Stupid Trade War

Markets didn’t want to believe that Trump really meant broad tariffs, because they’re such a plainly bad idea.

At the time of writing, dramatic moves in all three affected currencies make clear that doubt persisted even after President Donald Trump’s verbal announcement Friday

Trump himself suggested to reporters Friday that the levies weren’t meant as fentanyl or border bargaining tools, but were rooted in large trade deficits

That’s an argument for sustained tariffs, which would have sustained effects. 

If that’s right, the longer-term consequences for the global order are profound…

John Authers Bloomberg 3 February 2025

https://www.bloomberg.com/opinion/articles/2025-02-03/how-stupid-is-this-trade-war-let-me-count-the-ways

The FT View The absurdity of Donald Trump’s trade war

Donald Trump has fired the first shots in what threatens to become a devastating trade war.

He made use of the International Emergency Economic Powers Act, yet that law has not previously been used to enact tariffs. 

The courts and Congress ought to block them.

If they do not, the damage will be severe. Trump’s tariffs alone will quickly feed into higher US inflation and reduce growth. 

The justifiable retaliation will amplify the effects. 

Financial Times 2 February 2025

https://www.ft.com/content/069a3af8-261b-4848-b19b-4fe82d324c64

Welcome to the New World Order

https://englundmacro.blogspot.com/2025/01/welcome-to-new-world-order.html

Varför gör Trump som  han gör?

En av förklaringarna är att USA - och därmed hela världen - har ett problem.

- It is our currency, but is your problem.

https://englundmacro.blogspot.com/2025/02/det-ar-dollarn-bakom-allt-monetary.html

Tillbaka till Rolfs länktips 3 Februari 2025

https://englundmacro.blogspot.com/2025/02/rolfs-lanktips-3-februari-2025.html