Washington Edition

This is Washington Edition, the newsletter about money, power and politics in the nation’s capital. Every Monday, Bloomberg Intelligence senior analyst Nathan Dean gives his insights into what’s been happening and what’s coming up in the nooks and crannies of government and markets. Sign up here and follow us at @bpolitics. Email our editors here.

The Pressure on Putin

When I drive into work in the morning, I often listen to music from the likes of Billy Joel, Madonna, Green Day, Metallica. Great songs that my son labeled as “old man” music yesterday as he failed in his case for why I should play “Soda Pop” from KPop Demon Hunters for the 153rd time. No deal, he had to suffer through Boyz II Men.

But this morning I was listening to President Donald Trump’s remarks from Scotland with UK Prime Minister Keir Starmer when he said that he was going to give Russian President Vladimir Putin a 10-12 day deadline to reach a truce with Ukraine or face possible stiff economic penalties.

That made me think of Senator Lindsey Graham’s sanctions bill that would threaten 500% tariffs on any countries that buy Russian oil, gas, uranium or other products. Even the threat of such a tariff would almost certainly bring risk for firms exposed to China, India and Turkey and place even more pressure on sectors like technology and consumer discretionary spending.

The Senate will likely be gone for recess in 10-12 days, but it’s something to keep in mind when they return. Any movement there could wake up markets.

On the tariff front, it looks like the United States and European Union have a deal, though EU leaders are now having to defend it against “mounting business criticism.” The next headlines to watch for are what comes out of the US-China negotiations in Sweden and what is next for US neighbors, especially for Mexican President Claudia Sheinbaum, who is having a “bummer summer” according to JP Spinetto writing for Bloomberg Opinion.

Back in the US, we at Bloomberg Intelligence are extremely proud to release our next "Votes & Verdicts" episode where we talk with Robinhood's Chief Legal Officer Dan Gallagher about issues like tokenization of securities, crypto, artificial intelligence and of course, what TV shows should one download when they are on a 19-hour flight. Here's the Apple and Spotify links for your listening.

Tidbits

I'm a big fan of the Tour de France -- and every year I vow this is the year I'm going to get on my bike and start tackling the 4% gradient hills of Northern Virginia -- so I was a bit dismayed when I read this from Bloomberg's Giles Turner and James Crombie "Cycling Is a Hot Mess and Needs a Turnaround Plan".
In 2024, my father and I took a trip to Kentucky to visit the Buffalo Trace Distillery where I questioned why someone would wait in line 90 minutes to buy one bottle of bourbon (I’m an alcohol amateur). Yet collectors, take note, Bloomberg’s Brad Japhe has this with “Exclusive: Buffalo Trace Adds Weller 18 Year Old to Its Bourbon Lineup.” — Nathan R. Dean

Don’t Miss

The US will work on a new effort to provide food aid to alleviate starvation in Gaza along with other governments and organizations, including the UK and European Union, Trump said.

As Trump barrels toward his latest tariff deadline, the damage to the global economy from American protectionism is becoming increasingly evident.

US and Chinese officials finished the first of two days of talks aimed at extending their tariff truce beyond a mid-August deadline and hashing out ways to maintain trade ties while safeguarding economic security.

A US trade court has for now denied an effort to restore a tariff exemption for small-value packages from China that Trump ended earlier this year.

Trump asked a judge to order Rupert Murdoch to sit for a deposition within 15 days in the president’s $10 billion libel lawsuit against the Wall Street Journal over a story about Jeffrey Epstein.

Former Epstein associate Ghislaine Maxwell says the Trump administration is attempting to distract Supreme Court justices in an effort to convince them not to take up an appeal of her sex trafficking conviction.

World hunger fell in 2024, as declines in Asia and South America offset an increase in the number of people who lacked adequate diets in Africa, according to a UN analysis.

The US housing market just logged its slowest spring season in more than a dozen years as the most unaffordable housing market in decades has sidelined all but the most determined buyers.

The Trump administration is debating whether to allow a planned US stopover by Taiwan’s leader next week as concerns mount that it could derail trade talks with China.

The US has likely stationed nuclear weapons in the UK for the first time since 2008, in a signal to Putin that it remains committed to European security.

Watch & Listen

Today on Bloomberg Television’s Balance of Power early edition at 1 p.m., hosts Joe Mathieu and Kailey Leinz interviewed Texas state Representative James Talarico about how Democrats can fight Republican efforts to redraw the state’s congressional districts and whether he’ll run for higher office.

On the program at 5 p.m., they talk with former Deputy Secretary of State Wendy Sherman about efforts to alleviate starvation in Gaza and bring about a truce between Israel and Hamas.

On the Big Take podcast, Bloomberg senior economic writer Shawn Donnan joins David Gura to break down the fallout from Trump’s tariffs hiding in plain sight, and which sectors and countries are being hit the hardest. Listen on iHeart, Apple Podcasts and Spotify.

Chart of the Day

Tariffs could end up offsetting about one-eighth of the US budget deficit this year. If the pace of customs duties collection of recent months were to continue, revenue would quadruple to about $325 billion for an entire year. That would move them from being the 5th largest federal revenue source in 2024 to the 4th largest going forward -- surpassing excise taxes. Tariff revenue would still be less than collections from corporate income taxes, the third biggest revenue source, individual income taxes and Social Security and Medicare payroll taxes. Bloomberg Economics estimates that the average US tariff is now around 13.5%, up from almost 2.5% in 2024. — Alex Tanzi

What’s Next

Job openings and layoffs data will be reported tomorrow.

The Conference Board’s consumer confidence index for July also will be released tomorrow.

The first estimate of second-quarter GDP will be released by the Commerce Department on Wednesday.

Pending home sales for June will be reported on Wednesday.

The Fed’s decision on interest rates will be announced at 2 p.m. Wednesday.

Figures for June’s core personal consumer expenditure price index, the Fed’s preferred inflation gauge, will be released Thursday.

Trump’s latest round of tariffs are due to take effect on Friday.

The jobs report for July will be released Friday

The University of Michigan’s final read of consumer sentiment also will be reported next Friday.

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