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man to enjoy, you can hang out with all the boys. good morning, welcome to "squawk alley. happy q4 i am carl quintanilla with sara eisen and jon fortt. stocks start the quarter and week with an emphatic rally. going to be the best day since august s & p above the closing high for the moment mike santoli here to talk about what's working we can talk to a couple of things. >> the markets seemed like they were pointed higher. futures opened three-tenths of 1% the trade deal gives an excuse to buy beaten up stuff down on fears of something getting disrupted, kansas city southern, the railroad that was the proxy, but we also have amazon and apple up a percent and a half, presumably because the market is open people think the fourth quarter is set up for follow through gains. >> ymca, great way to remember the new trade deal we are

watching the rose garden for president trump to come out and tout this. last hour, raised an interesting point, it allows cheaper parts to the market, whether autos or canadian stock market, the green light to rally if you're looking for somewhere to get cheaper stock since the u.s., markets done relatively well, maybe look at the beaten down areas now they have the certainty of a deal. >> beaten down areas in the markets are bouncing today on that that would be things like auto i think the rest of the world is a bigger net beneficiary of trade peace if it becomes that than the u.s. is, because the u.s. has been the haven. you see the canadian market up a percent and a half today, similar with mexico. i think that makes some sense. i also think bigger picture, i started to say a couple weeks ago you're running out of time this year for things to fall apart. if you were cautious going into september thinking you know what, maybe we get a big deceleration of the economy,

maybe earnings start to falter, maybe tech starts to give up leadership, that hasn't really come together. this is one more thing that gets removed. >> even conflicting narrative on midterms and effect on fourth quarter. it is more positive when the third quarter was strong when midterms go, yes. >> when there's a flip, here's the thing. we so deviated from the typical midterm script, normally you have a big pull back september to october, then you have a big rebound. i'm a little reluctant to put a lot of weight on seasonal to midterms simply because it has not typically been a market mover and i don't think it rises to the level of physical significance how many have we had it is one of those things that's fun to talk about. >> biggest message, nothing that should stand in the way of the overall trend in the market.

>> eamon javers is with us from the white house. eamon, the experts we had on cnbc thus far talk about the deal, how is the white house framing this >> reporter: i don't think you'll hear a lot of details, you'll hear the president take a victory lap of sorts it will be sort of a political set of remarks, framing it as a big win for the united states and american workers behind me, they gathered members of the u.s. trade representative staff, members of the national economic council and cabinet all of whom will surround the president when he makes remarks today. you can expect the president to talk about big wins in terms of auto for american auto workers and on dairy wait and see if there are other specifics that the president rolls out. one of the things to listen for, whether he highlights concessions made by the united states you remember reporting early on

in the negotiation that the president said privately he was not going to authorize concessions from the negotiating team you can see here on the podium behind me. we will wait and see whether the president spells out specifically any specific concessions made by the u.s. side as the negotiation came to a close late last night. we're going to see political remarks, the president framing this as a big win. then wait and see more details as everybody in washington is pouring through the text all through the morning. >> is this a signal to the markets, to investors, and i asked this question before, that the bark is worse than the bite? how many times did president trump and candidate trump threaten to pull out of nafta because he thought it was a terrible deal, one of the worst deals the u.s. ever made they put a few changes on it, and voilà, we have a great victory and a brand new deal. is that a signal to the markets that it is different to listen to rhetoric versus the actual strategy >> reporter: i think it is a lesson for everybody in markets around the world and in politics

around the world to calibrate the president's rhetoric here. the president can come out with very tough rhetoric against some world leaders during the course of a negotiation saw it with kim jong-un, certainly saw it with justin trudeau, he called him dishonest and weak early on in the negotiations and now the president is able to make a deal with somebody who he dismissed as dishonest and weak. with previous american presidents, rhetoric like that would indicate they're beyond the point to get to a deal with this president, rhetoric like that might indicate negotiations are heating up and there's a deal coming at some point and the president is trying to position himself rhetorically for a big win this is a president that can move on quickly from that harsh criticism of fellow world leaders, see what words he has for justin trudeau today in the wake of a tight negotiation. >> and ylan mui, any risk depending who is in power when

this comes before them labor groups are holding out, saying they're going to look at details of this before they say whether it is good or not. what are the chances that this hits any speed bumps in congress >> i think it is important it is a try lateral agreement. what you heard from members of congress, a u.s. mexico only deal would be difficult to pass and possibly illegal under authority that the president was negotiating that agreement with. so the fact it is a tri lateral improves chances, but congress is not going to take this up until after the midterm election we have to see what happens, who is in power in washington after november in order to know what the likelihood of passage might be democrats even though they have been supportive of some enforcement restrictions that are in the new agreement, they may not want to be hand president trump a win on such an

important issue. >> elthank you. i want to bring comments from the imf, hinting at revising the economic forecast for the global economy lower when they put out the new forecast next week she's giving a speech now, traditional curtain raiser to actual meetings that are happening in indonesia in july, we projected global growth for 2018 and 2019 the rhetoric is a new reality of trade barriers this is hurting not only trade itself but also investment and manufacturing as uncertainty continues to rise. obviously the imf is one of those multi lateral organizations, 200 countries working together they absolutely endorse free trade and everybody working together to come to new trade agreements and see major risk when it comes to tariffs and

barriers. >> talking about china, saying the disputes may exacerbate china slow down, talks about global growth plateauing and says the u.s. is growing strongly. >> and the dollar borrowing and issues there, concerned about how the u.s. political and monetary policies will impact emerging markets as we have seen pain in places like argentina and turkey with that sort of negative outlook from the imf, talk how trade will impact the economy with the new deal today between the u.s. and mexico. with us, former ambassador to canada, bruce hyman, and trade representative matt gold, now law professor at fordham are you happy to see they reached a last minute deal last night? >> well, this is obviously welcome news, welcome news for

north america and for the markets this morning the president will declare victory on a disaster that almost happened. some of the reads i got overnight, two-thirds of the agreement is going back to tpp all they did was take so much of the language in tpp and implement it here, and so as it pertains to canada, this is good news economically. but there's work to do to repair the relationship >> matt, what about that warning from the imf that all of this will hurt the global economy now that we are seeing threats materialize into tariffs, even though we have a new deal between the u.s., mexico, and canada, there's still uncertainty over u.s. japan talks that are starting, u.s. europe talks, and of course

china which it is unclear whether we are talking to them at this point. >> the imf is right and so is the ambassador you need to take into consideration the enormous damage donald trump did in how he managed the nafta re-negotiation threats of steel and aluminum tariffs which are violative of wtf rules, undermining the whole trading system and threatening national security interest and economic interest of the united states at the same time, what did he get? a large number of small umpdates most of which were in the tpp. got us back to small access of the canadian dairy market, almost all in the tpp he pulled out of at the end of the day, no reason for congress not to approve this, but damage done to get here was not worth it, and most of it was really trying to come back from our loss as a consequence of pulling out of tpp. >> ambassador, i wonder if you can give us some more on that.

seems you're saying the damage done here again is not worth it. what would it have taken i guess to be worth it as you look at the details, and what are the down sides in what you perceive as being a damaged relationship going forward, whether it has to do with trade or other things we may need canada's backing on >> so the u.s., canada relationship, multi hundred year relationship in which we are which each other through thick and thin, so trade is one component of that. everybody knows the canadians were there, taking our dip low mal mats out of the iran hostage crisis, helping divert flights on 9/11, with us on nato, norad, so many ways, so when the president basically used his language and style and then the 232 tariffs on steel and aluminum on the basis of national security interests for

the united states against canada, i think many canadians were shocked, surprised, disappointed, and trust and relationships take a long time to build, but they can quickly be disrupted and harmed. i think long after the ink is dry on this deal, we will be working to repair damage that the president and his team did, calling for a special place in hell for the prime minister, really, seriously. that's the kind of language that is so wrong and so harmful and the president looks at these relationships on a transactional basis and our relationship with canada in particular is so much deeper than that >> matt, at the same time there are others that say this bilateral strategy worked in this case and connotes the way forward regarding china is the right way, especially if you can bring canada and mexico and maybe japan and the eu and confront china with the united

front, something we have not been able to do yet. is that possible >> couple of things. first of all, the bilateral did not work we had more leverage over canada and mexico in the tpp negotiations, multi lateral 12 countries than in the tri-lateral. i was in tpp talks with mexico and canada i can tell you that's true second of all, china is a different case unlike canada and mexico, china really has been violating trade agreement obligations to the united states for 16 years we have a different situation with china but trump mismanaged that as well it was legitimate to retaliate and confront china but not to go outside the world trade organization retaliation system. that opened the door to retaliation to our retaliation, put us in a downward spiral i don't think the two countries get out of until after president trump is out of office >> just saw some applause from members of the administration for jared kushner, the son-in-law and adviser and

ambassador in the trade negotiations treasury secretary, steven mnuchin. what about the president's team, wilbur ross is there, the commerce secretary are these the right people to be making these deals do you have faith in them? there were questions about their experience level going in, but if they're able to deliver these deals with improvements and modernization, should we have faith about the other negotiations they have to make going forward? >> no. first of all they didn't deliver this deal, the chief u.s. negotiator, senior career person who is the assistant ustr for the western hemisphere and his deputy assistant, job i used to be in, mexico director and canada director and career people delivered this deal wilbur ross and secretary of commerce and peter navarro who is the white house trade

economist are woefully over their head, don't understand trade agreements at all. robert lighthizer does understand them. hard to know if he thinks he is saving us from president trump's worst impulses, hard to know why someone that knows as much as he does is on board with this bad and damaging trade policy. but wilbur ross, peter navarro are unqualified for their positions if involved in trade policy >> ylan mui, can we get a take from you on what members of congress might be listening for. you saw paul ryan tweeting earlier he would be watching for more details on dairy in particular, but in the past we have seen president trump after a lot of rhetoric in

negotiations, then make nice and kind of open his arms and say everything is great now. is that the sort of thing members of congress might be listening for, others around washington, to see how the president perhaps ties a bow around some ofthe rougher edge of the negotiations? >> reporter: i think one thing is clear, that the president's hard ball negotiating strategy is playing well amongst republican base. president trump was at a rally in west virginia over the weekend in which he said, you know, my strategy is working everybody loves me because of what i've done for the steel industry, and the aluminum industry he got major applause from his base at a rally for those statements i think that republicans are taking that to heart they've been careful not to criticize the president, even though obviously free trade is one of the planks of the republican party for a long time i also think it is notable when you look at what canada and mexico were able to get of this,

i think some of their biggest wins was just relief from punishment in the future there were side letters that agreed for canada and mexico to be exempted from potential tariffs on autos in the future i think all of that is important. what it says is how much have they gained in trade, how much they were able to avoid punishment in the future >> ambassador heyman, we have scant details, based on what we've seen so far, who comes out on top could it be that all three come out on top and it makes north america more competitive as a manufacturing hub versus some of the countries in asia? >> i think it makes north america stronger i think, though, we have to make sure we don't farm our friends and relationships just to get this outcome this could have been negotiated a year ago and everything that i see in the details that are out, there's nothing remarkable here.

the most remarkable thing is that we're still putting tariffs on canada for steel and aluminum which need to be removed as soon as possible. that being said, i think that tpp would have been the best approach to tackle china that's a mistake the president made >> as you're speaking, the president is coming to the lectern. >> please sit down it's really great to see everybody on this beautiful, beautiful day in washington, d.c. some people say the swamp, but i will not say that today. i refuse this is too important, what we're doing, one of the most important deals and the most important trade deal we've ever made by far. want to thank senator joanie earnst for being here. i will be there soon, doing something important in iowa. i want to thank you for being

here congressman holding, congressman rowe, congressman newhouse, and congressman meadows, thank you for being here very much appreciate it. you have been very instrumental. thank you. i'm thrilled to speak to the american people to share truly historic news for our nation and indeed for the world i want to thank vice president pence for joining us this morning. migrate honor to announce we have successfully completed negotiations on a brand new deal to terminate and replace nafta and the nafta trade agreements with an incredible new u.s., mexico, canada agreement called usmca. sort of just works usmca.

that will be the name i guess that 99% of the time we'll hear, usmca. has a good ring to it. i long contended that nafta was perhaps the worst trade deal ever made. since nafta's adoption, the united states racked up trade deficits totalling more than $2 trillion, and it is a much higher number than that. with canada and mexico, it lost vast amounts of money and lost 4.1 million manufacturing jobs and one in four auto jobs. about 25% of our auto jobs, even more than that throughout the campaign i promised to renegotiate nafta, and today we have kept that promise, but for 25 years as a civilian, as a businessman, i used to say how could anybody have signed a deal like nafta, and i watched new england and so many other places where i was

just the factories were leaving, the jobs were leaving, people were being fired and we can't have that so we have negotiated this new agreement, based on the principle of fairness and reciprocity. to me, it is the most important word in trade because we have been treated so unfairly by so many nations all over the world, and we're changing that. just signed a much better deal with south korea we had a horrible, horrible deal, and just signed that at united nations, and that's worked out well and they're happy, we're happy, good for jobs, good for a lot of things when that deal was signed, they said 250,000 jobs will be given by signing this transaction. and they were right. i've said it before. they were right. 250,000 jobs to south korea, not to the united states so that's changed and very much for the better, and this is a brand new deal the agreement will govern nearly 1.2 trillion in trade which

makes it the biggest trade deal in the united states history i want to congratulate u.s. trade representative bob lighthizer that worked, nobody understands how hardest's worked [ applause ] no matter when you called him, he was in his office or in somebody else's office doing the same bob lighthizer is great. i heard it foryears. i said if i ever do this, i want lighthizer to represent us the entire team standing behind me and some here in the audience i want to thank you all. peter navarro, everybody thank you all. fantastic group of people. they love our country. i also want to thank secretary

mnuchin, secretary ross, nielson, purdue, peter navarro, united states ambassador to canada, kelly craft. thank you. thank you, kelly i also want to thank president of mexico, we had a few agreements but he may like me a lot. he may like me, i'm not sure he is a terrific person and he will be leaving soon, but he has done a good job, wonderful, wonderful person and the mexican president elect who has given support to this agreement, and we're developing a really good relationship which i think is very important for our country, frankly, and for mexico and so they worked together on this, done by both i said look, i don't want to sign an agreement and a new

president comes in, they don't like it, and we have difficulty. they work very much together on it i appreciate it from both. i have to certainly give my highest regards to prime minister of canada, justin trudeau. a lot of stories came out about justin and i having difficulty together, even though we did over the trade deal, but i tell you it's turned out to be a very good deal for both and a very, very good deal for all three it puts us in a position we've never been in before it's very good when you look at the world and what the world is doing and when you look at the unfair trade practices that countries are using against the united states, this is a terrific deal for all of us. once approved by congress this new deal will be the most modern, up to date, balanced trade agreement in the history of our country with the most advanced protections for workers

ever developed if you look at the reviews, people that would normally not under any circumstances say good things because automatically they have to say bad, even some democrats say that's amazing we had some, they haven't been given the sound bites yet, but some democrats said this is amazing if he really got all of that but by tomorrow i would suspect they'll change their tune, but that's okay. people know how good it is it is an amazing deal for a lot of people. likewise, it will be the most advanced trade deal in the world with ambitious provisions on the digital economy, patents, very important, financial services and other areas where the united states has a strong competitive advantage. mexico and canada have agreed to strong new labor protections, environmental protections, and new protections for intellectual

property so important this new deal is an especially great victory for our farmers. our farmers have gone through a lot over the last 15 years, they have been taken advantage of by everybody. prices have gone way down. and we're working on other deals that will make them very happy also, but this is a very, very big deal for our farmers mexico and canada will be opened up a lot more than they are now, and i think there will be a better spirit between the three countries which is important for farmers. the agreement will give farmers and ranchers far greater access to sell american grown produce in mexico and in canada. the deal includes a substantial increase to export american wheat, poultry, eggs, dairy, including milk, butter, cheese, yogurt and ice cream to name a

few. i want to be very specific i want to be very specific right? and many other products, but those products were not really being treated fairly as far as those that worked so hard to produce them and now they're going to be treated fairly these measures will support many hundreds of thousands of american jobs. this is also a historic win for american manufacturers and auto workers who have been treated so badly. we have lost so many jobs over the years under nafta. under the current new deal, and if you look at the current nafta deal, the new deal is taking care of all of these problems because nafta, foreign companies have been allowed to manufacture many of their parts overseas, ship them to mexico and canada for for assembly, and send foreign cars to the united states with

no tax we let all our people go, we fire everybody, they make cars, they make products, they make everything in another country and send them into the united states, no tax and the cost is very little difference, sometimes more for those people that like to talk about cost with this agreement, we are closing all these terrible loopholes. they're closed, they're gone they were a disaster for example, we are requiring a large portion of every car to be made by high wage workers which will greatly reduce foreign outsourcing which was a tremendous problem and means more auto parts and automobiles will be manufactured inside the united states we will be manufacturing many more cars. and our companies won't be leaving the united states, firing their workers, and building their cars elsewhere. there's no longer that incentive. before under the nafta deal, they had that incentive, they

had the opposite incentive now we're not losing our companies. to me, that was the most important thing. i don't want to see our companies leave and fire our workers and our workers never get jobs to replace those jobs those days are over. this deal will also impose new standards requiring at least 75% of every automobile to be made in north america in order to qualify for the privilege of free access to our markets, and that's what it is, it is a privilege. we don't take it as a privilege. we don't take it as a privilege. it is a privilege for them to do business with us and i'm not talking about mexico, i'm talking about everybody. everybody. it's a privilege for china to do business with us it's a privilege for the european union who has treated us very badly. but that's coming along. to do business with us japan, every country, it is a privilege for them to come in

and attack the piggy bank. in this, we will have a result of much more happening here in the united states. it means more than anything else far more american jobs and these are high quality jobs. there are also strong provisions to enforce what's called rules of origin requirements this will incentivize billions in new purchases of u.s. made automobiles. once approved this will be a new dawn for the american auto industry and for the american auto worker. they will see. they understand. they voted for us in large numbers, even though their leadership always goes democrat. couple of them said to me, i don't know how i can do it again. many of them, the leaders would back democrats and would tell me you're going to get most of the votes from union workers and we got most of the votes from

workers, period. but the american auto worker was very much behind what we were doing as one primary aspect. it will transform north america back into a manufacturing powerhouse you remember the previous administration said we're not going to have manufacturing jobs any more essentially we're not going to make things any more no just the opposite. it will be a manufacturing powerhouse that will allow us to reclaim a supply chain that's been off shored to the world because of unfair trade issues we also provide brand new intellectual property protections for biologic drugs. we want our drugs made here. when you talk prescription drugs, we don't like getting them from foreign countries. we don't know what's happening with those drugs, how they're being made

too important. this landmark agreement will send cash and jobs pouring into the united states and into north america, good for canada, good for mexico, instead of jobs leaving for overseas, they will be returning back home and we already have it many, many car companies, i was with prime minister abe from japan, he said we have sent many car companies to the united states over the last year and a half, it is true big expansions and very importantly he said many more are coming because they have an incentive now to be here people want to be back in the united states again. as i say, the united states is respected again, but it's also respected as to trade and industry this is a truly extraordinary agreement for the united states, canada and mexico. the president, it is so important, the president and i

developed this sort of a bond, a bond on trade. a man that has done a very good job for mexico in times of trade, and prime minister trudeau who i just spoke to, both of them, a little while ago, they love their countries, want to do right by their countries and that's what we have done. if you look at this, we formed a great partnership with mexico and with canada. and i plan to sign the agreement by end of november i then will submit it for approval to congress where in theory there should be no trouble, but anything you submit to congress is trouble no matter what single greatest agreement ever signed, they'll say well, you know trump likes it, therefore we're not going to approve it because that would be good for the republicans, so therefore we can't approve it, but it will be sent to congress pursuant to the

trade promotion authority act. this agreement follows on the heels of successful completion of a new and balanced trade deal with south korea tremendous difference in that deal from what it was. it was a disaster as i said. to improve the old deal that killed so many jobs. it also follows on the announcement last week of a new trade negotiation with japan japan would never negotiate with the united states. they say we're not going to negotiate. they told the previous administration we're not going to negotiate i said you don't have to negotiate, but we're going to put a very substantial tax on your car if you don't. without tariffs, we wouldn't be talking about a deal, just for the babies out there that keep talking about tariffs. that includes congress please don't charge tariffs. without tariffs you wouldn't be -- we wouldn't be standing here, bob and all these folks wouldn't be standing here now, and we're totally prepared to do that if they don't negotiate,

but japan is wanting to negotiate. actually they called about three weeks ago and he's a terrific man, had a tremendous victory. they said we would like to start negotiations immediately india, which is the tariff king, they called us and say we want to start negotiations immediately. when bob lighthizer said what happened, you would never do this they said no, we want to keep your president happy isn't that nice? isn't that nice? they have to keep us happy because they understand that we're wise to what's been happening. india charges tariffs of 100%. and if we want to put a tariff of 25% on, people will call from congress, but that's not free trade. i look back and say where do these people come from where do they come from? because of the power of tariffs,

we in many cases won't even have to use them. that's how powerful they are and how good they are. but in many cases we're not going to have to use them. many cases, countries charging massive tariffs are eliminating those tariffs. as you know, we have $250 billion at 25% interest with china right now. and we could go $267 billion more and china wants to talk very badly. i said frankly, it's too early to talk, can't talk now because they're not ready, because they have been ripping us so many years, it doesn't happen that quickly. if politically people force it too quickly, you won't make the right deal for the workers and the country. but china wants to talk, and we want to help with them we want them to help us with north korea, we want them to continue to help us with north korea. that's very important. the european union has been very

tough on the united states last year and for many years they've lost in the vicinity of $150 billion a year. they have massive trade barriers and they didn't want to come they didn't want to talk jean-claude, great business person, head of the european union, jean-claude, my friend, i would say we want to make a deal he goes no no no, we are very happy. i said you may be happy but i'm not happy because we have one of the worst deals of any group we have one of the worst deals with the european union, and they just didn't want to come because they were happy with the deal, but i said we're not happy with the deal. finally after going through a whole process, i said look, we're going to put a tax of 20% on the millions of mercedes and bmws, millions of cars they sell here that they won't take over there. farm product that they won't

take over there because there are barriers, you can't sell our farmers aren't allowed to sell many of their products, much of them, most of them so i announced we're putting a 20% tariff, could be 25 on their cars coming in and they immediately called and said we would like to start negotiations, and we're having a successful negotiation we'll see what happens who knows. i always say who knows but we'll see. i have a feeling we'll be successful a pillar of national security is economic security and trade. national security is not where we lose hundreds of billions of dollars a year over the last five years, we averaged $800 billion a year loss on trade. how dumb is that $800 billion this group doesn't know about those numbers. i don't even want them to hear those numbers, but the united states in its trade deals lost on average almost $800 billion a

year that's dealing with china, dealing with european union, with everybody japan, mexico, canada, everybody. and we're not going to allow that to happen but we have to have a strong manufacturing base and manufacturing sector we need a thriving economy those are all essential ingredients to national security we can't allow what's been happening over the last 25 years to happen. we are building our military like never before, it will be the strongest it ever was. all the jets, rockets, missiles, ships are all being made in the united states, jobs. our economy is booming like never before jobless claims are at a 50 year low. the stock market is at an

all-time high. think of that. over 50% since my election 50%. people, the 401(k)s, they were dying with them for years. now they're so happy i was telling the story i often tell of a policeman in new york came up, his wife was always very upset with him as an investor because he wasn't doing well with the 401(k)s. now she thinks he's a genius because the numbers are so crazy. we are up over 50% since the election and you heard me say this many times, but african-american unemployment, asian unemployment, hispanic unemployment is at record lows in history, not for the last two years, the history of our country, african-american, asian, hispanic. young people without high school diplomas, all at historic,

that's a very important sector, all at historic lows the lowest in history. it is really something that's great. this is helping so much with people to get out of prison. we have a tremendous problem they get out of prison, can't get a job. employers don't want to hire them the economy is so good they're hiring them and they're turning out to be incredible workers, they're really given a second or third chance in some cases i had numerous employers come up, say i tell you what, i have taken people that were in prison and we've hired them he wouldn't have done this in a normal economy or bad economy, only in this kind of economy and now he is like the biggest fan. one man in particular has taken numerous people. he said most of them have been unbelievable that's a great thing that's a really great thing.

it gives them a chance before we take questions, i want to extend warmest condolences to the country of indonesia, friend of mine, we're going to be calling up the leader who is a great leader indeed, but they got hit by a giant tsunami, like people have not seen in this part of the world so much fortunately. they say it is the worst of all, you look at the tornadoes, the hurricanes, you look at all of the different natural disasters. friend of mine that studies natural disasters, i don't know why he does that but he does, he says that tsunami is the worst of all and they got hit very hard, and probably thousands of people killed we have already sent a lot of first responders and military and others to help, but it's a really bad, bad situation.

and finally before closing, i want to send our thoughts and prayers to victims of the las vegas shooting that was a horrible, horrible time in the life of our country. took place exactly one year ago today. all of america is grieving for the lives lost and for the families they left behind. so to all of those families and to the people of las vegas, we love you, we are with you, we're working with you very hard it was a terrible, terrible event. so thank you very much for that. i want to ask bob lighthizer who is just a terrific individual as well as man that knows a lot about the subject to come up and say a word about the usmca, the new agreement. and if you have any questions, we'll take questions after that. bob?

>> thank you, mr. president. before i start -- >> all right during this period, we'll wait for the president to come back meantime, you heard him talk about robust defense of tariffs obviously along with a laundry list of things going well for america's economy, the stock market, the jobless rate, confidence, 401(k)s, going on to say the new agreement between the u.s. and canada will turn the u.s. into a manufacturing powerhouse ylan mui is watching this as well your thoughts? >> i think the president's statement that trade is a pillar of economic security was really important. that's the framework with which he is using to approach some of these decisions. tariffs on steel and aluminum remain in place, even though the renegotiated nafta or usmca is being signed now, canada and mexico wanted relief from those,

perhaps as part of these negotiations, part of a side deal, they didn't get it president trump used the threat of future tariffs on autos as one of the negotiating tools to bring canada to the table. we know from democratic lawmakers that u.s., mexico text of the bilateral deal had been put together, pulled together, and mexico even said they planned to submit that as late as friday, so this really was a last minute negotiation, and president trump at least seems to believe that looming threat of tariffs on autos, continued tariffs on steel was one of the things helped bring canada to the table and seal the deal. >> i mean, it was a full threat of defense on tariffs, saying he recognizes some members of congress are not okay with it, but a deal wouldn't have been reached with canada and mexico without them i wonder if investors buy that view because they have become ad

>> i think in general, investors are being restrained in how much they're counting on tariffs either to cost the economy very much in absolute dollar bases and also whether it is effective outside this instance with canada actually it is hard to know if threat of tariffs did budge this deal, considering a lot of ingredients were already out there. i'm thinking the market will be hesitant to extrapolate this to china, even though i think they would love to, they would love to have the idea that this was supposed to be the incremental easy deal with canada and mexico, and it was kind of made high stakes and risky by the administration's approach. if you could say maybe if they're going to take incremental rule changes with china, trumpet them as a massive revolution as he is doing now with nafta, that would be great,

but i don't think we can make that step. >> combine gdp of mexico and canada is a quarter of chinese gdp, to give you a sense of what it effects madam ambassador, always good to talk to you. we have spoken repeatedly as this has been on the docket in the past several months. your thoughts about the actual text and what it is going to change >> i haven't studied the text carefully, but there are a few changes. there are some pluses. i think the auto rules of origi make it more complicated, but it is good that we have moved forward in some areas. we picked off the trans-pacific partnership areas like governing the intellectual property and

environment, sunset clause is a little disconcerting, it is longer than originally proposed. so we'll see how the congress looks at this. >> ambassador, what are some other areas that you would want to scrutinize more closely you mentioned the sunset clause. as you do go back and look closely at this, what are the sticking points? >> i think that people will look at the auto rules of origin carefully, see how it effects all of them, including small and medium size businesses in the parts development and sale, and i think that there will be -- they will look at the inspector, investor state, dispute settlement that was kept, but was modified a bit i think there will be a careful look at our trade remedies

we haven't listed the tariffs on steel and aluminum, and of course that effects the auto industry that is still in application and the and the retaliation from canada and mexico still in application, so that when the president talks about how the farmers are going to be happy, they are being bludgeoned by the closure of business by reason of the tariffs. >> madam ambassador, the president, i think, is taking some questions forgive us as we listen in >> question? >> thank you, sir. you've had tensions with prime minister trudeau >> yes >> how did that affect your ability to get this deal done? >> i don't think it did. he's a professional. i'm a professional we had very strong tensions. it was just an unfair deal whether it was mexico or canada

and now it's a fair deal for everybody. it's a much different deal it's a brand-new deal. it's not nafta redone. it's a brand-new deal. i just spoke with him. we have a great relationship, and we're going to work as partners don't forget the rest of the world is looking to take advantage of us, and as a region, you might say, and we're going to work very closely together with canada and with mexico because we'll be able to compete with anybody we have things that nobody else has. we have energy that nobody else has. we have timber that nobody else has. we have things that no other part of the world has to the extent that we have. we're going to do very well together i think we have -- there was a lot of tension, i will say, between he and i more specifically and it's all worked out. >> it ended about 12:00 last night. but he's a good man. he's done a good job and he loves the people of canada >> you mentioned the $267 million in possible more tariffs

on china what does china need to do to avoid that >> well, we'll see what happens with china we have lost $375 billion in trade deficits they have a surplus of $375 billion, with a "b," with the united states, and it's been that way for years and years and years. i always say we rebuilt china. they took that money and they built fighter jets and they built bridges. they built more bridges than we've built in the last 100 years probably, big ones like the george washington bridge, like big bridges and i'm not going to take, you know -- look, i don't blame china. i blame our leadership they should have never let that happen and i told that to president xi i was making a speech in china and i was hitting china hard and i'm in china -- i don't know if that's a good thing to do. but i looked at it, you know, i don't blame you. i blame our leadership for

allowing that to happen. he knew exactly what i meant we had no deal with china. i asked a representative at the highest level came to the oval office i said, let me ask you, how did this happen? he's a pro so he doesn't have to be cute. he said, nobody ever did anything from the united states. when we put on a 25% tariff on every car that comes from the united states into china we thought we would be rebuked. we thought it would be terrible. nobody ever called nobody did anything. that was years ago and we charged them nothing, 2.5, but we don't collect it we do now. so they charged 25%, we charged essentially nothing. i said how did it happen nobody called. there's no deal. they do whatever they want so we have a tremendous proble

with theft of intellectual property we have primarily trade problems with china as you know they're having a much more difficult time now i don't want them to have a difficult time and we're doing better than we've ever done. everybody talked about the tariffs, the tariffs, the tariffs. the tariffs ended in 1913. they went to another system, totally unrelated. then in 1928 you had the great depression for a lot of different reasons not necessarily our country's fault but a little bit our country's fault. and then in the 1930s, they said we'd better start charging some tariffs. we need money to come into our country again. so i'm not advocating tariffs. i will tell you this, our steel industry is stronger than it's been in 25 years this has taken six months because i charge for the dumb

perfects they were dumping steel and aluminum into our country. i charged 25%. that's a lot could be more. but that's a lot and if you look at u.s. steel and newcorp, newcorp announced a new plant. they're expanding plants i don't think there's any industry like what's happened to steel in the last nine months, ten months, since i really started doing what i'm doing it's been pretty amazing aluminum, also and we need steel. we need steel for defense. what are we going to do, go and say we'll get steel from another country? can't do that. we can't do that so we need steel and we need it badly for defense. i'm proud of what's happened with the steel industry. question go ahead sure she's shocked that i picked her.

in a state of shock. >> i'm not thank you very much. >> you never do. >> i'm sorry >> go ahead. go ahead >> in a tweet, mr. president, you said that it's incorrect to say you're limiting the skoem of the fbi investigation -- >> i don't mind answering the question but i'd like to do the trade -- >> it has to deal with the other headline, the nomination >> let's do trade. anybody have a trade. >> do you think your trade deal will pass through congress, sir? >> i think so, but if it doesn't, we have lots of other alternatives but i do think so if they're fair, which is a big question, if it's fair on both sides, the republicans love it industry loves it. our country loves it if it's fair, it will pass i think it will pass easily, really easily, because it's a great deal i mean, nafta passed, it's one of the worst deals inconceivable that it was made fair question. any other questions on trade i'll get back to you >> i would like to go forward with my kavanaugh question

>> i'll call you a second time go ahead, please thank you very much. >> thank you, mr. president. you have described india as a -- >> india charges tremendous tariffs. when we send harley-davidsons, motorcycles, other things to india, they charge very high tariffs. and i've spoken to the prime minister and he will reduce them substantially. nobody ever spoke to these people he said, nobody ever spoke to me in other words we've had leaders here -- i'm not trying to be overly dramatic. we've had presidents of the united states and trade representatives that never spoke to india brazil is another one. that's a beauty. they charge us whatever they want if you ask some of the companies, they say brazil is among the toughest in the world, maybe the toughest in the world. we don't call them and say, hey, you're treating our companies unfairly you're treating our country unfairly so india is a very, very high --

they really charge tremendously high tariffs on motorcycle it was 100%. so you send a motorcycle into india, there's a 100% tariff now that's so high that it's like a barrier who is going to buy it of course they've reduce that had substantially but it's still too high my relationship with india is great, and they're going to do a lot. they've called us to make a deal they called us to make a deal, which is shocking to people. yes, sir, go ahead yes? >> i do have a second question on the kavanaugh thing when you get back to it if you'd take that you'll take that now >> no, no. still trade. >> on trade the question i have on trade does this mean the end of tariffs if you could spell that out to canada >> no, it means -- >> do you think it will pass

>> the steel is staying where it is and aluminum. but it means we probably, for the most part, won't be having to use tariffs unless we're unable to make a deal. if we can't make a deal with the european union, we will respectfully put tariffs on the cards. the united states will take in billions and billions of dollars into its coffers isn't that nice? you don't hear that. >> only from sagan >> yes, sagan. it will take in billions and billions of dollars, but really what's going to happen is they'll make the cars in the united states. this way they don't have to pay the 25% or 20% tax >> and could you spell out -- >> i don't think you'll have to use the tariffs too often. there will be cases you have countries that are just absolutely not willing to do what's fair and reciprocal and in that case they'll pay tariffs. and, you know what, the united states will do very well >> do you think it will pass in canada, mexico and, more importantly, here in the united states >> i don't know. i can't tell you all i know is we made a deal

the highly respected presidents and in the case of canada the prime minister are satisfied with the deal. it's good for canada -- it's good for all three this is good for all three that's good -- and just that fact makes it good for us, but this is good for all three but this is a much different deal than nafta, and this is much more of a reciprocal deal for the united states which is really good. go ahead, peter. >> -- can we move on to kavanaugh briefly? >> we'll do the kavanaugh questions. you talk about being treated harshly, we'll do that in a couple -- let's finish up trade. you have a lot of people who want to run over to "the wall street journal" and start writing. please [ inaudible ]. >> i can't hear you. >> a mexican journalist? >> sure. >> so you're going to keep the tariffs on steel and aluminum on mexico and