squawk Box on CNBC. I'm Joe Kernan, along with Becky Quick. Andrew is off today. Let's do it. Joining us now with the latest on Trade Talks, the future of TikTok and more, Treasury Secretary Scott Besson. Mr. Secretary, it's good to have you on. Even I can figure out where you are from that backdrop. Joe, good to see you. Good to be here in London. And it's good to have you on. So I think you got, obviously, you have an earpiece in. So you heard what was in our headlines. Let's just go in order and talk about some of the things with Steve Myron that we talked about.

16:57And 48-47, isn't it beautiful? I don't know. And I think Republicans couldn't even get all their members to vote. So it's very highly partisan. But is it an odd structure to have him stay in the administration, even if it's with a leave of absence? But he's only going to be there, I guess, four months. What's your comments on how that has been set up? Yeah, Joe, I don't think there's anything irregular about it at all. I mean, what's the difference between taking a leave of absence, leaving his job open, and then having him to go through confirmation again? So I think just that the kind of kabuki was dispensed with and, you know, everyone knows that he's going back to CEA.

17:43So I think cards on the table is actually much more transparent. So he'd have to get confirmed again to go back to CEA? We were wondering about that. Well, if he didn't take the leave of absence, if he stepped down, the job would have remained open. and then he would have had to be reconfirmed whenever he leaves January, February. Yeah, that. So I think the signaling value here is that the plan is for him to come back to CEA. This is interim. It was caused by Governor Kugler's unexpected early departure. If he were to stay and have his term extended in some way, shape or form, I would assume at that point the the CEA job would no longer be one that was on hold for him, that that would be opened up.

18:34Of course not, Becky. Of course, it wouldn't be held. But the plan right now is for Stephen to come back. We also mentioned your latest thing that you're spearheading, among many other things, Mr. Secretary, and that is a search for a replacement for for Chair Powell. James Bullard, we have spoken positively about him because he's been a friend of the show over the years, always thoughtful and always open and transparent about everything he was thinking. We did point out some of the things he said he seemed to be stressing Fed independence and the ability to raise rates if necessary, you know, to defend the dollar or a lot of things maybe that a president that really wants lower interest rates might not like to hear.

19:25Was any of that disqualifying in your view? None of that's disqualifying in my view. Of course, the Fed does not have a dollar mandate. The Fed has an employment mandate. It has a growth mandate. And the dollar is a byproduct of that. And Mr. Buller and I had a very good approximately two-hour session. He has incredible experience from the St. Louis Fed. He is an expert on monetary policy, deep academic background, and knows the institution of the Fed very well. There are some that think that the only thing the Fed really should be focused on is a dual mandate, but it's inflation and the value of the dollar.

20:12You just kind of indicated that their primary mandate, in your view, is full employment and maximum growth for the economy? No, I said it's inflation and growth and the calculus between those two. Okay. I guess going back to Fed independence, and I understand that I don't know of a single president that hasn't argued for lower rates, but under President Trump, Do you think Volcker could have done what he did back in that period of hyperinflation that we had, Mr. Secretary? I think that's what people worry about. When there's times you need to take some medicine, maybe even cause a recession to do what's right long term for inflation.

20:58Would that be difficult under President Trump, in your view? Joe, as you know, President Trump's very sophisticated economically. And I think he has been right at almost every turn, whether it's his first term, his second term. And if he thought inflation were the problem for the American people, sure, he'd be willing to have rate hikes. But right now, the problem has been that the Fed has been behind the curve. We're hoping they will start catching up in a rather fulsome way. 25 basis point cut is priced in tomorrow. And we will see whether the Fed wants to go to neutral or become accommodative.

21:39The president thinks neutral is like 300 basis points from where we are right now. Do you agree with him on that calculation? I don't think he thinks that's neutral. I think he thinks that's accommodative. And I think he thinks that the Fed is behind the curve. We are in the middle of a housing crisis and this affordability crisis, President Trump didn't get us here. It happened during the Biden administration. And the first thing that President Trump has done is bring down inflation. For the past six months, inflation has been below the Fed's target. So we had to bend the curve down, and now we're going to start working on affordability.

22:28And one of the keys to housing affordability is lower rates. Mr. Secretary, the Fed controls the short end, not the long end. If something happens that the long end goes up, even after the Fed cuts rates, that will mean that mortgage rates won't come down either, because the 10-year mortgage rate is going to be what 30-year mortgage rates are – The 10-year is what 30-year mortgage rates are tied to. What do you do in that scenario? Well, Becky, first of all, what you're describing is what happened last year at this time when the Fed did the 50 basis point jumbo rate cut in front of the election, and the long end kind of rebelled a bit.

23:13Right now, the very front end of the curve is inverted. I think that the market is pricing in 75 basis points between now and the end of the year. So if it's already priced in, then it's priced in. And I expect we will see inflation starting to come down. Rents, which are a big component, that's a housing component, are with a lag. Energy prices are down. So I think that the long end is very well anchored. And I point out that the U.S. bond market has been the best performing bond market in the G7. That in the fall, excuse me, in the spring, all we heard was that the U.S. Treasury market isn't a risk-free asset anymore.

24:03And nothing could be further from the truth. We're the best performing bond market in the world. I want to talk about TikTok, but I also, the market's at new highs again, Mr. Secretary. And I made the point again that most of those stock markets, maybe not the Dow, but the S &P and the Nasdaq indicated higher today. With everything we've heard about and worried about in terms of global trade rebalancing and tariffs and, you know, the labor market and everything else, do you think it does it deserve to be there? Is it because of the anticipation of some rate cuts, or is it something more positive, like deregulation or something else?

24:46Joe, I think it's a combination. I've been in the market 35, 40 years. It's very difficult to tease out one factor. We all know the market climbs a wall of worry. But I think the market, the U.S. market, is seeing a lot of things it likes with President Trump's agenda. And first and foremost, it's back to his first term, non-inflationary growth. We are going to see substantial deregulation. I can tell you, everyone asks me, what's the biggest surprise for you now that you've gotten into the Treasury seat? And it was just this regulatory morass that we had surrounded American businesses with. And President Trump is determined to cut through that.

25:35In his first term, he said that there was going to one regulation could go in for every three that came out. It ended up being one went in for every seven. He set the target of one for every 10. Now, I think it will be substantially more. We're seeing over at EPA, Lee Zeldin is doing a great job, great job in terms of letting America get back to building things again. We had become the kind of country where we weren't able to build things in a robust fashion. It was delayed. We couldn't build things across state lines. So we want to be an AI superpower. We want to be energy dominant. And all that's got to come from deregulation.

26:18And I think the market likes that. I think the markets are also looking through and seeing that the president's tariffs, contrary to what everyone said in April, we're now getting research reports from major Wall Street banks. Barclays had a very good report about 10 days ago that said that the U.S. bond market is performing very well because of the revenue from tariffs. Tariffs were supposed to destroy the U.S. bond market, and instead were going to take in hundreds of billions of dollars this year to pay down the debt. How do you think that plays out, Mr. Secretary? Have you had conversations about what to do if the Supreme Court upholds some of those decisions about the tariffs?

27:01Are there other avenues that are you involved in trying to figure out what the next step would be? Joe, I'm confident that the Supreme Court will rule in favor of the administration. I think the law is on our side. I think historically that the Supreme Court is very reluctant to overrule a president's signature policy and President Trump's two signature policies. The first is the border, where he has closed the border. They said it couldn't be done. And the Supreme Court has gone along with all the immigration rulings, despite what the lower courts have done. And I think we're seeing here the lower courts are trying to stop this, and I'm confident we'll see it in the Supreme Court.

27:44And there are lots of other authorities we can use, but I am confident that we will prevail with the IEPA lawsuit. Mr. Secretary, yesterday you said that Chinese negotiators in the talks that you were having with them came up with a very aggressive ask. We reported, there was reporting around it that suggested that was related to technology issues and broader trade issues and tying those two together. You said at the time that the U.S. was not willing to sacrifice national security for the sake of reaching a deal. And then later we heard that there is a framework. You came out and said there's a framework for a deal for TikTok.