Trump's 'Liberation Day': US govt imposes tariffs to 'reset' global trade, 'MAGA', 'defeat' China - Will it work?

Puma

Puma

The Living Force
FOTCM Member
Well here we are, this is Liberation week according to President Trump, this will start on April 2nd, the recovery of the wealth that the world has taken from the US. This is already enough for the globalists to turn on the alerts and set in motion all the Wall Street machinery to show people that nationalism is a bad idea.

Also, it is officially the week of the "reciprocal tariffs", the so-called trade war and some financial missiles have already been launched or are ready. Tariffs on more than 25 countries. Financial analysts say US tariffs will impact $1.5+ TRILLION worth of imports by the end of April.

Yesterday the panic started in Japan and this meme certainly describes it perfectly.

https://twitter.com/x/status/1906504583427367252

Japan's Nikkei enters correction as Trump's impending tariffs drive sell-off in Asia markets​


Asia-Pacific markets plunged Monday ahead of U.S. President Donald Trump's fresh round of tariffs expected later in the week, with Japan's Nikkei 225 entering correction territory.

The benchmark Nikkei index plunged 4.05% to end the day at 35,617.56, losing nearly 12% from its December high.


This morning the S&P500 also returned to correction territory.

Take a look at the Economy Policy Uncertainty Index. Policy uncertainty is currently above just about any crisis in modern US history. We are seeing ~80% HIGHER uncertainty levels than 2008. As a result, market swings are widening and we expected an extremely volatile week. The Kobeissi Letter​
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Typically, gold prices rise when investors seek a "safe haven" asset during times of uncertainty. For many, this is a good indicator of what the expectations of large capitals are for what is to come, since gold is often seen as a hedge against economic instability.




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Puma said:
Typically, gold prices rise when investors seek a "safe haven" asset during times of uncertainty. For many, this is a good indicator of what the expectations of large capitals are for what is to come, since gold is often seen as a hedge against economic instability.
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In a real crash phase, gold crashes too and cash is king.
 
daddycat said:
In a real crash phase, gold crashes too and cash is king.
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Yup. Warren Buffett, through his company Berkshire Hathaway, keeps a substantial amount of cash, recently reported at $325 billion as of late 2024, but we are talking about an ultra-rich. Buffett values liquidity as a safety net because this ensures he can weather financial storms without borrowing or selling assets at a loss.

Ordinary people will be able to convert their gold into cash or food in times of crisis and for a while. A complete collapse would bring the value of the currency to zero and the only thing that can be exchanged is shots.

Currently the average American is having trouble maintaining a substantial cash or gold reserve and credit is already showing problems.​

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20250401_004554.jpg

Signs


Entertainment & discretionary spending first to go?

Nevada Gaming Control Board, reported a 13.8% year-over-year drop in gaming revenue on the Strip for February 2025. The decline has been attributed to factors like the absence of a major event like the Super Bowl.
​

Nevada and Las Vegas Strip revenue down again in February​


The lack of a Super Bowl cut deeply into Las Vegas and Nevada’s visitation, falling nearly 12% in February year over year. That led to a 9.2% statewide decline in revenue and a whopping 13.8% decline for the Strip.

The Strip reported $690.3 million in gaming revenue, down from $800.6 million in February 2024. It wasn’t as bad away from the Strip. Downtown Las Vegas also felt the drop off but fell only 4.9% to $72.4 million. North Las Vegas fell 2.7% while the Boulder Strip fell 1.3%. The balance of Clark County outside of Mesquite and Laughlin rose 1%, according to the Nevada Gaming Control Board.

cdcgaming.com

Nevada and Las Vegas Strip revenue down again in February

The lack of a Super Bowl cut deeply into Las Vegas and Nevada’s visitation, falling nearly 12% in February year over year. That led to a 9.2% statewide decline in revenue and a whopping 13.8% decline for the Strip.The Strip reported $690.3 million in gaming revenue, down from $800.6 million in
cdcgaming.com cdcgaming.com
 
Puma said:
Signs

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Trump never went personally bankrupt, six of the many companies he owns did.
 
Today is "Liberation" day and the markets know it. So far, all green, even TSLA


Maybe they know that the tariffs are a nothing burger.
 
Trump’s reciprocal tariffs have been announced:

🇨🇳34% on China
🇪🇺20% on EU
🇨🇭Switzerland 31%
🇻🇳Vietnam 46%
🇹🇼Taiwan 32%
🇯🇵Japan 24%
🇮🇳India 26%
🇰🇷Korea 25%
🇹🇭Thailand 36%
🇰🇭Cambodia 49%
🇬🇧Great Britain 10%
🇧🇩Bangladesh 37%
🇲🇾Malaysia 24%
🇿🇦South Africa 30%
🇵🇭Philippines 17%
🇮🇱Israel 17%
🇵🇰 Pakistan 29%
🇱🇰Sri Lanka 44%

46% tariff on Vietnam and 49% on Cambodia is an absolute bomb. So many companies moved all their production there.

A minimum baseline tariff of 10% on everybody else.

PM Mark Carney spoke with President Sheinbaum about trade agreements between Canada and Mexico.​


At the moment Canada and Mexico are exempt from reciprocal tariffs however, Trump criticized NAFTA and all indications are that there will be a review of UMSCA.

Trump waited until the market closed to announce the reciprocal tariffs.
Screenshot_20250402-161852_X.jpg

The trade war with China enters a new episode.
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Some people online are astonished that the US applies tariffs on Israel imports given that Israel lowered its tariffs (there were tariffs?). So the US gives Israel money for free, and then Israel uses part of that money to buy US politicians so that they give Israel money for free. Applying tariffs on money you give anyway is retarded.
Retardation however can have good consequences: People will trade more with each other without relying on the US or the EU. China, Japan, and South Korea, who hate each other are already initiating an economic rapprochement. Take that China!
 
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The carnage is just beginning


To illustrate just how nonsensically these tariffs were calculated, take the example of Lesotho, one of the poorest countries in Africa with just $2.4 billion in annual GDP, which is being struck with a 50% tariff rate under the Trump plan, the highest rate among all countries on the list.

Why? Does Lesotho apply extortionate tariffs on U.S. products and the U.S. is merely being "reciprocal" here? Not at all, despite what Trump is saying, it's NOT the way these tariffs are defined.

As a matter of fact Lesotho, as a member of the Southern African Customs Union (SACU), applies the common external tariff structure established by this regional trade bloc.

Which means it applies the same tariffs on U.S. products as South Africa does, as well as the 3 other members of the bloc: Namibia, Eswatini and Botswana.

So since the tariffs charged by these 5 countries on U.S. products are exactly the same, they must all be struck with a 50% tariff rate by the U.S., right? Not at all: South Africa is getting 30%, Namibia 21%, Botswana 37% and Eswatini just 10%, the lowest rate possible among all countries.

So what gives? Again, the way these tariffs are calculated has absolutely zero relationship with actual tariffs imposed by these countries on U.S. products. Instead, they appear to be simply derived from trade deficit calculations.

Looking at Lesotho specifically, every year the U.S. imports approximately $236 million in goods from Lesotho (primarily diamonds, textiles and apparel) while exporting only about $7 million worth of goods to Lesotho (wits.worldbank.org/CountryProfile…).

Why do they export so little? Again this is an extremely poor country where 56.2% of the population lives with less than $3.65 a day (databankfiles.worldbank.org/public/ddpext_…), i.e. $1,300 a year. They simply can't afford U.S. products, no-one is going to buy an iPhone or a Tesla on that sort of income...

The way the tariffs are ACTUALLY calculated appears to be based on a simplistic and economically senseless formula: you take the trade deficit the U.S. has with a country, divide it by that country's exports to the U.S and declare this - falsely - "the tariff they charge on the U.S."

And then as Trump did in his speech last night, you magnanimously declare that you'll only "reciprocate" by charging half that "tariff" on them.

As such, for Lesotho, the calculation goes like this: ($236M - $7M)/$235M = 97%. That's the "tariff" Lesotho is deemed to charge this U.S. and half of that, i.e. roughly 50% is what the U.S. "reciprocates" with.

It's extremely easy to see why this makes no sense at all.

First of all, there's nothing Lesotho can do about it: they can't change tariffs they allegedly charge the U.S. to reduce the tariff rate the U.S. "reciprocates" with because, again, it's NOT based on any tariff that they charge.

Similarly they can't do much about reducing the trade deficit they have with the U.S. because, again, they simply don't have enough money to buy U.S. products.

Also the main rational Trump gave for the tariffs is to get production back to the U.S., to "bring manufacturing back". 47.3% of Lesotho's exports are diamonds: how do you bring the "manufacturing" of that "back to the U.S."? Anyone can see it makes just about zero sense.

The Lesotho example exposes the fundamental economic incoherence of these tariffs. Rather than addressing actual trade barriers, they punish countries based on trade deficits that arise from structural economic realities. All the more countries like Lesotho which pose zero competitive threat to American industry.

Worse yet, these tariffs will likely make these structural realities even worse: the U.S. is Lesotho's second most important export destination so it's a fair bet that applying 50% tariffs on their products will make people in Lesotho even poorer, and therefore even LESS able to afford U.S. products.

But perhaps the most unfair and detrimental aspect of all this is that these tariffs represent a complete reversal of longstanding U.S. development policy, and therefore a betrayal of countries - like Lesotho - who chose to follow U.S. advice in the past.

For decades the U.S. has used preferential trade access to encourage economic development in the world's poorest nations, recognizing that trade, not just aid, could get them out of poverty and ultimately put them in a position where they too could afford iPhones or Tesla.

They're now effectively penalizing countries for following previous U.S. policy, a lesson which I bet they won't forget anytime soon.

So all in all the irony is painful: in the name of fighting unfair trade, America has just demonstrated what truly unfair trade looks like.

This isn't something designed to address genuine trade issues, but simply a mechanism based on arbitrary math to punish countries for the affront of selling more to the United States than they buy.
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Oups!

Nowhere on Earth is safe’: Trump imposes tariffs on uninhabited islands near Antarctica​

Australian prime minister surprised after external territories – including tiny Norfolk Island and remote islands home to penguins – targeted by US president.

A group of barren, uninhabited volcanic islands near Antarctica, covered in glaciers and home to penguins, have been swept up in Donald Trump’s trade war, as the US president hit them with a 10% tariff on goods.

Heard Island and McDonald Islands, which form an external territory of Australia, are among the remotest places on Earth, accessible only via a two-week boat voyage from Perth on Australia’s west coast. They are completely uninhabited, with the last visit from people believed to be nearly 10 years ago.


Nevertheless, Heard and McDonald islands featured in a list released by the White House of “countries” that would have new trade tariffs imposed.
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Apparently there are people who eat Penguins as a delicacy and a traditional ethnic food.

Penguin meat is a delicacy that is not easily found in most parts of the world. Known for its exotic flavor and lean protein, penguin meat is a sought-after ingredient by food enthusiasts. However, due to concerns over conservation and animal welfare, purchasing penguin meat can be a complex task.

Where can I buy penguin meat? - Chef's Resource

Title: Where Can I Buy Penguin Meat? Introduction to Penguin Meat Penguin meat is a delicacy that is not easily ... Read moreWhere can I buy penguin meat?
www.chefsresource.com www.chefsresource.com
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This in my view is just a starting point for the US to enter into trade equality with China - which they would never be interested in or allow to happen with the European Union - and it is their partners, neighbors and friends (Israel) who have to help pay either in the form of tariffs or as a bargaining chip for their international negotiations.

The following is an article from Barron's which comes from Money Circus (Telegram) explaining the origin of these grandiose ideas of tariff increases. Here is the article (which is under paywall) and the commentary from Money Circus.

Trump’s Tariffs Are the Toughest Since the Great Depression. The Dangers We’ve Forgotten.​

The Smoot-Hawley Tariff Act of 1930 choked off trade just when the world economy needed it most.
By
Kenneth G. Pringle
March 06, 2025, 12:01 am EST
The Smoot-Hawley Tariff Act of 1930 is blamed for deepening the Great Depression. Don’t tell that to the Trump administration, which just unveiled the toughest tariffs in almost a century.
Investors see the new tariffs as threatening the economy, and stocks have gyrated wildly in recent days. President Donald Trump has slapped tariffs of 25% on goods from Mexico and Canada, plus an extra 10% tariff on Chinese imports, with a threat of more to come. Every fresh tidbit of news sends jumpy traders in a new direction.

But, then, who can blame them? Smoot-Hawley happened decades before they were born.

Enacted eight months after the Wall Street crash of 1929 and pushed by President Herbert Hoover as necessary protection for American farmers and workers, Smoot-Hawley was actually a product of the precrash good times. When congressional discussions began in 1928, the stock market was reaching new highs almost daily, much as it has in 2023 and 2024.
Smoot-Hawley was a Republican proposal, though Congress split along regional lines, with debate centering on the eternal question: Are the protections that tariffs provide to workers and industry worth the price increases that everyone else must pay?

In April 1929, amid congressional hearings on the tariff, The Wall Street Journal found all the arguments unconvincing. But it did come up with one conclusion, as true today as it was then.

“Nothing and nobody anywhere is without a tangible interest in the tariff question,” the Journal wrote, “not an industry, or a business, or a home, or an investment anywhere can escape the effects produced by changes in tariffs.”

A tariff is a tax placed on imports and paid by domestic importers. In the U.S., tariffs are collected by Customs and Border Protection at the port entry.
Who ultimately pays the tariff depends. The importer could seek a concession from its foreign partner, who might accept a smaller profit margin as the cost for remaining in the U.S. market. The importer, too, may eat part of the tax. But some of the price increase is almost always borne by the consumer.

Tariff proponents call this a feature, not a bug. Eliminating low-cost imports allows U.S. businesses and farmers to compete on a level playing field, protecting good American jobs. This is what Trump argues today, and Hoover argued a century ago

So, what happens next?
In 1930, the international reaction to Smoot-Hawley was swift and severe.
“Canadian Tariff Increases Hit American Exports,” Barron’s wrote June 8, 1931, as Ottawa enacted its third “upward revision” since Smoot-Hawley. It covered 174 items, a third of all American exports to its northern neighbor, including a 30% levy on midprice cars and 40% on luxury models.
Canada was hardly alone. Barron’s reported that, in 1930 alone, 45 countries raised their tariffs on U.S. products.
Smoot-Hawley 190018302000010203040506070%

U.S. big business sounded the alarm. “Hard-headed industrialists” joined with “professors of economics and doctors of politics” in opposing Smoot-Hawley, the Christian Science Monitor wrote on June 25, 1931. Among those speaking out were the president of the Pennsylvania railroad, Boston store owner Edward Filene, heads of cotton and textile merchants associations, and car makers Henry Ford of Ford Motor and Alfred P. Sloan of General Motors.

“We can’t expect to do all the selling and have the other fellow do all the buying,” said future J.P. Morgan chairman Thomas W. Lamont in 1931, the “other fellow” being America’s trade partners.
The logic behind the retaliatory trade measures was summed up by British Prime Minister Stanley Baldwin. “A tariff, among other things, is one of the quickest and most effective weapons to induce other countries to lower their tariff walls,” said Baldwin, a confirmed protectionist himself.
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Money Circus
Whether or not Baldwin’s retaliatory tactics were the reason, the trade walls erected by Smoot-Hawley were torn down by the Reciprocal Trade Agreements Act of 1934. This allowed the president to negotiate bilateral agreements and served as a framework for the multilateral agreements that dominated the post-World War II “free trade” world.
Today, the consensus argument is that Smoot-Hawley and its retaliatory responses worsened the Great Depression by choking off trade just when the world economy needed it most.
Not everyone agrees. Robert Lighthizer, the U.S. Trade Representative during Trump’s first term and an architect of his trade policies, has written that Smoot-Hawley “had little if any impact on the economic crisis of the early 1930s” amid larger forces at play.
Yet, in a sense, Baldwin was right. It took a depression and another world war, but the tariff walls were eventually lowered globally, and something close to a level playing field was created.
Not everyone plays by the rules anymore, argues Trump, and the global-trading system needs a reset to once more level out that playing field.
Hopefully this time we won’t need a depression and world war to see it happen.
 
I would be cautious to believe anything that publications like Barron's say. Many if not most of such media outlets seem to be owned by globalists who of course will continue to push for globalization and "free trade".

There seems to be no consensus on what caused or deepened the Great Depression. A big part of it seems to have been due to speculation and banks, though higher tariffs may have played a role as well.

www.britannica.com

Causes of the Great Depression | Britannica

What brought about the worst economic downturn in modern history?
www.britannica.com www.britannica.com
 
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