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      China Accuses U.S. of Blackmail After Trump Threatens More Tariffs

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      The country’s commerce ministry called President Trump’s threat to escalate tariffs on China by another 50 percent “blackmail.”China lashed out at the United States on Tuesday after President Trump demanded that Beijing rescind its retaliatory tariffs or face an additional 50 percent U.S. levy, calling his threat “blackmail,” as tensions between the two major powers rose.The Ministry of Commerce, without referring to the American president by name, said that Beijing had noted that the United States had threatened to impose a further 50 percent tariff on China. It said that Beijing would take countermeasures to safeguard its interests.“The U.S. threat to escalate tariffs on China is a mistake on top of a mistake, which once again exposes the blackmail nature of the United States,” the ministry’s statement said. “China will never accept it. If the United States insists on its own way, China will fight to the end.”China had announced last week that it would match Mr. Trump’s tariffs by imposing a retaliatory 34 percent tax on imports from America. The latest escalation that Mr. Trump described on Monday, if imposed, could bring the U.S. tariff on Chinese goods to 104 percent. For some products, though, the rate is likely to be much higher because of levies that date back to Mr. Trump’s first term. Mr. Trump also threatened to halt any further negotiations.American consumers last year bought $440 billion of goods from China, making it the second-largest source of U.S. imports after Mexico. Taken together, it could prove costly for American importers bringing in clothing, cellphones, chemicals and machinery from China.China said that the United States should cancel all unilateral tariffs against China, “stop suppressing China’s economy and trade, and properly resolve differences with China through equal dialogue on the basis of mutual respect.”China has been trying for months to engage in high-level talks with the Trump administration to try to lay the ground for a potential summit between Mr. Trump and China’s top leader, Xi Jinping. But despite Mr. Trump saying earlier this year that he was open to engaging with Mr. Xi, Beijing has struggled to receive much of a response from the White House.Berry Wang More

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      Why Did Wall Street Get Trump So Wrong?

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      Donald Trump’s 2024 election sent many finance types into spasms of anticipatory ecstasy as they imagined freedom from regulations, taxes and unfamiliar pronouns. “Bankers and financiers say Trump’s victory has emboldened those who chafed at ‘woke doctrine’ and felt they had to self-censor or change their language to avoid offending younger colleagues, women, minorities or disabled people,” The Financial Times reported a few days before Trump’s inauguration. It quoted one leading banker crowing — anonymously — about finally being able to use slurs like “retard” again. The vibes had shifted; the animal spirits were loose.“We’re stepping into the most pro-growth, pro-business, pro-American administration I’ve perhaps seen in my adult lifetime,” gushed the hedge fund manager Bill Ackman in December.One Wall Street veteran, however, understood the risk an unleashed Trump posed to the economy. After Trump’s victory in November, Peter Berezin, chief global strategist at BCA Research, which provides macroeconomic research to major financial institutions, estimated that the chance of a recession had climbed to 75 percent. “The prospect of an escalation of the trade war is likely to depress corporate investment while lowering real household disposable income,” said a BCA report.The surprising thing isn’t that Berezin saw the Trump tariff crisis coming, but that so many of his peers didn’t. You don’t have to be a sophisticated financial professional, after all, to understand that Trump believes, firmly and ardently, in taxing imports, and he thinks any country that sells more goods to America than it buys must be ripping us off. All you had to do was read the news or listen to Trump’s own words. Yet Berezin was an outlier; most of the people who make a living off their financial acumen had less understanding of Trump’s priorities than a casual viewer of MSNBC.On Monday, as stocks whipsawed on shifting news and rumors about the tariffs, I spoke to Berezin, who is based in Montreal, about how Wall Street had gotten Trump so wrong. He told me that many investors who pride themselves on their savvy are in fact just creatures of the herd. “All these cognitive biases that amateur retail investors are subject to, the Wall Street pros, are, if anything, even more subject to them because they’ve got career risk associated with bucking the trend,” he said.People in finance, said Berezin, are more likely to be punished for being too cautious and pessimistic than for being too hopeful and aggressive. Last year, for instance, a famed strategist named Marko Kolanovic left JPMorgan Chase abruptly when his gloomy predictions about 2023 and 2024 turned out to be wrong, or least premature. Mike Wilson, also known for his bearishness, stepped down from his post as chair of Morgan Stanley’s Global Investment Committee, though he stayed with the company. “You don’t get fired for being bullish, but you do get fired for being bearish on Wall Street,” said Berezin.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      JPMorgan Chase CEO Jamie Dimon Warns of Economic Pain From Trump’s Tariffs

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      President Trump’s wave of tariffs threatens to bring both short-term economic pain, including lower growth, and long-term damage to America’s standing and trade relationships around the world, the chief executive of Wall Street’s biggest bank warned on Monday.“The recent tariffs will likely increase inflation and are causing many to consider a greater probability of a recession,” Jamie Dimon, JPMorgan Chase’s chief executive, wrote in his annual letter to shareholders.The warning by Mr. Dimon, one of Wall Street’s most influential leaders, echoes the growing anxiety among corporate chiefs about how the tariffs will play out. Even those who had initially professed support for Mr. Trump’s trade plans are becoming increasingly worried about the consequences.Even before Mr. Trump’s tariff announcement last week, the U.S. economy had been showing signs of strain after years of healthy performance, Mr. Dimon wrote. Inflation was already a worry, Mr. Dimon said, pointing to a yawning fiscal deficit and the need for more infrastructure spending. And stock valuations remain well above historical averages, — even after the recent market sell-off.The potential consequences of the trade fight could make things worse, the letter said. Those include other countries’ efforts to fight back — as China has done by imposing 34 percent counter-levies — and a possible erosion of confidence among consumers and investors. Mr. Dimon also warned about the weakening of the American dollar’s role as the global reserve currency.“If America, for whatever reason, becomes a less-attractive investment destination, the U.S. dollar and the economy could suffer if foreigners sold their U.S. assets,” he wrote.JPMorgan’s own economists have increasingly been saying that a recession is more likely this year, though Mr. Dimon did not personally take a position on those odds in his shareholder letter.While Mr. Dimon asserted that JPMorgan itself was strong enough to withstand the shocks that the levies posed — its traders have profited from previous whipsaws in the markets — the global economy may not be so fortunate. “It is not particularly good for the capital markets,” Mr. Dimon wrote of the tariff-linked volatility.For now, Mr. Dimon wrote that he was hoping for a speedy resolution to the trade battles. “The quicker this issue is resolved, the better because some of the negative effects increase cumulatively over time and would be hard to reverse,” he wrote.The longer-term worry, Mr. Dimon said, is that Mr. Trump’s fight could shred decades-old alliances that cemented the United States’ primacy in the global order. The JPMorgan chief wrote that he was worried that America’s trading partners might seek out deals with the likes of China, Iran or Russia in response to the tariffs.“America First is fine,” Mr. Dimon wrote, referring to Mr. Trump’s description of his policies — “as long as it doesn’t end up being America alone.” More

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      Bitcoin Is Down 10% Since Trump’s Global Tariff Announcement

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      The rapid drop shows that cryptocurrencies, which the president has promoted, are subject to the same market gyrations as any other risky asset.Virtually everyone in the cryptocurrency world celebrated the second election of President Trump, an enthusiastic booster of the industry who promised to turn the United States into the “crypto capital of the planet.”But now the man nicknamed “the first Bitcoin president” is presiding over a Bitcoin crash.Since Mr. Trump announced his global tariffs last week, the price of Bitcoin has plunged 10 percent, dropping below $78,000 on Sunday night. In January, Bitcoin reached a record price of nearly $110,000 on the day that Mr. Trump was inaugurated.The rapid drop shows that Bitcoin, often pitched as a stable long-term source of value, is still subject to the gyrations of the broader market that has cratered since Mr. Trump announced broad import taxes last week. Many investors treat Bitcoin just like any other tech stock, a risky investment that it makes sense to sell in difficult times.Ever since he won a second term, Mr. Trump has largely made good on his promises to help the crypto industry. He has appointed regulators who support crypto and signed an executive order directing the creation of a government stockpile of Bitcoin.At the same time, Mr. Trump has also broadened his personal investments in the crypto world, marketing a so-called memecoin to his supporters.But the impact of his tariffs on the crypto market has led to some disgruntlement.“Crypto is weird, but it’s mostly correlated to optimism & risk appetite,” Haseeb Quresehi, a venture investor who specializes in crypto, wrote on social media on Sunday. “That optimism is crumbling under Trump’s silence.” More

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      Stocks in Asia Fall Sharply, Extending a Rout Caused by Trump’s Tariffs

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      Futures on the S&P 500, which allow investors to trade the index before regular trading begins on Monday, added to last week’s sell-off.Financial markets were hit hard by another wave of selling at the start of trading in Asia on Monday, with investors and economists grappling with rising odds of a severe economic downturn caused by President Trump’s significant new tariffs on imports.Trading was extremely volatile. Stocks in Japan plunged over 8 percent, while South Korea tumbled about 5 percent. In Australia, stocks fell more than 6 percent.Over the weekend, analysts circulated notes warning that Asia could be particularly vulnerable to a tit-for-tat exchange of retaliatory tariffs between China and the United States. Many countries in the region, including Japan and South Korea, count both nations as their top trading partners.President Trump doubled down on Sunday evening, saying that he would not ease his tariffs on other countries “unless they pay us a lot of money.” He also dismissed concerns that his steep new taxes on imports will lead to higher prices. “I don’t think inflation is going to be a big deal,” he told reporters on Air Force One.On Friday, China struck back at the United States with a 34 percent tariff on a number of American exports, matching a 34 percent tariff that Mr. Trump imposed on China last week.On Monday, stock benchmarks in Hong Kong and Taiwan plunged about 10 percent when they started trading. Stocks in mainland China were down about half that amount.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      After Trump’s Tariffs, Stocks Plunged but Penguin Memes Ticked Up

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      The internet poked fun at the Trump administration’s decision to impose new tariffs on Heard Island and McDonald Islands, Australian territories near Antarctica where many penguins but no people live. The Trump administration this week levied sweeping tariffs across the globe, provoking retaliation from other countries and sending the stock market tumbling. An unexpected consequence? Penguin memes.Images of the flightless birds have waddled their way across the internet this week after President Trump imposed tariffs on Heard Island and McDonald Islands, Australian territories near Antarctica that are home to many penguins but no people.One meme featured an altered photo of the explosive February White House meeting in which Mr. Trump and Vice President JD Vance publicly clashed with President Volodymyr Zelensky of Ukraine. Instead of a fiery confrontation with the wartime leader, however, Mr. Trump and Mr. Vance sit next to a black-and-white bird.One person who posted the meme wrote, “Maybe it didn’t say thank you?” in a possible reference to Mr. Vance’s accusation that Mr. Zelensky had not appropriately thanked the United States for the military support Washington had provided Kyiv throughout the war.A different meme showed a penguin teaching sea gulls to aim their waste at Teslas, an apparent nod to Mr. Trump’s billionaire adviser, Elon Musk. Yet another showed a huge gathering of penguins with a caption citing “Unprecedented protests” on Heard Island and McDonald Islands, “as the population rises up” against Mr. Trump’s imposition of across-the-board tariffs.The UNESCO World Heritage Convention notes the islands’ “complete absence of alien plants and animals, as well as human impact.” Still, Mr. Trump included the desolate islands on his list, imposing the 10 percent base-line tariff he placed on nearly all goods imported into the United States.The Wednesday announcement, which Mr. Trump described as America’s “Liberation Day,” sent shock waves across the world as both allies and adversaries scrambled to make sense of the new and hefty tariffs. The move has shot U.S. import duties to the highest levels in over a century.Also slotted for new tariffs were the British Indian Ocean Territory, a collection of mostly uninhabited islands, save for U.S. and British soldiers stationed on joint military bases.Other islands subjected to tariffs included Tokelau, a territory of New Zealand that has fewer than 2,000 inhabitants; the Norwegian islands of Svalbard, which has about 3,000 residents; and Jan Mayen, where the only humans are the military personnel who operate a weather and coastal services station.Mr. Trump has said little about the methodology behind the new system of calculations, but each country’s new tariff rate appeared to come from a formula that takes the trade deficit America runs with a nation and divides it by the exports that country sent into the United States. The White House explained its methodology in this post, which essentially confirms that formula.Then, because Mr. Trump said he was being “kind,” the final tariff number was cut in half.It is not clear how the administration decided to add Heard Island and McDonald Islands to the list of tariffs. The White House did not immediately respond to request for comment.Jenny Gross More

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      Musk Says He Hopes Europe and U.S. Move to a ‘Zero-Tariff Situation’

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      Only three days after President Trump announced sweeping tariffs, including a 20 percent tariff on goods from the European Union, Elon Musk said on Saturday that he hoped that Europe and the United States moved “to a zero-tariff situation, effectively creating a free-trade zone.”Mr. Musk made the remarks during a videoconference appearance with Italy’s far-right League party in Florence. They came after the tech billionaire turned presidential confidant had stayed largely silent about Mr. Trump’s tariffs.During Mr. Trump’s first term, Mr. Musk had said there should be “no tariffs at all either way” between the United States and Britain.Mr. Musk also said that he hoped that the United States and Europe could “establish a very close partnership,” a statement that contrasted with the contempt members of Mr. Trump’s administration have shown for Europe, and statements by Mr. Trump himself, who claimed the European Union was created to “screw” America. He added that he wished there were “more freedom of people to move between Europe and North America.”Mr. Musk’s appearance at the League’s meeting, in which he warned of the dangers of censorship and mass immigration, came as he continued to use his influence to bolster far-right forces across Europe.Just a day earlier, Mr. Musk and Mr. Trump had voiced support for Marine Le Pen, the French far-right leader, who was convicted this week on embezzlement charges and disqualified from running for public office. Earlier this year, Mr. Musk publicized the German far-right Alternative for Germany party and weighed into Italy’s immigration debate, prompting the country’s president to rebuke him.On Saturday, he appeared at the party conference with Matteo Salvini, the leader of the League party. During his brief intervention, Mr. Musk also promoted the activities of his cost-cutting Department of Government Efficiency, supported Mr. Trump’s position on the war in Ukraine and attacked what he called the overregulation of the European Union. More

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      A Tariffs Cheat Sheet

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      An escalating global trade war has tanked markets and plunged corporate America into chaos. DealBook asked economists, investors and other experts to help make sense of what’s next.It was much worse than expected. President Trump’s attempt to reverse the rules of global trade through sweeping tariffs against dozens of nations, including major partners like the European Union, Japan and China, has caused a meltdown in global markets and sent corporate boardrooms scrambling.Today, 10 percent tariffs go into effect on all of America’s trading partners except Canada and Mexico. Additional, “reciprocal” tariffs will go into effect on dozens of other nations on Wednesday. China faces the toughest levies — at least 54 percent — and it hit back with its own toll on U.S. goods yesterday. Expect a response from the E.U. next week.Trump has argued that the economic pain caused by the tariffs will be short term and ultimately justified by a boom in the U.S. economy, but news of the measures hit investors hard. The benchmark S&P 500 closed yesterday near bear market territory, with analysts warning of an increased risk of recession.Jerome Powell, the head of the U.S. Federal Reserve, offered a somewhat glum outlook yesterday on the prospects for growth and warned of higher prices that he acknowledged could be more than temporary.There’s a lot going on. DealBook asked economists, investment researchers and other experts to help make sense of what’s next.How have the new tariffs changed the risk of a recession?We asked: Jason Furman, a professor of economics at Harvard and former economic adviser to President Barack Obama.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More