Quick Tariff Update - and yeah it is complex (Patreon)

Why Tariffs are required? Easy answer - to bring balance back.

Eg Mexico has been running a significant trade surplus with the U.S., which has ballooned to $175 billion, making it the second-largest trade surplus of any country with the U.S., behind only China. Hanson highlights that much of this surplus stems from Mexico acting as a conduit for Chinese goods. China sends raw materials—like components for computers, phones, and appliances—to Mexico, where they are assembled and then exported to the U.S. under free trade agreements, such as those established under NAFTA and its successor. This practice allows China to evade U.S. tariffs while Mexico benefits economically. The tariffs aim to pressure Mexico into addressing this loophole and reducing the trade imbalance, which is seen as unfair and exploitative of U.S. trade policies.

Why Tariffs Hit the Stock Market

Trump’s tariffs casue economic pain by raising costs, disrupting supply chains, and spooking the stock market. Some say costs will only rise temporarily as in time more stuff will be onshored. But real hit is most of all the stock market hates uncertainty.

Why majority of voters are not impacted?

Trump voter base are largely working-class Americans with little stock market exposure—cares more about his promise to protect American jobs than about Wall Street’s woes. The Vanguard report underscores this disconnect: most Americans aren’t heavily invested in the market, so a dip doesn’t hit them directly. Most care most about dropping cost eg Gas, Eggs, Interest Rates etc and these items are all dropping like a stone right now.