What A Day Trump Tariffies The Markets
Apr 4, 2025
Scott Lincicome, Vice President of General Economics and Trade Policy at the Cato Institute, dives into the fallout from Trump's steep tariffs. He discusses how the tariffs devastated global markets, wiping out over $3 trillion in U.S. stock value in a day. Lincicome analyzes the unpredictable impacts of tariffs on international relations and U.S. exports, as well as the ripple effects on companies facing increased challenges. He also highlights the absurdities of the mixed public reactions and the serious implications for consumers.
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Trump's Tariff Plan
- Trump's tariff plan applies tariffs to imports from every country, based on their supposed unfair treatment of American exports.
- This is based on the idea of a national emergency declared by Trump due to the U.S. trade deficit.
Tariff Calculation
- The tariff calculation was surprisingly simple, figured out by someone at a grocery store.
- It involves a nation's trade deficit or surplus with the U.S., divided by its import volume, then halved.
Tariff Retaliation
- Countries are retaliating against U.S. tariffs with their own tariffs, targeting politically sensitive exports.
- They also use asymmetric retaliation like targeting investments and intellectual property.