Very Little Capital Mgmt

TARIFFS and AI. Views are not advice. Do your own DD!

[Very Little Capital Mgmt @TJohnsonLess70M]

APPEAL CONFIRMED!

The Noticing of Docketing of Trump's appeal of the #CIT's #IEEPA refund order has hit the docket!

[Very Little Capital Mgmt @TJohnsonLess70M]

Critically, this tariff suggests a focus on utilizing section 301 of the 1974 Trade Act, which provides a much more legally defensible basis for the #Trumpadministration and @POTUS

[Bloomberg @business]

The US is proposing a new tariff of at least 10% on imports from 60 trading partners in President Donald Trump’s biggest move to rebuild his protectionist wall since his earlier levies were struck down by the US Supreme Court.

@LucilleLiu has more https://t.co/dUOjRRSFdH

[Very Little Capital Mgmt @TJohnsonLess70M]

How are imported products taxed?

It’s all down to HTS codes—the official 10-digit classification system used by U.S. Customs to determine the exact tariff rate and legality of incoming cargo.

Think of it as a 10-digit DNA sequence for your imports:
• Digits 1-6: A globally standardized product description.
• Digits 7-8: Lock in the legal U.S. duty rate.
• Digits 9-10: Used strictly for statistical trade tracking.

When a President adds special or emergency tariffs (IEEPA anyone...?), they don't rewrite the permanent schedule—they just overlay a temporary Chapter 99 code on top!

[Maaiz Khan @MaaizKhan]

Looking at a Japanese company called Hikari Tsushin that has compounded investment returns at 19% annually for 20 years. They buy cheap Japanese public companies and push for better capital allocation. Trades at 7.5x 2027 earnings and 1.3x book while the rest of the market chases AI.

[Very Little Capital Mgmt @TJohnsonLess70M]

Seeking an IEEPA tariff refund? Here are a few @CBP forms you should know:

1.      Form 5106 – Importer Identity Form.  Registers your business’s identifying details into CBP’s ACE Portal

2.      Form 3461 – Used to request the release the goods you imported

4.      Form 7501 – Official form used to declare goods

[Very Little Capital Mgmt @TJohnsonLess70M]

@supplychainldr @POTUS The “following investigation” language is critical here as the President can lawfully impose certain tariffs after investigations by authorized agencies… suggesting a much stronger legal basis for these tariffs than the IEEPA ones

[Very Little Capital Mgmt @TJohnsonLess70M]

Good article from @millerchevalier on the current #122tariff litigation:

https://t.co/fjT6mxN82I

[Very Little Capital Mgmt @TJohnsonLess70M]

@ErnestScheyder Thanks! @POTUS seems to have asserted the tariff reduction was designed to help American farmers manage equipment costs and encourage LT domestic manufacturing

[Very Little Capital Mgmt @TJohnsonLess70M]

A RETROACTIVE TARIFF?

#CIT ruled @POTUS's 122 tariffs illegal b/c #Trump didn't cite a valid definition for a "balance-of-payments deficit" in Proclamation 11012...

@SkaddenArps has speculated #Trump could issue a new proclamation w/ the correct definition and assert it has retroactive effect.

IMO this unlikely as Courts have consistently said any grant of legislative authority, especially retroactive, must be explicitly granted. As @millerchevalier notes: "The Supreme Court has explained that statutes, rules, and regulations cannot be applied retroactively, unless clearly authorized by Congress"

[Very Little Capital Mgmt @TJohnsonLess70M]

@claudeai is my favorite #AI, not b/c its smarter or faster than @GeminiApp or any other app... I just love that it starts every answer to my follow-up questions with an apology for not being clearer originally... #AIhumility

[Very Little Capital Mgmt @TJohnsonLess70M]

@scottlincicome Of course, small business pays the price for public policy confusion...

[Very Little Capital Mgmt @TJohnsonLess70M]

@scottlincicome Even more pertinent, many if not most of those companies should have the pricing power to pass on such tariffs to their consumers through increased prices

[Very Little Capital Mgmt @TJohnsonLess70M]

@business The issue of who "actually" paid the tariff and if IORs should pass any such refunds on continues to loom large

[Very Little Capital Mgmt @TJohnsonLess70M]

SUMMARY OF 122 TARIFF LITIGATION

Plaintiffs
President can’t change 1974 term to fit his objective as doing so creates a constitutional violation in that only Congress can levee tariffs

DOJ
Congress didn’t freeze emergency powers to dead 1970s metrics; $1T current account deficit & massive asset sell-offs are a modern payments crisis. President needs broad foreign affairs flexibility to defend U.S. wealth.

The CIT Majority (The Ruling)
The Executive cannot arbitrarily redefine historical accounting terms to trigger emergency taxing powers.

[Very Little Capital Mgmt @TJohnsonLess70M]

NOT CONGRESS'S INTENT

Congress wrote sec 122 (Trade Act 1974) to protect against a run on US gold reserves (i.e. a "balance-of-payments deficit"), if we ever got back to the gold standard...

Trump says that term must be updated for the current economic reality but such a view would raise a constitutional question over the authority to levy tariffs if the President can just assert a particular economic disaster is occurring without any justification whenever he wants to impose tariffs on a nation!

[Сarm1ne @carm1nee]

At 81 he manages $72 billion, and says markets right now are "just about as risky as I've ever seen" and AI is "way over its skis"

He has never celebrated a winning trade in 47 years, this is the most feared investor on Wall Street

the full story is in this 40-minute interview - every satisfword of it is worth your time ↓

[Very Little Capital Mgmt @TJohnsonLess70M]

Trump is Wrong but Will Win the Appeal!

There isn’t a balance of payments deficit, Trump can’t impose the 122 tariffs… but…

CIT’s ruling proffers a diff reason than what Plaintiffs argued for granting summary judgment w/o giving defendants an opportunity to respond, violating FRCP 56(f)…

This paves the way for the Federal Circuit to overturn summary judgment on the ensuing appeal!

[Very Little Capital Mgmt @TJohnsonLess70M]

Here's a link where you can download it from CBP's website: https://t.co/iFBaZHqu6X

[Very Little Capital Mgmt @TJohnsonLess70M]

FORM 5106!

If you are an importer who paid #IEEPA tariffs, you NEED to be familiar with Form 5106!

Its also known as the "Importer Identity Form", its used to

1. Establishes / updates importer's ID w/ CBP
2. Assigns a unique importer #, and
3. Is a prerequisite for becoming an IOR