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

Some good analysis on the situation from X
This is batshit insane, no other way to call it. We now have the first attempt by the White House—specifically by Steve Miran, the Chair of the Council of Economic Advisers—to justify the tariffs based on economic "theory", and it's without a doubt the most dishonest piece of economic reading that's I've ever had the misfortune to lay my eyes upon. The gist of Miran's argument is to reposition the global reserve currency status of the dollar not as an exorbitant privilege (as erstwhile French President Valéry Giscard d'Estaing once characterized it), but as somehow a "burden" that the rest of the world needs to compensate the US for bearing . As Miran explains it, having the dollar as a reserve currency "has caused persistent currency distortions and contributed, along with other countries’ unfair barriers to trade, to unsustainable trade deficits" which "have decimated our manufacturing sector. "So he wants to give up the reserve currency status of the dollar, right? Wrong. He wants to have it both ways. He says that America's "financial dominance cannot be taken for granted; and the Trump Administration is determined to preserve [it]" but this same financial dominance "comes at a cost" and "other nations" need to pay for it .And he means this literally. He made a list of what exactly he means by "burden sharing" and one of the forms it can take is countries "simply writ[ing] checks to Treasury that help us finance global public goods.
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"Let's pause a moment here to contemplate the sheer insanity of this: the U.S. is literally suggesting that countries should mail checks to the US Treasury as tribute for the 'privilege' of maintaining the dollar as a global reserve currency, when it is this very reserve status of the dollar that is the cornerstone of US power. It's the equivalent of Samson asking everyone to pay him to keep his hair. Because that's what Miran is conveniently not mentioning in his text. The reason Giscard d'Estaing called it an "exorbitant privilege" is that it allows the U.S. to quite literally have its way of life subsidized by the rest of the world. Miran (and Trump) complain about the trade deficits, but they are the very manifestation of this subsidization: countries normally cannot run a permanent trade deficit because they'd one day face a balance of payments crisis. It's like a private individual: you cannot indefinitely buy more from others than what you yourself earn. At some point you'll have to pay up. Unless, that is, you're the issuer of the currency everyone uses, in which case the normal rules of economic gravity are suspended.
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While other nations must balance their books eventually, the dollar's reserve status gives America the unique ability to consume more than it produces perpetually, with the world eagerly accepting dollars that cost nothing to create in exchange for real goods and services. That's not a "burden", it very much is an "exorbitant privilege". So yes, sure, because America can effectively buy most of what it needs from the rest of the world for "free" (by printing dollars), this situation doesn't exactly create incentives to do the hard work of manufacturing goods domestically. But framing this as other countries taking advantage of America rather than America taking advantage of its currency dominance is an astonishing inversion of reality. And even more astonishing is Miran's ask that countries now compensate the U.S. for this. Some people mention that it's like asking vassals for tribute but it's actually even worse than this. The tribute is already embedded in the global reserve currency status of the dollar: other countries work hard for the U.S. while they can just issue IOUs that never come due. What Miran is thus proposing is effectively demanding vassals make payments for the privilege of already making payments—a double tribute system where countries first subsidize American living standards by accepting dollars as reserves, and then must pay an additional fee for the 'burden' this supposedly places on the US. Miran's piece is replete with other complete inversions of reality. For instance, he now blames China for the 2008 crash because "their holdings of U.S. mortgage debt helped fuel the housing bubble, forcing hundreds of billions of dollars of credit into the housing sector without regard as to whether the investments made sense. "Anyone with even a rudimentary knowledge of the 2008 financial crisis would have their breath taken away by such brazen revisionism. Not only is the crisis universally known to have been caused by US regulatory failures and the reckless securitization of subprime mortgages by Wall Street firms, but China in this instance literally saved U.S. markets from complete meltdown after Hank Paulson personally appealed to Beijing to continue purchasing US Treasury bonds during the height of the crisis, which they did. To now blame them for the very crisis they helped mitigate and played no part in creating is beyond dishonest—it's gaslighting on a geopolitical scale.
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All in all, it's clear what the US is trying to achieve here, they effectively want to have their cake and eat it. They want to keep the privilege and want the rest of the world to pay for the downsides that come with it. Which means we're truly at a crossroad in history where nations must make an immensely consequential choice: acquiesce to this insane double tribute system or stand against it. There are very few precedents in world history for such a nakedly exploitative power play, but history is very clear on two things: submitting to extortion only invites more of it, and collective resistance is the only effective response.
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Basically Trump is going full mafia. Extortion based on the new victimhood ideology that the US is being ripped off, which is just an inversion of reality.

Trump wants the world to bend the knee in complete vassalhood or they must break. The ones who can't afford the extortion fees, he'll want other concessions. Sell your national assets like ports or mines at a bargain to Blackrock, allow the US to build bases etc. All nations must accept full domination so the US can have a golden age. I'm thinking this will rather lead to world war than a golden age.
 
Candice said:
Basically Trump is going full mafia. Extortion based on the new victimhood ideology that the US is being ripped off, which is just an inversion of reality.
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The reserve currency status of the dollar is both an "exorbitant privelege" and an "exorbitant burden" on the US. Yet for some reason, neither the Trump administration nor his critics address this dilemma, instead one side focuses only on the "burden" part and the other sides focuses only on the "privilege" part.

Overall, it seems that the benefits outweigh the downsides of having the reserve currency, so that the critics are closer to the truth.

The Trump team does not explicitly talk about the downsides of the reserve currency status of the dollar, instead opting to say in general terms that "other countries are taking advantage of us". However, at the same time one of Trump's first acts was to threaten the BRICS with 100% tariffs if they create a BRICS currency that would challenge the dollar status as reserve currency.

So Trump and his team bemoan the downsides of having the reserve currency status, but they want to keep it and threaten others not to create a viable alternative. And it does look like Trump chose to use questionable mafia-like methods (which in his mind may be simply "The Art of the Deal") to extract concessions from weaker countries.

The big question is what China will do.

1. The threat of 100% tariffs by Trump if the BRICS create their own reserve currency is no longer viable if the US tariffs on China are already over 100% as they are now. However, it seems that the other BRICS nations are unlikely to want to go ahead right now - especially India and Brazil, or even Russia which wants to continue peace negotiations with the US.

2. As many have pointed out, China could create a lot of problems for the US by selling the trillions in US treasuries it holds. But that would most likely create instability for China itself, so it seems unlikely that they would do something aggressive like that. More likely is a gradual sell-off which China has been doing anyway.

3. In the bigger picture of the last few decades, it seems that China decided to use one of the main "burdens" of the US having the reserve currency to China's full advantage - and that was to basically let the US deindustrialize itself, so that China became the by far biggest industrial powerhouse in the world. China itself helped speed up this process with artificially low exchange rates.

This deindustrialization of the US seems to be the main issue that Trump is trying to correct with the tariffs now. However, the deindustrialization seems to have been primarily caused by the reserve currency status of the dollar (which he wants to keep).
 
axj said:
The reserve currency status of the dollar is both an "exorbitant privelege" and an "exorbitant burden" on the US. Yet for some reason, neither the Trump administration nor his critics address this dilemma, instead one side focuses only on the "burden" part and the other sides focuses only on the "privilege" part.

Overall, it seems that the benefits outweigh the downsides of having the reserve currency, so that the critics are closer to the truth.

The Trump team does not explicitly talk about the downsides of the reserve currency status of the dollar, instead opting to say in general terms that "other countries are taking advantage of us". However, at the same time one of Trump's first acts was to threaten the BRICS with 100% tariffs if they create a BRICS currency that would challenge the dollar status as reserve currency.

So Trump and his team bemoan the downsides of having the reserve currency status, but they want to keep it and threaten others not to create a viable alternative. And it does look like Trump chose to use questionable mafia-like methods (which in his mind may be simply "The Art of the Deal") to extract concessions from weaker countries.

The big question is what China will do.

1. The threat of 100% tariffs by Trump if the BRICS create their own reserve currency is no longer viable if the US tariffs on China are already over 100% as they are now. However, it seems that the other BRICS nations are unlikely to want to go ahead right now - especially India and Brazil, or even Russia which wants to continue peace negotiations with the US.

2. As many have pointed out, China could create a lot of problems for the US by selling the trillions in US treasuries it holds. But that would most likely create instability for China itself, so it seems unlikely that they would do something aggressive like that. More likely is a gradual sell-off which China has been doing anyway.

3. In the bigger picture of the last few decades, it seems that China decided to use one of the main "burdens" of the US having the reserve currency to China's full advantage - and that was to basically let the US deindustrialize itself, so that China became the by far biggest industrial powerhouse in the world. China itself helped speed up this process with artificially low exchange rates.

This deindustrialization of the US seems to be the main issue that Trump is trying to correct with the tariffs now. However, the deindustrialization seems to have been primarily caused by the reserve currency status of the dollar (which he wants to keep).
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I think China and Russia will be seeing this as an opportunity to further crystallise multipolarity.

I don't think the "art of the deal" type thing from Trump will work with China if the plan is to get China to essentially act against its own interests. I think China is more than happy with compromises where both parties benefit but it's certainly not happy with a position where the other party benefits and it shoots itself on the foot. Trump is saying America is being taken advantage off which I think is quite opposite to the truth.

I just don't see how you essentially threaten the whole world like some playground bully and have it all play out ok. Negotiation ploy or not, I'm just not seeing how business via threats is conducive to mutually beneficial relationships. 🤷

I think essentially what Trump wants to do is almost make America its own planet (no need for the rest of the planet) with the rest of the countries occupying this planet (apart from Israel) essentially paying some kind of regular tribute for daring to exist.
 
Ha! China has now raised their tariffs to 84%.

Tit for tat game going on.

I tell you what, if the normal person in the US starts to suffer from this economic warfare, I think that will create a real political crisis. Like, if prices go up ridiculously and the like, or supply chains get really disrupted or businesses start to shut down because they can get what they need due to tariffs.
 

War Journal​

Well, China didn't call him on the phone and didn't "kiss his ass" like he mocked other nations did either.

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When America was sleeping peacefully, "somebody" (China surely) dumped TSYS causing 30-year and 10-year bonds yields to spike.
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Consequences:

● Higher Borrowing Costs: Bond yields represent the return investors demand for lending money. When yields rise, it typically means borrowing costs increase for governments (services), businesses (slow down spending and investment) and consumers (real state mortgage, car loans)

● Rising yields can signal expectations of higher inflation, as investors demand more return to offset the eroding value of money

● Higher yields hurt bondholders with existing low-yield bonds, as their value drops when new bonds offer better returns.

● (Other) Chinese actions

China's central bank, the People's Bank of China (PBOC), instructed major state-owned banks to reduce their purchases of U.S. dollars to stabilize the yuan. China’s move to limit dollar purchases is a countermeasure to mitigate pressure from a strong dollar.

China has added U.S. companies to its "Unreliable Entity List," barring them from trade and investment in China.

China’s Finance Ministry has announced plans to impose additional tariffs of 84% on all U.S. goods, effective April 10

https://twitter.com/x/status/1909926662004695059

● European actions

The European Union Commission says it will be imposing its first "countermeasures" against US tariffs beginning April 15th.

Food for thought

Screenshot_20250409-075022_X.jpg​
 
This analysis seems to me to be very accurate, China is hitting where it hurts the most... because I don't think Trump cares much about the damaged he is doing to the small companies that need Chinese materials to produce their products. Albeit he brags much about it. To mention just one example, there are many entrepreneurs of body and face products, with small seasonal batches that need package or ingredients from China.

From Telegram Channel TheIslanderNews

China Doesn’t Flinch. It Plays Go.

While Washington crows about “winning” with a 104% tariff blitz (of course symbolism matters and ending in 4 is done on purpose to anger the Chinese), Beijing doesn’t bother matching the noise decibel for decibel. Instead, it does what it always does: moves with surgical precision, calm resolve, and strategic depth. The new 84% total tariff on U.S. goods isn’t a surrender or a tit-for-tat. It’s a message, and not just to Trump, but to Wall Street, Congress, Silicon Valley, and America’s hollowed-out industrial core.

Let’s decode...

First: China didn’t need to match 104%. Why? Because when you control the rare earths, you control the game board. Dysprosium, scandium, yttrium, these aren’t just minerals, they’re the sinews of missiles, fighter jets, AI chips, and hypersonics. Add to that China’s export controls, blacklisting of six major U.S. firms, and WTO complaints not meant for wins, but for optics while the real game plays out across BRICS+, SCO, and Belt & Road corridors. Rare earth restrictions will bite, when China controls circa 80 percent of global processing.

Second: Timing is everything. China dropped its 50% tariff hike precisely after U.S. stock markets hemorrhaged $10 trillion. No need to hit the brakes. Just a gentle squeeze on the heart of speculative finance. The rare earth restrictions? That’s the silent detonation, crippling production pipelines, not headlines.

Third: MAGA might cheer Trump’s “big numbers,” but Beijing’s playing a long hand. U.S. consumers will foot the with a surge in inflation set to hit middle America. Meanwhile, China’s state-led economy insulates its people from short-term turbulence. Long term this is only a win, if the US can actually bring back manufacturing, hello lag time to build factories, hello labor addicted to casino money.

Fourth: the WTO complaint is not an olive branch, it’s camouflage. While Washington postures with tariffs, China is accelerating its exit from the dollar-dominated trade system. Yuan-ruble energy deals. Petro-RMB exchanges with the Gulf. New settlements across the Global South in local currencies. Trade de-dollarization is no longer a theory, it’s an active construction zone.

Fifth: Silicon Valley is under siege. Dual-use tech export bans and the ‘unreliable entity’ list are precision-guided strikes. Imagine trying to build the next-gen drone swarm or hypersonic guidance system… without access to China’s core materials.

Sixth: The American military-industrial complex? Already buckling. As defense contractors whine over rare metal shortages, the Pentagon scrambles to diversify supply lines, to Latin America, to Africa, to even Russia. But those alternatives take years. China’s leverage? Immediate.

IThis isn’t Beijing playing defense, it’s playing forward. Not with soundbites, but with systems. Not with emotion, but with architecture. The U.S. imposed 104% tariffs and gutted its own markets. China responded with 84% and a scalpel to the arteries of American hegemony.

This isn’t checkers. This isn’t even chess. This is Go. And Beijing just captured another corner.
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Current opinion:
There's no foreign power working towards a US take down, don't believe president Trump or the MAGA rhetoric. Russia nor China are not the culprits in taking down the US economically. The US is hoodwinking it's population by disguising it's own corporate devil's as a foreign tariff problems. The same corporate devils who hollowed out the US's industrial base thru the implementation of NAFTA are the same corporate devils who brought us the 1929 depression and are now poised to continue their greedy shenanigans. President Trump is being blindsided?

Is this what's actually happening?

 
mkrnhr said:
Trump: "These countries are calling us up, kissing my ass". That's top diplomacy and negotiation!
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Sometimes one highly disrespectful public statement can undo what a politician is trying to do. This reminds me of Hillary's "deplorables" comment, insulting half of the country before the election.

In this case Trump is basically insulting all the countries that want to remain friendly towards the US - while negotitations are ongoing and China is openly defying the US.
 
As his momentum gathers unexpected consequences bringing fear on all who experience or witness his threats...what is history's lesson on those incapable of working with other nations but only against them and treats them as cattle ? Examples are at vomitorium.
Whoever is responsible eventually crashes into a ruin of his own design and causes an enormous pain across the world.
 
Which countries would they have been, African, Asian, Latin American? As far as I know, EU had approved retaliatory tariffs (10-25%) hours ago. Wonder if the American textile industry also went begging, it's change of season, spring-summer fashion arrives, a huge percentage is made with materials or made abroad.

Wonder if this comes more from China's unreliable list rather than the increase from 34 to 84% fire back tariffs.
Per Grok:
The companies on China's unreliable entity list specialize in: - Shield AI: AI-driven autonomous aviation (drones, jets). - Sierra Nevada: Aircraft mods, space tech, ISR solutions. - Cyberlux: Military UAS, comms, tactical lighting. - Edge Autonomy: Autonomous systems, optics, energy for ISR. - Group W: Analysis, modeling, research for complex issues. - Hudson Tech: Refrigerant services, HVACR sustainability
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Edit, just saw Beau's post
 
Former White House Chief Strategist Steve Bannon warned European allies to stop taking advantage of the US, and defended Trump's tariff war.Steven Edginton sits down with Steve Bannon for a no-holds-barred discussion on Trump’s “Liberation Day” tariff war. Bannon defends Trump's bold economic strategy, slams China's influence, calls out America's so-called allies, and warns Republicans that the stakes in 2028 couldn’t be higher. From Elon Musk’s media distraction in Wisconsin to the geopolitical error of giving away the Chagos Islands, Bannon pulls no punches.

 
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