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      Trump warms to Nippon Steel, backing ‘partnership’ with US Steel

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      Donald Trump has thrown his weight behind a “partnership” between US Steel and Nippon Steel, months after insisting he was “totally against” a $14.9bn bid by the Japanese firm for its US rival.While the US president stopped short of an all-out endorsement of the takeover, he announced a deal between the two businesses on social media on Friday.Trump’s predecessor, Joe Biden, had blocked Nippon’s acquisition of US Steel, citing national security concerns, during his final weeks in office. The Trump administration has since been reviewing the proposal.Under the arrangement announced by Trump on Friday, US Steel would remain in the US, with its headquarters in Pittsburgh, he stressed, announcing plans to hold a “big rally” in the state next week.“This will be a planned partnership between United States Steel and Nippon Steel, which will create at least 70,000 jobs, and add $14 Billion Dollars to the U.S. Economy,” the president claimed on Truth Social, his social network. “The bulk of that Investment will occur in the next 14 months.”Shares in US Steel surged more than 21% after Trump’s announcement on Friday afternoon.Nippon and US Steel did not immediately respond to requests for comment.The United Steelworkers union had urged the president to reject Nippon’s bid, dismissing the firm’s commitments to invest in the US as “flashy promises” and claiming it was “simply seeking to undercut our domestic industry from the inside”.Trump’s position on Nippon’s approach has shifted significantly. Just in December, he declared he was vehemently opposed to the transaction. “As President, I will block this deal from happening,” he wrote. “Buyer Beware!!!”By last month, however, he had somewhat softened his stance, stating only that he wanted US Steel to remain in the US. “We don’t want to see it go to Japan,” he said. More

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      Trump says he is hitting EU with 50% tariff as trade talks are ‘going nowhere’

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      Donald Trump has said he will impose a 50% tariff on all EU imports to the US from 1 June after claiming trade talks between the two trading blocs were “going nowhere”.In a surprise announcement, the US president posted on his Truth Social platform that his long-running battle to secure concessions from the EU had stalled.He accused the EU of taking advantage of the US on trade, saying: “Our discussions with them are going nowhere! Therefore I am recommending a straight 50% Tariff on the European Union, starting on June 1, 2025.”Speaking to reporters in the Oval Office, Trump claimed the EU had “taken advantage” of the US and claimed the new tariffs would be imposed unless EU companies moved their operations to the US.“It’s time that we play the game the way I know how to play the game,” said Trump.Stock markets slumped in response to the news, the tech-heavy Nasdaq closed down 1% as Trump also signalled plans to impose tariffs on Apple, Samsung and other phone manufacturers. The broader S&P 500 lost 0.68%. The STOXX Europe 600 index fell by 1.7%. In London the FTSE 100 closed down 0.2% after initially dropping as much as 1.5%. Germany’s car makers were particularly hard hit, with BMW down 3.7%, Volkswagen off 2.6% and Mercedes-Benz down 4%.The US imposed a 20% “reciprocal” rate on most EU goods on 2 April, but halved that rate a week later until 8 July to allow time for talks. It has retained 25% import taxes on steel, aluminium and vehicle parts and is threatening similar action on pharmaceuticals, semiconductors and other goods.skip past newsletter promotionafter newsletter promotion“This is a major escalation of trade tensions,” said Holger Schmieding, the chief economist at Berenberg, on Friday. “With Trump you never know but this would be a major escalation. The EU would have to react and it is something that would really hurt the US and European economy.”EU negotiators have been locked in meetings with White House representatives since Trump’s so-called “liberation day” tariffs were first announced. Dozens of countries have been holding discussions to try to bring down their own levies before the 90-day pause elapses.The White House has relented on many of its most onerous tariffs, including lowering total tariffs on Chinese goods from 145% to 30% after what Trump declared were constructive talks with Beijing, which lowered its retaliatory border taxes from 125% to 10% in response.A week ago the US president appeared to acknowledge that Washington lacked the ability to negotiate deals with scores of countries at once, saying the US would instead send letters to some trading partners to unilaterally impose new tariff rates.Perceptions of an easing back on a hardline approach to trade brought a period of calm to stock markets, but Friday’s threat of a 50% levy on EU goods, plus a separate threat made the same day of 25% tariffs on iPhones made abroad, have brought an end to the peace.The EU presented a fresh trade proposal to the US on Thursday. The offer included phased tariff cuts on non-sensitive goods, plus cooperation on energy, AI and digital infrastructure. The bloc was readying about $108bn in retaliatory tariffs if talks failed.To sweeten the deal, EU officials were also willing to extend a 2020 tariff-free arrangement on US lobster imports, according to the Financial Times. But it appears to have proved insufficient to persuade the US president to sign a deal allowing only his 10% universal tariff to apply to the EU, as it does the UK. More

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      The US credit rating has been downgraded. But there’s an easy fix for our debt | Robert Reich

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      On Friday, the credit rating of the United States was downgraded. Moody’s, the ratings firm, announced that the government’s rising debt levels would grow further if the Trump Republican package of new tax cuts were enacted. This makes lending to the US riskier.Moody’s is the third of the three major credit-rating agencies to downgrade the credit rating of the United States.So-called “bond vigilantes” have already been selling the US government’s debt, as the Republican tax package moves through Congress. They’re expected to sell even more, driving long-term interest rates even higher to make up for the growing risk of holding US debt.Some rightwing Republicans in Congress are using the Moody’s downgrade to justify deeper spending cuts in Medicaid, food stamps and other social programs that lower-income Americans depend on.But, hello? There’s a far easier way to reduce the federal debt. Just end the Trump tax cuts that mainly benefit the wealthy and big corporations – and instead raise taxes on them.I’m old enough to remember when the US’s super-rich financed the government with their tax payments. Under Dwight Eisenhower – hardly a leftwing radical – the highest marginal tax rate was 91%. (Even after all tax credits and deductions were figured in, the super-rich paid way over half their top marginal incomes in taxes.)But since the Reagan, George W Bush and Trump 1 tax cuts, tax rates on the super-rich have plummeted.So instead of financing the government with their taxes, the super-rich have been financing the US government by lending it money.skip past newsletter promotionafter newsletter promotion(You may have heard that the US’s debt is held mainly by foreigners. Wrong. More than 70% of it is held by Americans – and most of them are wealthy.)This means that an ever-increasing portion of the taxes from the rest of us are dedicated to paying ever-increasing interest payments on the debt – payments that go largely to the super-rich.So when the debt of the United States is downgraded because Trump Republicans are planning another big tax cut mainly benefiting the rich and big corporations, most Americans could end up paying in three different ways:

      They’ll pay even more interest on the growing debt – to the super-rich.

      They’ll pay higher interest rates on all other long-term debt. (As higher rates on treasury bonds waft through the economy, they raise borrowing costs on everything from mortgages to auto loans.)

      The debt crisis will give Republicans even more excuse to do what they’re always wanting to do: slash safety nets. So many Americans could lose benefits they rely on, such as Medicaid and food stamps.
      The “bond vigilantes” are not the cause of this absurdity. Neither is Moody’s or the other credit-rating agencies. Nor, for that matter, is the growing national debt.What’s the underlying cause? Just follow the money. It’s the growing political power of the super-rich and big corporations to lower their taxes at the expense of most Americans.

      Robert Reich, a former US secretary of labor, is a professor of public policy emeritus at the University of California, Berkeley. He is a Guardian US columnist. His newsletter is at robertreich.substack.com More

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      JP Morgan chief warns of ‘complacency’ as markets look past credit downgrade

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      JP Morgan chief executive Jamie Dimon warned on Monday that investors were being too complacent as markets shook off news that the US has lost its last triple-A credit rating amid fresh concern over the federal government’s burgeoning debt pile.Credit ratings agency Moody’s dealt a blow to Washington on Friday when it stripped the US of its top-notch rating, downgrading the world’s largest economy by one notch to AA1 and become becoming the last of the big three agencies to drop its triple-A rating for the US.The announcement unnerved markets on Monday morning, but stock markets had recovered by the end of the day.Speaking at JP Morgan’s annual investor day meeting in New York, Dimon warned against complacency. “We have huge deficits; we have what I consider almost complacent central banks. You all think they can manage all this. I don’t think [they can],” he said.Dimon said he saw an “extraordinary amount of complacency” and added that he believes the possibility of stagflation – a recession with rising prices – was far higher than investors believe.Moody’s downgrade came as Donald Trump struggles to push his “big, beautiful” tax and spending bill through Congress, Moody’s said it expected the US budget deficit to keep rising.“Successive US administrations and Congress have failed to agree on measures to reverse the trend of large annual fiscal deficits and growing interest costs,” Moody’s said, announcing its downgrade. “We do not believe that material multi-year reductions in mandatory spending and deficits will result from current fiscal proposals under consideration.”Trump administration officials sought to play down the significance of the setback. “Moody’s is a lagging indicator,” Scott Bessent, the treasury secretary, told Meet the Press on NBC on Sunday.The US president has himself remained silent on the downgrade. On Monday morning, he used posts on his Truth Social platform to criticize celebrities including Beyoncé and Bruce Springsteen, who castigated Trump on stage in Manchester last week, for supporting his political rivals.During a rare Sunday night vote, House Republicans advanced Trump’s tax cut and spending package out of a key committee. It has been estimated that the proposed bill could add as much as $5tn to the US’s $36.2tn debt pile over the next decade.On Wall Street, the benchmark S&P 500 fell during early trading, before recovering its losses to close marginally higher, while the tech-focused Nasdaq also closed broadly flat after reversing early declines. The FTSE 100 rose 0.2% in London.Bond markets also came under pressure, with the yield on 30-year US treasury bonds climbing 13 basis points to 5.026%. Yields rise as bond prices drop; an increase signals that investors are seeking a higher return for holding US debt. The dollar weakened against a basket of currencies.“Over the next decade, we expect larger deficits as entitlement spending rises while government revenue remains broadly flat,” said Moody’s. “In turn, persistent, large fiscal deficits will drive the government’s debt and interest burden higher. The US’s fiscal performance is likely to deteriorate relative to its own past and compared with other highly rated sovereigns.” More

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      US treasury secretary says Walmart will ‘eat some of the tariffs’ after Trump demand

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      The US retail giant Walmart will “eat some of the tariffs” in line with Donald Trump’s demands, the president’s treasury secretary Scott Bessent insisted on Sunday, claiming he received the assurance in a personal phone call with the company’s chief executive, Doug McMillon.A spokesperson for Walmart said the company would not comment on conversations between its executives and administration officials. However, a source familiar with the conversation said the phone call between Bessent and McMillon was arranged many days prior to Trump’s post – and that the company’s position had not changed.Walmart said this week it had no alternative to raising prices for consumers beginning later this month because it could not absorb the cost of the president’s tariffs on international trade, which have caused turmoil in international markets.The statement provoked an angry response from Trump, who posted a rant to his Truth Social network on Saturday saying the company should “eat the tariffs and not charge valued customers anything”.According to Bessent, speaking on Sunday to NBC’s Meet the Press, Walmart is now promising exactly that.“I was on the phone with Doug McMillon, the CEO of Walmart, yesterday. And Walmart is, in fact, going to, as you describe it, eat some of the tariffs, just as they did in ‘18, ‘19, and ‘20,” Bessent said after host Kristen Welker asked if the president was asking American companies to be less profitable.“What you’re describing was Walmart’s earnings call. The other thing the companies have to do – they have to give the worst case scenario so that they’re not sued.”On Thursday, McMillon said in the earnings call that his company, a bellwether of US consumer health, was moving to protect itself against the impacts of Trump’s tariffs, despite the president’s administration announcing a pause in its trade war with China that analysts called “capitulation day”.“We will do our best to keep our prices as low as possible but given the magnitude of the tariffs, even at the reduced levels announced this week, we aren’t able to absorb all the pressure given the reality of narrow retail margins,” he said.Walmart’s chief financial officer, John Rainey, told CNBC that the company, which has thousands of stores across the US, was “wired for everyday low prices”. But he said the tariffs were “more than any retailer can absorb” – and that consumers would begin to see higher prices towards the end of May and “certainly much more in June”.Trump announced plans for an unprecedented barrage of tariffs against numerous countries on 2 April, a date he called “liberation day”.For too long, he said, the US had been “looted, pillaged, raped and plundered by nations near and far”, and he presented a list of countries and territories that would receive tariffs, ranging from numerous US allies and longtime trade partners to barren, remote islands near Antarctica occupied only by penguins.The president’s strategy, which he insisted would lead to negotiations and trade deals with at least 150 countries, was variously ridiculed and condemned as flawed and unworkable. And it created an ongoing six weeks of chaos with higher prices, crashing stock markets and slowing economic growth.He has since attempted to walk back many of the excesses of the policy, including this week’s announcement that, for an initial 90-day period, tariffs on China – a dominant supplier to Walmart and myriad other US companies – would be cut from 145% to 30%.The White House called it a “total reset” in trade relations and followed up on Friday by announcing that it would not, after all, negotiate with many of the countries, but instead unilaterally impose new tariff rates.“[It is] not possible to meet the number of people that want to see us,” Trump told a meeting of business leaders in the United Arab Emirates during his tour of Gulf states.“We have 150 countries that want to make a deal, but you’re not able to see that many countries.”Bessent told CNN’s State of the Union in a later appearance on Sunday that the US was focused on its “18 most important trading relationships” – and that he expected trade talks to continue with a number of countries leading to a series of regional deals. More

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      Cooking the books? Fears Trump could target statisticians if data disappoints

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      Summarizing his befuddlement with numbers, Mark Twain observed that there were “lies, damned lies and statistics”.The acerbic phrase later become so deeply embedded in popular consciousness that it once formed the title to an episode of The West Wing, NBC’s portrayal of a fictitious US president played by Martin Sheen.Now professional economists and number-crunchers fear the aphorism could become a White House theme in real life. Buffeted by global markets and public opinion – both of which show a wary skepticism of Donald Trump’s affinity for trade wars – the president may be about to turn his renowned hostility to truths at odds with what he believes towards public servants charged with producing accurate information.A proposed rule change making it easier to fire civil servants deemed to be “intentionally subverting presidential directives” could pave the way for the White House to fire statisticians employed to produce objective data on the economy but whose figures prove politically inconvenient, experts warn.Statistics released by agencies such as the Bureau of Labor Statistics (BLS) and the Bureau of Economic Analysis (BEA) are used by the Federal Reserve Bank to set inflation policy and interest rates. They also form the basis on which businesses and investors take decisions.The US’s global reputation as a stable economic power and a reliable partner goes hand-in-hand with its long history of producing accurate data, dating back to the establishment of the BLS in 1884. Interfere with the latter and you risk sacrificing the former, experts warn.But with Trump under pressure to explain shrinking gross domestic product (GDP) figures amid economists’ warnings that tariffs could trigger a recession, the administration could use new employment rules to pressure workers into “cooking the books”.“There are a number of changes to the civil service that make it much easier for the administration to try to interfere with the activities of the statistical agencies and that worries me,” said Erica Groshen, a specialist in government statistics at Cornell University.While acknowledging that there is as yet “no evidence” the Trump administration has done so, Groshen, a former commissioner at the Bureau of Labor Statistics (BLS), fears a new rule proposed last month by the White House’s office of personnel management threatens the future integrity of federal agencies’ figures.The change, based on an executive order signed by Trump on 20 January immediately after his inauguration, would reclassify about 50,000 as-yet-unspecified permanent civil servant positions to “policy/career” category, thus enabling their removal for “poor performance or misconduct”.The precise roles to be so redefined have yet to be revealed but Groshen fears statistic specialists will be in the administration’s crosshairs.“Bureau of Labor Statistics’ leaders could be fired for releasing or planning to release jobs or inflation statistics unfavorable to the president’s policy agenda,” she wrote in a briefing paper that urges organizations dependent on BLS figures to submit comments criticizing the proposal.“By making it easier to remove employees if a president determines that they are interfering with his or her policies, it increases the potential for passivity or political loyalty to be prioritized over expertise and experience.”Trump regularly cast doubt on the accuracy of economic data when in opposition – calling positive BLS jobs figures during the Obama and Biden administrations “fake” but hailing them as accurate when they painted a rosy picture of the economy during his first presidency.Last month, when GDP figures showed an economic contraction during the first 100 days – partly fueled by tariffs – Trump put the blame on Biden.“We had numbers that, despite what we were handed, we turned them around and we were getting them really turned around,” he told reporters.The commerce secretary, Howard Lutnick – who has direct responsibility over many of the statistical agencies – has suggested changing the way GDP is calculated in a way that might provide more upbeat figures but which would mark a departure from established practice and international standards.Diluting data agencies’ impartiality risks adding the US to the category of countries which have had the veracity of their economic statistics openly doubted, critics say. Groshen cited Argentina, whose official inflation figures were rejected as false by the International Monetary Fund (IMF), and Greece, where government statisticians were said to have miraculously made inflation and disqualifyingly high budget deficits “disappear” to enable it to join the European Union’s single currency, the euro, in the late 1990s.The sleight of hand had dire consequences. The 2008 global financial crash propelled the country’s economy into a tail-spin, forcing it to seek huge loans from the IMF and the EU, which were only given on condition of harsh austerity measures and cuts to public services.Popular anger over the conditions in Greece destabilised establishment political parties and led to a rise in support for radical and populist alternatives, including the leftwing Syriza, which won power in 2015. Frequent elections and changes of government since have raised concerns about the health of the country’s democracy.The IMF also censured Argentina and threatened it with expulsion in 2013 after officials were found to have been grossly understating the inflation rate for the previous six years.Argentina – historically one of the IMF’s biggest borrowers – did not receive another loan from the organisation until 2018. That loan, followed by another in 2022, failed to stabilise the country’s economy and in 2023, Javier Milei, a far-right candidate and professed admirer of Trump, was elected president pledging drastic spending cuts to address its chronic economic problems.Last month saw the fund agree to another $20bn bailout for Milei’s government.Despite these baleful precedents, the Trump administration’s sensitivity to economic figures indicating a tariff-driven slowdown creates a potential spur to follow a similar path, argued Erasmus Kersting, an economics professor at Villanova University.“I would say that there’s definitely an incentive to cook the books, but I don’t think that it is going to be very easy or feasible to do,” he said, citing the US’s long tradition of producing accurate economic figures.“The Bureau of Economic Analysis would essentially need to be silenced or defunded and replaced with some other statistical agency, which would then result in different figures. The same would be true of the Bureau of Labor statistics.”Accurate and unbiased figures are crucial in helping the Federal Reserve form sound policy, Kersting said. In their absence, Trump might have more scope to attack the Fed’s chair, Jerome Powell, who he has already accused of “playing politics” by not bowing to his demand to cut interest rates.Kitty Richards, a former treasury and White House official under the Biden and Obama administrations, said data collection had been impaired by Elon Musk’s attacks on federal agencies under the auspices of the unofficial “department of government efficiency,” or Doge.“We should view attacks on government data collection as hand in glove with attacks on journalism,” said Richards, now a senior fellow at Groundwork Collaborative, a thinktank. “Undermining data collection and casting doubt on data that is released is part of a program of undermining the public’s ability to learn the truth.”Even a temporary interruption of the US’s established data-collecting capacity would be a “real tragedy” and lead to a permanent loss of knowledge, she said. “You can’t go back and fix it. If you have a data series stretching back 50 years, then it gets cut for two or three years, you no longer have that 50-year data series. You’ve lost knowledge forever.”Greshen, who is calling on users of government statistics to object to the proposed civil service changes before a 30-day window expires on 23 May, said the fate of US democracy could hinge on the continued production of accurate figures.“In a democracy, you want to be feeding people the right information so they will make the right choices. But if the goal is to destroy democracy, you’d want to control the statistics to fit your story … you want to be promoting your own version of reality.” More

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      This pause in the trade war will be brief. Small businesses, plan accordingly

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      Donald Trump’s massive Chinese tariffs are on pause. The media debated. Wall Street rejoiced. Many of my clients breathed a sigh of relief. Big retailers jumped for joy. But for how long?For starters, the tariffs that weren’t paused – a 10% levy on all Chinese goods, plus a bonus 20% tax that somehow relates to fentanyl, are still in place. When you take into consideration existing tariffs on steel from previous Trump and Biden administrations, the effective tariff rate on Chinese goods is actually closer to 40%, according to an analysis done by the Wall Street Journal.That’s a big number. Maybe that won’t deter people from buying underwear at Target. But for companies that rely on steel and aluminum, semiconductors, synthetic fabrics, plastics, minerals, coatings and solvents as well as certain bearings, motors, pumps and parts, a 30-40% hike is a major impact on their margins, which will affect their spending and investments. Ultimately, the costs of the end products that use these materials will also rise as companies simply pass them down.Just as important, Trump’s animosity towards China – unfounded or not – isn’t going to just magically disappear. He’s called the Chinese cheaters, polluters and thieves. And his past actions – particularly in his first administration – do not bode well for a quick resolution to this issue.In 2018, the Trump administration not only imposed onerous tariffs on China but also issued some very harsh requirements to address trading issues with its closest economic rival.There were specific quotas set to limit our trade deficit. There were demands made to reduce the Chinese requirement forcing American companies to share or transfer technology with their Chinese counterparts. There were rules aimed at stopping the alleged (ha, ha) stealing of data and intellectual property by the Chinese.The problem is that none of this happened. What happened – shortly after the negotiations started – was Covid. And then 2020 and a new administration. But don’t think that Trump won’t raise these issues again. He will, and when this happens we’ll be back to the same place we started: excessive tariffs and a trade war with China.That doesn’t mean that businesses are completely stuck. Many – those that have the funds – are using the tariff suspension to buy up products from China like it’s a fire sale at Costco on Black Friday. Others are contracting with bonded warehouses and storage facilities in free-trade zones to accept products that are temporarily tariff-free, hoping that when they pull materials from these storage units those rates will have come down.I have clients who are aggressively searching for alternative suppliers. I have others who are bringing their assembly and manufacturing back to the US. Those that aren’t able to make these kinds of investments are trying to work out how and how much they can change pricing and what the market will take. A few have already created special line items on their invoices to separate out the tariff charge in an effort to say: “Hey, don’t blame me for this stuff!”My smartest clients started doing this stuff the day after Trump was elected. They listened to what he’d said during the previous couple of years. They read the writing on the wall. Now they’re ahead of the game. Good for them.Companies that didn’t do this – especially small businesses that have fewer resources and are more reliant on just a supplier or two – are in trouble, particularly if they buy from China. For any business still reliant on Chinese suppliers and markets, this pause isn’t going to last as long as you think. There will be a lot more coming in this trade war – and let’s hope it doesn’t turn into an actual war. The outlook is precarious and risky. Trump is volatile and emotional and has a history of knocking China. Plan accordingly. More

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      Gone in 40 days: how Trump’s ‘liberation day’ tariff assault unraveled

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      Donald Trump hailed a new chapter in the US’s economic history on 2 April, dubbed “liberation day” by his administration, as he announced plans for an extraordinary barrage of US tariffs on the world. The chapter lasted 40 days.The page has already been turned. But the impact of those six chaotic weeks, from higher prices to slowing growth, is still unfolding – and the US president is already threatening further adjustments. The story continues.Trump had been steered away from his aggressive instincts on trade during his first term, and persuaded to walk back several tariff threats in the opening months of his second. But back in early April, he was determined to plough ahead.“April 2nd, 2025, will forever be remembered as the day American industry was reborn, the day America’s destiny was reclaimed, and the day that we began to make America wealthy again,” Trump declared at an event in the White House Rose Garden, before an audience of his top officials and supporters.The measures were blunt and severe: a blanket 10% tariff on all imported goods, and higher individualized rates, of up to 50%, on dozens of markets – those of economic allies and rivals alike – deemed to have treated the US poorly on trade.‘Be cool’First came the questions. How exactly did the Trump administration come up with such an array of specific duties to impose upon goods from so many countries and territories? And why was a group of barren, uninhabited islands near Antarctica among them?Then came the panic. Global stock markets tanked, with Wall Street enduring its steepest falls since the onset of the Covid-19 pandemic five years ago, as the president repeatedly insisted he was serious this time.Trump’s officials were sent out to hold the line. “The announcement today is the most significant action on global trade policy that has taken place in our lifetimes,” said Stephen Miller, his deputy chief of staff for policy. “We’re just going to have to wait and see” what happens, the treasury secretary, Scott Bessent, told Bloomberg. One thing’s for sure, the commerce secretary, Howard Lutnick, told CNN: “The president is not going to back off.”On day five of the new chapter, the 10% baseline tariffs came into force. On day seven, the higher, individualized rates followed. Beijing vowed to retaliate. Business leaders, including some who had backed Trump’s run for the White House, urged him to reconsider.A sell-off in treasury bonds, typically deemed a safe haven during periods of economic volatility, took hold. “BE COOL! Everything is going to work out well,” Trump wrote on Truth Social, adding a few minutes later: “THIS IS A GREAT TIME TO BUY!!! DJT”This advice seemed prescient four hours later. Seven days into the new chapter, with his individualized tariffs imposed for all of 13 hours, Trump announced a 90-day pause – in effect reducing the universal duty on all US imports from almost all countries to 10% – and markets surged higher.Almost all countries, that is, except China. Beijing’s pledge to hit back infuriated the president, who blamed its “lack of respect” as he announced a new US tariff of 125% (in effect, once other duties were included, 145%) on Chinese goods. It retaliated in kind.Getting yippyThe same officials who had been dispatched to defend Trump’s initial plan were sent out again, to explain his latest climbdown.“You have been watching the greatest economic master strategy from an American President in history,” Miller claimed on X.“Many of you in the media clearly missed The Art of the Deal,” the press secretary, Karoline Leavitt, scolded reporters, referring to the president’s 1987 bestseller, in which the real estate tycoon presented himself as a consummate dealmaker.While his aides claimed that more than 75 countries had been in touch following his initial tariff announcement, even the president struggled to present the reversal as part of a carefully orchestrated negotiating strategy. Asked what had prompted it, Trump told reporters people had been “getting a little bit yippy” about his plan.But some of the US’s largest companies were still feeling pretty yippy. Apple, for example, relies on factories in China to churn out the iPhone, which is responsible for almost half its business.Late on day 10, away from the noisy press gaggles and all-caps social media posts, US Customs and Border Protection posted a list of products that would be exempt from the Chinese tariffs – including smartphones, computers and semiconductor chips.While the administration had walked back much of Trump’s initial plan, concern lingered over what remained. Trump maintained that high tariffs were the way forward, but fears of widespread shortages and dramatic price increases loomed large. Polling made clear consumers were increasingly concerned.On day 28, at the end of a cabinet meeting, the president tried to play down the risks of his assault on China. “Well, maybe the children will have two dolls instead of 30 dolls, you know,” he said. “And maybe the two dolls will cost a couple of bucks more than they would normally.”Blame gameEarlier that morning, dismal economic figures for the first quarter had underlined how – as the last chapter drew to a close – the mere threat of Trump’s economic assault appeared to dent growth. US gross domestic product (GDP) shrank for the first time in three years, abruptly turning negative after a spell of robust growth as imports surged 41% while companies scrambled to pre-empt tariffs.Trump raced to pin the blame on his predecessor. “I think the good parts are the Trump economy and the bad parts are the Biden economy,” he told NBC’s Meet the Press.Many economists said the growth decline in the first quarter, as firms braced for Trump’s new chapter, raised troubling questions about the second, when the president finally launched it at his “liberation day” event.Aside from dolls, the administration started to indicate it might be willing to adjust tariffs on China that were hitting goods – like baby car seats and cribs – that the US almost entirely imports from the country. Such exemptions were “under consideration”, Bessent told Congress, potentially averting a spike in prices for young families.But as the weeks drew on, after promising his trade strategy would prompt countries around the world to trip over themselves to strike deals with the US, Trump was finding it harder to explain why none had materialized.On day 34, as questions mounted, he complained the media had become fixated. “You keep writing about deals, deals,” he said, adding that he wished journalists would stop asking. “Some deals” would be signed, the president said, but tariffs were a “much bigger” focus.On day 36, the first deal was declared done. Trump summoned back reporters to unveil what he called a “maxed-out deal that we’re going to make bigger” with the UK. In reality, there was still work to do: both he and Keir Starmer, the British prime minister, conceded certain details had yet to be finalized.By the next morning, Trump’s focus had returned to China. Bessent was preparing for talks with the country’s officials in Geneva, fueling hopes that the world’s two largest economies might lower their eye-watering tariffs. “80% Tariff on China seems right! Up to Scott B,” the president wrote on social media.‘This is going to crush us’Trump was also watching the liberal MSNBC network, where the business commentator Stephanie Ruhle argued his strategy on tariffs was not working. “You’re seeing day in, day out, more business leaders – whether it’s Warren Buffett, or Jamie Dimon, or Ken Griffin, on big global stages – saying this is going to crush us economically,” she said. “And then you’ve got congressmen, senators, from every state saying to this White House: our small businesses are … dying here.“I’m not saying Donald Trump has changed what he thinks in his heart. But he’s backed into a corner, and he needs to get off this crazy tariff train, and he knows it.”Trump punched back. “Few people know Stephanie Ruhle, but I do, and she doesn’t have what it takes,” he wrote on Truth Social, accusing her of lies. “We’re going to make a fortune with Tariffs, only smart people understand that, and Stephanie was never known as a ‘High IQ’ person.”If only smart people understood the US stood to make a fortune from tariffs, they might have been surprised by what happened next.Away from TV studios, some of the most senior people in the White House, including the chief of staff, Susie Wiles, reportedly started to warn the president of risks not unlike those laid out by Ruhle. “The key argument was that this was beginning to hurt Trump’s supporters – Trump’s people,” one person briefed on internal conversations told the Washington Post. “It gave Susie a key window.”On day 40, after discussions in Geneva, Bessent confirmed that US and Chinese officials would drastically reduce the tariffs they had aggressively ratcheted up just a few weeks before. With US tariffs on Chinese goods falling to 30%, Trump hailed a “total reset” in relations between Washington and Beijing.The reversal, although far from a total reset, confined the latest “liberation day” measure to history.2 April 2025, is not yet remembered as the day American industry was reborn. Much of what was announced that afternoon has already died.The page has been turned. On Friday, Trump claimed about 150 countries would soon receive letters “essentially telling” them of new US duty rates on their exports. Many learned of similar rates last month, only for the plan to change in a matter of days.A new chapter, without pomp or ceremony, is now under way. What this one will entail – or how long it lasts – is anyone’s guess. More