The impact of these tariffs on the world economy will be huge.
Beyond those seen during the high protectionism of the 1930s – they can be measured by lines in the US tariff income graph, which jumps into levels that were not seen in a century.
Or one night, the stock market falls, especially in Asia.
However, the real measure of these changes will be significant changes in the long -standing global trade routes.
This is a universal tariff for almost all imports for every country that comes on Friday night. These dozens of “worst criminals” will be mutually collected for trade surplus.
Tariffs on Asian countries are really remarkable. They will break the business models of thousands of companies, the factory and probably all nations.
Some of the supply chains created by the world’s largest companies will be broken instantly. The inevitable effect will definitely push them towards China.
Is this just a big negotiation? The US administration seems to be demanding tariff income for planned tax cuts. The scope of quick adjustment seems limited. As a White House official clearly said: “This is not a negotiation, but a national emergency”.
USA Formula called “mutual tariffs” Basically, it blames a country to have surplus goods trade with the United States and exports to America more than imports. It accelerates the load on the 10%universal base line, even if it is not too much.
All this reveals two things. The aim of the policy is to reduce the US trade deficit to zero. This is a remarkable re -orientation of world trade flows, and explains the focus of the special punishment for Asia.
Secondly, it is clear that bilateral negotiations do not make much difference or actually make any difference..
Explanations and surplus is a normal part of a trade system that specializes in the best ones of countries. The US has now ended this logic in a magnificent way.
However, it will take years that change the factories. Tariffs of this scale in East Asia will increase much faster in clothing, toys and electronic prices, especially at 30% or 40.
Now the question is how the rest of the world reacts.
Some consumers in Europe have opportunities to benefit from cheaper -oriented trade in clothing and electronics. Apart from the number one -looking world economy, the rest of the major economies can choose to integrate trade more closely.
As Tesla’s falling sales may show, only a number of this story is about the reaction of governments. Nowadays, consumers can also retaliate. It can be a new kind of social media trade war.
Europe may decide not to continue to buy consumer brands created in the USA and love the world.
The monopoly in providing social media services by Big US technology can be shaken.
And US officials may need to increase interest rates to combat the inevitable increase in inflation.
A scattered global trade war seems inevitable.
