That’s my read on why the U.S. just paused the global tariff hike to 10%.
From the beginning, I’ve believed the executive branch's real goal was to push down the yield on the 10-year Treasury. Why? Because Uncle Sam has to refinance a mountain of debt this year, and the cost of that depends heavily on Treasury yields — especially the 10-year. That’s the rate that sets the tone for everything from mortgages to corporate borrowing.
So they tried to spook markets. Introduce global tariffs. Stir up uncertainty. And it worked—at first. Yields dipped. Traders moved to Treasuries as a typical flight-to-safety.
But then something flipped.
Instead of being seen as a safe haven, U.S. debt itself started to look shaky. Maybe it was the deficit outlook, maybe the global response to tariffs — but whatever it was, yields started climbing. Fast.
At that point, the strategy backfired. The executive branch had no choice but to walk it back. So they paused the tariffs.
Because when your national budget depends on cheap debt, you can't afford a crisis of confidence in your bonds.
There's also a more basic answer to why US debt got more expensive. There is no such thing as a "trade deficit". You cannot import something without exporting something else. That something else, in almost 100% of the situations, is dollars. What do you do with dollars, if there's nothing you want to buy? You buy debt. So, every trade deficit ultimately tends to export debt. We have long known that government debt is proportional to trade deficits.
The problem with tariffs, in this context, is that they are being used as a signal that we don't want to sell people dollars anymore, explicitly saying "no more trade deficits". In doing so we are choking off the supply of dollars used to buy debt (rather abruptly), so that US debt is chasing fewer dollars and has to give a bigger yield as a result.
What's worse, is that because we are signalling that the tariffs are meant to be permanent, and we're seeing reciprocal tariffs as a result. When that happens, it means that using dollars in the future will purchase fewer US goods, so the time discount of money has gone up too. Further driving up yields to make bonds attractive enough to sell.
And meanwhile there is always a lot of US debt that needs to be rolled over (i.e. re-issued to a willing buyer.)
Except for the data point of today's 10-Year Treasury Auction which had a normal, usual result.
Trump is just a product of this right-vs-left volatile maximalism, represented as woke-vs-maga, which is fully on-track to get worse. Try guessing who will be the next woke maximalist and maga maximalist candidate, and what Executive Orders it leads to, which the US is pretty much ruled by at this stage.
Good luck with flip-flopping maga and woke Executive law as a country.
I don't think this holds up to any sort of scrutiny. Brexit, plenty of other examples across the world
> the US is politically unstable with its two party democracy
Somewhat tangential: I see two serious flaws with the US democratic system: (1) The supreme court is too powerful. If you look at many other highly developed, democratic nations, their supreme court (or equivalent) is much less powerful, and they are no worse for it. I have seen that in both semi-presidential and parliamentary systems. (2) The US president is too powerful.
The two-party angle really has very little to do with it, because there’s not that many “true moderates” in the electorate. Research shows that the “center” is comprised of people with a heterodox mix of views, but they’re not particularly mushy about any specific view.
France embraced the chaos and made it a point of pride, while China finds it absolutely terrifying and unproductive - but my point is that the population is exactly the same, scarily similar, in all its funny diversity, but the system is not a mirror of it, just an awkward model built on compromises: France wants to maximize representability and China wants to maximize order.
The US system is pragmatic: need to win, need to give the people a feeling of choice but not give them any sort of real power of structural change, and they split on a strange line, for most of the world, that I have even trouble to describe myself. I think Trump pleases people there because he pretends to be a structure reformist, which sounds fresh.
It's not the people who can't be diverse politically exactly, it's more complex.
Trump is notable because he is unusual for the US.
This is a product of duopolistic parties AND social media algorithms. Outrage. Outrage gets clicks, gets money, gets votes.
And so far we've been cool with that because it:
- continues to make the USD the dominant global reserve currency, strengthening our economic and political clout
- allows us to borrow cheaply to finance our military and whatever else we're spending $ on
Lots of countries settle trades between each other using dollars.
Making it harder to get those dollars will leave them seeking to use something else to trade.
https://www.msn.com/en-us/money/markets/aggressive-tariffs-f...
https://www.msn.com/en-us/money/markets/trump-threatens-100-...
https://www.bloomberg.com/news/articles/2024-12-02/south-afr...
These developments are going to be interesting.
Is it? They have some intra-government spats, but I hadn't heard that this threatened the stability of the whole country yet.
> which yes, brazil and India alone may hold up a stable reserve currency.
Also several other countries which joined the last year or are in the process of joining. I believe at some point, the official name was also changed to BRICS+
It's only the shit that we want to buy retail on Amazon US that are crazy expensive. And a big chunk is ICMS, that is state wide, not federal tax.
On top of that DHL charges a premium.
I know because sometimes I can buy directly using my prime subscription my beloved Nintendo games (that I hope I can buy directly from Asia now and cut one big middleman).
Brazil's deficit in the last decade accumulates hundreds of billions USD already, but only benefits a few. Yet as a good dogs we feel relieved that is only 10%. But you forget our biggest export products are already 35% on top what was before (steel).
This is a oligarchy fight that will splat on everyone, including my eggs since we quintupled the exports to cover someone's asses.
By the way, why do we need to buy expensive ethanol abroad since ours is cheaper, but in my state ethanol is never cheaper than gasoline?
But Trump also managed to devalue the dollar so much, we won't even feel the difference.
Even if dollar gets weaker, better to have less debts and more industrialization
Inflation and the "hollowing of your industrial base" are not inevitably connected, and in the case of the USA, have almost no connection to each other at all.
Someone was dumping, we don't know who or why. But the answer to that question is a lot (a lot) more important than people realize, and certainly more so than the immediate market motion or tariff policy.
Honestly if the answer was "The PRC was unloading bonds to send a message" that's sort of the best option, as they have limited wiggle room to continue to do so without wrecking their own financial situation.
If it's "The market as a whole lost confidence in US debt", then we're fucked no matter what Trump does next.
https://x.com/Nihonpolitics/status/1910096159835594786?t=RWB...
The problem is that China holds only 2.6% of US Debt as of February 2025. Can they leverage that small a percentage to make a market move like that? Especially assuming they didn't dedicate all of their holdings to that action?
Well, also, the holders of our debt now need liquidity. So they sell this famously-liquid asset we've been selling them for decades.
This is incorrect when your national currency happens to be the global reserve currency. All it requires is for the other country to be willing to accept dollars in payment.
[ EDIT: even that's wrong. All it requires is someone being willing to accept dollars, either in payment or as part of a currency exchange. ]
However, we define trade deficits to exclude financial transactions for various reasons.
You cannot import something without exporting something else. That something else, in almost 100% of the situations, is dollars.
I'd be happy to see a link that does.
Trade networks allow for stable equilibriums with no individual country having equal trade with any other county. To simplify, A on net sends money to B, and B buys stuff from C with A’s currency, C then buys stuff from A in A’s currency returning that money to A. However, people want to operate in their native currency and there are a lot more than 3 countries in the real world so you end with intermediary currency exchanges changes going on. In theory supply and demand steps in to balance things, in practice cash flows rarely actually sum to 0.
International finance is almost entirely about balancing the current and capital accounts [1].
The trade deficit is just one part of the current account [2]. Zeroing out the trade balance ceteris paribus requires a change in the capital account, i.e. foreign ownership of domestic assets and/or domestic ownership of foreign assets. If we’re just reducing the current account with tariffs, that means reducing both. Necessarily. This is one of the closest things to a law economics offers because it’s based on identities. The only run-around to it is the reserve account printing domestic currency, and we know how that goes.
[1] https://www.investopedia.com/ask/answers/031615/whats-differ...
Is it that hard to admit that you didn't properly read the comment you responded to?
A journalist successfully reverse-engineered the likely formula used to arrive at the figures for each nation, and it's not only implemented stupidly, it's also wrong from first principles. It's the same thing an actual school child might come up with if you asked them to. This is the same kind of "economic policy" cooked up by dumbasses on reddit who sincerely believe they are qualified to "fix US trade."
If our congress wasn't also packed full of ineffectual liberals and other fucking idiots, he'd be impeached by now for sheer incompetence.
It's the same issue we had in the last Trump admin. This nonsense is elevated to undue credibility by serious people discussing it seriously. It shouldn't be debated, it should be mocked, relentlessly, mercilessly, cruelly. As should Trump himself, as should his supporters, as should his sycophantic followers. Mock, belittle, make fun of, bully, parody, just continuously until every single one of these people refuses to approach a microphone.
In their world, any "evidence" to the contrary must be manipulated or misinterpreted, because as we all know the sky is green, the ocean is -- oh, he said it's yellow now? And the sky is red? Hah, of course! We knew it all along, it was the plan, stupid!
And meanwhile...
Most of the democrats' tiny minds struggle to operate outside of a context of rigid rules and procedures. A context of arguing a point and getting at least some degree of fair debate in return.
But this is another age of populism. It doesn't matter what you argue, on either side. Debate transforms, serving only to transmit your message to your side, ideally while inspiring them and demoralizing the enemy. It matters that you seem confident and powerful while you say whatever you're saying. It matters that you seem invincible and indefatigable.
Their world won't be back for quite some time, assuming something at all like it sticks around. They'll keep operating like robots, not understanding why an excellent diss or crude mockery matters more than 1000 additional volumes of "proof" about something in contention.
We think this is stupid because it kinda is, but this behaviour is part of the human traits and possibly is adaptive behaviour to enable the very possibility of us living in large societies.
I've always been in awe at the (absolutely crazy if you ask me) concept of money. The fact that we accept to give up possessions or time in exchange for the promise that anyone in the future will provide something equivalent because we just show some token/proof (which in itself are intrinsically valueless: sticks, stones, minerals, papers, now bits...).
We've been educated to be a bit suspicious and maybe show a slight contempt for it, probably to avoid being inelegant and also particularly because a lot of big owner of it are seen as not necessarily deserving of it.
But from an evolutionary perspective it's absolutely stupefying. And at its core its extremely positive. It shows absolute trust in our peers. It's probably one of the few behavior that really binds us together.
One could argue that it's the actually one trait that really distinguish us from other animals.
No offense intended, but I think the way you're explaining this is a little overly silly. Value credit was a natural evolution from the barter system and it makes perfect sense. If you wanna run down to the 7/11 for a slushie, do you want to bring a $10 bill, or a live chicken? I definitely vote $10 bill, especially because there's a non zero chance the cashier wouldn't want a chicken anyway, even if it's technically worth enough to trade for a slushie. Money just streamlines this whole process and makes even exchange for goods infinitely more efficient for all parties involved, and I think that's why virtually every organized society we've found evidence of has some type of currency, going back thousands of years.
Now, that's not to say I don't agree that the monetary system as it exists is borderline a crime against humanity. Capitalism and it's various knock-on effects, starting plus or minus with colonialism depending how you want to slice it, is, I think, the most horrific thing we've done to each other in our entire history as a species. But I don't think that's an indictment of money strictly speaking.
You can take any introductory banking system course and it will tell the same story. (I recommend Economics of Money and Banking by Perry G Mehrling)
It's not really a finished exchange.
Money represent a debt.
It's a one sided exchange against the promise of the completion of the other side of the exchange in the future (by someone else in this case).
It's like the amount in your bank account is not really money. It's a debt from the bank: the promise that it will deliver this amount as cash if you ask. (M1)
And money is so liquid that we never think about it that way. Except during hyperinflation periods. And bank account are so solid that we think about them as cash. Except during bank runs.
As a side note, the theory that barter really meaningfully took place is being challenged as there is no real evidence of this.
That said, as a consumer, I have no comprehension of how that would actually work. Do I get my guaranteed money 7 days after C-Day or 6 months after C-Day?
If an EMP blitzes my bank's electronic hard-drive records, is it my responsibility to prove I had X dollars in the account? If so, how? I can easily print a statement, but a statement clearly easily be forged. If it's the bank's responsibility, is there any guarantee they maintain physical and up-to-date records? Is there any regulation mandating they keep such records?
What happens if hyperinflation occurs and the 250,000 guaranteed by the FDIC is enough to buy a week's worth of groceries?
There's a lot of unknown variables and potential fragility in the system.
In other complex realms like software engineering, we get evidence that those complex systems really only have the budget to build the "happy path" and lawyers fight the cases when customers get damaged by the "unhappy paths."
It seems like our monetary system is on the happy path and very few times have the unhappy paths been tested.
Also the love affair with tariffs comes from a guy that wrote a book with his ideas and in that book he made up economic expert to support his views. (Ron Cara)
If you want the world to trade using your currency. You have to give them dollars. That is buy something from them. That is, imports.
All of this comes a section of US politics not being able to understand why the dollar standard even exists.
These tariffs are China's Four Pests campaign. Mao, a very trump like figure, decided to protect Chinese crops by destroying sparrows that were picking at them. Killing sparrows killed a predator of insects which did more damage to crops. This coupled with reality denying policies and ignoring experts led to one of the most devastating famines the world has ever experienced.
Hand waiving away this policy that denies reality and hurts America as a rational plan that went wrong is absolutely dangerous. Killing sparrows was "rational" in the same way these tariffs are. Authoritarians believe in power over reason. They do not like submitting to the authority of those who have studied problems because it is an attack on their own supremacy, so they fail to predict second order effects, which were likely obvious.
The damage this administration is doing to trust will be felt for generations. An agreement with America will have no value. No world leader will care what we say, they will only look at what we do. They will see power we have not as potentially being used for their own defense, but as a potential attack on their own sovereignty and they will wish to see us weakened so that they can spend less resources trying to determine our intentions.
Reminds me a lot of the thought process around having more manufacturing in the US by slapping tariffs around.
The authors said: "We are in the process of the second American Revolution, which will remain bloodless if the left allows it to be."[2]
[1]https://en.wikipedia.org/wiki/Project_2025 [2] https://www.washingtonpost.com/politics/2024/07/03/heritage-...
Not for investment tips or anything practical - just to satisfy my curiosity about how this bizarre period will be analyzed and understood.
I think a better question is what do you want them to say. Do you want them to say tyranny triumphed un-resisted?
And … if there is a future at all.
You should watch this (12min). You just expressed the "politics of eternity."
You should check out Timothy Snyder in general to see what historians are saying about our current times.
And I'm just pulling a few things off the top of Many Very Worrying Things here for brevity.
It seems to be the simplest possible explanation, too. Then again, never attribute to malice…
Donald Trump fundamentally believes that everything in life is a zero-sum game, and moreover that everyone is as crooked as him: either you're screwing someone else or you're getting screwed. That's why he's so obsessed with trade deficits specifically, because to him, that negative sign screams "you're getting ripped off."
There are other benefits. By imposing the tariffs like this and wielding them through executive power, he can extort countries and corporations to give him what he wants in exchanging for releasing the hostages, so to speak. And I'm sure people in his orbit _also_ used this as a get-rich-quick scheme, because these people are all grifters. But that is all secondary to the fact that he has believed this for forty years and finally got a chance to do it.
He could have done it in his first term.
And possibly being prosecuted for crimes, but Republican appointees on the Supreme Court kinda took care of that.
Got a link to the tweet? I don't have a Twitter account.
Edit: apparently it is true, and it is on Truth social. Someone sent me a screenshot.
To the downvoters: what is wrong with you? It was an honest question.
after implying I should be accurate, you go on to make your own statements using weasel words like "very likely never said" and "wasn't particularly more detached" and more on the same lines in the rest of your comment. where is the proof for your weasel words, bro, just like you ask me to be accurate?
weasel words are not accurate words, bro, rather almost the opposite.
”physician, heal thyself” - before you fuck around advising other people what to do or not do.
i see a lot of trends of this on hn too. pathetic.
>wasn't particularly more detached than aristocrats at the time were generally (which, to be fair, is quite a lot, but not all
laughable comment.
iow, what is evident to someone who sees beyond the surface meaning of the words you used, like I can, is that you want to attack someone verbally, without being held responsible for the consequences of your attack. in other words, you are a weakling and a coward.
that is why you waffle or equivocate.
and that is true of a lot of people, not just here but in the world. i have seen enough over my lifetime to know that that is the case.
for a very relevant and important current example, check out the news about the SignalGate scandal involving the topmost echelons of the US govt., how they fucked up, made a fool of themselves in front of the whole world, and then tried, unsuccessfully, like you, to cover it up.
jokers, and beggars, all such people.
update: wow, fuck, again.
proof. some time after writing this comment, on a whim, I thought of googling for the term signalgate, and what was my surprise, to see this Wikipedia page:
https://en.m.wikipedia.org/wiki/United_States_government_gro...
It just goes to show the notability of it, because Wikipedia only allows what they consider notable pages (according to their criteria, of course). iow, the topic is considered important by them.
The people around him with zipped mouths who know better could very well be treating it as a pump and dump however.
Not clever, or justified, or well though out, or based on any solid evidence. But there's probably a rationale behind it.
Now, ideally, we shouldn't have to care what the rationale was if there was any way of just getting back to "normal", but the same way Mao wasn't a flash in the pan, I assume we're looking at a few decades of it for the US as well.
For every four pests Mao had 100 successful projects that nobody talks about. Harm reduction is not an optimal strategy for any game.
The Great Chinese Famine was a famine that occurred between 1959 and 1961 in the People's Republic of China (PRC). It is widely regarded as the deadliest famine and one of the greatest man-made disasters in human history, with an estimated death toll due to starvation that ranges in the tens of millions (15 to 55 million).
That's 3% to 10% of China's population starved to death at the time.
US wants nothing to do with China. As the biggest consumer economy in the world, the have that right.
And China has shown that agreement with them has no value. Remember that China promised trump in term 1 to massively import US goods and reduce fentanyl, in part to slow trumps tariff down. They did neither of those things. Trump hasn’t forgotten that.
And I don't think anyone is calling themselves allies of the USA right now. The whole world is looking to decouple from the USA. Europe is completely over the USA, they can't rely on them for leadership, protection or for trade.
From a tech perspective, expect Europe to decouple from the USA from an economic and cultural perspective in the next decade. Smartest thing Europe can do is to create alternatives to US services, build its own defense industry and stop looking at the USA for any leadership.
https://www.jsonline.com/story/money/business/2023/03/23/wha...
Look closely at a business you know well and notice how much the profits depend upon information in people's heads.
Everything runs on a combination of money (capitalist profits) and non-money gains (other gains that people really care about).
We know TSMC is dominant - the real knowledge of how they are doing that is in the heads of people working at TSMC. Or maybe better to say that something is missing from the competitors? Process? Management? Everything?
Cadence and Synopsys are US companies that need to know many of the technical parameters of TSMC processes. They might know more.
Intel's Tick–tock model has lost it's tick. https://wikipedia.org/wiki/Tick%E2%80%93tock_model
As time goes on that becomes less and less relevant. Might be time to cut and run.
That seems to be over-rating the importance of Taiwan. If Taiwan sank into the sea tomorrow that'd be a catastrophe and the world would be worse off. But not that badly worse off. Life would continue. China's main global lever comes from the power of their unparalleled-in-history industrial strength and the aura of leadership they are building up internationally because they are substantially more peaceful than the US.
The peacefulness is probably not going to last, unfortunately, but until they change tack it is what it is.
Why not turn America then into a nuclear testing site? Since democracies aren't important.
After the US's abandonment of Ukraine, I'd say you are well past worrying about that.
There have been 2,121 tests done since the first in July 1945, involving 2,476 nuclear devices
Of these, one thousand and thirty two have been US tests (not all within the mainland contiguous USofA).
Air imagery of Yucca Flat looks like a bad case of acne, it's riddled with pockmark craters from underground nuclear tests.
https://en.wikipedia.org/wiki/Yucca_Flat
has been called "the most irradiated, nuclear-blasted spot on the face of the earth".
In March 2009, TIME identified the 1970 Yucca Flat Baneberry Test, where 86 workers were exposed to radiation, as one of the world's worst nuclear disasters.There is zero signal coming from any of these folk's mouths.
Yes, they have the right, but it doesn’t mean this is the right way. Consumers don’t suddenly stop consuming, and factories in the world don’t immediately start producing. This is like a slow flywheel; had we been almost spinning and ready to jump, it would make sense. This is not that.
Also, China is a super power which controls more than factories today. I agree they need to be checked, but sudden changes are not the way. I wish we did it by building trust with allies and then pushing China. Right now, even our allies are wary of us.
Why on earth would you be on the side of a country like this? Why we should be an ally of the US right now, if Trump can't even uphold agreements he signed himself 5 years ago? What guarantees do we have that, as soon as we decouple from China, the US won't treat us as a vassal because we gave up our only alternative? The only rational choice is to either be neutral or ally with China.
There is the second point to mention too though, which is that China is not exactly an exemplar of open markets and free trade, which is why you are not seeing many countries ally with China and form a united front against the US's trade rampage. Looking beyond the deranged policies, there are some truths in saying that China is a currency manipulator, has imbalanced trade to such a degree it causes problems in other economies, and even the somewhat more "far fetched" points about the unsustainability of a permanent trade deficit do have some truth on some level.
That is why, yes, you are seeing the EU normalize trade relations with China, but there are important caveats, like discussions about China having an expert quota and even internally capping production numbers within their own economy are on the table front and center. This would have never happened before, because China's strategy was to peg a low currency, export, and extinguish industries ex-China. Wish to some level is part of free trade, but it is underpinned in China with state sponsorship to a higher degrees in most trading partners are comfortable with (which is of course countered by the allure of cheap goods).
So another view would be that parties like the EU have new leverage against China that they can use to cut trade deals that strip out some of the abusive practices that made them uncomfortable in the past. If China is then willing to move on a bit from these approaches then the net outcome should be beneficial for the world of course.
I think that many players see the dangers of taking binary sides now more than ever. And indeed, skilled negotiators should see the advantages of playing these forces against each other to get what is best for them. In the face of the recent outrageous events, I would expect a sudden outburst of pragmatism elsewhere.
Tariffs were raised on Australia, UK, New Zealand and Canada.
It's asinine to say that you can trust these countries with your most secret intelligence (Five Eyes) but not enough to say treat them as allies.
The Trump plan to "decouple from China" was verging on dividing the world into the US and everybody else .. a large reason behind the partial rollback.
Countries are now openly rejecting China's offer to join hands .. but still sitting on the possibility of further deals with China should the US tariff insanity continue.
China stopped selling unlicensed fentanyl to the USofA, it later stopped supplying fentanyl to both Mexico and Canada.
The problem was that criminals in the USofA and Mexico purchased precursor chemicals in bulk and made their own fentanyl. Restricting precursors led to pre-precursors being purchased in bulk for drug labs to make their own precursors in order to make fentanyl.
The fentanyl problem continued under Trump and rapidly grew in size during his first term.
In 2021, Mr. Biden issued an executive order imposing sanctions on individuals and companies engaged in the illicit opioid trade. His Treasury Department put sanctions on more than 300 individuals and entities, freezing entire networks of fentanyl suppliers and traffickers out of the international financial system.
In 2023 and 2024 he identified China as a major illicit drug-producing country for its role in the synthetic opioid trade — a blow to the reputation of China’s chemical industry.
Simultaneously, the Biden administration pushed U.S. law enforcement agencies to conduct aggressive investigations and build indictments against dozens of Chinese citizens and companies that were trafficking fentanyl precursor chemicals into the United States.
[..] Biden secured a personal commitment from President Xi Jinping to restart counternarcotics cooperation in November 2023
[..] And we made progress. International fentanyl supply chains showed signs of disruption, forcing traffickers to change sources and tactics.
Together with other diplomatic initiatives and an expansive public health campaign, the number of lethal fentanyl overdoses in the United States has dropped.
In the 12 months ending September 2024, overdose deaths were down an estimated 24 percent from the year prior.
What has Trump done now he's back in office? Destroyed any cooperation with China on counternarcotics cooperation.
Tariffs alone will not push China’s government to help reduce drug overdose deaths in the United States. In fact, with Beijing already imposing retaliatory tariffs and proclaiming that it’s “ready to fight till the end,” Mr. Trump’s blunt-force tactics might drive China to cooperate less on fentanyl, not more.
With the stakes as high as they are, American communities cannot afford a miscalculation.Unfortunately they still have much more value than agreements with the US and Trump specifically. Which Canada and Mexico found out the hard way.
Of course the probability that Trump actually forgot that he was the one who no signed USMCA and none of his “advisors” dared to tell him is not insignificant..
When this happens, there will be a big recession, and that is exactly the moment companies will start deploying AI in earnest to save money. This will create a downward spiral.
Yes, the Trump administration is incompetent. But, if you insist on blaming an administration, I would propose Obama and Biden as more reasonable culprits. It was Obama who presided over the massive Fed intervention into markets that enabled unbridled government spending increases. It was Biden who presided over the most problematic parts of the Covid response. Trump is just an idiot. Obama and Biden are actually bad guys.
Companies are already deploying AI everywhere they possibly can as quickly as they possibly can. They aren't waiting for anything. AI just isn't up to the task of replacing most workers just yet. It's still unclear if it ever will be, but they're shoving AI into everything they can to see how it holds up, to see what it breaks, and to give it more data to work with so that it can hopefully be improved.
Some companies looking to get rid of even more workers might search for new technologies that they hadn't considered before but which could enable them fire more people, or they might accelerate existing plans to replace workers with technology to get rid of them even sooner.
AI is different though because companies are fully aware of it and they are already moving as fast as they can. They have been salivating at the thought of using AI to fire their workers for years now and they're already making every effort to replace workers anywhere it seems feasible to do so. They are in such a hurry that it sometimes results in embarrassing failures like this one: https://www.motorbiscuit.com/airline-ai-chatbots-refund/
Like you say, the world is messy, which means there is no rule saying that companies must leave massive piles of cash sitting on the table until the economy gets bad enough for them to reach out and take it. Shareholders won't accept that. Any company that sleeps on firing their workers when AI can do the job will get absolutely crushed by their competitors who don't sit on their hands.
Obama too had to clean up a mortgage crisis from his predecessor's careless deregulation. Not an excuse for his own crimes, like say drone striking US citizens. But Trump is just openly corrupt, inept, praising autocrats and aspiring to be one.
People give Obama a pass when they shouldn't. This stuff didn't start with Trump. The problem goes back much further.
In that environment ZIRP was the only solution. Ben Bernanke (a Bush appointee, re-appointed by Obama) devoted his academic career to how the Fed could have prevented the Great Recession. He was right.
No need for false equivalence.
Then again, they're tempting because the things they're doing are also really bad ways to accomplish Trump's stated goals.
Trump's hand was forced and he had to retreat. Like the market kept having little bursts before this, based simply on the core reality that this is a trade war that the US cannot stomach without extraordinary financial damage, so everyone just kept waiting for the out. It is far more exposed and doesn't have the "cards", as Trump says, that they think they have.
The guy really, really wants his tariffs, so who knows where we even are now. He will not, under any circumstance, back down. We saw that with Canada -- various pauses, then steel and aluminum tariffs, then car tariffs, then a 25% across the board tariff for non USMCA compliant goods. First he even targeted USMCA. Based upon a lie. He desperately wants these tariffs, and as the very special person he is, he has learned absolutely nothing from today and will be back at the trough when he thinks he gets another go.
The most amazing thing are the Trump faithful who hold this as a win. This is quite possibly the most disastrous outcome of all -- the uncertainty. It is going to be economic calamity for the US.
But maybe Trump can announce that Uganda has removed a tariff or something.
In fact, if they wanted to balance the books, they wouldn't care about the interest rate. The only reason to bet your economy into reducing the interest is if you want to go deeply negative on the books.
That can be explained by the fact that the cabal also doesn't like paying taxes.
1. Find instances where Trump or the billionaires backing him and/or in his cabinet are open to increasing tax as a solution to the deficit
2. Explain why the the administration and it's members are deadset against an effective IRS & Biden's effort to increase staffing at the IRS.
It's not about balancing the books. It's about not making a problem far worse.
You remember the global financial crisis of 2008? The reason most of the bailed out countries requested bailouts was their bonds spiraling out of control when they had to refinance their debt. That was the primary reason they reached out to the likes of IMF and had to undergo austerity programs.
The Trump administration put the US on that path with their global tarrifs and provoking their main trading partners, specially China.
The countries in this situation in 2008 where European countries that forfeited their central banks. Having relatively recently switched to the Euro made this situation relatively novel and those governments not used to not have access to this last resort tool. There was also a lack of legislation at the European level to give the central bank authority to intervene. And culturally some countries where much more scared by their recent history by the inflation risk. Which led to push backs and delays in the face or urgency. It's now probably roughly sorted at the EU level.
The USA don't have and never had this issue. The position of the FED is very clear: it will never let the US govt default. So the only risk for US bond holders is inflation (and price if they want to exit early).
https://www.bloomberg.com/news/articles/2025-04-09/fed-offic...
He's already done it; he pioneered the strategy of sending out covid lockdown checks.
Trump cares about inflation as a talking point to get elected and for no other reason.
There's definitely not 100% logic involved in his plans.
A flashing negative warning sign of this would be issue of new kinds of Treasury securities with new complex rules.
There is not going to be a war between Canada and USA.
like 100% tariffs on china.
No, they are nor deficit hawks. They don't care about deficit, except when trying to blame it on someone else.
Meanwhile the DoD, CIA, FBI, NSA, DEA, DHS, and ICE have never had a politician seriously consider reducing their funding.
How he's deployed them and spoken/written about them makes me think he thinks it's a good way to strong arm countries and he wanted to strong arm everyone.
even then, congress can vote but who would actually remove him from power?
There were a bunch of sentences regarding non delegation of powers of congress, mainly for federal agencies, and courts deciding that congress can't delegate those faculties, so, by the book, this would be a similar situation. There is actually an ongoing case for this aspect of the discussion:
https://www.theguardian.com/us-news/2025/apr/07/trump-tariff...
That and his self-image as The Best Negotiator (while his actual "negotiating tactics" are really just mob-boss intimidation and bullying) are a huge part of what's going on here.
It's the only "powerful" thing he can use that doesn't require him going back to congress.
I don't know why he held off on the other countries, but choose to go to "war" with China.
In the case of Trump-as-Mad-King tariffs, it sure would be nice if the world didn't conflate America, the historical land of twisting other nation's arms to reduce tariffs, with Trump and his fake-emergency tariffs.
I can understand if you do, and if America has permanently lost a lot of good will by electing this buffoon for you, I can hardly argue with you.
But still. In my mind, these are Trump's tariffs, not America's.
And specifically the idea that Trump's tariffs are reciprocal, that is even more "Trump is just a liar" than something any honest American would argue.
If you’ve never elected a buffoon like this it’s easy to believe it’ll never happen. If you’ve done it not once, but twice, it’s really hard to believe it won’t happen again.
https://www.barrons.com/articles/treasury-bond-auction-today...
We're nowhere near the primary auctions failing. That would literally require a full financial crisis.
I think there is a backdrop/larger picture (probably nuanced and multifaceted levers against all other parties negotiating), but the main I think is to shake up the global economic landscape to make it easier to improve it. Reset.
I see a lot of complex takes on here that require quite a lot of sophisticated theories...and while I enjoy the complexity and the perspectives (and - wish I had studied economics to really grok them), I think it's really just as simple as they say. And what they say they're doing makes sense.
Maybe the truth is no one really knows what will happen, and so it's a bold move but we'll see. But I believe they're doing what they think is right for America to strengthen the country, just as they say - not some 3 degree removed chess strategy, just simple.
The stuff I've seen people quote from the book have all been stupid, but the kind of stupidity seems to be a "do X, so you'll get Y" where "Y" is really bad and the author thinks it's good. So I guess I do expect some kind of coherence from him.
That said, I don't remember anybody claiming Project 25 talks about tariffs.
I don't think it's a coincidence, for instance, that Steve Banon's strategy of "flooding the zone" looks exactly as the type of chaos currently coming from the White House.
Since I'm one of 'those people' who's been willing to grant Trump some benefit of the doubt in the past, I'll respond with my take. tl;dr Trump's handling of the tariffs have been such disaster, there's simply no possibility it was based on a strategically sound plan. So, in answer to your question, this episode has caused me to substantially foreclose my prior willingness to grant Trump some benefit of the doubt.
To be clear, while I've tried to remain open-minded re: Trump I've never felt that he's especially smart and certainly not someone I'd ever personally like or hang out with but I'm also one of those contrarians who doesn't think every politician or public figure needs to be someone I personally like or approve of in a moral sense. I've also been willing to concede that some things done by the executive branch during his first term were generally positive (whether because of or in spite of Trump isn't clear). I also think his policies and statements have been subject to an unprecedented degree of negative spin in the media - sometimes well-deserved but always hyped overwhelmingly to the negative. So I made an effort to look past the constant headlines of, essentially, "orange man bad in all possible ways." I also decided to ignore Trump's own bizarrely extreme pronouncements and focus only on what he really put into practice and, most importantly, the tangible real-world impact of those actions on the broad population and economy over time (not the extrapolated predictions in the media).
However, even to me, how he's handled this tariff thing has been a complete shit show. I've spent a fair bit of time trying to understand the various explanations, contextualizations and even 'hidden grand plan' theories proposed by some and they simply aren't plausible. It's not a 'master negotiator strategy' because he asked for concessions but never made any concrete proposals of quid pro quo. There was no attempt at serious negotiation with most major trading partners (according to the WSJ) and thus no possibility of meaningful deals.
Now suddenly (somewhat) reversing course like this a few days after going so extreme and then publicly doubling down on his long-term commitment to the 'grand strategy' is unbelievably damaging to any remaining shred of credibility his administration may have had. It nukes any possibility that he was doing a 'crazy guy on the subway' strategy of punching his adversaries in the face and making them believe he was so nuts he'd saw off his own arm just to keep beating them over the head with it - all to cleverly convince them to make meaningful concessions they'd never make any other way. Yeah, well now that he blinked in less than a week, nothing he can do will ever make them believe that. I mean, if that was the plan, it was a terrible plan and poorly executed to boot, but flipping like this is even worse.
All I can figure is that it was a 'crazy guy' plan but that he intended to keep it going for several months and then, when his opponents were bloodied enough he'd open negotiations and "win" in a master stroke. Except he completely miscalculated the degree of economic destruction he'd cause in U.S. markets and has now had to not only fold but reveal he was playing a weak bluff all along. I'm struggling to come up with any way this could have been worse for the U.S. and Trump's interests. After this, it's hard to imagine any trading partner negotiating in good faith, or perhaps, at all with Trump over tariffs in the next 90 days. The only rational strategy for them is to play along and gather info while conceding nothing meaningful and simply wait and see what Trump's ultimately going to do long term.
As far as I'm concerned, I bent over backward to grant Trump some benefit of the doubt and give him a chance to prove himself but the tariffs have been so bungled they're impossible to put it in any positive light. So far, it appears to be an epic disaster of hubris and naive miscalculation.
It's pretty clear that's essentially what happened. The question is how, why and what Trump's plan was.
> Is it possible that Trump is just a stupid person?
I don't think a simple linear scale between "Stupid" <---> "Smart" is a useful model for predicting likely job performance in complex, multi-function roles. Reality is far more complicated and nuanced. Whether assessing an employee, CEO, politician or spouse, just using an IQ test (or any other single point measure on one dimension) yields only an approximate directional indicator. It's certainly not the optimal model because it's entirely possible for an employee, CEO, politician or spouse who scores meaningfully lower on an intelligence test to substantially outperform a higher scorer in real-world results on the broad composite of job, leadership, governance or spousal metrics you care about.
I've read Trump's "Art of the Deal" book. He thinks he's a gifted negotiator based on the success he had in negotiating commercial real estate deals. However, commercial real estate deals are generally a pretty narrowly specific kind of deal structure. They tend to each be one-off, transactional arrangements which hinge on accurately estimating the value which can be extracted over time from a property and the future performance of the market in that location. Then forming a one-time consortium of financial backers willing to provide the capital on terms which will allow the operator to make a profit. While the amounts can be large and horizons long, these are fairly simple deals with only a few unknown dependent variables everyone is estimating the value of their position on. It's a bit like poker in some ways. It's a bid, counter-bid type of structure with only a few sellers and a few buyers at the table at any given time and each seller is offering something different enough that it's not a true commodity. There's hidden information but the domain is constrained and the unknowns are known. The bidding process reveals some information about how each player has assessed the value of their hand. They can either have a truly strong hand, be bluffing or somewhere in-between.
This is why I think Trump is ill-suited to directly managing complex, multi-dimensional geopolitical negotiations. They are profoundly different. There's far more hidden information, the domain is nearly unconstrained, there are unknown unknowns. However, not being good at negotiating these kinds of deals isn't necessarily a problem for a president. There have been a lot of presidents who've done well in geopolitical negotiations who were similarly ill-suited. They did well because they were good at selecting talent to manage those processes, setting high-level objectives and meta-managing those processes against broad political objectives and policies (Reagan would be an example). The fundamental problem with Trump is that he thinks he's good at all types of negotiation AND that it's important to his self-image to be perceived as directly involved and instrumental in 'winning'. The final nail, as it were, is that it's pretty clear Trump's default model in negotiations, politics, legal strategy, financial deals, etc tends to be "win/lose" vs at least starting out seeking a "win/win". Complicating this is that his projected self-image seeks to be publicly acknowledged as winning by beating his opponent.
This is a bad scenario because every counter-party in geopolitical trade negotiations has a far more detailed psych analysis than what I wrote that's been prepared by experts who've read everything Trump's ever said or written publicly. While Trump's actions in any given moment are certainly unpredictable, that's not generally a good thing. Especially because his internal priorities, self-image and emotional dynamics appear pretty easy to read and fairly predictable. Whether they're right or not, the counter-parties almost certainly believe they have a fairly solid take on Trump's psychological drivers. Appearing "scrutible" wouldn't necessarily be a bad thing (in fact it could be quite good), except that these psych evals are both high-confidence AND they say Trump is unpredictable, sometimes acts out emotionally, is swayed by personal loyalty over strategy, can perceive negative outcomes as personal attacks, reflexively seeks retribution for personal attacks, is strongly influenced by the immediate feedback of a couple dozen people and has few strongly-held philosophical or political premises. Whether all of these things are entirely true or not doesn't much matter. Trump has projected them so consistently over so many decades others believe they're true.
That's why when Trump said yesterday that he intends to personally be "deeply involved" in the negotiations with trading partners, I sighed. He has virtually no credibility as someone willing to stick by any framework that might be developed in private negotiations. He also has no patience for the long, painstaking process involved. No matter how good the Treasury and State negotiating teams are, their own boss has convinced the counter-parties that these teams have little real influence or ability to strike a deal. To me, that means the odds of any meaningful deals being negotiated where counter-parties are willing to 'horse trade' elements of significant value is between slim and none.
Nepotism feels good all the way until it sinks your company.
There's a lot of obvious big problems - confidence in the USD, debt rising faster than GDP can catch up, military overextension, China's rise outpacing US, inequality, inaccessible education and health care, opioid crisis, etc.
Trump has a good eye for identifying this - that's why he won the election despite all his weaknesses. It's clear he knows some of this but doesn't understand it - his comments on a BRICS currency, for example. Yes, a "BRICS currency" would threaten Pax Americana but it's on literally nobody's mind.
I feel like, if anything, he's an overplanner. A smarter leader would think, these moves will have unplanned side effects. Trump makes a lot of roundabout moves like DOGE. These moves have a target, but he hasn't thought about the side effects. And when a crisis like COVID hits, it disrupts the complex plans, which is why he reacts so poorly to them.
Oh, US does have its share of economic advisors[1] of all stripes. And, I would love to be corrected on this, when SHTF, they immediately argue for NOT the very thing they normally argue for. They can tell what should be done for sure.. just not when it comes to their money..
(edit)Therein lies the issue or at least a part of the it.
[1]https://www.forbes.com/sites/mattnovak/2023/03/12/larry-summ...
Trump is famous for ad libbing and making up whatever he wants in the moment. His first administration was not prepared to govern. I'm not sure how this is seen as over planning.
1. Step 1
2. ???
3. ???
4. Profit!
occam's razor provides much better explanations here. He's an idiot obsessed with dominance games and thinks a tariff on a country means that country pays a tax to the US. He thinks trade deficits are bad, just like if I buy a toaster from Target, now I have a "trade deficit" with Target and I need to find something they'll buy from me.
He's a total dangerous moron and these attempts to come up with 11-dimensional chess rationalizations are misguided.
You want to do tariffs for national security reasons? Okay. I get it. Now get congress to pass a bill levying the tariff, have that bill be smart, encourage not just on-shoring, but also near-shoring (Mexico, Canada) of key manufacturing and minerals, apply the tariffs more strongly against the key geopolitical rivals (China), implemented in a graded, predictable manner. Do not piss of every ally in the world, in general pursuing this hierarchy U.S. > Mexico, Canada > European, African, and Pacific Allies > China, Russia. Finally, for key , and highly specific strategic industries, provide subsidies.
Well the US is still having a dick measuring contest with its largest importer, so no worries. We'll still get plenty of crisis from that alone.
Owning US debt is also simply less relevant to countries that are going to be trading less with the US. Countries which are ratcheting up tariffs with the US, for example.
I think it’s being reversed because it cratered global oil prices and that would be a terrible horrible very bad thing _for Russia_.
America doesn’t have ANY issue refinancing that debt. US treasury is the risk free rate. It’s the basis of an infinite number of financial models as the baseline level of risk people will tolerate. Every single analyst from here to China works on that basis.
This idea that you can’t refinance debt is nonsense. American firms are wildly profitable, and America used to be the safest bet to set up a new firm, or do ground breaking research.
If you wanted to make more money, increase taxes, and you can refinance debt even faster than this. Shifting the yields is … how does that apply to new bonds which would be auctioned??? The face value and rate are set anyway.
BUT, I actually started looking at moving more of the stable bond/treasury holding bit of my portfolio to foreign funds recently (in addition to moving more of the stock/mutual fund balance to international stuff).
If I'm thinking about that as an individual private citizen of the US, I can't imagine what actual professionals are thinking about.
For instance, here are two BlackRock ETFs tracking the MSCI emerging markets index, one US-domiciled and one Ireland-domiciled: https://www.ishares.com/us/products/239637/ishares-msci-emer... , https://www.ishares.com/uk/individual/en/products/251857/ish...
They are for practical purposes the same thing.
None of leaked conversations or prior discussions indicate anything like this. Peter Navarro has no even slightly nuanced agenda. He's been on record for years about this. I think their position was much more that they'd drive foreign tariffs down and would be able to make other demands against other countries, and they underestimated the tolerance even their base would have.
In his interview yesterday he mentioned that he won his weekend golf tournament. Of course he did, otherwise it wouldn’t be newsworthy (still isn’t, but oh well).
Then he asked the reporter if she saw that he won. I think he asked twice.
I look at that simple interaction as the most accurate model of his behavior. Are people talking about me? Good. Why aren’t people talking about me? I need to do something to make sure they do. He may very well have actual intelligence but it doesn’t seem obvious that it is the catalyst of anything he does.
You're making it seem that there's a plan ... but what if this is just regular incompetence coupled with capricious behavior from a chaos agent?
I'm watching various officials give interviews and all of them are non-committal as it pertains to expectations. Why? Because none of them actually know!!! Trump has arbitrarily and capriciously changed "the plan" many times.
The political cohort behind the president is roughly in two halves. The first half are the original MAGA crowd (looking out for the working class, pro-liberty, anti-woke, etc.). The second half are the billionaire crowd.
The second group are active on pod casts, on Twitter/X, and are partly represented in government (directly or as advisors). An easy way to follow up on these people is to watch the All In Podcast or their related social media connections.
What these folks have said for a long time is that if USA stay on the same path, the USA goes broke after 10 years. So if you have long term investment in the USA, you lose your fortune in 10+ years.
This is the key motivation for their involvement in the current executive branch of government. This is why the DOGE program is so well supported by them.
If you lose the battle to reduce the 10-year Treasury yield, you lose the billionaires because they stand to make meaningful losses on a 10 year horizon.
I recognize the plight of the common citizen here; they are the plurality. But the big political levers come from these billionaires (absent a grass roots supported leader in the wings).
When your rational explanation involves people shooting themselves in the head to cure a headache, something's off. There's nothing to explain here besides a weak and incompetent leader with a deep need for attention, surrounded by lots of enablers.
DOGE doesn't save any money. Not only because it's created many legal messes that will take forever to work out in court but because most of those jobs are important and will eventually need to be replaced at great cost and with worse results. Also some of those jobs are for auditing inefficiency and prosecuting corruption resulting in more money spent. And on top of it all they'll be using these non existent savings to justify much larger tax cuts for the rich.
The reason it looks stupid is because it is. It's not that Trump is purely dumb he's just intellectually lazy and doesn't care about policy. He long ago decided he likes tarrifs on instinct so he put massive tarrifs despite the warnings that they would be disastrous
Also, Trump has been obsessed with the idea of tariffs since the 1980s.
Small investors, and medium investors hate market turbulence for sure. But when you are a billionaire, you can easily profit from short term uncertainty. For example, Chamath recently disclosed a (potentially large) Credit Default Swap position (meaning he makes huge upside if USA debt position deteriorates). But he was the same person deeply concerned about USA long term debt. He is a well connected person to the executive branch.
The reason is that if you are a billionaire (tied to the USA financial system) then you can't escape the system when the entire system falls due to (God forbid) a collapse of the USA financial system in 10 years time. It is like they are the dinosaurs worried about a Meteor strike, but not worried about tigers and snakes (that can't hurt them).
Getting a short term interest rate cut makes very little difference to the robustness of the US economy in a decade's time, and even if it did, there are many ways of getting a short term interest rate cut that don't involve massive economic disruption and permanently sabotaging US trading relationships (most obviously, the president nominates the chair of the Fed...). You could see what the likes of Ackman and Elon actually thought about the tariffs from them breaking ranks to moan about them.
The billionaires who backed Trump like standard right wing stuff like tax cuts, deregulation and/or racism, or figured he was going to win anyway so they might as well get credit for being seen as his ally. Some of them might actually be well informed enough to place shorts (and hey, the ones who own trading shops rather than manufacturing and services companies might be able to win more than they lose in equity value that way) but that's a completely separate issue from the idea that chaos now could have positive effects in a decade's time, which only one billionaire in the world is dumb enough to believe...
The bond market is always the adult in the room. The UK PM lasted like 44 days when the bond market pushed her out [1]. In this case, the flip was that all the chaos led to people leaving behind the USD completely. Trumps view of the US/World is ~30+ years out of date. There are other stable places to put money now where it used to only be USD.
[1] https://www.cnbc.com/2022/10/20/uk-prime-minister-liz-truss-...
https://x.com/jaayjayAT/status/1908793907976040839?t=aP60h4w...
Iceberg lettuce is a cultivar known for its longer shelf life and higher water content. Romaine lettuce is another lettuce cultivar famous for its crunchy texture and higher vitamin content.
I am switching to Romaine for the vitamins now I know (have read a single headline on the internet) better.
China dumped 500B in treasuries and the basis trade blew up is what happened
Tariff deals were still going to happen regardless. The pause is a stop gap for the basis trade (20+x levered), of which an uncontrolled unwinding threatens the entire financial system. Fed already had a bailout facility ready as a plan B. Too big to fail and all that
I mean the guy who doesn't understand tariffs, at all, but has publicly loved tariffs for 40 years in charge of tariff policy. That's disturbing to contemplate head on.
Much better to invent some comforting fantasy of secret plots being carried out semi-competently to achieve nebulous but vaguely noble goals.
Same reason why it doesn't matter if China etc.. wants our treasuries. Fed is always there to buy them.
Being a global reserve currency only increases the extent of that printing, not the ability itself.
As for Treasury yields spiking, that was no accident. As part of China's (justified) retaliation to the tariffs, they started selling off 10 year Treasuries intentaionlly to spike the rates because that's one thing the Trump administration seemed to care about.
I still don't know what the endgame is/was here. Some seem to think devaluing the dollar was the goal to boost exports but also to effectively devalue US soverieng debt. There's precedent for this eg FDR's sovereign devaluation of the dollar and Reagan's Plaza Accord.
In my opinion the reason it backfired, what they proposed wouldn't merely cause a confidence in crisis, but also implied a fundamental shift in the market and the way it worked, this would also have to be priced in, hence the drop. There was no longer necessarily a "buy the dip, the market will go up at some point".
Will it pay off? Who knows. If it does, it will go down as one of the greatest gambits in modern history. If not, perhaps the end of dollar hegemony? End of the Global American Empire? Or nothing at all?
It’s time to stop bending over backwards pretending that Trump’s tariff threats are part of a coherent economic strategy. They’re not.
When you drop the economic lens and view tariffs as a political tool for consolidating power, everything suddenly makes sense.
Here’s how it works: - Tariffs hurt corporations. They jack up costs, raise costs. Executives know this. The markets know this. - But there’s a loophole: carve-outs. Trump has the power to exempt individual companies or industries from these tariffs. That means if you’re a CEO and your business is on the line, your only option is to go to Trump and ask for mercy. - That’s not policy. It’s leverage. It creates a system where corporate leaders must show loyalty to get relief. Not because it’s good for the economy, but because it’s good for Trump. Maybe it's public support for his initiatives, attacks on his enemies. Whatever it is, it gives him political power.
This mirrors the playbook used by authoritarian leaders throughout history. Look at Putin. His use of tariffs wasn’t about growing Russia’s economy—it was about punishing enemies, rewarding loyalty, and projecting control. Tariffs became a way to rewire power dynamics.
It could all be refinanced to three month bills without any issue at all.
Ultimately balance sheets have to balance. In a floating exchange rate system there is no aggregate out.
> you can't afford a crisis of confidence in your bonds
A safe haven isn’t much of a safe haven if that’s where the fire has started.
Generally the president acting like an insane maniac about to become dictatoe makes bonds look less trustworthy.
True. The odd thing is that the previous tariffs announcements on supposed allies, plus all the other sabre-rattling that Trump has been doing, NATO-bashing, flipping on Ukraine, etc., had already triggered a crisis of confidence. So what did they expect? That unexpectedly unleashing of wildly unreasonable and poorly-calculated tariffs would inspire _more_ confidence? If getting investors to flock to T-bills was the goal, it was always bound to fail. (It only worked in the short term because T-bills are the default in a time of market uncertainty; but when it became clear that the uncertainty was caused not by the market, but by the government's behavior, well then T-bills don't look so good anymore).
Maybe it was the idea of 4 more years of shenanigans like this that freaked everyone out.
The much more likely scenario is that this is exactly what it looks like: an incompetent and corrupt president flailing around. Tariffs are an excellent tool for soliciting bribes since there are any number of ways various groups can be exempted, and this type of abuse has often happened historically. The ham-fisted way they have been implemented has done a great job of getting Trump attention. I've never seen anything to make me think that Trump cares more about the long term health of the country over getting bribes and attention for himself.
Or, maybe, and hear me out on this, maybe it was Donald Trump literally saying he might default on US debt.
Maybe.
https://news.ycombinator.com/item?id=43630672
It was indeed about T-bills. Something Trump probably doesn't even know what it is. There’s no strategy, no objective, just sheer, unfiltered incompetence.
The stock market’s reprieve will be short-lived. In just eight days, this administration erased $5 trillion in market value, insulted its primary trading partner using language deeply offensive in Asian cultures, and made it clear to investors that it has zero credibility.
Futures are already negative, which is exactly what you'd expect. The market is responding. And let’s be honest: the claim about 75 countries eager to negotiate is a pure lie. The EU has publicly stated the U.S. administration was not even returning their calls.
Besides the financial uncertainty, I doubt businesses want to make huge capital investments within the US to re/build factories in such a febrile environment. Will they be 'encouraged' to make 'donations' or purchase Trump golf club memberships? Will their foreign management staff be abruptly deported if someone in the administration sours on their country of origin? Will they wake up one day to find they've been denounced by conservative influencers?
> Instead of being seen as a safe haven, U.S. debt itself started to look shaky.
No shit. Having an inconsistent policy because of clear incompetence (xx Dimensional chess) is a very bad sign for the world largest economy. At some point this will hit the bonds which is the foundation of this economy.
Bessent said the decision had nothing to do with the markets.
“This was driven by the president’s strategy,” he told reporters outside the West Wing. “He and I had a long talk on Sunday, and this was his strategy all along."
Trump later contradicted Bessent.
“I was watching the bond market," he said. “That bond market is very tricky.”
(https://www.yahoo.com/news/week-trump-pushed-global-economy-...)
The "executive branch" is Trump. Everyone else is just running around making up excuses for whatever his last decision was.
The "goal" is whether Trump feels like (not) having tariffs and whatever value he feels they should be.
There is no "they": it's just Trump (or maybe whomever he last spoke to that could change mind).
So, it's not this unstable president, his insult-spewing vice-president and his buddy the hyperactive billionaire manipulating a social network for Russia and China that makes the rest world want to avoid the USA for the next few years?
During the campaign Trump said he wanted 10 percent tariffs on the world and 60 percent tariffs on China. After all the noise we are now at… 10 percent tariffs with the world and 125 percent tariffs on China (pending negotiation with China).
"Alarm inside the Treasury Department over signs of distress in the US government bond market played a key role President Donald Trump’s decision to hit pause on his “reciprocal” tariff regime, according to three people familiar with the matter.
Treasury Secretary Scott Bessent raised those concerns directly to Trump in their meeting that preceded the announcement, underscoring the concerns shared by White House economic officials who had briefed the president on the accelerating selloff in the US Treasury market earlier in the day.
The market turmoil has rattled administration officials and market participants because it’s the exact opposite of what historically occurs in moments of global economic crisis or volatility. US Treasuries are considered the safest corner of the market. It’s the place investors across the globe flee toward with the assurance that the dominant US role in the global financial system will ensure asset safety.
But at the same moment Trump’s tariffs were causing foreign leaders to question the durability of longstanding US security and economic alliances, the rapid selloff of safe-haven assets raised concern that financial markets have similar concerns.
Trump acknowledged he’d been watching the bond market, telling reporters after the announcement the market is “very tricky.”
A spike in yields in the 10-year benchmark was of particular concern for Treasury officials. When the yields rise, US consumers face higher costs on things like mortgage rates for homes and financing costs for businesses."
https://www.cnn.com/politics/live-news/trump-tariffs-cnn-tow...
I mean, it could well be that they are risking the stability of the US economy to save money on refinancing the debt, but that would be a stupid thing to be doing.
All those long 8 weeks that people spent complaining about soft power, and the US government spent trying to gaslight people saying that they don't even use the power... The people complaining were talking about something real.
Seems pretty simple to me - bond yields moved up sharply because they follow inflation expectations. Bond holders take on inflation risk, so when future inflation is expected to increase, yields go up to compensate. Out of control tariffs equals out of control inflation, which equals rocketing bond yields. The fact that Trump's team didn't realize this would happen is both hilarious and frightening. This is Econ 101 stuff.
Now businesses know he really, super means it this time, so they get another reprieve. But next time it would be hard to claim Trump didn’t warn them.
You have Trump who has an instinctive affinity for tariffs, and a wack pack of various characters doing whatever. I’d guess they thought the Chinese would roll over rather that start dumping bonds.
Given that all of those things would torpedo your ability to actually service debt, both new and old.
But what do I know? /s
> In a strange turn of events, the president seems to have added another 10 percent tariff to Canada and Mexico. Asked earlier if the 10 percent tariff extended to those countries, Scott Bessent, the Treasury secretary, said that it did. And a White House official clarified for me just now that that was the case. Previously, Canada and Mexico had been exempted from this round of “reciprocal” tariffs, though they still faced a 25 percent tariff that the president imposed last month on many of their goods.
https://www.nytimes.com/live/2025/04/08/business/trump-tarif...
If it wasn't happening before, it certainly will be now.
What's actually wrong with them.
Market manipulation. 1. Sell. 2. Threaten tariffs. 3. Buy. 4. Walk back tariffs threats. 5. Repeat.
With the secret step 0: Pay enough of an Indulgence to get in the loop of when those are going to happen, and to stay in their good graces so the DoJ doesn't hit you for insider trading.
This was Monday morning when it was trading ~$40. It is at $53 now. What is 20% increase on $1.5 Billion? $300,000,000.
[0] https://www.msn.com/en-us/money/markets/gutsy-traders-make-1...
It's a pretty gross thing to think about.
Money is not an end. It’s a (one) tool to get there. To the ends you want. To some sort of change in the world you want to achieve.
On that front this is incoherent. I vote incompetence.
A lot of the finance folks work in an M-C-M' world, where Money (M) is the alpha and the omega, so you see this kind of (IMO) perverse behavior.
I've found this mental model helpful in explaining these kinds of behavior.
Maybe for the overwhelming majority of the population, but it simply isn't the mindset of the billionaire class that supports Trump.
There's a reason the dollar weakened in this crisis instead of strengthening like usual. Everyone can see that the US will be hurt far more by this idiocy than other countries will.
Maybe there's something to this theory of Trump being on the dole in Kremlin... ~
look at global trends. no one thinks anyone can make money without the world's leading per capita consumer spender fully on-board. That is leverage.
Every government that has to do something undesirable to their citizens have been given something to blame: a beautiful excuse that will be milked relentlessly to the disadvantage of the US.
Businesses get screwed by flaky management - and now we get to see the US get screwed by its unreliable self-centered Prez.
If anything, it showed the leverage the US has.
Even countries like Singapore, hit with a 10% tariff (marginal, and far lower than most countries) absolutely panicked.
Interestingly, I looked up the size of consumer markets - the US is twice the size of the next biggest market, the EU.
So I don’t blame countries for panicking.
And if you’re really conspiratorial, one could question whether the push for free trade was really an attempt to put the US into a situation where it had leverage against most of the globe.
"I bought $200 worth of stuff from your store and the store bought $0 worth of stuff from me. To punish them, I'm going to pay myself $100 every time I buy anything from the store in the future - that will show them!"
If you tarriff them 10% they'll tarriff you 10% which means your companies lose out more than theirs and you've also pissed off an ally?
Why?
I'm thinking about Australia, UK those kind of folks.
That's a little like what's going on now.
Pissing off your allies is good because if they're happy, that means you didn't squeeze them enough.
And it may hurt us and our companies more than theirs, but it doesn't hurt Trump personally, and that's all he cares about. He's going to be fine, so he's more than happy to cause us pain if it cause them pain as well.
Pissing off your allies is good because if they're happy, that means you didn't squeeze them enough.
It's the reason a "trade deficit" is seen as a bad thing by him. Trade deficits are the result of a mutually beneficial transaction, but that's not enough for Trump. It can't just be mutually beneficial, it has to be beneficial more in our direction than theirs.
Or look at how he treats contractors. He hires a person to do a job, they agree and deliver the work, and that should be the end of the mutually beneficial deal.
But not for Trump, his MO is to stiff contractors, force them to sue, mire them in a legal quagmire, and get them to settle at a loss. This is the kind of deal Trump likes because it's a win for him -- he gets the contracted work at a fraction of the price; and a loss for them -- they probably wouldn't have agreed to do the work had they known what they were in for upfront.
Is this a great way to run the largest economy in the world? Of course not! But that's how it's happening now because that's the kind of guy who is in charge.
He knows very little about government and policy, but tariffs and dollars and percentages feels familiar to him. He's got a lever, and he can't resist yanking on it to show that he's in charge.
Whether yanking on the lever actually benefits the country or him is entirely besides the point. He's a narcissist and narcissists can't let go.
except of course Trump brought a knife to a gunfight :)
> It's been a confusing day.
> As Verity said, it turns out Canada and Mexico are not getting a new 10 per cent tariff after all.
> The White House reversed its earlier announcement in a new statement just now. Here's the bottom line: No new developments for Canada and Mexico today.
> That means there are still worldwide 25 per cent tariffs on steel and aluminum, on some auto parts in North America, and on some goods traded within North America outside the rules of the Canada-U.S.-Mexico Agreement on trade (CUSMA).
> The bottom line here: Trump is starting an economic war on China, and U.S. allies are all taking some friendly fire. But a large swath of Canadian trade is spared.
https://www.cbc.ca/news/world/livestory/trump-pauses-most-gl...
Unlike Europe, in Turkey rules and everything is changing all the time, you can’t count on anything to be the same the next 5 years. No one in the institutions knows how everything works, they only follow the computer instructions. You are getting a loan? its a mystery if you will be able to get the stated amount because if you are buying a house down the road the computer may ask for the energy efficiency rating and limit the amount based on that. They will say that it is to promote energy efficient buildings but that regulation will remain only for a year or two- not enough to change buildings practices but enough to limit the loans given without explicitly limiting the loans given.
It’s a horrible thing, you can’t plan anything and those with connections end up catching all the good temporary situations because the got tipped. The moment the masses start realizing the opportunity, the rules chage.
It has become a tool for giving favors to loyalists and created a lot of horrible people who got “lucky” with their investments. When the politicians feel like paying loyalists, they will change something in the law that will allow for previously non-developable land to become developable and loyalist will get tipped that they should buy the land before prices increase. It will be something non-obvious, like something about changing the category of a road or something that changes the status of the land when appealed.
I find it curiously useful that Trump’s blatant lying can be used as a shibboleth. E.g.: they’re not reciprocal tariffs, so almost everyone calling them that is a “true believer” that accepts Trump at his word.
I disagree. Non Trump aligned media called them reciprocal tariffs. I don't know if identifying the lie was too controversial or they couldn't understand the equation the administration published. And non Trump aligned people called them reciprocal tariffs because they heard or read the phrase.
However, with this administration, who really knows?
Perhaps Trump is staying quiet to avoid aiding Carney in the election. Perhaps he'll announce harsher tariff's on Canada tomorrow. Canada did retaliate and hasn't been hit with retaliation for retaliating, which gives the lie to Trump's statements that countries should refrain from retaliating if they don't want to be treated even worse.
There is not one whit of consistency or logic on display here.
[1]https://www.theglobeandmail.com/politics/article-canada-will...
>There’s no change to Canada and Mexico tariffs, indicating that their levies aren’t going down to the 10% baseline. Recall that Trump initially threatened a 25% surtax on each of them. That morphed over time to affect non-USMCA compliant goods -- and it’s not crystal-clear exactly what proportion of Canadian and Mexican shipments that then affects. Canadian energy products also got a smaller rate.
https://www.bloomberg.com/news/live-blog/2025-04-08/trump-ta...
[1] https://www.newsweek.com/trump-tariffs-hit-lawsuit-group-his...
[2] https://thehill.com/homenews/senate/5236142-congress-tariff-...
Constitutionally, the power to set tariffs resides with the Legislative branch, not the Executive branch. Congress has delegated some authority to set tariffs under certain conditions (namely, emergencies and matters related to national security). But the Court is clear that one branch cannot delegate all of its powers to another. The Court is pretty deferential to the Executive branch, especially in matters of national security. But no matter how much you squint, it's hard to see how setting broad based tariffs on all goods from every foreign countries qualifies under the Emergency Economic Powers Act.
If the president tries to do X, then the lawyers block X, then in political game theory the president "wins" in the eyes of the electorate because the president can argue "my plan was perfect, the execution failed due to the opposition, so I am not accountable to what has now happened".
The left might want to see a disaster play out to capitalize in the mid-term elections, laying the accountability directly on the president. The right might not have freedom of action because they fear a well-funded challenger for their seat.
In am interested in other people's opinions and ideas in this area. I agree it is too little discussed and analyzed. Please share your insights!
If judiciary blocks X, then trump will say "these are the real bad guys, they are as worse as the dems, lets remove them". And BAM ! You have a dictator.
The sad part is that one of the most powerful nation in the world is filled with idiots who will lap up the above argument.
I would say that all this current situation is because of corporate greed, leading to a skewed distribution of wealth, leading to the evolution of a class of voters who are desperate, gullible and mis-informed.
And more pragmatically, I think that Trump is so committed to causing disasters that he's likely to succeed at enough of his attempts that there should be pushback to as much of it as possible.
Unlikely. SCOTUS is cowed, as shown by the latest batch of rulings (https://www.npr.org/2025/04/08/nx-s1-5351799/scotus-probatio...). They want to avoid his ire, and interference.
Possibly, they are saving dry powder for a bigger fight.
It’s this kind of legal storytelling, by which you pretend you didn’t authorize something, while actually taking actions that ensure it’s authorized in practice, that is the worst enemy of the rule of law.
For the same reason that i believe a situation like that could play out, i don't think i should judge a judges understanding of, dedication to work through, and knowledge about– the laws.
I actually studied law for a few years. And i am baffled by the confidence of laymen about court rulings. It's almost like a client explaining to me how easy it is to fix this small bug.
Then when you look at how SCOTUS justified it, they basically claim that the petition is invalid if it's not filed where the detainees are currently held. So how is it supposed to work if the feds just keep shuttling them around?
But how do you justify all of the other trade deals made by other presidents?
Were those also unconstitutional? Or just Trump's because they went up not down.
Are there any examples pre-Trump that were not ratified by Congress?
It's a foundational part of the sickness in people like Trump that anything bad is by definition somebody else's fault, and clearly his cultists just keep lapping up his lies no matter how insane and transparent.
Conservatives lack the ability to empathize abstractly. Due to their extreme emphasis on being self-centered, they are deficient in understanding that what happens to another can happen to them.
Once something bad happens to them, they are able to start to see the threads that bind them to others and society. But it’s only once it’s been made personal that there’s a chance of this recognition occurring.
So “us good, them bad” style of mob thinking is more common in conservatives only because they systematically do not ask themselves “are we actually different from them?”
I'm honestly not sure there is another way since laws can't cover all possible future edge cases with effective enforcement mechanisms. The simpler fix is to not elect blatantly corrupt and incompetent leaders, but voters failed that task and now the country is paying the price.
Trump is only out to make money, the guy never had any other thought in life since money gives him status, fame, and power.
It's a grift, as any other of his grifts, but now he can manipulate the whole stock market with his power.
There's nothing else that I can rationally come up with to explain this absurdity.
Nope. Not even close. He's all about power, and the appearance of strength. It's no coincidence that he looks up to Putin.
Money is almost always a means to an end, and this is no exception.
As the latter categories are more representative of US exports, it would surely be an interesting escalation if other countries were to start including them in their “retaliatory” tariffs.
US has an imbalance on goods that was used to calculate the tariff amount, but it has the opposite imbalance on service from what I've read
Last I've looked "Lidl Cloud" from Schwartz-IT that is often mentioned as alternative is basically managed Kubernetes for more than double the price of Azure/AWS before rebates. They have that idiotic meaningless TÜV button on their websites and unfortunately it's not technical excellence but rather a trap for boomer CEOs...
Europe missed that boat unfortunately and I don't see that changing soon. Hetzner/OVH and so on only provide bare metal or virtual machines for little money but there is no European cloud with serious IaC and managed services that are stable and battle tested as far as I know.
Changing taxation rules is the interesting topic but unfortunately EU countries are competing on that and that would destroy the business model of countries like Luxembourg or Ireland - I'm all for changing it and it would be better in the long-term but it's probably impossible to pull off at the moment.
On the long term this can really make EU more sovereign, less dependent and it's not a crazy thing.
I have never understood the argument of "yeah tariff would hurt us because we are dependent on foreign tech". Yeah that's precisely a problem at a country level. Promoting local alternative is best than winner takes all.
There's also a price in not looking tough when you're getting bullied sometimes.
But if we are talking about tariffs (and not a ban) then a partial move is also relevant. And, at least in my anecdotal experience, a non-trivial fraction of our cloud-cost is pretty simple services which can be moved. It's almost like a 95/5 kind of thing, moving 95% of the stuff would take 5% of the time.
Having a hybrid cloud setup is clearly more hassel, but it's doable.
Say an American multinational like Microsoft provides some SaaS. They have a division in Europe where their developers help make their products. They have offices, customer support, servers, etc. in Europe. Do they pay a partial tariff based on what fraction of the development of their software happened in the US? What if they sell the rights to the European version of their software to their European division?
Of course, the multinational could also use the funds to invest in Europe, build warehouse or commercial real estate or acquire European startups. I think they already do this to some extent to avoid US tax.
Using these to fund free credits to European cloud providers could be a good way to build up a local alternative. I think we underestimate the importance of free credits in the reliance on the 3 US hyperscalers, especially for startups.
We're lacking VC funding, not skilled tech workers. Increasing visas for tech workers without increasing the funding just lowers wages which are already low.
One facet could be increasing investment, VC and otherwise
_How_ you do that? I'm not sure, but I also doubt it's a completely unsolvable problem
Plus, EU visas are basically just rubber stamps anyway compared to how hard getting an H1B is.
Actually here's another unused pressure point, the EU can retaliate by making it as difficult for Americans to work in the EU as it is for EU citizens to work in the US. Why isn't it already reciprocal?
I suppose you could have a kind of tariff equivalent of the doomsday machine from Dr Strangelove, in principle; a set of automatic measures to come into force if the adversary does [whatever]. However, Trump strikes me as a bit of a General Ripper, so it might not be a _great_ idea.
Most foreign extradition courts would laugh in their face for trying to use that, but if you have any assets in the EU (as most corporations inevitably will if they get big enough to go international) they can seize those as punishment for not following EU laws related to business conducted outside of the EU and that goes back to what OP tried to argue:
>if they don't break the law there's no way for the EU to collect the money
they actually can, because they can say you broke their law while conducting business outside of their jurisdiction that wasn't even illegal in the coutnry that actually had jurisdiction over that transaction.
GDPR covers people in the EU. Not EU citizens. Non EU companies can avoid GDPR liability complying with the law or not conducting business there.
Global companies have assets in the EU because they conduct business in the EU. International companies which do not conduct business in the EU do not have assets in the EU generally. And having assets in a jurisdiction subjects you to the laws of that jurisdiction obviously.
In the US system of law, it is based on codified "rules". If you follow the letter of the rules you are fine - no fines.
The system of regulation at play here is the EU digital markets act. These laws are based on the effect of your actions, not the specific actions you undertake.
If the effect of the steps you take produce unacceptable outcomes, you pay fines even if you follow the requirements. The converse applies as well. If you ignore the rules but the outcome is in the spirit of the laws, then no fine.
The idea is to avoid malicious compliance but the cost of this is ambiguity in interpretation and also the market response to your actions might be genuinely surprising.
Here is a technical example to highlight the problem:
Apple were asked that you should allow independent browser technology implementations. They did this (to allow Google's technology to be employed as an example). But due to practical complexity they could not make progressive web apps work on iPhone (since they would need to route through the API which can be provided by Google's browser technology). So to comply with the rules, Apple disabled full screen PWAs and instead allowed them instead the web view area inside a browser, not full screen like a native app is experienced.
The EU regulatory body said revert that, and allow PWAs despite their own rules being then violated (as it would be using only Apple's browser technology) because the effect of allowing PWAs is a competitive marketplace for native app alternatives (web apps).
I do not like the idea that law can become a game of finding loopholes that go against the spirit of it, it's whack-a-mole that costs the State a lot to keep patching. I much rather have the system most of the EU has where subjectivity can play into decisions since some loopholes can be clever enough to work around terminology, jargon, and non-specificities to skirt around what's written while being opposed to the intent of the rule.
Companies can still contest, and bring forth cases to be reviewed to check if those solutions comply with the law, their lack of cooperation is a choice to drive a wedge between the citizenry and the regulations by non-complying and crying foul to the public to gather sympathy. That's an active choice, the companies could work with regulatory bodies to cooperate, and find a solution (I work at a company who did that for DSA) but most would much rather give a bad rap to regulations to turn the public against it.
Rule by law rather than rule of law?
There's no mind reading, most of EU's fines only happen after a pattern of non-compliance, complain as much as you want about EU's bureaucracy but it's quite cooperative if you want to figure out a solution. I prefer this system than one where the written laws are worth nothing since well paid corporate lawyers can figure a way out, or hell, they might even be paid to write the laws themselves as it happens in the US.
I'd like to know if you know what's you're talking about. In france the local subsidies are really low and the inversely the big rebates like "Tax Credit For Research & Dev" are for everybody, US companies like EU ones.
Physical goods you can hold until tariffs are paid.
Services are paid for by invoices between two corporate entities whose legal domicile may have nothing to do with the real country of origin of the services.
Lots of European SaaS providers invoice US customers from their US subsidiary - impossible to distinguish the transaction in order to put a tariff on it.
Yes it would be a strong response, but unlike the US we are not interested in appearing like the strongest idiots, the EU would rather we all get along and trade. We'd rather work on real issues instead of this self damaging garbage.
https://www.politico.eu/article/belgium-brussels-amazon-goog...
https://www.politico.eu/article/eu-trade-bazooka-anti-coerci...
https://www.euractiv.com/section/tech/news/france-singles-ou...
when people in other countries use that at a non-trivial scale, aren't the servers on the other end of the connection still located in their region?
You can tax the "intellectual property" payments that the subsidiaries make to the USA parent, or you can pick some other criterion. Or you can just create a new sales tax for any one part of the transactions you want. It's tricky but it can be done.
If I order physical goods from a foreign nation it's gonna have to somehow get into my hands, and can be withheld until i pay tariffs
If a irish subsidiary invoices me subscription prices for intangible services, there's no way in the current legal world to enforce a tax on my end
Collecting taxes on goods flowing through a limited number of physical locations is much much easier than trying to audit the client list of a huge number of foreign service providers.
Agreed that other countries are considering this.
That's why you read things like «The Anti-Coercion Instrument (ACI), a nuclear option that has yet to be deployed, would empower the EU executive to hit U.S. service industries such as tech and banking». https://www.politico.eu/article/eu-trade-bazooka-anti-coerci...
You can just pick the top 10 biggest financial and tech firms and be done with it.
I think there are some sound-bites from Trump-45 calling it a scam (in strong contrast to Trump 47) but even then then he never tried to do anything about it. If trump gets on Truth social tommorrow and fires off a tweet about how Bitcoin is a chinese threat designed to destablize US hegemony and circumvent tariffs and he's going to sign a legally-questionable EO to ban it, bitcoin's price would go up "bigly". Same would apply to the EU or any other major economy, although i will grant that it might not be to the same degree since nobody pisses people off the way trump does.
I.e. GameStop is all very impressive until you compare it to anything finance actually dumps money in by default.
If the pyramid is isolated it tops out somewhere a lot higher than now and then collapses for lack of a place to sell to next or an actual return.
A lot of earnings are coming out next couple of weeks. Take Apple for example, how would they forecast Q2 numbers? They have 125% tariffs on all imports from China. Maybe it'll go up more as China increases their own. Or maybe it gets paused. I feel for the FP&A team there.
They can't. They're saying it out loud updating their guidance.
In polite terms, on earnings calls you're going to hear "we don't know what the fuck to predict".
Follow Bloomberg and you'll hear bank CEOs saying the same thing about the markets, they have no idea what to predict or how to price anything. Right now the line is that America looks like an emerging market with unpredictable wild swings based on policy changes. That is going to drive everyone away from the US, industries, customers, and trade partners.
Apple is perhaps already hiring a fleet of planes and ships to transport iPhones from all over the world to the US.
Regular people have no business gambling with levered bets on publicly traded equities. Those losses are their own fault, and they should sell gambling treatment.
Thanks, Robinhood!
It's probably many things, but one part of it is for sure stock manipulation.
8:37AM "THIS IS A GREAT TIME TO BUY!!! DJT"
12:18PM "I have authorized a 90 day PAUSE, and a substantially lowered Reciprocal Tariff during this period, of 10%, also effective immediately. Thank you for your attention to this matter!"
What's even wilder is this random Twitter account that 'leaked' the 90 days pause two days ago, got picked up by the news as truth, caused the market to recover by trillions of dollars temporarily... and now this...
https://old.reddit.com/r/wallstreetbets/comments/1jve86e/tin...
A finance whiz could tell you that it wasn't the biggest day in the market's history, but maybe a cause for extra celebration among a more select few.
Its stock manipulation all the way down, if you’re inclined to see it that way.
The stated goal of the administration is to 'reindustrialize' the US by manufacturing more of the goods consumed within the US itself. To get to that goal, tariff barriers are just one part of the story. For tariffs to be effective towards getting to the strategic goal, they need to be coupled with sound industrial policy and a long term execution framework. The three legs of the stool, so to say.
So far, there has been no mention of the other two legs. There is currently no serious bill proposed that aims to apply the required industrial policy and all of these tariffs being imposed under executive orders mean that instability in tariff rates and application is pretty much guaranteed. The very opposite of the stable, long term approach that is needed.
Without the other parts, there is a very high chance that the US will bear the brunt of the short term damage, but with none of the long term benefits.
What we’re seeing now makes as much sense as a middle-aged laptop jockey deciding that they want to be in better shape – and then quitting their job to run in the Badwater Ultramarathon the next week.
Everyone knows that getting another trump may not be possible for at-least another 10 or so years (I don't mean the dems will win, just that republicans may put forth a saner version of trump just to save the party)
I hate to bring up Hitler but that's how he gained much of his power. He was a "useful idiot". The people that helped him were looking out for themselves. They thought they could use Hitler to grab power/wealth.
It is the textbook definition of a fucking shit show.
Came back from a meeting to find things were halfway back to where I sold and started to feel bummed.
Guess we'll see what tomorrow brings.
It doesn't; S&P500 is now at like 5400 vs nearly 6200 a couple of months ago. It's just that it is clearly not _as_ bad as it was earlier in the week.
And honestly you'd wonder how much this is being held up by confused retail traders; looking at WSB, say, many of them seem to think that tariffs are back where they were a few weeks ago (they're not; the 10% thing is staying, and of course there's China).
Of course, you have Congress to keep the President in check that these are real emergencies. Which is why the House will definitely be bringing S.J.Res. 37 to the floor, right? Because it's their sworn duty to act as a check on executive power, right?
https://constitution.congress.gov/browse/essay/artI-S1-5-1/A...
Any democrats with working brain stems and genitals should be taking this to supreme court.
Also it probably wouldn't even fly with anyone since so many other emergency powers are generally accepted as necessary (i.e. defense). The immunity decision is full of rhetoric about the legislature being too slow for crises.
Their best bet is to invent a time machine, go back to Obama, have Obama pass emergency tariffs, then lobby to repeal that act.
He responded that he's not allowed to discuss campaigning and that I can instead donate to his 'friends' network (PAC?)
I don't think the Dem establishment really opposes Trump at all...
We ~know that they were: https://finance.yahoo.com/news/the-market-pummeled-401k-acco...
As always, normal people sell low and likely buy high (I'd bet that a lot of the already-fading market euphoria yesterday was retail trading).
https://ec.europa.eu/commission/presscorner/detail/en/qanda_...
fxxk xi, fxxk trump
The EU should do what does best: make things boring.
If retaliatory tariffs is the way to go, maybe do it the boring way: considered bit by bit, no flashy announcement.
Or just make a 10 year deal on LNG so Trump can say we're paying the US money every year.
I'm pretty mad a the US for fucking up the entire world right now, but I also realise that acting on that anger is a bad idea. I appreciate the EU having some long discussions while the emotions fade.
Exactly, the absolute best thing the EU could do right now is project stability
EU already had 10% tariffs on all US autos. (Though tbf most other things were near zero.)
There's actually some confusion about that. They said they paused the global tariffs but didn't mention the Canada and Mexico tariffs.
If the 10% global tariff is in addition to the Canada and Mexico tariffs, the net tariff rate on those countries could be quite high. Combined with 125% tariffs on China and we would have very burdensome tariffs on 3 of our largest trading partners.
The rally is because Trump caved to pressure and is backtracking earlier claims that he wasn't going to change his policy.
What I'd guess most of us are interested in is what you have to say.
I'm here for the people. No AI is going to tell me what you think about something.
I believe that Trump is shaking things off, but his goal is to introduce a fixed "tariff" like a soft VAT.
He is just testing (and profiting with $$$$$) what happens when you do things like 30% there, 24% there, etc. But his long term goal is a fixed tax. In that context, who are we to judge them? We also have VAT on imports.
Now, if we were to split VAT in two: 1. tax on imports, 2. tax on whatever goods/services people in that country pay/buy, you could keep just the 2 and have free trade with other countries with zero tax. Or the opposite, do tax on imports and free trade inside your country.
The fact that VAT has always been like that (1 and 2 together), it doesn't mean it has to stay that way.
Not sure why we should care about how a country decides to apply taxation in their own country, especially if that country sets a more or less equal tax for everyone - that's understandable.
> 1. tax on imports, 2. tax on whatever goods/services people in that
> country pay/buy, you could keep just the 2 and have free trade with
> other countries with zero tax.
Why can't this free trade be done with individual countries for specific products then?
> Why would there a VAT on, say, domestically produced pasta on the grocery shelf, while the Italian import pasta right next to it has none?
You answer (correctly) that that isn't the case, both boxes of pasta have the same VAT applied to it.
In light of this, I think people are really struggling to understand what you're arguing for or against here. The whole subthread started by someone pointing out that the 10%-for-everyone version of trump's tarrifs is very different from European VAT, since European VAT applies to all products sold to consumers, regardless of whether they are imported or not. That is, indeed, a vital difference. You seem to argue that it's not the case, while giving examples of how it is the case, leaving everyone confused.
This is why tariffs are much more flexible, because they allow you to, let's say, trade oil at a cheaper price, while pasta (widely produced in europe) at a higher price.
Well.. that’s an idea.. I suppose..
There are some exceptions. Sudden changes can be painful if you built a factory to service some market and they block the sales all of a sudden. But a 10% across the board tariff may not make it worth retaliating.
Wouldn't you say the same thing about VAT?
HK and Singapore did have low tax and small government which probably helped them.
Why forgive VAT what we can't stand in tariffs?
Is the United States trying to free Europeans from the tyranny of their government? Americans should also stop paying sales tax and income tax.
> Why forgive VAT what we can't stand in tariffs
Now replace VAT in that sentence with incomes tax, alcohol duty, property taxes.. makes no sense.
So it's xx% that goes on top of a rate defined by the type of the item.
And the US has sales tax.
VAT is paid on all products, it doesn't matter if it's domestic or imported!
Maybe you should not repeat these nonsensical talking points?
VAT applies to everything, both imports and domestically produced goods. This reasoning makes even less sense than Trump’s ChatGPT tables…
> but his goal is to introduce a fixed "tariff" like a soft VAT.
You really don’t understand at all what VAT is?
Just so we're all on the same page, instead of maga talking points.
What percentage is VAT in Europe? Typically around 20%? Maybe Trump should enact a 10% sales tax instead of a tariff and then everyone would obviously be completely fine with it, problem solved.
The world wouldn't care if he introduced a federal 10% sales tax (provided it was implemented similar to VAT, ie. non-protectionistic)
The WH repeats this lie constantly. Anytime they get pushed on the absurdity of tariffs they mention VAT like it's in anyway related. The right wing outlets then amplify and we further dumb down America.
The difference between sales tax and tarrifs is it applies to all products within the same category irrespective of its origin.
If Trump wants to implement a 10% sales tax on everything purchased in the US that would not be considered a tariff and no one would retaliate.
Same way it reduces the consumption of domestic goods? Seems like fair level?
No, it does not seem fair for Europe to take measures to dramatically reduce European consumption of US exports when the US does not take measures to dramatically reduce consumption of European exports. To be fair, the US would need to do something to dramatically reduce US consumption of European exports.
And I happen to know just the guy to do it.
Seems like fair level?
To simplify,
US product for sale for £100, then VAT would be £20 ( assuming 20% rate)
UK product for sale for £100, then VAT would be £20 ( assuming 20% rate)
same thing with privacy, the US is abusing europe by not having comprehensive privacy standards equivalent to the GDPR. only california is not defrauding the EU
Uhm, it also reduces consumption of locally produced goods, not just something imported into Europe. Its like...a sales tax, the only reason it is treated differently from a sales tax at all is because of its more fair rebate system.
Interesting(?) that the only two previous spikes higher than the current one are COVID and the 2008 GFC.
Not to mention, with increasing China's tariffs - he STILL hasn't made compelling domestic policy to bring manufacturers here, and has put the cart before the horse by punishing U.S. companies for doing offshoring, before giving them a chance to build domestically. He's only made the super-cheap offshoring approach more expensive (but not more expensive than domestic production). Post-tariff offshoring is STILL a lower expenditure than (A) the investment of domestic infrastructure, (B) the runway of cash it takes before becoming sustainable, and (C) the ongoing wages, maintenance, and taxes to continually maintain it.
I can, as shown, also go the other way, where tarrifs are removed under shipments.
Regardless, the core is exactly that people don't send things overseas in this environment.
Nevertheless, it was still a good time to buy, and also a good time just to ignore it and go about your daily business.
Don't blame the markets.
A lot of people made money today; no, they are not all Trump "buddies"
Only people with insider knowledge reliably made money. You either knew Trump would say the thing about the tariffs, or you guessed it and got lucky.
People who get lucky in certain endeavours like to proclaim they have some kind of skill.
There's markets can be irrational angle, of course, but it doesn't apply here.
Using "common sense" to both divine that Trump is so incredibly stupid as to suggest obviously bad economic policy but simultaneously smart enough to revert it is gambling.
There is no 5D chess going on. There is entropy, Trump is an agent of chaos. He is not stupid, nor is he intelligent, he is destructive.
You have better odds sticking to cartomancy or other forms of divination. I have no issue with gamblers, but I do take issues with gamblers who are so delusional as to think they can see that which is unseen.
Again, you're just taking pure luck and rebranding it as common sense, using survivor bias.
If you still insist you had a crystal ball, then I ask you: Did you predict the 125% non-delayed tariffs on China, or did you think he would delay all the tariffs? Are you still predicting the 125% tariffs on China will be delayed?
Which is absolutely catastrophic for all kinds of reasons.
and regardless who is in power next decade the dems should anyway
It's like some blackhat is trying to find every loophole in government and exploiting it, like a fuzzer test
The problem of course is that any move like that is going to result in chaos inside the republican party. I imagine that might delay the moment before e.g. Mike Johnson (speaker of the house) puts such a thing up for vote in the house. Because it sounds like that would be a career ending move for him. Until that changes, Trump can do as he pleases essentially unopposed.
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.
This exact thing happens frequently at scale. When countries put export controls in place on shipments to Russia recently, they had a sudden spike in exports to a number of countries known to re-ship products into Russia.
I thought it was highly suspicious when I noticed, like evasion of sanctions on Russia. However, food products aren’t covered by sanctions in Canada and apparently, the Belarus packaging is to make it easier to sell German fish in Russia!
https://redarrowlogistics.com/international/dodging-tariffs-...
If not, what stops a Vietnamese shell company from sending "Vietnamese" goods through a port in China, or worst case, a port in Vietnam?
Who is incentivized in this system to say that this product is actually coming from China? Is it the US government regulators who just lost their jobs? Or the Businesses themselves who don't want to pay higher tariffs? Is it China who avoids the tariff? Is it Vietnam who just got paid for doing nothing?
The answer would typically be that the US gov't would monitor this. But that is not a muscle this administration is capable of. That would require nuance and strategy, and it's very clear from this move that this administration doesn't have that capability.
The foreign factory system is already in place for those that use it
I have a friend who had to get something shipped from Australia to Germany via freight, he told me intercontinental freight shipping generally takes multiple months if you aren't Wal-Mart/Amazon and you aren't willing to pay out the ass for express handling.
>The foreign factory system is already in place for those that use it
ah but there's the small kernel of genius within the corncob that is trump's insanity: which foreign factories do you use and who will they take the shipment from and and wait fuck he just gave a 90-day extension less than a week in, will the factory let me have my money back if i cancel?
The discount is from importing/re-exporting to access your market for cheaper than they otherwise would.
isn't this all just a huge pile of bluff poker?
plus remember trump could threaten nuclear attack on the ringleader.
That makes as much sense as a hunger strike over food rations.
As nice as this surge is, I'm more focused on upping my cash reserves and bracing myself for a recession.
They're not supposed to. The only people who are planning anything in this scenario are Whitehouse insiders coordinating stock frontrunning from Signal group chats.
https://bsky.app/profile/unusualwhales.bsky.social/post/3lmf...
Which is perfectly fine, now that we have Executive Order 63, Pausing Foreign Corrupt Practices Act Enforcement to Further American Economic and National Security. This is no longer something the DOJ looks for or tracks, with AG Pam Bondi having to sign off on any potential investigations after a 180-day pause.
Trump also all but disbanded the DOJ Public Integrity Section, that watches for public corruption. https://www.nbcnews.com/politics/justice-department/justice-...
Who cares? Business leaders & the politicians they helped elect are stripping the copper from the country. Whatever's left when they're done is someone else's problem.
All of this chaos is specifically because they have chosen to be complicit instead of opposing the president. If you want the madness to stop, call your representatives. Speak to your family and ask them to do the same.
So if they can find like 20 R senators who realize that they no longer support a Mad King, they're all set.
After overriding a veto, which Trump has already stated he'll use, to block Congress taking back the power of tariffs:
https://bsky.app/profile/sahilkapur.bsky.social/post/3lmak2w...
Theyll need 19 or 20 to get the inevitable veto override. I guess we'll see how these events have shaken congress and if thars enough to take trumps toys away.
Me either. I'm afraid you'll have to ask the people who did elect the copper thieves for an explanation.
We didn't vote for any of this to happen. We voted for the adult. But the reality is that this country held fair elections and the population democratically elected someone that is a somewhat ambiguous melange of amoral, stupid, craven, venal, and selfish.
Many of us knew shit like this was going to happen and that it's going to be a very long 4 years. We are getting exactly what we collectively asked for.
I'll poke my head out for the 2026 elections and see if there's anything worth saving...
Beyond that, IMO, the public doesn't really care about tariffs. Right now there is a lot of noise because this kind of capricious threat/application of tariffs is something new, but the tariff chaos will become boring background noise in a few months and people will move on to the next thing.
Yes, but the big problem is that these same business leaders and politicians are going to be the ones who get first bite at the apple. And so how they plan is going to impact what's left for everyone else.
I don't care because they burned the system to the ground, I care because they're gonna salvage what they need and nothing else.
If I don't know if Trump is literal or serious about re-shoring to normalize trade deficits, or its just a revenue gimmick, or if its all going to be delayed, or negotiated away ... am I moving any production back to the US? No.
Plants are cancelling orders as they are uncertain what the tariff might be by the time goods ship.
Etc.
Burn it all down is not a governing philosophy.
It's also unlikely that it would have been split between only two additional parties. In my state we had 5 parties on the ballot. Colorado (to pick one at random) had 12.
If there was any real movement to get non-voters to vote for a third party, there would likely be even more of them. As it is, each of those parties took a fair bit of effort to get on the ballot, knowing that at best they would "send a message".
If the message is "we don't like you", then the message has been received, for many years. But the reply is "OK, go get people to agree on somebody else", and that's the sticking point.
We don't necessarily feel it when it's up though. As seen from 2024.
I'm doing the same because I'm legitimately in fear of both economic troubles and/or losing my job as a result of all this uncertainty.
I have cut my personal spending to nearly zero aside from essentials and have been hoarding my money. It's the only sensible option when planning for one's future becomes impossible.
I have been in the job market since 1996 and had to find a job both last year and the year before. I’m on my 10th job. None of the fundamentals ever change:
Live below your means so you can take a job that pays less than you are making, keep an emergency fund, keep an updated resume and career document. Also keep an active network and always be interview ready.
Also play the political game at your job and be sure to be in profit centers not cost centers. Market yourself both internally and externally.
And exactly there is a recipe for recession. A self fulfilling prophecy.
Not that you are to blame but the reason why politicians usually avoid projecting uncertainty.
> How are businesses supposed to plan anything in this environment?
They cannot. This is how you can tell Trump was never a real businessman, but rather a TV host and a celebutante. I'd venture nearly all major American business, public and private, depend on stability in the American government. Trump's actions make it painfully clear he is not, and never was, really part of the "business" or "deal making" world.
We in Argentina feel for you: it's exactly the same for us, replacing Trump with Milei. And with the added humiliation of Milei being a lapdog to Trump.
This phrase of yours "unless congress grows a sack" is exactly how we feel about our own congress in Argentina.
Or one that makes people pray that one of those cheeseburgers he's been eating finally does something...
[1] https://www.usatoday.com/story/news/politics/2025/04/07/trum...
from 2021-01-03 to 2021-01-28 by HR 8 [4],
from 2021-03-13 to 2021-04-22 by HR 118,
from 2022-08-01 to 2022-09-30 by HR 1289,
from 2022-10-03 to 2022-11-11 by HR 1396,
from 2022-11-21 to 2022-11-28 by HR 1464,
from 2022-12-22 until the end by HR 1529,
[1] https://www.law.cornell.edu/uscode/text/50/1546
[2] https://www.govinfo.gov/content/pkg/GPO-CLERK-RULE-PAMPHLET-...
[3] https://www.congress.gov/quick-search/legislation?wordsPhras...
[4] https://www.congress.gov/bill/117th-congress/house-resolutio... (mutatis mutandis for the others)
> Each day for the remainder of the first session of the 119th Congress shall not constitute a calendar day for purposes of section 202 of the National Emergencies Act (50 U.S.C. 1622) with respect to a joint resolution terminating a national emergency declared by the President on February 1, 2025.
Referring to 50 U.S.C. 1622(c) [2]:
> (1) A joint resolution to terminate a national emergency declared by the President shall be referred to the appropriate committee of the House of Representatives or the Senate, as the case may be. One such joint resolution shall be reported out by such committee together with its recommendations within fifteen calendar days after the day on which such resolution is referred to such committee, unless such House shall otherwise determine by the yeas and nays.
> [and so on and so forth with fairly stringent time limits all the way through the legislature]
(As somebody who’s never been to the US—come on, am I the only one who finds legal questions like this to be basically irresistible RTFM bait?)
[1] https://www.congress.gov/bill/119th-congress/house-resolutio...
[2] https://www.law.cornell.edu/uscode/text/50/1622#c or https://uscode.house.gov/view.xhtml?req=(title:50%20section:...
And I mean, both of the houses participated in the first part but only the lower house in the second (AFAICT), so maybe there’s something iffy about that for example. Then of course there are all the suggestions about how the statute these tariffs were ostensibly instituted under (the IEEPA) may not actually authorize tariffs; or that if it does authorize that, then it effectively amounts to the legislature delegating all of its power over tariffs to the executive, which does not entirely sound in tune with the Constitution.
But you see how this starts to look like something you’d want to consult an actual expert on constitutional law about, not dismiss out of hand or listen to random opinions on the Internet on. It’s not immediately clear what even a perfect court would decide here.
This is also how this shambling ghoul gets what any actual citizen of earth would consider a third term. It's already done! This is why he said "you'll won't have to vote again."
The president is only 50 days into his term forever; time is stopped. Hell upon us eternal.
Anything that distracts the president from playing golf is an "emergency".
But nobody can predict recessions.
Also nearly 100% tariffs on one of the biggest trading partners is unlikely to hold for very long. There's probably a lot of options because of that.
Maybe if you already owned your final house and didn’t need healthcare or education.
Plan on relying less on the US market. Grow customers elsewhere.
The problem remains. Anyone who imports from China - which covers a lot of the economy - is screwed.
And Rest of World no longer trusts anything he says.
- not lying about tariffs being taxes on other countries that would replace us paying taxes
- not calling trade deficits tariffs and pretending to impose reciprocal tariffs
- negotiating ahead of time like normal people and clearly communicating the path forward
This is a fabricated justification. There has been literally zero public reporting of any trade negotiations post-tarifpocalypse. The only people saying there are deals being made are the White House, who have produce zero evidence of deals.
No, Trump was responding[1] to the movement of the market and in particular to the sudden spike in federal bond rates. This was absolutely not a win for Art of the Deal. There was no Deal.
[1] In "good faith", to be sure.
Honestly, that's one thing that makes me happy about these tariffs: big business is used to getting its way, and tariffs are very much not what they wanted. I've enjoyed the articles about Wall Street Billionaires getting mad and feeling helpless.
Separate, possibly unrelated question: what was trump’s goal when he created and rug pulled the Trump coin?
It doesn't make sense that the tariff policy can be both leverage in a negotiation with the ultimate goal eliminating trade barriers and also so high and predictable that they can raise something the 10-20% of GDP.
The logical conclusion is that there is no plan here - we're living in a world like England under Henry VIII, where everything is done based on the whim of the king, and the advisors try to justify it ex post facto.
They weren't saying that all along. They were saying that tariffs are a tool that will be used to reindustrialize the USA.
Full on grandmas off her meds level nonsense.
How did they do it in the past?
Do you believe that, if the environment stays this way, businesses will just cease to exist as a phenomenon?
How does that help? The steel and auto tariffs are still in place. There are plans on tariffs for other industries. You'll be hit 1 way or another.
The end goal would be 0% corporate and income taxes, funded with high tariffs. Over time the US re-industrializes.
Building a factory is a 3-5 year task, with a decade-long payback time. And at any point, tariffs can be removed, making all that investment futile.
And even then, there's no guarantee that the factory is going to help people. If it's a lights-out facility staffed with robots, then it'll just be producing more expensive goods, with all the profits staying in its owners' pockets.
> Over time the US re-industrializes.
Or just becomes another Argentina.
No part of your plan will happen.
Right, because the US doesn't have diamonds, vanilla, coffee beans or the many other things it needs? How do you avoid tariffs like this?
The US still needs fish from the penguins. What's the plan? To tell penguins to stop fishing and come to the US and work in factories?
> The end goal would be 0% corporate and income taxes, funded with high tariffs.
Well you have that right. When there's 0% of the people working no 1 will be paying corporate and income tax. It'll just crash.
> Over time the US re-industrializes.
Like it's gone? You do know the US is the 2nd largest global manufacturer right? That is even today. So do we need to blow that up 1st in order to re-industrialize?
Pennsylvania unemployment rate is 3,4%.
In the EU you commonly see unemployment rates around 10% and that is even after rather massive reeducation programs.
Why is this seen as such a big problem that these 3,4% pretty much get to decide the entire US policy?
In the EU that would be a great number and mostly normal considering that people that switch jobs or just finished studying or are just generally unemployable is counted towards that numer.
https://www.pa.gov/agencies/dli/newsroom/pennsylvania-s-unem...
How many people are employed but are in a job that barely provides enough money to survive? How many people are working 2 or even 3 jobs just to barely survive? Those people would be counted as 'employed'. You should look at these other groups of people before making judgement.
But all I hear is "we want factory work back to Pennsylvania".
If the jobs pay too low, why would you want even more low paying jobs back to USA, sewing t-shirts, making sneakers, working in a factory?
And - specifically - why do the people that want that get so much influence?
https://www.marketwatch.com/livecoverage/stock-market-today-...
Clearly some listened or simply had knowledge the announcement was coming.
https://www.snopes.com/fact-check/donald-trump-fifth-avenue-...
Its probably not so much that people trust it but either you invest broadly (index funds) and trust long historical data that the likely direction is up or you think you have more information than other people and can beat the market.
Only if you look at American stock market data. And that's extreme cherry-picking, because the American stock market is by far the best performing over the last century. What are the chances the American stock market will be the best performing next century?
So, let me rephrase, do you think it is likely that they would do anything?
I'd say arguably. https://en.wikipedia.org/wiki/Tariffs_in_the_second_Trump_ad...
Now, congress can take away that delegation. They could also cancel any declarations. But actions taken by the admin in pursuing this will almost certainly be seen as core duties by the supreme court. As such, I don't see any real opening for review in this?
https://truthsocial.com/@realDonaldTrump/posts/1143082727259...
Edit: best to note that Trump is still doing plenty to destroy the US economy, so be careful out there.
Shit like this is why! It deterred them from firebombing the entire goddamn economy to make a buck for their friends and followers!
Are you sure you remember that? Jimmy Carter put his farm in a blind trust, he didn't sell it.
https://www.usatoday.com/story/news/factcheck/2023/02/24/fac...
https://www.tastingtable.com/1204239/why-president-jimmy-car...
notes:
>Carter sold all his personal stocks, and he put his interest in Carter Warehouse and Carter Farms into a blind trust.
I’m not trying to ascribe moral character either. Power, status, fame, etc are just so much more compelling.
We need to do something about out of control inequality, such as in the past when we had strong regulations on industry, high taxes on the rich, and pervasive union membership, but lying about what is going on helps no one.
I’m trying to address the narrative I’ve seen a bunch lately that billionaires in this administration already have enough, so we can trust that they wont be financially motivated.
* Observation valid for the next 30 seconds. Certain restrictions apply.
> THIS IS A GREAT TIME TO BUY!!!
- @realDonaldTrump today at 6:37 AM PST
> For my friends, anything. For my enemies, the law.
- Oscar Benavidez, Peruvian dictator
Edit: On second thought, he wouldn't even have to, since he already has immunity anyways.
Who would stop them? Certainly not their voters.
The second order play would be for Trump to tip his associates off that he was going to do this and let them profit handsomely from the bump. Congratulations Mr President: your lackies love you because they profited from fraud but moreover you now have grade A kompromat on all of them in the form of your Signal chat records showing they were complicit in market fraud!
But the timeline would hardly be immediate. We'd have to go through considerable pain before the government would act.
Yeah, if we lived in that world, Trump would have been removed from office during his first term for all the crimes.
It's worth noting that impeaching and removing Trump from office now would actually take fewer votes than the business of overriding the import taxes he's trying to impose with "Canadian fentanyl is scary" emergency powers.
As a big bonus, voting to remove him entirely leaves everyone far safer. He's gonna have a guaranteed tantrum of scorched-earth revenge no matter what you do, but this way he won't have official power to do it with.
Trump's whole schtick was that #1 - - get countries to negotiate.
Except China. The USA gets 25% of it's bandages from there, and that's no way to prepare to defend Taiwan.
The rest of us suffer for it, except for the sad portion of the republican party who's only motivation is to own the libs and who now are congratulating themselves on how thoroughly the libs have been owned.
They do realize who pays that 2 billions?
Exhibit 1:
The US Dollar devalues against the Euro.
Some claim that is Trump‘s plan to make easier to pay the US debt.
>He once told me: “I won’t make a deal just to make a profit. It has to have flair.” Another Manhattan developer said it differently: “Trump won’t do a deal unless there’s something extra — a kind of moral larceny — in it. He’s not satisfied with a profit. He has to take something more. Otherwise, there’s no thrill.” [0]
[0]https://www.villagevoice.com/how-a-young-donald-trump-forced...
these fetishes can start to supplant material reality, real banana republic stuff. we should give the wasps and neoliberals credit to always have been somewhat immune to and disdainful of these practices.
Notable exception: Xi Jinping. So it's a contest of wills. Trump vs. the man who enforced a "zero-Covid" lockdown on 1.4 billion people.
"Hello President Trump, I am the leader of Bigorgia. I know you are a big strong manly man and I will beg you to stop the tariffs please."
But I agree, Xi Jinping is a real strongman, not a sad old man with delusions of grandeur.
Permanent damage has to our economic markets, since everyone now knows that everything can change on the whim of a single man.
Permanent damage has been done to any reputation we've had as a supporter of democracy worldwide now that we've abandoned our support of Ukraine.
Permanent damage has been done to our own faith in our country. Any pride I had in our values and democracy has slipped away, now I know that they were all illusions.
I understand this feeling but this quote has been helpful to me.
“Patriotism is supporting your country all the time, and your government when it deserves it" - Mark Twain
This is a dark time for America. But we shouldn’t turn our backs. The next few years will be painful. As patriots we need to work toward making it better. Take care of your neighbors. Work toward seeing the change you want in the midterms. Demand accountability from your representatives.
China is also likely to continue selling off US treasuries; even if that wasn't an immediate way to disrupt the American economy by itself, it's a sound idea if their trust in the stability of the US as a sovereign nation has gone down. China is also, historically, the second-largest buyer and holder of US T-bills; if that changes, it will have consequences in terms of America's deficit.
Even with global regulation. I think it would take a decade to do what the federal governments could otherwise do in a year. The EU is an instructive example here.
"For technical reasons, there is not one “absolute” figure for the average tariffs on EU-US trade, as this calculation can be done in a variety of ways which produce quite varied results. Nevertheless, considering the actual trade in goods between the EU and US, in practice the average tariff rate on both sides is approximately 1%. In 2023, the US collected approximately €7 billion of tariffs on EU exports, and the EU collected approximately €3 billion on US exports."
https://ec.europa.eu/commission/presscorner/detail/en/qanda_...
Lee Kuan Yew referred to Europe as "fort Europa" for a reason many decades ago..
Why do Peterbilt trucks still exist? Don't US truckers deserve to drive Scanias and Volvos?
The US shouldn't be taken seriously any more, world wide. Trump, and his Project 2025 conspirators, have proven that the US system of government had a loophole, and have taken full advantage of it to perform a hostile take over.
US soft-power was what allowed the US to dictate US law to other countries. US law doesn't even mean anything in the US itself, so the rest of the world should be suddenly ignoring a whole bunch of historic US-pressured behaviours.
Given the deportation discussions, I'd say one of the first things to go would be extradition treaties. I'm hoping copyright duration madness retracts entirely back within US borders as well.
Also see: https://www.bbc.com/news/articles/c5yrr0e7499o
> Confidence in the US economy is plummeting as investors dumped government debt amid growing concerns over the impact of Donald Trump's tariffs.
> Governments sell bonds - essentially an IOU - to raise money from financial markets for public spending and in return they pay interest.
> The US does not normally see high interest rates on its debt as its bonds are viewed as a safe investment, but on Wednesday rates spiked sharply to touch 4.5%
we can wipe out humanity if we get cranky
The reasonable world doesn't take Russia or China seriously. US is about to be added to that list.
Also, we're now busy building nukes. Morons.
But then these are politicians they will declare 2*infinity tariffs.
I do not care about turning the other cheek, I want him gone. This will not get fixed until Americans understand that fascism only leads to ruins and suffering.
It's a good idea to recognize and internalize this, as it's quite inherent to human nature, and won't be going away during any of our lifetimes.
The thing to recognize and internalize is that the world is a lot more win-win than our psychology has been evolved to recognize. Nationalism, realpolitik, xenophobia - all of these are ideologies that make you poorer and worse off, not giving you some secret insight into the truth of human nature.
Asia started dropping US treasury bills. 30 year bills reached a max in decades
Trump blinked.
Edit: this was front and center in Financial Times, WSJ three hours ago. Now suddenly pushed back, exchange rally being front page news. People don’t understand how close to financial apocalypse we have been. Somebody in the WH scared the shit out of Trump.
His first round with Canada back in February, and MAGA insisted "he won"
Then came back and tried the same thing again two months later. Same response from the Canadian side. Same slight backing off, reorganizing, but confusion, and nobody seems to actually know which tariffs apply and which do not.
It sounds now like 10% for the whole world, but still 25% steel and aluminum and other tariffs on Canada, the US's biggest trading partner and customer? How insane is that?
They're "flooding the zone" with confusion and chaos, and making money in the process. Anybody who wants to maintain power and influence and money has to get close to him, avoid criticizing him, and then they get the inside scoop.
It's mafia level crap.
> "Perhaps even more alarmingly, U.S. Treasury markets are also experiencing an incredibly aggressive selloff..."
> The largest holders of Treasurys are Japan, China and the U.K.,...
https://www.ft.com/content/0005e091-930d-46ff-9e81-8591704a9...
> "Hedge funds have trillions tied up in this kind of strategy,” he said. "As things spiral, they’re being forced to sell anything they can — even good assets — just to stay afloat . . . if the Federal Reserve doesn't step in soon, this could turn into a full-blown crisis. It’s that serious."
> One hedge fund manager said: "Those huge hedge funds with trillions of dollars of Treasuries relative value trades will blow up today if the Fed doesn’t bail them out."
https://www.marketwatch.com/story/all-eyes-turn-to-treasurys...
https://www.cnn.com/politics/live-news/trump-tariffs-cnn-tow...
I have a moderate understanding of finances, but for me this was the Siamese cats from the aristocats playing around the nuclear football
Now is the ripe time, 90 days, to make a deal with the US and offer the best terms.
The whole point of Trump is to leverage uncertainty, make an unrealistically high water mark, then go down from there (to a point thats still very favorable)
This rationale can explain many actions he’s taken. Is it reckless? Risky? For sure. Does it work? It has in the past, let’s hope it does for the global financial system, for everyone’s sake.
Did it? They said it did, but I wouldn’t trust a word they say.
What concessions has he actually got from the rest of the world? Was it worth it? It seems to me the two biggest trading ‘partners’ (China and EU) were escalating, not conceding.
Multiple countries offered no tariffs, like Israel and Vietnam I think? EU offered 0/0 for cars/industrial. SK president said they will negotiate.
> Was it worth it?
Time will tell.
Yes. Trump and his administration lie more often then they tell the truth. There's virtually no reason to negotiate under those conditions, as random decisions will often have indistinguishable outcomes.
All the countries who chose to do nothing, evidently, came out on top. Because the decision was reversed. Those attempting to conform to the chaos will be whiplashed around, like fish in a Tycoon. Doing nothing at all proves to be an equally effective strategy, on average.
I doubt everything those charlatans say. They are liars and will say anything to maintain the illusion of competence.
What terms? Remember, the tariffs were not reciprocal -- that was a boldfaced lie. They were based on trade imbalance. So what, Cambodia is supposed to pledge to buy ... what exactly? ... from the US in order to balance its trade?
The reason Cambodia or Vietnam have a trade imbalance is because US/other companies have factories there to produce the goods. You think those companies are going to set up garment and shoe factories in the US? With what labor?
The whole thing reeks of a shockingly inept understanding of global trade and economics.
Global financial reacted to the idiocy adequately enough to tell you what it thinks of it… You are trying to rationalize something that is as far from rational as it gets…
This isn't 1946 when the United States was heads-and-shoulders the most prosperous nation on earth, with most other developed countries having to rebuild. Other regions such as the European Union, China, and the bloc of East Asian democracies (Japan, South Korea, Taiwan) also have strong, competitive economies with a high standard of living for many of their residents. If they got together, it's possible that they could move to some alternative to the US dollar should they wish, and with Trump's bullying, this might just be the push.
Who knows.
> China issued an alert warning its citizens and students of the potential risk of traveling in the U.S. and attending schools there. > > “Recently, due to the deterioration of China-US economic and trade relations and the domestic security situation in the United States, the Ministry of Culture and Tourism reminds Chinese tourists to fully assess the risks of traveling to the United States and be cautious,” the ministry said in an alert.
Can't blame them honestly
Avoiding travel to the US right now is a perfectly reasonable decision.
a. Chinese retaliation. I don't think they are going to start arresting Americans, but it might get uncomfortable if I don't have my passport in the subway station.
b. American retaliation. My wife has a greencard, this is actually worrying me more than anything, although as far as I have heard so far, we should be OK.
Trip is still on. I'm really interested in how China has changed since I left 8 years ago.
Drama, manipulation, and a US government tactic, all in one.
I forget all the details, but some constituency once came to FDR to ask him to do something. He likely leaked that he was planning on doing so to major Catholic organizations in America, and when there was outrage, turned to the first party and told them that he'd love to, but his hands were tied. He never intended to do anything in the first place, he just wanted a convenient scapegoat.
This doesn't make any sense. Why not just go with 10% tariffs across the board? There wasn't going to be any pushback, it should be clear at this point. Or why not just leak the plan, and then say "I guess it has to be 10% because business leaders won't accept higher."
This isn't masterful juggling, it's improv comedy.
Admin proxies have said tariffs are to pay for tax cuts, they've stated they're intended to bring back manufacturing jobs, they've stated we should prepare for a lengthy trade war and accept the higher prices like men, and while some proxies have said this is a negotiation tactic others have stated unequivocally that this is not a negotiation tactic.
Bold assertions like yours are easy to make with the benefit of hindsight. What do you predict tariff rates to be in a week? A month? A year?
You can get rich this way, but you can't get respect. The fact that half of a respected nation opted for this approach continues to baffle me.
And maybe I should say "formerly respected nation", the global perception of the US goes rapidly down. I guess the question now is will the nation actually profit from that.
In short he argues that there is no point in making $50 chinos. Similarly to Italy, the US should focus on regional branding and high-end artisanal products.
I would argue that ship has sailed under Trump. The US was in a prime position to brand itself via soft power and the media, and now it's actively being boycotted.
One of my biggest concerns is the value of the dollar. If foreigners are discouraged from doing business with America either due to tariffs or due to other matters, how does this affect the dollar, which is a fiat currency? The US dollar is currently the world's reserve currency, which is the result of the United States' emerging victorious from WWII while Britain, holder of the world's previous reserve currency (the pound), had to contend with rebuilding as well as dealing with the loss of its empire. Fiat currencies, by definition, are not backed by assets, but are instead backed by "faith"; not in the religious sense, but in the faith that people have in the government issuing the currency. How will the world keep the faith if the custodian of the dollar acts so recklessly?
For many years I've been concerned about deficit spending and easy-money policies from central banks. However, for the past few months I've become very concerned about Trump's policies that alienate our allies and partners. What Trump and the rest of MAGA simply do not understand is that the United States is part of an interconnected world. American strength is more than just weaponry; it's also in our economy and our reputation.
Unfortunately Trump and his cabinet have done extraordinary damage to our nation in less than three months. He's like an angry man with a baseball bat smashing up irreplaceable artifacts in a museum, and sadly there is no police to stop him, because he is the chief of police. He is by far the worst president America has ever had to endure, and if this continues our nation will end up at war, either with itself or with other nations.
And why should we believe them? If it was the strategy, you could have made the tariff announcement into an acrostic or something.
Advisor A: So we're all agreed then. 10% tariffs across the board is our strategy, except China, because Xi is a special boy.
Advisor B: If we announce that, everyone will freak out. There will be rage and panic.
Advisor A: That's where the tactics come in. We announce greater tariffs first, according to this super sketchy formula my intern cooked up with ChatGPT.
Advisor C: That's not what we agreed!
Advisor B: How will that stop the rage and panic?
Advisor A: It's tactics not strategy. We walk it back just before it hits. People will be too busy being relieved to be raged and panicked about 10%. We get the policy we want; the people / markets / etc. will only freak out for a few days and then go back to normal.
Trump: I like it. (Opens Resolute desk drawer.) Here's a signed copy of the Art of the Deal.
Advisor A: Thank you sir! I will cherish it for the rest of my days.
Again, the above is my guess as to what happened, under the (perhaps questionable) assumption that Bessent is telling the truth. ("How likely is this assumption?" is a question orthogonal to the point I'm trying to make, and therefore, out-of-scope for this post.)
Seems to show people knew it was going to happen a few minutes before he posted.
But he illegally (without required notice period and specific reason provided to Congress) fired them right at the beginning of his term.
> are completely insane
More likely detached from reality, laser focused on personal gain, and punishing perceived enemies.
He owns his own social media stock (DJT), where he post this morning "THIS IS A GREAT TIME TO BUY!!! DJT" to his followers. Attracting more to his social media company.
He has a meme coin in cryptoland, and now via tariff manipulation, he can guide select people to place big bets on the largest derivatives market.
Grifter crypto scams aren't necessary when it's possible to fleece taxpayers directly.
"Alright, I think people knew of the tariff pause and traded it beforehand ... "
This is all so obviously dumb and I’m frankly astounded by so many people (especially here on HN) playing devils advocate or, I don’t know, honestly believing that this all makes sense.
Even if you agree with the stated (also somewhat incoherent, by the way) goals why do you think this implementation can achieve any of that?
Tariffs are appealing to him because they are incredibly forceful blunt instruments over which he alone has almost complete control. They give him immense, immediate influence over the entire world. What we're seeing is that the US President today, if the full capacities of that office are pushed as far as possible without violence, is arguably one of (if not the) most powerful human beings ever.
Beyond this, Trump has said that one of his greatest weapons is uncertainty. He wants to be feared. Having people genuinely afraid of you is the next step of power that he is already flirting with by posting videos of people being blown up in warfare on social media.
That's the true aim behind all of this constant course shifting. The ultra rich, those who have large amounts of liquid assets or outright cash, can make bank at the moment... buy the dip. Even if the markets dip another 20%, they'll rebound soon enough.
It's a good idea to hedge against future trade uncertainties.
After COVID some Danish and German companies began looking for non-Chinese alternatives for electronics manufacturing. The only area where China is the absolute better alternative is PCB manufacturing without mounting chips/components. The Danish and German companies get tens of thousands of these bare PCBs from China. The chips/components are from Taiwan, South Korea, the US, Italy, and Germany and can be cost effectively mounted in Denmark and Germany.
In the automotive sector alone - GM, Ford, and Stellantis all flipped the master breaker to "off" on a number of plants and sent everyone packing.
That hire-back will not be instant. People are going to miss payments for rent/mortgage, car loans, utility bills, etc.
Let's not forget that many companies hit the brakes, hard, on exporting goods to the US - so there's going to be the shipping equivalent of those traffic "waves" because two hours ago someone on the highway panic-braked
Still I'm sure I unintentionally missed many examples of people who've been negatively affected by this saga. I didn't mean anything by that, it's just ignorance or lack of thought on my part.
Let's not forget everything else he's doing because there is nothing good in the plan.
The hike will not be 10% on consumers. In most cases the seller will eat a good chunk of the cost otherwise it won't sell.
Take coffee, tea, or chocolate: Americans buy a ton of those, there’s almost no domestic production, and most of the market lives on tight margins. Trump’s tax hike means that the average consumer’s choices devolve to paying more or buying less.
If they raise prices by 10%, consumers will buy significantly less. There's a sweetspot somewhere for max profit, it's not 10% and probably not 0% either.
Coffee and tea are very cheap when you buy from a retailer and make it yourself, 10% is nothing anyway. Stuff like starbucks have crazy profit margings. Chocolate is a delicacy that shouldn't be consumed in large quantities anyway. That shit should have a 200% tax.
I think that was the real reasons that tariff effects were postponed, the increase in interests in the bond markets would have been too fatal too quickly.
As it is it lets the billionaires hold us hostage and the wealth gap will continue growing.
The stock market is a barometer for future predictions.
Stocks going down meant we were on track for everyone to have reduced buying power, which would impact company's bottom lines, which would make them less valuable.
Trying to see this as class warfare between investors and average people is missing the point.
Furthermore: Stocks are up, but yields did not drop. If this holds, it's still not good for the average person. Expect mortgage and auto rates to go up, combined with that 25% tariff on autos that wasn't delayed.
I know that with RSUs etc people treat it that way. But no the risk is real.
Yea, I want my president looking out for financial vultures leveraged to the hilt
fxxk Xi, fxxk Trump,
The most important thing that can be done for the prosperity of America right now is to put an end to the senseless fraud and nonsensical policy promoted by the snake oil salesman of the MAGA movement.
I’m convinced this was his plan all along, and his friends were all in it.
What's really amazing is all the muttering from "Very Important Wall Street" type people who are saying that he's insane. Like... with that kind of salary, weren't you paying attention? We've known he wasn't right in the head for a while now. Maybe they should be replaced by AI.
Whether anyone bought into it is another matter, but opening factories is part of what they said they wanted.
The US news is pretty useless here. It's more nuanced than they would like to admit. Foreign sources of news are the most instructive as they're actually covering the options realistically.
The weirdness of this administration has created a lot of volatility. With American-style options you are allowed to exercise early, so if you think there's going to be a ton of ups and downs in the next few months, I wonder if this could be lucrative.
I might try this just as an experiment with one of the cheaper options.
Also, the current VIX is the same as January of 2020. If you believe the current state of the world is less certain than the outbreak of a global pandemic, I have some options to sell you.
> Also, the current VIX is the same as January of 2020. If you believe the current state of the world is less certain than the outbreak of a global pandemic, I have some options to sell you.
I don't know if it's more volatile, BUT it it has shot way up since yesterday, and it doesn't seem too weird to think that it will go down to the numbers we had yesterday.
Puts are a necessary hedge now for your 401ks or stock grants.
In a sane world all these people would be ignored by media outlets moving forward.
The market is absolutely delusional right now. It's not pricing in how devastating this general uncertainty is, nevermind the fact that massive tariff hikes are still in effect.
In 3 months, sell your positions, let him play his stupid games and re-buy once he backs down, because he will. Or just hold and ride it out.
10% sounds like where we’ll default to in the long-term because that was the ‘base rate’ for everybody anyway. He just wants to rattle his sabre, especially with China.
It’s quite pathetic, really, but weirdly I feel slightly more calm about the situation now that I realise he hasn’t got the bottle to follow through.
That has always been the case with him. That's literally his negotiation tactic.
I couldn’t tell whether he would really go through with this or not. Now it’s clear he has no bottle at all. So weirdly is more of a comfort.
Remember when presidents used to put their family farm into a blind trust to avoid any accusation of impropriety?
If you want wealth, stay close to where the secret knowledge is.
Markets operating at the whims of a capricious King (is there even a functioning government right now?)
....Otoh this is good in a meta sense, tells about the level of resilience of the capitalist system, I think we should treat this entire fiasco as one of those controlled forest fire sort of things.
Like...anytime someone tries to mention JIT or other corporate 'efficiency' nonsense, we can refer to these sort of shenanigans and shut them down.
He's also planning a $100M military parade in DC, apparently on his birthday (although he denies that point).
He's a wannabe dictator - seems same motivation for Greenland, Panana, Canada (51st state), maybe also strikes on Houthi.
This would be straight Roman Emperor stuff.
Makes me think of Woody Allen in "Bananas". Maybe Trump will play dress-up as general too? Would a fake Castro beard be too much to ask ?
Tariffs let him wave his dick around. Cutting taxes requires passing legislation. Raising other taxes requires passing legislation.
On margin.
Both the ups, and the downs (short trades).
Imagine being able to make it an open secret that if someone pays you and publicly kisses your ass a little, you'll send some of those advance hints their way.
Imagine how much money you could make in a matter of weeks.
He's threatening Iran because he's a Russian asset right? Bombing Houthis too? No, someone else benefits from those, maybe he's an asset of that country?
But of course you are totally right. No adults anywhere. Keep thinking that Europe can count on others to pay for its defense while buying all the energy they need from Moscow. At least you have adults in the room, right?
The political subtext is "Follow me and I will make you extremely rich."
Congress, the Senate, and the Supreme Court won't touch him after this.
It does not accomplish much when you try to redirect people with what-aboutisms. Mostly it just betrays your own biases and politics.
Let’s not start echoing far right talking points. Immigration is a topic that should be approached with measured language. Terms like ‘decimated’ is not helpful.
Not wanting your culture to erode is not a "far right talking point". Mass immigration has absolutely decimated Europe.
He's not unstable, just very aggressive. He did have a plan.
We can argue about the merits of his plan, but dismissing him and his advisors as stupid or insane is underestimating them.
It ain't his. https://en.wikipedia.org/wiki/Tony_Schwartz_(writer)
> We can argue about the merits of his plan, but dismissing him and his advisors as stupid or insane is underestimating them.
Pretending the man didn't repeatedly bankrupt his own companies and stiff his vendors is underestimating him. We've decades worth of knowledge about how "his plan" goes.
This is a retreat by Trump. It's him losing. It makes him look like a joke. Or, more correctly, more like a joke.
Trump desperately wants tariffs. He thinks they're free money. He has been saying this for years and still people desperately try to sane wash it into some masterful 4D chess. The only reason this laughable 90-day pause happened is because the US house of cards is on the precipice of absolute collapse, so Trump had to bow into Bessent's attempts to turn this into some sort of China containment.
So are all those factories coming back...or aren't they? Are tariffs going to replace income tax, or aren't they? Something something war with China. Just absolute insanity by a group of charlatans, self dealers and clowns who have no idea what they're doing.
I think there are two things at play here.
1) Narrow the gap between the wealthy and the rest: attempt to reduce the US public sector, backtrack on globalization, and enact policies to benefit the median American, not the mean American [1].
2) Prepare the US for possible conflict with China (maybe over Taiwan) and avoid supply chain disruption that would make Covid look mild.
I think both of these things are sensible positions to take.
When you look at it through this lens, it starts to have some logic to it. Again we can debate the merits and drawbacks of this strategy, but I think it's what is behind everything. Things like his stance on Panama start to fit into the picture when you look at it this way.
It is not the actions of someone stupid or insane.
This could absolutely be all about asserting dominance over China. It could be a great way to deter or blunt the threat of war. It might backfire horribly. We shall see.
He is stupid. You just have to listen to him speak to understand that. But he doesn't invent policy, he has people for that.
Like, listen to what Trump himself says to justify the pause-
https://bsky.app/profile/atrupar.com/post/3lmfosw5usb2f
Basically "everyone was saying this was really stupid -- getting "yipeee" -- so I paused it". Not "Haha now I've got them where I want 'em!"
These pauses and this chaos is literally the worst of both worlds. Christ, he would have done better either cancelling them or going full bore.
Congress needs to remove his ability to levy tariffs under his imaginary emergencies.
Moreover, from the outside (European here), it looks like the US president can literally do whatever he wants without being subject to regulations or facing any consequences - pretty much like a dictatorship. No discussion, no parliament, no opposition taken into account. Crazy.
https://en.wikipedia.org/wiki/Gödel%27s_Loophole
We're witnessing that there doesn't need to be any single clever actively exploited loophole. A two-party presidential system can become a dictatorship if one party holds just enough power across all branches of government to not resist what their leader wants.
Even if they weren't strongly correlated, you would still be able to do a coup every 200 years or so.
"Burn it all down" is popular on both the far right and far left.
it looks like the US president can literally do whatever he wants without being subject to regulations or facing any consequences
Yes, presidents have been given far too much power to do whatever they want by declaring a fake "emergency". It's inexcusable that Congress hasn't put a stop to this.
A lot of people in USA felt they were entitled to their slice of the American dream, did not achieve it because we stopped building houses therefore you can't buy one on a high school education like our parents and grandparents did. Add in what appears to be somewhat of a collapse in people starting relationships/families and you suddenly have a massive segment of the population with little to lose.
I presume many on the HN community are insulated from this reality of life in USA.
Which also shows that lack of home ownership cannot be the driver of this situation. It might be one of the lies of the left, their "trans" story. Where I'm from the left is also pushing this housing narrative but it's not pulling in the votes, its impossible to solve, and i dont know if its the problem enough people have.
Though details like what color your house is arguably are first amendment protected speech and so the federal government could do something (but out likely go to the supreme court - in turn depending on the justices not the election results.)
Classic right wing playbook. Here they defunded immigration services and then called for a crisis because there was not enough space to put all asylum seekers and there was too great a backlog to get it all processed in time.
The last 8 or so were created by Trump. Like you said, he's just doing what is already allowed.
https://en.wikipedia.org/wiki/List_of_national_emergencies_i...
Is it that much different from EU? Where was the discussion before mass immigration? Where was the opposition taken into account there?
It's interesting how it's mostly men that flee as well.
I mean, I'm not saying that mentality is racist. But I am saying that every racist who has ever existed has had that exact mentality.
They would already be impeaching if it was a Democrat.
He starts to tell that everyone is maintained by the US - lol what?
He starts blaming Europe for being a parasite (thanks!) and treating Zelensky like everyone has seen live.
No one is telling him that his actions will have consequences for the US in their international credibility (gone) and relationships with partners (ruined)?
One day, he does a totally broken linear regression and applies no sense tariffs to every country in the world (no Russia - weird enough).
It's well known that tariffs are not a way to attract investment in your country - there's a lot of theory and historical examples that demonstrate that.
Moreover, it's just absurd to think that these kinds of actions are going to make American (!) corporations, now producing elsewhere, back in the US. No supply chain ready, lack of resources, ...
I don't know - it looks like a single man has too much power and no one around him is helping him make better decisions (for the country) in the long term. On the contrary, it looks like all the decisions are pretty much market manipulations in order to make some "friend" get some money.
But again, this is what it looks like from the outside - and it's quite worrying
Which makes them fairly uninvestable.
Not only stock market. The whole "Project 2025" point is to turn everything from the "rule-based" approach to "unitary-executive's-really-a-King's-whim" approach.
Just today - the export control or lack of it on specific Nvidia chips isn't really result of security needs of US, instead it is just a result of Jensen getting a dinner at Mar-a-Lago. Just like in Russia.
Trump 2 isn't Trump 1. These are uncharted waters indeed
1. US is decoupling full on from China. Any ally negotiating will have to show that they are not helping china to export, by putting up similar tariffs on China. Basically, declare your allegiance. And so far, no one has unexpectedly sided with China.
2. For the laggards who are waiting until the last seconds to move away from Chinese supply chain, trump is giving them more time but also telling them, hey it’s your last chance
3. Short squeeze for those who dare attack US economy
4. Navarros is the chief architect and his vision is aligned with trump to fully execute his plan. Just go read his book, he lays it all out
That Alibaba stock you have? No, its a share from a seperate company setup in the Cayman Islands which should track the Alibaba stock. They are circumventing a Chinese law that makes foreign investment in Chinese companies illegal. It's a bad idea to own these.
The volatility levels are unseen since Covid and GFC.
People’s livelihoods will be at stake soon enough.
US voters disagree.
Some polls would disagree with your assessment:
> A Wall Street Journal poll released Friday[1] found 52 percent disapprove of Trump’s handling of the economy, compared to 44 percent who approve. The disapproval is 12 points higher than the 40 percent who said in October that they had an unfavorable view of Trump’s economic plans.
> Pollsters found 54 percent said they oppose placing tariffs on imported goods, while the percentage who said tariffs will raise prices on consumer products rose from 68 percent in January to 75 percent in March.
* https://thehill.com/homenews/campaign/5236712-trump-tariffs-...
[1] "Americans Were Souring on Trump’s Economic Plans Even Before Tariff Bloodbath":
* http://archive.is/https://www.wsj.com/politics/policy/americ...
A) This is obviously wrong if you spend even 5 seconds looking it up, unless you misspelled "2024"
B) You can't just ignore that they spent several days telling financial journalists it was just a negotiating tactic and leading them to believe this might be peeled back quickly.
- April 9th: "THIS IS A GREAT TIME TO BUY!!! DJT", then 4 hours later announce a 90 days tariff reduction, markets jump nearly 10%
This level of market manipulation orchestrated directly by a head of state is something you only see in totalitarian states.
The US is moving into a very serious situation. These people won't ever voluntarily leave the Oval Office.
We could...oh...increase are R&D on automation, AI, green energy, electric vehicles dramatically, we could focus on better education and better infrastructure for our cities (like lightrail in Seattle to where I live that doesn't take $200 billion and 2 decades to build). We could have just fought China with a better product. We could lean into our chip advantage that will only last at most a decade anyways. And many of those fit in with Conservative philosophy even (who doesn't want less regulation and cheaper/quicker construction, well, at least moderates like me would).
But no, we doubled down on culture wars and going back in time to when America was more self sufficient but less rich.
i dont want china to be some colony of the west. i want china to become as rich as the west so that they can have clean domestic consumption with strong worker protections and rights
It's a good reminder that there are a strong cohort of Trump's followers who will always side with him (to a religious degree), and who have a deeply held us-vs-them mentality.
[1] https://edition.cnn.com/2025/04/03/business/tariff-related-l...
[2] https://www.thebanker.com/content/250b43e2-67e2-46ba-93ea-8a...
Blink twice if you need help escaping the cult.
The mental gymnastics you have to do to think this dildo has any feelings for you and/or the working class is amazing! Gold medal.
I'm not saying you owe the person in question better, but you owe this community better if you're participating in it.
As for the actions themselves, they're pretty much his standard operating procedure:
> I think I can get away with bullying these people, so I will
When he talks about the existing agreements being unfair, he means that we have leverage that we're not using. The proposed tariffs are proportional to the trade deficit because the trade deficit is a reasonable proxy for how invested that country is in its economic relations with the US. You can extort more from somebody who is heavily invested, and less from somebody who is lightly invested. It's a classic protection racket, just on a sliding scale.
He's trying to look ignorant because it's at least a better look than showing the malice that actually drives him.
There is sound reasoning behind the tariffs, and I can at least understand the motivations. However, to execute the vision behind the tariffs would be tantamount to severely contracting the American economy, and the voters would never agree to go hungry in order to militarily independent.
He knows what he's doing, but him and his ilk are openly lying to the American public because no one would ever agree to it.
If about 30 million people count as a fringe number, yes.
He is still delivering for me on the reasons I voted for him but this chapter has been a debacle. Fun part is with Trump as president every week is a chapter, for most presidents a chapter is 2 years. So excited to see what's next.
If he delivers on China and effectively resets the world financial and trade picture in our favor then well done but so far not impressed.
Whole world celebrating the guy who started the fire putting it out.
"Lisan Al Gaib" JFC
Irrespective of what you think of Trump, decentralization of production capacity is a good thing — maybe even essential. If this continued for, say, another twenty years, the West and the rest of the world would be completely stripped of all ability to defend themselves. Literally everything from picket fences to rolling stock to tableware is coming from one country.
Trump's actions will probably boost European, Canadian and Australian industries a bit more now. Investment in the US will be a hard sell for companies that care about the stability and level-headedness of governments where they operate.
Every other approach attempted to date has been milder, and hasn't worked. But we'll see if he sticks to it.
A lot of things were working even if they did not change everything overnight. And the changes that will come to the world order and industries following this administration will on the whole be detrimental for the US economy and position in the world.
> A lot of things were working even if they did not change everything overnight.
We can disagree. The frog was slowly getting cooked.
China's trade surplus has reached 1 Trillion dollars, and has seen consistent YoY growth for decades. Such asymmetry is dangerous in the long run. Now, none of this is China's fault. They did the right thing for their country and their population.
> And the changes that will come to the world order and industries following this administration will on the whole be detrimental for the US economy and position in the world.
That remains to be seen. I have no way of knowing, but I would assume that it isn't just the US which is concerned about this.
Is it yuppie college grads working in silicon valley startups who have always had a thick abstraction layer between them and the system that gives them their paycheck? Is it trolls? Is it lifelong diehard contrarians (the same thing as trolls really)? Is it something else?
If what Trump was saying about making the country rich were true, then sure, why would people complain? But it's not true; just a lie told to placate his followers. It's another version of "diamond hands" or "ride the dip" that you hear from people pumping and dumping crypto stocks.