The US is willing to impose lower tariffs on the UK than the EU primarily due to strategic, economic, and political factors:
Bilateral Leverage and Trade Balance: The UK, as a single nation, has less negotiating power than the EU, a bloc of 27 countries with a larger collective market. The US can secure concessions more easily from the UK. Additionally, the US runs a trade surplus with the UK (e.g., $25.9 billion in goods in 2024), while it has a significant trade deficit with the EU (e.g., $209 billion in 2024). Lower UK tariffs align with maintaining favorable trade dynamics, while higher EU tariffs aim to address the deficit. Post-Brexit Alignment: Since Brexit, the UK has sought closer ties with the US to offset its reduced EU market access. The US leverages this to secure a favorable deal, offering exemptions (e.g., auto, aerospace) and lower tariffs (e.g., 10% baseline vs. EU’s potential 20-50%). The UK’s flexibility, unbound by EU regulations, allows quicker agreement on US priorities like digital trade and agriculture. Geopolitical Strategy: The US views the UK as a key ally in countering EU influence and promoting a US-led trade framework. Lower tariffs strengthen the US-UK “special relationship,” especially in defense and intelligence (e.g., AUKUS), while higher EU tariffs pressure the EU to concede on issues like steel and digital services taxes. Source: SuperGrok
US debt has consistently risen regardless of which party is in power
Source: The Rabbit Hole @TheRabbitHole84
Great chart by Otavio (Tavi) Costa which summarizes very well what the Treasury market it currently trying to tell us:
▶️ Front end of the curve (short-term rates): the growing influence of the "shadow Fed chair" on short-term rates ▶️ Long end of the curve (30Y): The mounting fiscal disarray It seems that risk assets and store of values are the main beneficiaries of this backdrop. Source: Bloomberg, Tavi Costa
Handy tariff "state of play" sheet from BBG.
Source: Neil Sethi @neilksethi
The world's biggest tourism economies last year.
Source: Civixplorer
Stocks as a share of household assets
Source: zerohedge @zerohedge
Here are a nicely written summary on Elon's "America party"
Source: Mario Nawfal on X
$JPM JPMorgan has outperformed 5 of the Magnificent 7 over the last 5 years.
Source: Koyfin
