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Donald Trump just imposed a 25 percent tariff on virtually all goods produced by America’s two largest trading partners — Canada and Mexico. He simultaneously established a 20 percent across-the-board tariff on Chinese goods.

As a result, America’s average tariff level is now higher than at any time since the 1940s.

Meanwhile, China and Canada immediately retaliated against Trump’s duties, with the former imposing a 15 percent tariff on American agricultural products and the latter putting a 25 percent tariff on $30 billion of US goods. Mexico has vowed to mount retaliatory tariffs of its own.

This trade war could have far-reaching consequences. Trump’s tariffs have already triggered a stock market sell-off and cooling of manufacturing activity. And economists have estimated that the trade policy will cost the typical US household more than $1,200 a year, as the prices of myriad goods rise.

All this raises the question: Why has the US president chosen to upend trade relations on the North American continent? The stakes of this question are high, since it could determine how long Trump’s massive tariffs remain in effect. Unfortunately, the president himself does not seem to know the answer.

In recent weeks, Trump has provided five different — and contradictory — justifications for his tariffs on Mexico and Canada...

...more in the article.

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[-] FlashMobOfOne@lemmy.world 59 points 22 hours ago

Just my opinion as a layman: the tariffs give his corporate backers all the excuse they need to jack up prices even higher.

[-] MuskyMelon@lemmy.world 43 points 21 hours ago

And when he takes the tariffs off, the prices never go back to the original starting point.

[-] Benjaben@lemmy.world 41 points 22 hours ago

That, plus it seems very likely that he and friends are just manipulating the market to trade on the predictable moves he's causing. Ya know, the kinda stuff that earned Musk some mild hand slaps and theatrical pearl clutching (in addition to giant financial benefits) in recent years.

[-] banghida@lemm.ee 13 points 22 hours ago

It's basically how Musk got rich. Intelligent market manipulation.

[-] HK65@sopuli.xyz 4 points 6 hours ago

Intelligent market manipulation.

Not really intelligent, just blatant. He bet on the US and the NYSE enforcement mechanisms not actually working, and he won the bet. Same with Trump, except he bet against the US constitution.

It really feels like the kids of the people who carefully destroyed the checks and balances in the US and created a world order where they can quietly pull strings took over, and the kids don't understand the value of discretion and are just seeing what they can get away with.

[-] banghida@lemm.ee 1 points 5 hours ago

But he was also intelligent. He presumed that the bulk of money out there is comically dumb money, and he played that mass to his benefit. I remember watching 5,6,7 years ago how he would deliberately make Tesla stock look bad in the short term, to lure in suckers to short with high leverage, only to promptly reverse it, destroy the shorts and use their capital to make a new all time high. All while perpetually rewarding those who just hold and trust the man at the helm.

If this method sounds familiar, it was also used by the Tether clan to propel Bitcoin. But with a healthy dose of freshly printed fake money as well.

[-] Randomgal@lemmy.ca 2 points 18 hours ago

That's a weird way to write inheritance.

[-] Manos_in_lemmy@lemm.ee 5 points 21 hours ago

Agree, inflation can theoretically increase not only prices, but wages to compensate the increased cost of living, therefore appear as a boomed GDP, bringing the debt to GDP ratio lower without actually reducing debt. Eu, china, Russia all have much lower debt to GDP. Of course in reality inflation is hard to manage once it gets out of hand, and the levels of interest rates don't give enough space for corrections, and the problem of inflation being the reduced consumption leading to a lesser increase of GDP.

[-] Saleh@feddit.org 4 points 17 hours ago

GDP is always calculated in nominal and real (inflation adjusted) GDP.

Inflation does not reduce debt to GDP by increasing the perceived GDP, but by devalueing the debt owned, as it is a fixed sum with usually interest rates fixed for a certain time

[-] Litebit@lemmy.world 1 points 20 hours ago

yup, it forces everyone to raise prices, including competitors.

this post was submitted on 05 Mar 2025
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