Grant Cardone Breaks Down Trump's Tariff Strategy and the Art of Stacking Asks in Global Negotiations

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[00:33] Easter. Joining us now is Grant Cardone,

[00:37] equity man, fund manager, real estate

[00:38] investor, Cardone Capital, author of The

[00:40] 10X Rule, and Grantcardone.com. Grant

[00:43] just recently hosted me at a pretty

[00:44] amazing event in Las Vegas. Grant, it's

[00:47] great to see you. Uh Grant, welcome to

[00:49] the program. Grant, what is your take on

[00:50] President Trump's negotiation and

[00:53] leverage that he's using via tariffs? As

[00:55] a businessman, what is your analysis?

[00:57] Well, I I understand, Charlie, first of

[00:59] all, always great to be with you.

[01:01] Enjoyed our time together in Las Vegas

[01:03] and love everything you're doing. Uh I

[01:06] understand that the art of the deal is a

[01:08] bestseller across China this morning

[01:11] because uh the government is reading how

[01:14] to negotiate with probably the master,

[01:16] best, most genius, most calculated

[01:19] negotiator on planet Earth. Your

[01:21] comments earlier about the Panama Canal,

[01:23] this is called stacking. when you

[01:25] negotiate transactions and I've I've

[01:27] negotiated very large transaction not

[01:30] not you know hundred trillion dollar

[01:32] negotiations like are taking place right

[01:34] now across the world but you want to

[01:36] stack your ask meaning that you want to

[01:40] overwhelm the other party with the

[01:42] number of things that you want almost to

[01:45] the point where you sound

[01:47] ridiculous and then you start settling

[01:52] or removing things that maybe aren't so

[01:54] necessary neessary. So I think your

[01:56] analysis of what Trump did with the

[01:59] Panama Canal is absolutely uh

[02:03] spoton. Uh things like bringing you know

[02:06] majority of the countries to the table

[02:09] was not to bring them to the table but

[02:11] to let China know, hey, they're coming

[02:14] and sooner or later you're going to come

[02:16] too.

[02:18] So Grant, I I love that stack the asks.

[02:20] Let's talk more about that in practice.

[02:22] What does that do to the party that is

[02:25] on defense? So, how does the Chinese

[02:28] respond to that? Let me ask this

[02:30] differently. What happens, Grant, when

[02:31] you're on the other side of the table

[02:33] and someone is stacking the asks against

[02:35] you? How do you then prudently respond

[02:38] to somebody that is using that sort of

[02:40] strategy and that kind of expertise?

[02:43] Yeah, that's a great question. Okay. So,

[02:45] if it's me being on the other end of the

[02:47] stack,

[02:49] uh the question always is who has the

[02:51] leverage? Like four things have to

[02:53] happen in negotiations. You have to have

[02:55] decision makers at the table. We don't

[02:57] yet by the way in with the tariffs. Two,

[03:00] you have to have a desire and a

[03:01] willingness to come to an agreement. We

[03:03] don't have that. Three, you have to have

[03:05] urgency. Trump does not have that yet.

[03:07] So, the only thing he has is the fourth

[03:10] uh the fourth weapon, which is leverage.

[03:12] So in the beginning if somebody's

[03:14] stacking against me I have to calculate

[03:16] how much leverage do I have here. If I

[03:19] don't have leverage Charlie uh then what

[03:22] happens is I get overwhelmed and then I

[03:25] start whether whether you whether I say

[03:27] it or not I mentally start

[03:31] unpacking how much I'm willing to give

[03:33] up. I imagine I came to the table

[03:36] believing I would give you this and then

[03:38] you start stacking on me. like I start

[03:42] basically unmocking or compromising with

[03:45] my own self what I'm willing to give up.

[03:49] Okay, it could be in a divorce

[03:50] settlement. You know, the let's say the

[03:52] wife comes at me and says, "I want half

[03:54] and I want the house and I want the boat

[03:56] and I want the plane and I want the

[03:58] kids." She might not want any of that

[04:00] stuff, but she starts overwhelming me.

[04:03] And then if I don't have leverage, she's

[04:05] going to win probably more than she

[04:07] actually uh thought she could or would.

[04:12] So that that is my wife. I hope my wife

[04:14] never hears this, by the way.

[04:17] Well, no. I I pray none No, no one gets

[04:20] into a divorce. I I pray it's a terrible

[04:22] awful thing. In some ways though,

[04:23] metaphorically, we are looking at we're

[04:26] looking at it's a great comparison

[04:27] though because what US and China are

[04:29] brokering is a little bit of a divorce

[04:32] or a decoupling of the way that the two

[04:34] powers have been interacting over the

[04:36] last 20 or 30 years. And we're going to

[04:38] have to renegotiate those terms. Just

[04:41] looking at this objectively, Grant, as a

[04:43] businessman who's done billions and

[04:45] billions of dollars of transactions and,

[04:47] you know, has done tens of billions of

[04:49] dollars of value through everything

[04:50] you're doing. Who has the cards here?

[04:52] Who who is the one that you would say is

[04:54] the shrewd operator that acting as if

[04:57] they have leverage? Kind of stake it out

[04:59] here as an objective third party. Yeah.

[05:02] Who like what what cards does the United

[05:04] States have? What cards does the China

[05:06] have? And then kind of give us a little

[05:08] bit of analysis there. Well, look, I

[05:10] mean, you know, a lot of people have

[05:12] leverage in a situation and they never

[05:13] use it. In the case of the United States

[05:15] and China, you we have leverage that

[05:18] cannot be duplicated anywhere and has

[05:20] not been duplicated anywhere on planet

[05:22] earth, which is a consumer economy. You

[05:25] know, I was asked once what what's

[05:27] easier to create a manufacturing economy

[05:29] or consumer economy? No one has created

[05:32] a consumer economy. Many countries have

[05:34] created a manufacturing economy. I would

[05:37] rather have a blend of both. But America

[05:40] has the greatest consumer economy on

[05:42] planet Earth. Every country needs us. We

[05:44] have maximum leverage. Now, what

[05:46] leverage does China have? Well, they

[05:48] make products and services cheaper than

[05:50] we can. They have 1.4 billion people. Uh

[05:54] but they lose that, Charlie, because

[05:56] their economy is terrible. They've tried

[05:58] 26 different stimulus to fix their

[06:01] economy. None of them worked. Uh they

[06:03] have an aging population as you know and

[06:06] they're in trouble right now for all the

[06:08] troubles that we have. China has 10x

[06:10] more and um any leverage point they did

[06:15] have they're going to lose because

[06:17] ultimately uh they their economy is so

[06:21] weak. Uh that that being

[06:24] said we lose some leverage because of

[06:28] the way our political system is set up.

[06:30] If enough people turned on Trump,

[06:32] particularly internally, that would flip

[06:34] the leverage back to China. And that's

[06:37] why we need people to consolidate.

[06:38] Particularly, American citizen needs to

[06:40] pray for

[06:42] affirm and send best wishes to uh

[06:45] President Trump because he's attempting

[06:47] to do something that has not been done

[06:49] by any president in my lifetime and

[06:51] should have been done by all of them.

[06:55] So then, how do we going back through

[06:57] that sequence of your analysis of how

[06:58] big deals happen? How do we make sure

[07:01] that this does not get heightened to a

[07:03] kinetic war or tensions blow up and just

[07:07] get boiling into levels that we don't

[07:09] want to see them happen. How do we make

[07:11] sure this is within guard rails? Explain

[07:13] the balance, Grant, because I'm sure

[07:15] you've had deals that have blown up.

[07:17] Yeah. Yeah. Please explain. Yeah,

[07:19] because you can back a you could back a

[07:21] a dog with rabies into a corner and then

[07:23] he's going to bite you. So, you don't

[07:25] want to do that. So, you have to be very

[07:26] careful. I think uh President Trump

[07:29] yesterday telling everybody, "Look, it's

[07:31] just 10% everything's cool." What he did

[07:33] was he relieved all the tension. Uh I

[07:37] think the the U media was saying, "Oh,

[07:40] he caved in." He didn't cave in. You

[07:42] want to relieve pressure in a

[07:44] negotiation so no one feels cornered and

[07:47] just wants to, you know, in this case

[07:49] nuke, which would never happen, by the

[07:51] way, in my mind. But you do need to

[07:54] bring the players to the table. Remember

[07:57] the first three things are decision

[07:58] maker, willingness, three, urgency. You

[08:01] increased, Donald Trump increased the

[08:04] urgency yesterday. You had you had many

[08:06] countries, I don't know what what the

[08:08] exact number is, could have been as many

[08:09] as 70 that came to the table and said,

[08:11] "Okay, we're ready. We have urgency."

[08:13] And Donald Trump said, "Don't even worry

[08:15] about it. It's just going to be 10% and

[08:17] we're cool."

[08:18] That leaves China out by themselves kind

[08:20] of looking like what do we miss here? Uh

[08:24] again and President Trump knows there's

[08:26] egos involved. Egos are very very

[08:29] important when negotiating. You don't

[08:32] want to trap a guy. You don't want to

[08:33] make a guy look. Yeah. So

[08:35] let let me let me interrupt you there,

[08:38] Grant. I'm so glad that you mentioned

[08:40] that. I mean there is no bigger ego than

[08:42] Xiinping. He looks at himself as king of

[08:44] the world, king of China. He's control

[08:46] of 1.4 4 billion people. How and then

[08:49] you have equal amounts of personas

[08:52] across the board. How then do you

[08:54] navigate with the egos, with the pride

[08:57] of the Chinese culture? How do you go

[09:00] through that thicket? It's an enormous

[09:03] task.

[09:05] Look, I I imagine he's on the phone with

[09:07] him right now. All these players at that

[09:09] level have egos. Nobody wants to look

[09:12] bad, whether it's president of China or

[09:14] the president of the United States of

[09:15] America. The high ego drive, by the way,

[09:18] is necessary in order to be a winner.

[09:22] And there's nothing wrong with I I I

[09:24] think it's highly recommended for people

[09:26] to actually develop some kind of ego

[09:28] that has humility and a balance mixed

[09:31] in. And I could imagine Donald Trump or

[09:33] Howard Lutnik letting China know

[09:35] yesterday, hey guys, we're going to come

[09:37] to a solution. Everybody knows we're

[09:39] just negotiating here. Like this is a

[09:41] big boy game. It's very

[09:43] transparent. Uh there's nothing wrong

[09:45] with telling the other side, "We're

[09:46] trying to get the best deal for us. I

[09:48] know you want the best deal for you.

[09:50] Everybody knows exactly what's going

[09:52] on." So, I imagine he's softening the

[09:54] rhetoric that we're hearing here in

[09:56] America. Uh so that um so that they can

[10:00] stay at the table and save

[10:04] face. Grant, we have a minute remaining

[10:06] in this segment. Why don't you plug some

[10:07] of the stuff you're working on? You got

[10:09] books, you got all sorts of stuff. Kind

[10:10] of give us an update on what Grant

[10:12] Cardone is up to. Well, look, look, my

[10:14] my I'm an educator. My whole my whole

[10:16] life, I've been an educator. My dad died

[10:18] when I was 10 years old, and my uncles

[10:20] didn't come to to to mentor me. And I

[10:22] always promised if I ever got

[10:23] successful, I was going to I was going

[10:25] to help other people. So, we're an

[10:27] educational company that tries to

[10:30] attempts to, you know, share financial

[10:32] literacy and competency. And I I wrote

[10:36] uh President Trump when he won the

[10:38] election. Hey, I'd love to to

[10:39] participate in making America

[10:41] intelligent again around their finances.

[10:44] Um so that's what I do. My company

[10:46] educates people on you can find me

[10:48] almost anywhere. Just plug the name in

[10:50] Grant Cardone on Google and you'll see

[10:51] all the stuff I'm doing. We got a big

[10:53] real estate fund. We're changing the way

[10:55] real estate is invested in right now by

[10:57] putting real estate and Bitcoin in one

[11:00] fund with no debt, by the way. Uh, and

[11:04] we we're going to take real estate from

[11:06] what it was doing, which was an eight or

[11:08] 10% return to a 30 and 40% annualized

[11:10] return. So, I'm really really excited

[11:12] about that. We'll probably take that

[11:14] public toward the end of the year or the

[11:15] first of next year. I'm actually having

[11:16] a meeting on it right now. Grant, I know

[11:19] you got to be careful about giving

[11:21] individualized investment advice, but

[11:23] tell us about how you are thinking about

[11:24] this volatility and some of the

[11:26] principles that you think people should

[11:28] employ during economic uncertainty.

[11:31] Well, first of all, my wife just ordered

[11:33] some rough greens and I said, "We don't

[11:36] have a dog." She's like, "I ordered it

[11:38] for you. You are the dog in the house."

[11:42] So, the deal was too good to be It's

[11:44] going to really improve your health,

[11:45] Grant. You're You're going to see a

[11:47] great improvement in health. So, thank

[11:49] you. Thank you. Um, okay. What people

[11:52] should be doing, by the way, this is

[11:54] financial advice. I am not a financial

[11:55] adviser, but I will give financial

[11:57] advice. Uh if you're invested in the

[11:59] stock market, you should be very you

[12:01] should not panic right now. I would tell

[12:04] you and suggest that you should reassess

[12:06] what you're invested in. Uh depending on

[12:08] your age, if you're in a 401k, IRA or

[12:11] Roth, I think, you know, people need to

[12:13] reconsider what that really is today.

[12:15] These are old vehicles that have been

[12:17] created that look like tax advantages to

[12:20] the public that Charlie, you and I have

[12:22] talked about before. I really believe

[12:24] these will not be great mechanisms for

[12:26] people in the future. They have been

[12:27] great for Wall Street. You know, these

[12:30] are $38 trillion has been invested in

[12:33] retirement funds that I am very

[12:35] concerned in the future, 10, 15, 20

[12:38] years from now, are going to be taxed

[12:40] not at the 19% they are now, but at you

[12:44] know, 50 and 60 and 70%. Particularly if

[12:47] we had the wrong politicians,

[12:49] um, you know, at the

[12:51] table. But I would tell everybody,

[12:53] reassess what's in there. What companies

[12:56] are you really invested in? Do they do

[12:58] those companies that you're invested in

[13:00] actually match up with your moral

[13:02] compass? Because I think you'll find

[13:04] that many of those companies do not. And

[13:07] then re-evaluate what your returns are.

[13:09] Second thing I would say is, you know,

[13:11] you should be invested in real estate.

[13:13] Everyone, every American should have

[13:15] money invested in real estate that cash

[13:17] flows. Uh there's a tremendous

[13:19] correction going on in the housing

[13:22] apartment marketplace. Charlie, you and

[13:24] I have talked about this. It's happening

[13:26] from Scottsdale to to Sedona all the way

[13:29] to New York City to Miami. It's a

[13:32] massive correction going on. Uh I have

[13:34] made um my my family and our investors

[13:37] hundreds of millions of dollars just in

[13:39] the last year because we're buying real

[13:42] estate that no one's looking at uh at

[13:44] very um corrected prices below

[13:48] replacement value uh because of the debt

[13:51] market's problematic right now. So

[13:53] there's tremendous opportunity

[13:54] particularly in the apartment space uh

[13:56] for for uh

[13:58] individuals and middle class people to

[14:01] to create wealth using real estate.

[14:05] Very good. So so Grant super quick just

[14:08] what are you hoping to see as an

[14:10] investor from tax cuts? Uh you know as

[14:13] we mentioned it's not breaking news but

[14:15] the house has passed the budget

[14:17] resolution package which is great which

[14:19] will pave the way. What do you want to

[14:21] see more than anything else as a

[14:23] deliverable to full depreciation? What

[14:25] do you think is really going to

[14:26] supercharge this economy? One minute

[14:28] remaining, Grant. Yeah, that's one of

[14:30] them. You know, any investments in any

[14:32] manufacturing, any new buildings, any

[14:34] new housing, 100% bonus depreciation. I

[14:38] like that. What I like better than that,

[14:40] and I would be willing to give that up,

[14:42] is basically gut the IRS, go to a fair

[14:46] tax, zero federal income tax nationwide.

[14:50] I think that's actually doable in this

[14:52] term. I I I don't think most people

[14:54] believe that, but I believe it is. And I

[14:56] believe it'd be a great thing for

[14:58] Americans not to pay uh federal

[15:00] withholding tax. Uh learn how to invest

[15:02] your own money. The IRS is never going

[15:05] to do it better for you than than you

[15:06] can do it for you. Um, short of that,

[15:10] uh, states are going to start looking at

[15:11] reducing their property taxes. Florida

[15:13] is doing it right now. Texas is looking

[15:15] at it. Yep. And I think those those

[15:17] states that do that, Charlie, are going

[15:19] to be big winners and they're going to

[15:21] draw more uh more people and more

[15:23] companies to their states.

[15:26] Very good, Grant. Thanks for everything,

[15:27] man. Uh, looking forward to seeing what

[15:29] you have next and what you have coming

[15:31] down uh the schedule for you. So,

[15:34] thanks, Grant. We really appreciate it.

[15:35] Yeah, appreciate you, man. and and uh

[15:37] I'm still working on California. I'm

[15:38] going to do my best to flip California

[15:40] red this year.

[15:43] You're the best. Thanks, Grant. Talk to

[15:44] you soon. Thank you. Thanks.