538’s significant digits email reports on the hits investors keep taking as Trump tries to salvage his disastrous trade war by digging faster and deeper.
$60 billion in goods
China has launched its own salvo in the latest escalation of President Trump’s trade war, saying that it will raise tariffs on nearly $60 billion in U.S. goods from 10 percent to 20 percent or 25 percent. After the news, the S&P 500 fell more than 2 percent. [The New York Times]
The NY Times Monday Evening Briefing (email) also focused on the economic consequences of Trump’s trade war.
American stocks suffered their steepest daily drop in months after China said it would increase tariffs on American-made goods in response to a similar move by the White House.
The S&P 500 fell 2.4 percent, pushing its loss for the month above 4.5 percent. Investors hammered shares in trade-sensitive sectors like agriculture, semiconductors and industrials. Just weeks ago, the S&P 500 reached a record. Above, the New York Stock Exchange on Monday.
China’s move will affect the roughly $60 billion in American imports already being taxed as retaliation for Mr. Trump’s previous round of levies; those imports include beer, wine, swimsuits, shirts and liquefied natural gas.
Both sides left a window for negotiators to try to reach a deal, but they continue to have significant differences over how tariffs should be rolled back.
President Trump said he was not concerned by the tariff increase, saying “there can be some retaliation, but it can’t be very, very substantial by comparison,” given that China imports far less than it sells to the United States.
Will buying at Walmart blunt the effects of a trade war?
Today, in defense of his trade war and those self-inflicted wounds to our economy, Trump Urges Americans to Boycott Chinese Goods and Just Buy Things at Walmart. Andy Borowitz, the New Yorker satirist, fills in all the gaps in that headline - except those between Trump’s two ears.
WASHINGTON (The Borowitz Report)—Asking for their solidarity in his trade war with China, Donald Trump is urging Americans to boycott Chinese goods and “just buy things at Walmart.”
Trump made his request via Twitter, where he told his fellow-citizens that it was their “patriotic duty” to punish China by buying as many goods at Walmart as possible.
“If you go to a great american store like Walmart, you’ll find lots of cheap sportswear, shoes, and other items for you and your family to enjoy,” he tweeted. “What better way to show China that we don’t need their dumb stuff!”
Shortly after Trump sent those marching orders to his countrymen, the Chinese President, Xi Jinping, offered a muted response. “I’m beginning to see how he lost a billion dollars,” Xi said.
Trump’s trade war hurts rural America
Satire aside, on a related topic, Trump promised $15 billion in aid to farmers who are hurt by his trade war. But nobody has any idea where he will get that kind of money - and neither does he if truth be told. Trump says U.S. farmers to get $15 billion in aid amid China trade war reports Yahoo.com.
American farmers, a key constituency of Trump, have been among the hardest hit in the trade war. Soybeans are the most valuable U.S. farm export, and shipments to China dropped to a 16-year low in 2018. Sales of U.S. soybeans elsewhere failed to make up for the loss. U.S. soybean futures fell to their lowest in a decade on Monday.
While farmers have largely remained supportive of Trump, many have called for an imminent end to the trade dispute, which propelled farm debt to the highest levels in decades and worsened credit conditions for the rural economy.