What a revolving door circus Trump’s tariff policy has become. 
Yesterday, I noted Trump Backs Down More on Tariffs Exempts Smartphones, Electronics from China
Today, we learn Tech Products Will Face Separate Levies, Lutnick Says
Futures markets opening Sunday evening are [were?] expected to rise after President Trump issued tariff exemptions for smartphones, laptop computers, memory chips and other electronics in a move that could benefit Apple and other tech companies that import many of their products from China.
After issuing his latest exemptions late Friday without a statement, Trump told reporters aboard Air Force One on Saturday that more exemption details will be revealed Monday.
But on Sunday, Commerce Secretary Howard Lutnick said the reprieve may be temporary.
Smartphones and other tech products that won an exemption Friday night from the latest so-called reciprocal tariffs will still face separate levies in a month or two as part of a trade investigation into semiconductors, Commerce Secretary Howard Lutnick said Sunday on ABC’s “This Week.”
“This is not a permanent sort of exemption,” he said.
Tech products will soon get separate sectoral tariffs along with semiconductors following a Section 232 investigation, Lutnick said. Section 232 allows a president to adjust imports that pose a threat to national security and is also being used for other sectoral tariffs like autos and potentially pharmaceuticals.
The technology exemptions were the latest jolt on the economic roller coaster ride the president has taken the nation over the past week and a half since he first rolled out a shock-and-awe level of tariffs on April 2 that he moderated following wild market swings.
Revolving Door Circus
The administration had months of on-off announcements in which everyone was waiting for the big reciprocal announcement.
On February 13, I noted Trump Fails to Pull the Trigger on Reciprocal Tariffs, Will Study the Issue
For all Trump’s huffing and puffing over Canada, the US goods trade deficit is only $64 billion. The entire deficit (and then some) is oil imports at a cheap price, very beneficial to the US.
The Big announcement came on April 2, when I explained Trump’s Big Announcement Is Half-Reciprocal Tariffs on the World
Factoring in value added taxes and other alleged manipulations, Trump announces Half-Reciprocal Tariffs with a minimum baseline of 10 percent.
The formula for reciprocal tariffs is ((Trade Deficit / Imports) / 2). It’s actually a bit more complicated but that is what it nets to.
There is an error in the formula, in addition to the nonsensical idea that reciprocal tariffs are not based on tariffs at all.
Trump Partially Capitulates
On April 9, I commented Trump Capitulates with a 90-Day Pause on Tariffs, DOW Jumps 2,200 Points
That backdown left 10 percent tariffs on across the board.
However, Trump did not fully back down on Mexico or Canada, treating our two best trading partners worse than the rest of the world.
Administration Lie of the Day
The administration lie of the day was “Trump Goaded China into a Bad Position”
Treasury Secretary Bessent is a bad liar. Clowns portray it as 5D chess.
Competing Theories
- Trump concocts ridiculous definition of “reciprocal” to goad China into retaliating. Socks and bonds crashed in response. And China will stop buying agricultural goods from the US. But that’s OK because Trump will again to bail out US farmers, with taxes collected from US citizens via tariffs to bail out the farmers but no one else. This is 5D chess.
- Trump capitulated with a 90-day pause reacting to the plunge in stock and bond markets.
Trump then upped tariffs on China to 145 percent and China responded by hiking tariffs on China.
Proving that the US was also in a bad position, the Chinese were told – once again – that Chinese President Xi Jinping should request a call with US President Donald Trump.
Xi did not answer the call but Trump backed down on technology tariffs from China, anyway.
Today we learn, not so fast. Technology tariffs are not yet set.
Definition of Reciprocal Revisited
Noticed the crossed out variables in the denominator, image from Axios.
As applied by the Trump administration, the variables cancel out.
The AEI reports President Trump’s Tariff Formula Makes No Economic Sense. It’s Also Based on an Error.
Though in effect the formula for the tariff placed on the United States by another country is equal to the trade deficit divided by imports, the formula published by the Office of the US Trade Representative has two additional terms in the denominator that just so happen to cancel out: (1) the elasticity of import demand with respect to import prices, ε, and (2) the elasticity of import prices with respect to tariffs, φ.
The Trump Administration assumes an elasticity of import demand with respect to import prices of four, and an elasticity of import prices with respect to tariffs of 0.25, the product of which is one and is the reason they cancel out in the Administration’s formula.
However, the elasticity of import prices with respect to tariffs should be about one (actually 0.945), not 0.25 as the Trump Administration states. Their mistake is that they base the elasticity on the response of retail prices to tariffs, as opposed to import prices as they should have done. The article they cite by Alberto Cavallo and his coauthors makes this distinction clear. The authors state that “tariffs [are] passed through almost fully to US import prices,” while finding “more mixed evidence regarding retail price increases.” It is inconsistent to multiply the elasticity of import demand with respect to import prices by the elasticity of retail prices with respect to tariffs.
Correcting the Trump Administration’s error would reduce the tariffs assumed to be applied by each country to the United States to about a fourth of their stated level, and as a result, cut the tariffs announced by President Trump on Wednesday by the same fraction, subject to the 10 percent tariff floor.
Now, our view is that the formula the administration relied on has no foundation in either economic theory or trade law. But if we are going to pretend that it is a sound basis for US trade policy, we should at least be allowed to expect that the relevant White House officials do their calculations carefully. Hopefully they will correct their mistake soon: the resulting trade liberalization would provide a much-needed boost to the economy and may yet help us stave off a recession.
Applied mathematically correctly the Reciprocal tariff on Vietnam should be 12.2 percent not 46 percent.
The Trump administration cited Alberto Cavallo but he also says they applied the formula incorrectly, nearly 4 times too high, not that the idea makes any sense in the first place, which it doesn’t.
If your brain is as dense as lead, you think this is 5D maneuvering.
Trump is desperately trying to find some level of tariffs the stock and bond markets won’t react negatively to. However, the revolving door clown show is destabilizing in and of itself.
Donald Trump has an inflated ego, which is combined with a reliance on a set of beliefs that are void of expertise and rigor. This creates a very dangerous situation where zealots who align with those beliefs can easily influence the President, leading to decisions made without any debate that conflict with the President’s uninformed beliefs. Given the power vested in the President, such a situation is utterly unserious and extremely dangerous.
Not sure if Trump himself is more dangerous, or the lack of checks and balances anywhere, not the left, not the courts, not Congress, not Trump himself, and worst of all, nobody in the GOP who has the allegiance to the USA and the Constitution over Trump who will even utter words of opposition to Trump, let alone take action that anyone would consider brave or bold to defend the USA against attacks by Trump.
Trading business: BYDFi could see a short-term increase in trading volume and fee income as the tariff drama generates economic uncertainty and market volatility, with some investors looking to cryptocurrencies as a hedge. At the same time, tariffs could trigger capital controls or foreign exchange restrictions, and cryptocurrency as an alternative channel for cross-border fund flows could drive BYDFi’s demand for money in and out of the country. • Compliance costs: The Trump administration may adjust the financial regulatory framework along with the tariff policy and increase the scrutiny of cryptocurrencies, such as anti-money laundering, tax compliance, etc., which will increase the operating costs and compliance pressure of BYDFi. • User psychology: The sensitivity of the market to tariff policy is evident, and every major announcement will trigger sharp price movements in the crypto market, causing investor sentiment to swing with trade war news, which may affect users’ trading decisions and investment confidence on BYDFi.
This thread might as well be a Bernie Bros orgy.
if you don’t like it, why are you here?
Bye Felicia! You can go find a safe space, I’m sure.
Lot’s of whining in these comments about Trump. But he identified the problems in our country, explained his strategy to correct them, and the American people elected him to do what he promised. Lot’s of complaints here but I read no solutions.
The SOLUTION is FREE MARKETS. What you are advocating is the governing style of Cuba, Venezuela and North Korea. Trump is using government force to dictate where a business needs to manufacture, who it should hire, where it should hire them, etc. This is communist crap that you are advocating.
And lastly, CENTRAL PLANNING DOES NOT WORK.
You see no value in producing our own drugs, steel, aluminum, rare earth minerals, uranium, chips and autos? How about having our own space program instead of paying Russia to carry our people to the ISS and provide engines for our rockets? You liked paying for Europe’s security? How about Japan and S Korea too? USAID? Are you good with funneling taxpayer money to NGO’s that are trying to subvert our country? Look pal…all that and no need for caps.
The reality is that the USA labor rate and COGs are far too high for the country to profitably manufacture most products.
The labor rate can be mitigated by running mostly automated factories but automation doesn’t employ common blue-collar workers (Trump’s base), doesn’t pay taxes and doesn’t build the community.
Trump is acting like Queen in Through The Looking Glass, believing in impossible things:
You don’t get it. I can explain it to you but I can’t understand it for you.
If it takes China 400 million people to produce “drugs, steel, aluminum, rare earths minerals, uranium, chips and autos” AND you want ALL of that brought back to the US, where the f**k is the labor supposed to come from?
The US has 340 million people and 80 million are useless social program geezers. We have 4% unemployment now so please tell me where the labor will come from with your magical re-industrialization?
The US has been in a demographic death spiral which is why China was allowed into the WTO and started making all the crap we didn’t have labor for and that’s why we’re here. Our labor is too expensive.
What next? Trump outlaws unions because labor cost are too high? Trump forces minimum wage down to $2/hr? Or maybe just turn Americans into slaves.
And if your response is “robots” then why the hell does it matter where stuff is manufactured if its all robots?
He’s going to need more words from Trump to be able to answer you.
Are you a straw man dealer? You are proficient with straw men!
Free markets are impossible as long as the world is built around nation states.
I asked Perplexity.ai about the topic:
Absolute free trade without any tariffs is politically improbable in the modern world due to several economic, political, and social factors:
**Economic Factors**
– **Protectionist Policies**: Governments often impose tariffs and subsidies to protect domestic industries and jobs, especially in sectors vulnerable to foreign competition[2][4].
– **Unequal Gains**: While free trade generally boosts economic growth, it can cause significant disruptions, such as job losses in import-competing sectors. These uneven effects make it politically challenging to implement absolute free trade[2][4].
**Political Challenges**
– **National Interests**: Economic nationalist parties often oppose free trade, favoring protectionism to safeguard local industries and resources[2].
– **Regional Agreements**: Free trade zones like Mercosur or the European Economic Area create internal tariff-free trade but maintain external barriers, reflecting the political preference for regional rather than global free trade[2][4].
– **Voter Dynamics**: Bilateral agreements may raise the utility of certain groups while reducing support for multilateral free trade, making universal tariff elimination politically unfeasible[1].
**Social and Regulatory Constraints**
– **Non-Tariff Barriers**: Even in free trade agreements, nations impose regulations on goods like drugs or processed foods to ensure safety and quality. These barriers effectively limit absolute free trade[4].
– **Compensation for Losers**: Policies to address the negative impacts of liberalization—such as retraining displaced workers—are often necessary to mitigate backlash against globalization[2].
In summary, while economists broadly support free trade for its positive impact on growth and welfare, political realities, protectionist tendencies, and social considerations make absolute tariff-free trade unattainable in practice[2][4].
….
https://www.perplexity.ai/search/is-absolute-free-trade-without-Er2qGi2PTqKh_zRxIEbEoA#0
If Free markets don’t work then you’ve already lost so pick one: communism, socialism or fascism. Oh wait, you’re a boomer constantly asking for more SS taxes to give you free money handouts, socialism is your choice. Good luck to ya, let me know how that works out long term.
It’s not a question of whether the free market works, it’s a question of how to stay elected while you implement it. The fact that it’s right doesn’t make it politically doable. Your 80 million geezers also vote, along with the inevitable socialists and grifters. “Politics is the art of the possible.”
You don’t need to use Sithian absolutism asked of AI to make a fair assessment on Free Trade. Not everything exists as black and white. Many things exist on continuums, for example Free Trade. Maybe you did not not understand this?
Please run your comments through an AI and ask for an English translation.
You may be correct but the reverse, unfettered capitalism, is failing the USA. There has to be a middle ground. Maybe Ford had it correct so many years ago when he said he had to pay his employees enough so they could buy the cars they were making. Maybe restricting profit margins, raising wages and limiting imports regardless of price is worthy of study. Do we really need other countries making our products if we eliminate the need for huge profits? Since POTUS Reagan, companies have used their high profits to buy back their own stock driving the stock market to it’s unbelievable valuations of today. Wouldn’t that money be better used to increase employee wages and benefits, research into new products and as dividends to stock holders? Should a CEO make more in one day than his lowest paid employee makes in an entire year?
There is a lot to fix in American businesses, we really don’t need to look to other countries to find OUR problems.
Well Trump is president, so self-accountability for him or the USA is one of the few things that he will NEVER consider.
Trump is promising to prove that central planning and autocracy is not good for the USA
Remember when conservatives believed in free trade and said it would solve everything? To quote Tony Montana “Lok at you now!!!”
Trump historically has been a very good diagnostician. As a therapist though he frequently fails miserably.
Statistic is elastic. It’s rigged like UFC fights for expected results. Trump will not cave in even if his statisticians were wrong.
Thank God. The last thing we want in a leader is to admit a mistake and correct it. Just plow on ahead please.
What a hoot.
When did Trump admit a mistake or correct anything?
Barrack Obama : “I was wrong about chemically and surgically castrating children…” Yeah no, you never heard that. Biden, ditto. Etc.
Obviously you were not going to answer the question that was asked.
Mao “Great Leap Forwards” cost thirty million lives. Stalin mistakes killed 30 millions in Ukraine.Their propaganda machine protected them.. Mao and Stalin never apologized. Both Mao and Stalin were great communist leader. The puke media will attack Trump no matter what: right or wrong .
Are you saying Mao and Stalin should be Trump’s role models in sticking to completely idiotic policies?
Comparative evils is probably the closest we can come to the truth…
45-50MM
You bring up two points in your post: leaders who’s mistakes and refusal to correct them cost millions of people’s lives. And the “puke media” attacking Trump. Personally I am much more worried about the former, and Trump so far has shown little regard for anyone who’s not his crony.
Given how he breaks the law routinely and screws up most of what he does (DOGE, Tariffs, Balloonning the deficit, Ignoring security breaches via Signal to name just a few) it’s not suprising even if the “puke media” would go far in attacking him. It certainly is a much, much lesser problem than Trump being in a comparison with Stalin and Mao.
“Trump so far has shown little regard for anyone who’s not his crony.” Musk gave Trump more than $270M and it looks like he has been discarded. So I’m not sure being a Trump crony is the road to wealth and happiness. Definitely taking any of the spotlight off Trump is a guarantee to being discarded.
I get it, you willingly put Trump next to Stalin and Mao. Trump is one of them.
Oops, have a delete (as your just mentioned it!)
Speaking of the Trump insantity is the very sad truth that eventually (and maybe even if not?) Trump is wanting the tariffs to have some (likely insane again) measure of tax cuts.
What’s beyond “5D” and in some alternate reality is any sustainably viable (God forbid some measure of reasonably just) tariff revenues.
You jerk their chain in two directions until they are confused. But they know where they get fed and watered. They do what you tell them.
Chinese factories are empty. Nobody’s getting paid. Nobody is ordering. Shipments in route are refused. Banks aren’t paid. Local governments have no income.
All of China’s food supply depends upon imported factors of production that cannot be financed. Starvation follows. Xi Jen Ping proudly says Chinese are tough enough to eat tree bark. I never saw a surviving tree in any picture of China.
Sure. And everyone in China is starving. Lol!
I heard they have good chinese food over there.
Did you eat a big rice bowl today Papa?
Yeah, and in 2022 we were served a jug of Kool-Aid. The Russian army was just two weeks from running out of artillery shells, had to take the chips out of Ukrainian washing machines to put into their hypersonic missiles, were having entire squadrons shot down by the Ghost of Kyiv, were losing drones to grannies throwing jars of pickled tomatoes, and infantry was down to fighting with shovels.
I’m sure this jug of Kool-Aid you’ve drunk is just as good as that one.
Knock yourself out, lots of images of trees in China. I suppose Trump has already instructed you that they are all fake images and watch out for the Chinese spies sending you these photos? Gung Hai Fat Choy!
https://duckduckgo.com/?q=trees+in+china&ia=images&iax=images
After Trump big announcement on Apr 2 SPX gap lower making a rd trip to 2022 high in wave 3 of 3. The puke media might send it lower, but the plunge is caused by other reasons than tariffs, which the puke media know nothing them.
Steer Clear of the Elliot Wave cultist!
Lack of leadership in which the game plan changes by the minute is a major concern. However, it appears that the administration thrives on controversy.
Understanding that the only thing that Donald Trump cares about is people paying attention to him explains everything. He has to do or say something new and different everyday so that he can see himself on the tv. That’s really all there is to it.
That is his mental illness, it may cause injuries to the US that take years to recover from, if ever.
Checkmate? Perhaps Trump should pick up the phone and call Xi?
Lets see Mish. Trump says something that “appears” tough, and really hard on the “others” (whoever they may be, friend or foe), and gloats. Then, that half assed, mean, demeaning, dishonorable path doesn’t work out because it’s idiotic. Then, he changes track, says that was his plan all along, his sycophants honor him (Art of the deal! A MASTER negotiator, DealMaker in Chief!), and declares victory. It’s literally what he does EVERY time.
You’re still flying that Ukraine flag aren’t you?
So you just change the subject? Look over there!
What does that even mean?
remember manufacturing? We are gonna bring it all back to the USA? We all know the US has lost its manufacturing capacities and gained the supply chain. It’s going to take many, many years to return that capacity, including both physical infrastructure and re-training labor, if it can be done at all, and I’m 100% sure that those in power at the moment either don’t recognize this (i.e. they’re stupid) or couldn’t care less about it (i.e. they are avaricious).
Manufacturing cannot be brought back unless it is completely automated. But doing that creates very few, if any, blue-collar jobs, which is the stated intent by Team Trump as to why these tariffs were put in place.
Secondly, building factories are going to run into all sorts of environmental problems that will result in lawsuits, which will result in delayed and more costly build time.
Correct – Post on this coming up JoJo
Oh, but Trump and company are gutting environmental regulations faster than even the Congress or agencies under existing law (right or wrong) should be clearing out. Everything now is a “national emergency,” don’t you see?
But Trump will be leaving and it may take years or even decades to recover from the damage he has and will cause to the US. Once an old growth tree has been cut down or a species goes extinct it ain’t coming back. Trump needs to be stopped, that is the emergency facing America today.
Yes, I can already see thousands of American workers lining up to screw tiny screws into iPhones.
/s
What a great show to watch! Better than I had hoped for.
Tariffs On. Off. On Off. On. Off.
Uncertainty. As promised.
So Apple, a trillion dollar company, gets exempted from tariffs, but if you’re a small company and you import textiles from China, for example, you don’t. I don’t see how anyone can call this anything other than utter insanity.
Now you’re gettin’ it
Tim Cook donated $1 million to Trump campaign. Need further explanation?
Or maybe…
PRESS RELEASE
February 24, 2025
Apple will spend more than $500 billion in the U.S. over the next four years. Teams and facilities to expand in Michigan, Texas, California, Arizona, Nevada, Iowa, Oregon, North Carolina, and Washington
apple . com/newsroom/2025/02/apple-will-spend-more-than-500-billion-usd-in-the-us-over-the-next-four-years/
Let’s check back and see how much really winds up being spent. Many such promises by one company or another were made during Trump’s 1st erm and most never completed.
The only reason any corporation would invest money is they expect to make at least ten times the money spent in profit, it’s not for goodwill or compassion for their employees or public. Corporations are not your friend even stockholders get screwed.
Penguin Republic throws down tariff gauntlet!
Thanks for sharing, brilliant
Trump the geriatric is in mental decline.
The fog of trade war.
I was watching a Steve Hanke interview on David Lin’s YouTube channel, and Hanke was saying this type of “regime uncertainty” was a factor in causing the Great Depression. He also said M2 money supply has fallen for only the 4th time since the Fed was created and the previous three times it resulted in recessions or depressions. He also drew comparisons of these tariffs to Smoot-Hawley. His track record is strong, so the outlook isn’t good.
In the case of the imbalance in the bond markets, the erratic behavior of Trump has highlighted weakness in the bond markets, potentially creating a panic. With respect to US Treasuries, Trump averted turning a potential crisis into a full-fledged crisis when he paused the effective date of his tariffs when Treasuries unexpectedly sank in value, the opposite of what usually happens when safety becomes an issue and investors buy Treasuries for safety causing their prices to rise. But Trump’s gotta be Trump, and now that we know there is a problem (as highlighted by the fall in prices of the bonds when Trump increased tariffs and the return to normal when he paused the tariffs), the next time Trump has to be Trump, we may not be as lucky.
All of this winning is making me nauseous.
3D Chess6D Chess
No, Trump is such a genius, it’s no less than 10 dimensions. Lol
Strip poker, and the emperor has no clothes.