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Monday Edition: Another tariff hike?

The Preface
Monday Edition: Another tariff hike?
By Samuel Wonacott • Issue #42 • View online

The Takeaway: Trump rattles global markets with threats to hike tariffs on Chinese goods
The U.S. stock market soared Friday, hoisted to record-breaking heights by news the unemployment rate fell to 3.2% in April, but a confrontational weekend tweet by President Trump threatening to raise tariffs on Chinese goods ruffled investors around the globe and sent U.S markets tumbling Monday morning.
On Sunday, days before the Chinese Vice Premier Liu He was set to arrive at the White House to begin trade negotiations, President Trump fired off a tweet that partly attributed the sanguine economic news to tariffs and threatened to hike tariffs from 10% to 25% on $200 billion worth of Chinese goods.
Donald J. Trump
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
....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!
Trump’s tweet surprised the Chinese government, which had expected negotiations to include the possibility of eliminating tariffs on both sides, but according to the South China Morning Post, Vice Premier He is still scheduled to meet with Trump on Wednesday.
Trump’s tweet is the latest escalation in a trade war between China and the United States that began in early 2018, when the White House announced a series of tariffs that targeted around $200 billion worth of goods from China, including solar panels, washing machines, and steel and aluminum. China quickly retaliated, enacting protectionist measures against hundreds of U.S. goods in two separate cases throughout the year.
According to U.S. Customs and Border Protection, the United States Treasury collected about $15 billion dollars from tariffs on Chinese goods in 2018.
Trump has long claimed trade barriers hit foreign companies hardest, but a recent study by economists at Princeton, Columbia, and the Federal Reserve Bank of New York found that Trump’s tariffs fell most heavily on U.S. consumers, costing them almost $3 billion a month in 2018.
Scoops and Tidings
In a neglected cemetery lie black jockeys who helped create the Kentucky Derby - LA Times
Why Wages Are Finally Rising, 10 Years After the Recession - The New York Times
UFO Sightings: U.S. Military Takes Them Seriously, You Should Too - Bloomberg
The Case for Free Trade - National Review
Podcast Episode of the Week
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Samuel Wonacott

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