So much for the United States and China being close to reaching a new trade agreement.
For months, there have been endless reports about the U.S.-China trade war coming to an end, a new trade pact coming through the pike, and President Donald Trump and President Xi Jinping signing a new agreement. Despite none of these events ever happening, the market still believed it – possibly just lying to themselves to inflate equities.
Perhaps there is now proof that those reports were just fake news.
President Donald Trump confirmed on Twitter that tariffs on $200 billion worth of Chinese goods will spike from 10% to 25% on Friday, and another $325 billion in imports will “shortly” face tariffs.
He tweeted:
For 10 months, China has been paying Tariffs to the USA of 25% on 50 Billion Dollars of High Tech, and 10% on 200 Billion Dollars of other goods. These payments are partially responsible for our great economic results. The 10% will go up to 25% on Friday. 325 Billions Dollars….
— Donald J. Trump (@realDonaldTrump) May 5, 2019
….of additional goods sent to us by China remain untaxed, but will be shortly, at a rate of 25%. The Tariffs paid to the USA have had little impact on product cost, mostly borne by China. The Trade Deal with China continues, but too slowly, as they attempt to renegotiate. No!
— Donald J. Trump (@realDonaldTrump) May 5, 2019
As a result, the Dow Jones is down nearly 300 points, the S&P 500 is down 31 points, and the Nasdaq is down 100 points (at the time of this writing).
Is Trump just a Twitter troll like Elon Musk? Or, does he not know what he’s doing on trade? Maybe it’s a bit of both.
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