All into Account: How to win a Trade War

[on-hold music] Good morning, good afternoon, and good evening. Welcome to J.P. Morgan's All Into Account. I'm Joyce Chang, Chair of Global Research at J.P. Morgan. And today I'm joined by Chad Bown, the Reginald Jones Senior Fellow at the Peterson Institute of International Economics and co-author with Soumaya Keynes of the new book, How to Win a Trade War. Now, I can't recommend this book highly enough. And also just following Chad on his own podcast, Trade Talks. I've known Chad for a very long time. He served as the Chief Economist at the State Department in the Biden/Harris administration. He was on Obama's Council of Economic Advisors. He's also had stints at the World Bank and the World Trade Organization. I can't think of a better person to discuss the issues at hand today as we look at these trends on trade, de-globalization, tariffs, and what this all means for the global economy. Well, the trade wars are here to stay, with tariffs, export restrictions, and sanctions now accepted as a part of the normal policy toolkit. Governments and corporations are responding in a lot of different ways to identify and address supply chain vulnerabilities. Some of you may have already heard about J.P. Morgan Chase's Security and Resiliency Initiative. This is a $1.5 trillion 10-year plan to facilitate finance and invest in industries critical to economic security and resiliency. And we have looked at an additi- initial $10 billion, which can be expanded, but we've also rolled this out, um, recently and expanded this year. Um, so what we've seen, um, from a global research perspective is that we've seen trade reorientation, but not capitulation, and we have seen a strengthening of China's external position, a trade surplus that hit a record $1.2 trillion last year, while the US goods and services deficit reached $900 billion. So with China now trading with, um, more, more, with 130 countries in the world than the US, Chad and Soumaya examine whether trade wars can ever truly be won. Um, they look at, um, how democracies should navigate an increasingly uncertain trade environment, and the subtitle is An Optimistic Guide because they do look at the things that we're all going to learn from each other through this process. Now, I really want to thank Chad for joining us, but I also want to say that, you know, oh, a book on trade, a lot of people think, "Well, is that really a nerdy book?" This is a really fun read. Lots of, um, personal anecdotes, um, and examples in it. It's not 500 pages. It was something that really in the course of going through a transatlantic flight, I really read, um, through the book, and I highly recommend it to all of you. So Chad, thank you so much for joining us.

Thanks for having me. And the, the easy to read bit I will, um, attribute to Soumaya, my co-author, who's a columnist at the Financial Times, and she is an amazing writer. And so we put a lot of time and effort into trying to make it read well. So thank you.

Well, I feel like I know a lot about you and Soumaya's families now.

[laughs]

Because there are a lot of anecdotes to really bring this to life, and examples to think about this, whether it is looking at it like