What's quite impressive, is that people are so relieved now. The base scenario must have been really bad.
As it is, we get:
- 10% of tarrifs on everybody, 25% on several big sectors, 125% on China. Which is absolutely massive
- any confidence in the sanity of the government absolutely destroyed - 90 days ? He can change his mind tomorrow, or in 90 days. Entirely possible that he forgets this whole thing during the 90 days. How is the tough negotiation with Russia going btw ?
- China that showed it's not afraid of Trump. Trump fired all the bullets he had on China, he can increase the tarrifs to 1000%, it doesn't change a thing. Other than convincing other countries to openly joint US trade war on China, or use of military force, he cannot do anything more I believe.
China on the other hand can wreck havock in many, many different ways. Just look at the bond markets yesterday - nobody knows if it was China or not. But everybody knows China could make it much worse.
Same goes for US businesses. Safety inspection in Tesla or Apple suppliers factory ? Why not.
I don't mind the China tariffs. They have been abusing US interests for years and scoffed at promises they made when they entered into WTO and any IP is fair game for their corporate spies, and US companies would be laughed at to try and litigate any of it inside their borders. Something does need to happen with China, but the vast majority of Trump's tariffs were indeed as if he is stupid as a sack of rocks.
As it is, we get:
- 10% of tarrifs on everybody, 25% on several big sectors, 125% on China. Which is absolutely massive
- any confidence in the sanity of the government absolutely destroyed - 90 days ? He can change his mind tomorrow, or in 90 days. Entirely possible that he forgets this whole thing during the 90 days. How is the tough negotiation with Russia going btw ?
- China that showed it's not afraid of Trump. Trump fired all the bullets he had on China, he can increase the tarrifs to 1000%, it doesn't change a thing. Other than convincing other countries to openly joint US trade war on China, or use of military force, he cannot do anything more I believe.
China on the other hand can wreck havock in many, many different ways. Just look at the bond markets yesterday - nobody knows if it was China or not. But everybody knows China could make it much worse. Same goes for US businesses. Safety inspection in Tesla or Apple suppliers factory ? Why not.