Transcription
Hello, Business Tomorrow Live by TER KP at 10:00 AM on February 26, 2026. Today, we analyze the issue of trade wars in the new world order, after the Supreme Court overturned the use of retaliatory tariffs that Mr. Trump announced since Liberation Day in the past year. However, Mr. Trump has now signed an order to enforce a new form of taxation, which is a 10% tariff increase on global trading partners, which took effect earlier. Today, there has been further comment from the USTR, the US trade representative, saying that the 10% may be raised to 15%, and they will wait for the appropriate timing to increase the tariff from 10% to 15%. In this new version of tariff increases, it appears to be more limited than the previous universal or all-encompassing increases. But does this mean the world will be free from the risk of trade wars and the use of tariffs as a weapon in the Trump era? Today, we will analyze this issue with Associate Professor Somchai Paksupiwat, an independent academic in political science and international economics. Associate Professor Somchai, hello.
>> Yes, hello.
>> Professor, hello. Today, after the Supreme Court rejected the previous retaliatory tariffs, Mr. Trump seems to be trying to impose new global tariffs and new rules. The latest is the 10% with Section 122. Professor, but recently, the trade representative said that from 10%, they are preparing to increase it to 15% again. So, in summary, will this new 10% or 15% tariff actually be enforceable globally and legally? Professor.
>> Uh, they will likely rely on legal grounds. The one that was overturned was a valid law, but they exceeded their authority.
The International Emergency Economic Power Act of 1977, as it's called. They exceeded their authority. Therefore, this affects two matters. One is what the USTR mentioned earlier, the Liberation Day. Do you recall? But the other thing that was sanctioned, China and Russia, are smiling. It's what they targeted initially. Do you remember? They targeted Mexico and Canada with 25%, China with 10%, and later an additional 10% for fentanyl. This was also affected. Therefore, China is smiling because it disappeared out of nowhere, that 20%. And, uh, but what they are using now, uh, they have started using one, which is the law from, uh, uh, 1974, but Section 122. Section 122, 122 allows for tariff increases, but observe, it's 10% with an analysis that America is being targeted and suffering from a balance of payments surplus. Therefore, it's an across-the-board increase of 10%. As for increasing it to 15%, whether they will use this is a question. Because if they use this, it means an across-the-board increase or something similar. But they are considering it. Therefore, in this case, many countries, especially, not many countries, but about 2-3 countries dare to say, "Hey, if that's the case, we need to talk again." Regarding the European Union, regarding India, regarding China. China is happy, but they are afraid that Trump is investigating how to target them. So, there have been warnings that, "Hey, you, you've done this and are now increasing tariffs again, this is not acceptable." Therefore, this is one part that still has uncertainty. But what is certain, that Trump will use, is, uh, I think Section 301. They will likely use 301 of 1974, which allows for targeting individual countries if the USTR investigates whether there is discrimination or what they call unfair trade. Therefore, this is something they can, uh, implement. Because they can implement it, and in fact, they can increase it beyond 15% in this case. The second point, the 15% is limited by what they are currently using, which is Section 122. Section 122 limits it to a maximum of 15% and a duration of 150 days. I don't know if they will use this, but they are using this for the 10%. And another one they might use is, uh, 2011. But from what I hear, they are not planning to use it yet. 1974. 2011 will be used in cases where there is an impact on businesses or industries. This is what I've heard, it will be 301, as Guitar mentioned, and Section 122, which they are using. And another one they have used correctly is the 1962 Trade Expansion Act, where the Department of Commerce stated that it impacts issues of National Security. That's when they increased tariffs on steel, aluminum, and various other things. Therefore, these are all included. That's why some countries say, "In reality, some countries are hit hard." Not only do they face steel tariffs, but also this, like the European Union, and on top of that, from 10% to 15%. Therefore, this has gone too far. Therefore, this is one part, not everyone is treated equally. Therefore, in this case, I think Trump is preparing, but he has told countries, because the European Union has explicitly stated that the agreement, the Turnberry agreement, the Turnberry agreement in Scotland, which the European Union has never been very satisfied with, because in this agreement, the European Union is at a disadvantage. First, they must allow 90% of American goods to be imported without tariffs. At the same time, Europe is charged 15% tariffs and is also forced to invest in America, approximately over 700,000. This is like, what, Taiwan, South Korea, Japan. How much did Japan pay? 500, 550,000. Korea, 380,000. Taiwan has to invest in semiconductors and other things. India also got hit, but not as much as that. Therefore, what is happening is that Trump's tariffs are currently uncertain. But what is certain is that he said he will take action. He said, "Don't negotiate again, you will be hit harder." Simply put, I will take action to make it the same as before. The same as before means that each country is charged differently. Therefore, for example, we are charged 19%. How will it be the same? But this is a bit difficult because "the same" means net or, uh, net. Because in the case where they say 15%, which I hear, Europe will likely be the same. But Europe says no, because if they are charged 15%, according to the agreement, this is not net. Some items, like cheese, butter, these will become more expensive. Many items, clothing, or anything will become more expensive. But what they will benefit from is liquor, liquor, which is, uh, alcohol. Therefore, in this case, it will not be the same because it is cumulative, as many items are combined. Therefore, in this case, it will likely be a technical matter, how Trump will try to maintain "the same" by using laws that are different from 1977, across the board. Not across, meaning Trump has full discretion to take action. But if Section 301 is used, they must, uh, allow the USTR to investigate each country first. If Section 1900, uh, uh, 1962 is used, the Department of Commerce must investigate first. If Section 122 is used, there is a committee to oversee the balance of payments. Therefore, it's a technical problem. That's why they are given 5 months, 150 days, to find the law that will support "making it the same." I want to tell everyone not to negotiate or bargain. Everything will be the same. But countries, the European Union, say it's not the same. But America says, "Calm down, it's the same." China is also warning today because they will meet to see what you are investigating. If you investigate and then increase tariffs, I will not accept it. Because Trump is referring to Phase 1. Guitar, do you remember Phase 1? In Phase 1, there was a compromise. Because if Mr. Trump accused China of not complying, it was during the COVID period.
>> COVID. Because of COVID, what they said about imports, if I recall correctly, within 2 years, approximately 200 billion, to solve the deficit problem. It turns out that China did not import enough, not up to that amount. Therefore, in this case, China is concerned that they are looking for ways to target them, including Phase 1, which they said is still not enough. Therefore, this is the situation that can be said to be that Trump's tariffs are currently uncertain in two aspects. Aspect 1 is that what he said about making it the same will take time. It will take time to see the real results, no less than 5 months. The second uncertainty is which law to use and how, because it lacks the flexibility of what they used in 1977. Therefore, each country is worried. But some countries are happy. They are happy. For example, ours, cars from 19% to 15%. Vietnam from 20% to 15%. But some countries are distressed. Uh, uh, what about the UK, from 10% to 15%. Do you recall? Yes.
>> Therefore, in this case, some countries, small countries, are charged 10% and then 15%. Therefore, some countries are gainers. But we should not be too happy yet about being gainers, because the matter is not over. Because that means Trump has to see, because we are still in negotiations. He will see what the attitude of each country is. And it's not just about economics. He will link it to security, to what else, including your attitude. If you show an attitude that is similar to what they call, what do they call it? A professor mentioned, I don't know if Guitar read it, what they call predatory hegemony. Leadership in a predatory manner. The word "predatory" means not just playing games with you, but destroying you. Or it means hunting in the sense of large animals. Small animals must bow down. It's like everyone who meets Trump has to praise him. "Hey, you've won an award." Therefore, in uncertain negotiations, it involves content, attitude, and security dimensions. This is what the European Union fears. If they negotiate again, they will target the issue of Ukraine. They are already targeting it today. Do you see? For four years of war, the only country that refused to participate was America. There were no representatives at all. Therefore, this is something to be wary of regarding the uncertainty in negotiations. Therefore, this is one thing that is happening. Therefore, at this moment, all countries that gain or lose should not be too happy yet, because the game is not over. Because they are taking measures to investigate and observe the attitudes of each country in negotiations.
>> Yes, so does the Supreme Court's rejection of Mr. Trump's retaliatory tariffs mean that global trading partners do not have more bargaining power with the United States, Professor?
>> Actually, it's like having bargaining power. It's like it, but Trump is ruthless and, uh, people are afraid. Because what he announced means that everything he increased was illegal. Once the law is violated, what we are charged must disappear, right? It must disappear. So Trump immediately countered by increasing it by 10% to compensate for the loss of 10%, and he intends to increase it to 15%. As Guitar mentioned, it will be 15%. But now, this is being cut out for each country differently. Some countries 20%, some 15%. How much did China get charged? Between 45-50%. Do you recall? The tariff from 145 is now around 45-50%. Therefore, in this case, the 20% is gone because this includes fentanyl. Therefore, they will issue laws to compensate for these things. Therefore, in this case, it means the situation is not yet resolved. Will the laws to compensate be fully effective? There are problems with accumulation. Therefore, it's a technical problem. And secondly, the situation is still under negotiation in many aspects. Ours is not over yet. Therefore, negotiations depend on the attitude and content of the negotiations, independent of the 1977 law. Suppose this law is still in effect, and they are still negotiating with us. If they are not satisfied, they might increase it beyond 19%, or if they are satisfied, they might reduce it. Therefore, there is still uncertainty in many aspects. But what Trump fears most are the superpowers. He doesn't fear us. He fears superpowers, the European Union, China, and India, who are showing signs of wanting to renegotiate. This is one part that they are warning in advance. "Don't do it, if you do, I will retaliate severely." At the same time, they are comforting by saying they will make everything the same. Let's take that with a grain of salt. Another part worth mentioning, Guitar, think about it. What happened? They asked for refunds. The tariffs collected were illegal, right? So, who will ask for refunds? Importers, right? Because they have to pay import duties. And secondly, the public who have to buy expensive goods. If the import duties are to be refunded to American companies, how much? Over 170 billion. 170 billion is gone. Will Trump accept it? Therefore, in this case, the Supreme Court issued what? No decision on this matter. So, it's as if it favors Trump. So Trump says, since this is the case, one thing is that this matter will be fought in lower courts, intermediate courts, lawsuits. There are some lawsuits now, but Trump has weapons. First, the worst case is lawsuits, which take 5 or 10 years. Second, I believe Trump will use other methods. Which company dares to sue me? He will use other weapons to destroy them. This is one part, simply put, they will use this method. But in reality, there are already lawsuits because of the refund issue, which is another matter. They think in their minds, how to refund? Because I will have new laws to compensate, to make it the same. What do you want to refund? Everything will be the same. Therefore, this is another reason why the issue of refunds is not talked about much, but it is talked about.
>> Yes, so if the issue of refunds, until the government has to lose revenue, has to find money to refund, causing fiscal problems, it might not happen, right, Professor? Because Mr. Trump seems to have many ways out, as you mentioned.
>> Not necessarily. His attitude is like a gangster. It's like, the sugar cane has entered the elephant's mouth. But some people are not afraid. Some will fight. Do you recall? They fight in lower courts, intermediate courts. If they win or something, it's not certain. But what Trump does is do everything to prevent what is happening. Therefore, this is uncertainty. But what is clear is that the money he collected, over 10,000, but he is trying to compensate. It means 170,000 is gone. But compensation is a help. But what is important is that before compensation, before it's fully implemented, new laws must be enacted for many months. Therefore, some companies that are now losing more than 15%, they are smiling. Because in the end, it's back to 10%, then back to 15%. So, this money, will the new laws, and while it's not being collected yet because it's illegal, this money is a loss for America, right? Will they accept it later? This is another part. But what is important is that it increases the risk to America's fiscal discipline. Because America's fiscal discipline requires money, approximately, the numbers are uncertain, but between 3.5 trillion, 3.5 trillion, that they have to increase due to accepting, uh, reducing corporate income tax, which has been since Trump 1, or 21, and individual income tax. This needs to be compensated. And don't forget, their treasury situation is now 120% of GDP. Therefore, if this increases, they hope to get some money from tariffs, some from investment in America due to compulsion. But both are lower than expected. Lower than expected. And for investment, the latest figures are still lower than during Biden's time. So, this is not very clear yet. Therefore, in this case, it's another part. And what is clear is that in the last quarter, the American economy grew slower than expected, so much so that last year's growth was lower than the year before, 2.2. This is part of the American economy that Trump talks about in the State of the Union. "Wow, I've done so much, the economy is terrible." It turns out, look at the news, everyone shakes their heads. It's not true according to the analysis, according to what was announced. This is a risk in one aspect, related to tariffs, related to the American economy, which is having problems, as we have described.
>> Yes, and regarding the risk of future trade wars, after this court decision, are there still scary things waiting for us? Can we be at ease and think that they are gone, those 50%, 100% tariffs, or arbitrary tariffs at very shocking levels like in the past? Professor.
>> It's not over yet. Don't forget that some matters are collected across the board. Like across the board, we see various sectors. But don't forget, across the board, they can grant exemptions for specific cases. Look at the steel and aluminum tariffs. They used the law from what year? 1962. Initially, it was increased by 25%. Do you recall? Later, it was increased to 50%.
>> Do you recall that for certain sectors or medicines, it was announced to be increased to 100%, even 300%? So, simply put, it's not over yet. And if they use the 301 tariff, 301 is a type of targeting. Because 301 stipulates that the USTR will investigate whether a country discriminates against others, or unfair trade. Unfair trade means subsidies, dumping, selling goods below cost. Therefore, this can be targeted individually by country, not across the board. And this has no limit. They can target it, unlike the 15% that is currently collected at 10%, that's Section 122. Therefore, Section 301, as I said, they can target. Therefore, the statement that it's not over means it's not over. It means they will observe the attitudes of each country, there will be discussions, there will be targeting or not. But what they discuss is not limited to trade. They will look at, for example, targeting the European Union, which is reluctant to negotiate, even though they are dissatisfied, because they are pressuring on Ukraine. Do you recall? Today, they are already pressuring Ukraine so much that Ukraine has many problems. Therefore, linking this issue to Ukraine. Therefore, this is one part that makes Europe so worried. They have to provide financial assistance alone. Trump is not providing assistance, but he is still selling weapons. But where does the money for weapons come from? From the European Union. Therefore, this is one thing that makes the situation uncertain. They can collect higher tariffs than before, using laws they deem appropriate to target each country.
>> Yes, but with the limitation of the court's power reflected in the latest decision, will some countries decide to retaliate or refuse to negotiate as before? For example, China or Europe, which have high bargaining power, Professor?
>> Okay, observe. The countries that dare to show their attitude, as far as I can see now, are 3 countries: China, Europe, and India. But India doesn't dare to show much. But India is actually doing well, because later it was reduced from 50% to even lower than ours. Do you recall? So India is there, but the two countries that have shown more clearly are the European Union. But the European Union has shown it in a certain way. Because when the Turnberry agreement came out, many countries were dissatisfied, saying, "Hey, do we have to yield to Trump this much?" But what method did Trump use to make countries swallow their pride? Because he linked this agreement to assistance related to Ukraine, bringing security issues into it. Therefore, today, the European Union is exactly the same. Simply put, they want to renegotiate, but they are hesitant. But what is important, what they dare to say is that it must not be more than before. This they dare to say clearly. Some things you mentioned, 15%, it's clearly more than 15%, like cheese, butter. But today, the trade representative said, "I will do everything to make it the same." They are trying to respond directly to China.
>> Today, they are just warning.
>> Warning about what? Because they will meet in April. They are saying, "Hey, you, don't bring up new issues to target us." Simply put, you are investigating this and that, don't add anything more. Therefore, China is just warning. They want it to be the same. But if it's the same, China smiles. While new laws have not yet been enacted, what is clearly gone is the 20%. The 20% or 10%. Guitar, you probably remember, because there was a new agreement that took 1 year, in exchange for China allowing concessions on the export of minerals. They reduced this from 20% to 10%. Do you recall? Because this was the first thing that targeted Mexico and Canada. Mexico and Canada were charged 25%, China was charged 10%, and then another 10%. It was reduced by 10%, and later there was a feeling that it would be reduced again if an agreement was reached for 20%. But automatically, the remaining 10% is gone because the Supreme Court said this is illegal. It falls into the category of illegal. Therefore, in this case, China understands that from 45%, it has been reduced to 35%. But China also wants to say, "Hey, you are investigating. You must not make it higher." And another thing, Trump is talking about two things. One is about licenses, which no one knows what Trump means by this. Simply put, Trump will find other methods, not just tariffs. If there is retaliation, licenses might be involved. And another thing is that China is telling Trump, "These agreements, don't, uh, Phase 1, I have agreed to it, but today the USTR is investigating whether the Phase 1 agreement has been breached." China is now worried. "Don't use these as an excuse to increase tariffs. That's not allowed. An agreement is an agreement. If you create more burden, I will retaliate." This is the only country that dares to speak so clearly. Now, there is another part, which is the transshipment tax, which is still pending for our country. At that time, it was said that if transshipment goods were detected, we would be charged 40%, on top of the 19% tariff. This seems to be the rate for many countries. Is the 40% transshipment tax still possible to be collected, Professor?
>> This transshipment issue is not over yet. Because regarding transshipment, they can cite any law. But what was agreed upon is that transshipment relates to the origin of goods, which we are still negotiating with them. It's just that they will use which law to collect tariffs. Therefore, they can collect it. Therefore, in this case, it depends on what they want, which is for us to set high tariffs for the origin of goods, to reduce Chinese investment, because they are misusing the rights. This affects us, because if we agree, it will affect Chinese investment. This issue is within each country. Vietnam is the same. They are among the countries that need to discuss this. This is about transshipment. As for how much tariff they will collect in case of transshipment, the tariff is at Trump's discretion to apply correctly, using which law. There are two issues. One is the term "origin of goods," how much. The second is the tariff to be collected. This is left to them to use the law they cite. In reality, they have laws to target. We have talked about 1974, which has 3 sections: Section 301, Section 122, Section 2011. And the second is the 1962 Trade Expansion Act, which is Section 232, concerning steel, aluminum, etc. But another one, which they can use, but I think Trump wouldn't dare to use, is the 1930 Smoot-Hawley Act, which caused the global crisis. Do you recall? It happened because there were problems with trade. But what you haven't mentioned is that Trump might use this method, but I think he wouldn't dare. But for the sake of completeness, it's about making the 1977 law legally correct. Because the Supreme Court said Trump exceeded his authority in 1977, regarding the emergency, because he did not seek permission from Congress. Do you recall? Therefore, Trump, for example, might say, "I will ask Congress." If so, then 1977 can be used, but it must pass Congress. But analysts, including professors, do not think he will dare to use it. Because to pass Congress, the numbers are clear. In the Senate, Republicans have 53, Democrats have 45, plus 2 Independents. The Independents will side with Democrats. This means Trump has about 3 votes. That's all. You will never get a majority. Only 2-3 people disagree, and there are already Republicans who disagree. In the House of Representatives, there are 435 members. Currently, there are 2 vacancies, so 432, 33. Currently, Democrats have 214, Republicans have 218. This means 2 Republicans disagree, and the law will not pass. Therefore, this is Trump's way out, but Trump dares not use it because the chance of it passing is too difficult. You have people who disagree. Therefore, in conclusion, I think Trump will only use two laws. Two laws are, uh, the 1974 law, and the one he has already used since the beginning, the 1962 law. But in other areas, which might be beneficial, he will use licenses, which he has mentioned, but people are still confused about what it means. This is a mechanism. Therefore, Trump has many ways to play.
>> Yes, so it's not over yet. The trade war. We cannot be at ease about Mr. Trump's new measures that may be revealed one after another. Now, regarding the impact on the American economy, Professor. From previously collecting tariffs from each country at different rates, to now all countries potentially being charged 10% or 15%, how much will the impact on America in terms of inflation and national income differ from before, Professor?
>> What has happened, we can see clearly. The American economy in the last quarter was bad. One part is that investment has not gone as Trump said. Second, the cost of living, which America is paying a lot of attention to. Trump's ratings are bad in this regard. This is the reason why advisors say, "Hey, you are focusing only on Iran, Iran, Iran." Your midterm scores are up because the American economy is not as Trump claims in the State of the Union. Therefore, we can clearly see that 1. Economic growth is slowing down. 2. Inflation, cost of living, because collecting tariffs makes the cost of living higher. Therefore, in this case, we can clearly see, for example, that ordinary people, their prices are lower, but meat and other things, prices have all gone up. And housing, affordability, these are also the same. Therefore, in this case, it's another part that makes it so that even though Trump says, "Hey, my method will make you buy medicine cheaper," the assistance related to welfare has decreased. So, simply put, overall, the American economy is still facing problems. But what you fear more is that Trump is in a situation where America has a deficit, has, uh, public debt as high as 120%. And the amount that they will use to compensate for the tax reduction is over 3 trillion. And if it's not compensated, especially with the current uncertainty in tariffs, it will increase the risk. Coupled with the fact that the economy is not growing, or investment is not as they expected. Therefore, this is another risk that will occur in terms of fiscal discipline and other matters. Don't forget, Moody's, not just Moody's, all three rating agencies have downgraded America's rating since the beginning. This is another part that explains why the dollar is weakening. This also explains what is happening to the economy and general sentiment. There is only one good thing, stocks. Trump talks about this, stocks. But we will talk about this later. It's a good part with hidden dangers.
>> Hidden dangers, how so, Professor?
>> Guitar, ask JP Morgan.
>> Uh, which recently, Mr. Jamie Dimon of JP Morgan said he is highly concerned that the current atmosphere is similar to before the 2008 crisis. Professor, do you see it similarly? Is there a hint of a crisis that will repeat the 2008 hamburger crisis?
>> When that crisis occurred, everyone was optimistic. Oh, assets, asset prices, rising a lot. Land was okay, okay, okay. Do you recall? So everyone was optimistic until things became too expensive. At a certain point, it exploded. When it exploded, it was about supply, related to real estate, the stock market, etc., it exploded. So, but at that time, uh, the G20 did not come to help, or China did not come to help. We have to thank China. Because when the subprime crisis exploded, America realized it could not solve this problem on its own. It needed the G20. So, the G20, at the ministerial level, G20 was formed after the 1997 crisis. Two years later, it was formed to solve the Tom Yum Kung crisis, but it was at the finance minister level. But when the subprime crisis occurred, France said, "Hey, we need to meet at the head of state level." That's when it's explained that the subprime crisis was survived, partly due to assistance from international countries, especially China. At that time, they really had to help, and also helped themselves by stimulating the economy greatly. This made the subprime crisis not as severe as feared, because people were afraid that the subprime crisis would be like the 1929 Great Depression. So, this also resulted from the explosion of asset prices and other things. Therefore, what Dimon said, it indicates that the situation is similar to the subprime crisis of 2008, which is what? Everyone is happy, looking only at the optimistic side. Asset prices are rising, rising, rising. Things are happening. He said the cycle must end. Therefore, this is what he warned about. And this is part of what we observe. Asset prices are still rising. Meanwhile, looking at the American economy, is it that good?
>> Therefore, this is another part that has been warned. So, simply put, looking at public debt, many people have warned, even in articles published about 5-6 months ago, there have been clear warnings that public debt will one day become a time bomb for America. Because if there is a feeling that, hey, regarding, uh, lack of confidence in America, which is related to lack of confidence in the dollar and bonds, it's starting to show. We see that US bonds are no longer considered a safe haven. This is important because if this lack of confidence increases, it means that the pressure will cause the interest rates that America has to pay to increase. If interest rates increase, it means that America's fiscal discipline will be in trouble. Because the reason they have public debt today is partly because people have confidence in America, confidence in the dollar, and low interest rates. But now people feel that this lack of confidence is starting to spread to the currency, and there are attempts to target the dollar by reducing it. This is the reason why the dollar index is not a safe haven anymore. The clear safe haven is gold, so gold has risen. And they are also looking for new safe havens, like silver. This is another part that affects the uncertainty in the American economy.
>> Yes, and besides asset prices, or stock prices that have risen so sharply, are there other signs that you see that there is a risk similar to before the 2008 crisis in America now?
>> Uh, there are two issues. One is asset prices, which are related to, uh, taxes, uh, the stock market.
>> Meaning stocks, including American bonds. This is part of the price. The second part is related to, uh, geopolitics. On one hand, America is, uh, preparing to target, uh, uh, Iran.
>> Therefore, Iran has created pressure. They say they cannot fight directly, but they have prepared. They say they cannot fight, but your friends will get hurt. They know they cannot target America, but they can use, uh, proxies, uh, forces. They have decided that if you target one leader, others will decide to target. So, what will they target? Iran, uh, sorry, Israel, target, uh, allied countries, oil, Qatar, UAE. Regarding this, but there have been threats to target your ships. But I think this is more of a threat. Because American ships, whether it's the Abraham Lincoln, whether it's the Ford, wow, they carry aircraft carriers, helicopters, etc. It's a threat. But this is enough to make America think. And they also threaten the Strait of Hormuz. They can threaten it fully. Because the Strait of Hormuz is about 160 miles long, with a maximum width of about 20-odd miles, averaging 22 miles. In some parts, it's 2 miles. And if you look at the geography, Iran covers all of this. So, they are conducting exercises. They say if that happens, the economy, oil, analysts say, "Oh, if the Strait of Hormuz is closed for one day, the price of oil will go up to $150." But Guitar, take this with a grain of salt. Don't believe it too much, but it will rise sharply. But it might rise for a day or two. Because to target this, it must be admitted that it affects other countries. Iran must think. It also affects themselves, because oil revenue comes from oil, and a lot of oil passes through here. But at least, the Iranian leader knows that in this game, they must be ready to fight hard, otherwise America will retaliate severely. Therefore, Trump also has to think hard. Therefore, this will be an issue of whether, if you make a mistake, it will affect the American economy, the economy, and, uh, security. In this case, it will affect that. That is the second risk. So, the risk of asset prices, the risk of geopolitics, and another risk that was mentioned earlier, the risk of fiscal stability. This is another part that is affecting them. And another one, this will be more of an internal risk. We must admit that America today is quite divided. And America itself is being heavily targeted. Therefore, uh, uh, not long from now, Trump will face the risk of the Supreme Court considering two issues. One is whether to accept Trump's dismissal of the central bank governor, who was sued. Regarding, uh, he was also a professor and had two residences. He declared his address, paying less interest. Trump fired him, saying he lacked ethics. Is Trump exceeding his authority? The governor is suing. It's now in the Supreme Court to consider whether Trump's dismissal was valid. And the more serious one is that Trump is, uh, doing something that may violate the Constitution. The Constitution accepts what they call, what do they call it? Jus sanguinis. Anyone born in the country, in terms of nationality, there are two types. Using Latin, jus sanguinis means that whoever the parents are, the child can be born with the nationality of the parents, according to blood. But America and France use jus soli. Jus soli means nationality can arise from the territory. Anyone born in France, anyone born in America, automatically becomes a citizen. They become a citizen, uh, American citizen, French citizen. Therefore, in this case, they are targeting people born in America. Therefore, the Supreme Court will consider this, as it is a law related to nationality. Normally, France tries to bring this up, but it doesn't pass. People resist. Therefore, Trump today will face the decision of the Supreme Court on two issues, especially the issue of jus soli. If he loses, it will be a second loss, which is very important. It's related to internal matters. Therefore, this is a risk for Trump himself. But this risk is related to the confidence of the public and people around the world in Trump. This is another risk that is happening.
>> Yes, and regarding the economic risk similar to subprime, which Jamie Dimon mentioned, is the issue of excessive borrowing, Professor? And he is concerned that with excessive borrowing, and if there are problems or economic vulnerabilities, it could lead to the collapse of these debts, especially the private credit debt or private loan debt. What do you think? Is it that serious?
>> This is a chain reaction. It's from subprime. When it's from subprime, the guarantee. Who would believe it? It turns out that the subprime had many layers of guarantees. It turns out that none of them broke. So, what happened is that at that time, people thought, "Hey, this is like 1930, 30." Right? Then in 1930, there was an attempt to, uh, separate, uh, banks from, uh, uh, finance companies. But later they were combined. This was to prevent it. When it happens, what is happening now is that we are in the same situation. Because that means everything is linked, financial institutions. So, if these collateral items have problems, it links to the American financial system. This is one thing that is related to subprime, related to, uh, America's, uh, this is part of it, related to asset prices that have risen so much. It's unbelievable that they have risen this much.
>> Yes, and Jamie Dimon linked it to the risk of the AI group as well, Professor. He said if there is a crisis, or if it happens now, software is being dumped and sold. It could be a chain reaction. Yes, exactly. Because you look at AI companies. How many times have they risen? How many times? And if you observe AI, its value is considered nonstop, right? So, today, the perception of people involved in the value of these things, I think it's exaggerated. Wow, with AI, wow, stock prices have risen a lot. Think about it. Who would believe that a significant number of American companies have a market value higher than the GDP of our country? All of this comes from digital AI.
>> Therefore, this is something that I think is clear. Just look at it. For example, look at Bitcoin. Observe how volatile it is. Guitar, in a short period, how much has it disappeared?
>> 30%. So, imagine if the stock market, if there is volatility like this, from AI, from other things, it affects everything across the board. Therefore, what JP Morgan said, I completely agree. Because the current situation is like everyone is optimistic. When a crisis occurs, it usually happens when people are overly optimistic. And the current psychological situation in America is indeed like that.
>> Especially the stock market participants. And they are trying to expand their influence. They are trying to target Europe, which has controls. Regarding, uh, taxing big tech companies to prevent them from making profits. Trump will target two countries, France, Spain, uh, England, which, uh, are limiting social media for people over 15-16. This is what they are helping these big tech companies with. Therefore, this is another part that explains that this trend creates moral hazard problems, and it also creates problems for asset prices that are inflated.
>> Yes, and the point that has changed from 2008 is that the market size has become much larger, and the size of businesses has also become larger, Professor. If this crisis happens, will it be more severe than 2008? Will it be more complex, more damaging, Professor?
>> Professor cannot say when the crisis will explode. But he can say that there are, uh, there are, uh, indicators to be cautious about. First, second, when it explodes, will it be as severe as we have seen? We can clearly see that when the subprime crisis occurred, people thought it was like 1929.
>> The Great Depression. In the end, it became the Great Recession.
>> Do you recall? Because there were tools. And we have to admit that later, there was, uh, even the euro currency, it wasn't that bad. So, Professor cannot say how severe it will be. But what he agrees with JP Morgan is that there is a risk related to America itself, which will also link to the rest of the world. In this case, it is a risk that we must factor into our analysis. I agree that it is related to asset prices that have risen so high, it truly seems unbelievable. Part of this comes from, uh, AI. This is one thing that makes the American stock market perform so well. Why is our stock market not rising? Because we don't have new products like America. Why is it rising so high? Because of innovation. But innovation is a double-edged sword. Because this innovation leads to, uh, the end of moral principles. AI and this issue create head speech, making people, wow, worse, brainwashed. This is the disadvantage. Second, it creates asset prices that exceed their true value. These two are very serious for what is related to AI.
>> Yes, it remains a situation that we are closely monitoring. It doesn't mean it will happen, but there are many indicators pointing to that risk. If there is more information, we will invite Professor to share his knowledge with us again. Thank you very much today, Professor Somchai. Thank you. Goodbye.
>> Yes, goodbye.
>> Goodbye. Professor Somchai Paksupiwat's perspective on the global trade war atmosphere, which may reduce tension from previous tariff formats, but it cannot be said that the war is over. Because Mr. Trump still has many weapons he can use. The trade laws in his hands, whether it's from 1974, or even trying to make the previously overturned law legally sound by bringing it to Congress, or the extremely severe law, Smoot-Hawley of 1930, which caused the Great Depression around 1930, after a severe trade war. However, Professor Somchai believes it will not reach the level of using such a devastating weapon as in 1930. He will likely use the 1974 and 1962 laws to collect global tariffs of about 15%, and also tariffs on specific goods or sector-specific tariffs. He still has the power to collect these. Therefore, it does not mean that the world can negotiate with Trump. Unless the two superpowers, China and the US, may have more bargaining power to at least prevent tariffs from rising further. But to reduce tariffs to zero, or to have zero tariffs, it is unlikely to happen in the Trump era. Now, the impact we have discussed continuously is that besides the costs that the whole world has to bear, it is reflected back to America itself. Inflation may rise, and entrepreneurs who have to pay taxes will flock to ask for refunds. This will affect the fiscal situation amidst public debt figures as high as 120% of GDP. And what is becoming increasingly clear now is the shadow of an atmosphere similar to the 2008 crisis, which Jamie Dimon, CEO of JP Morgan, sees, and Professor Somchai agrees. That there is currently a rather untrustworthy atmosphere. Asset prices are soaring, especially tech and AI stocks, which have been adjusted but remain expensive. And there has been massive borrowing and investment, believing that the economy will grow, as Mr. Trump announced that this is an era of economic prosperity. But Professor Somchai also sees that there are real risks with problems in the private credit sector. And if this is combined with the lack of confidence in Mr. Trump's policies, the risk of geopolitics that forces the US government to spend more, or even laws that cause internal division, it carries the risk of leading to a crisis as happened in 2008. However, at this moment, it is still in the stage of vigilance. There is no need to panic yet. But we will continue to update you on the signals that look untrustworthy in the United States, including Trump's tariff measures against the world. It cannot be said that the trade war has ended yet. Our time for this live session is up. Thank you very much for watching. We will see you again in the next live session. Goodbye.