Trump pauses reciprocal tariffs
But he raises levy on Chinese goods to 125%
By: John Bacon
Joey Garrison
Swapna Venugopal Ramaswamy
and Philip M Bailey
USA Today
..... After a tumultuous week in global business and politics, President Donald Trump made a sudden reversal, announcing Wednesday [04/09/2025] that he would pause his reciprocal tariffs, immediately, for 90 days.
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But he said a 10% across-the-board levy would remain. And he was raising the already sky-high tax on Chinese goods to 125% "based on the lack of respect that China has shown to the World's Markets." he wrote on social media.
..... U.S. stocks immediacy shot up in response. China and European Union had already unveiled stiff retaliatory levies Wednesday. [04/09/2025] The Asian trade giant vowed to impose its own 84% tariff on U.S. goods starting Thursday,[04/10/2025] up
from the 34% insisted on further escalation its economic and trade restrictions. China has the firm will and abundant means to take necessary countermeasures and fight to the end," the Ministry of Commerce wrote in a document released Wednesday. [04/09/2025]
..... European Union coutures agreed to approve the bloc's first countermeasures again U.S. tariffs.
The 27-nation bloc said it would put in place duties mostly of 25% on a range of U.S. imports starting April 15. [2025] The products include corn, wheat, barley, rice, motorcycles, poultry, fruit, wood, clothing and dental floss, according to a documents seen by Reuters. They totaled about $23 billion last year. [2024]
..... Trump rolled out a flurry of reciprocal laves on trading partners at 10:01 AM. Wednesday [04/09/2025] after 10% levies on almost all imports over the weekend. That sparked negotiation efforts, with Trump saying 75 nations have gotten in touch ti open tariff talks.
.... The administration has started negotiating with South Korea and Japan, and is meeting with a delegation form Vietnam, Treasury Secretary Scott Bessent told Fox Business.
..... But China has remained defiant.
..... "We will see what China does," Bessent told reporters outside the White House.
'So what?'
..... Beseent said the president has been following a plan they discussed on Sunday. [04/06/2025]
..... "You might even say that he goaded China into a bad position. They responded. They have shown themselves to the world to be the bad actors," he said. One lesson: "don't retaliate, and things will turn out well."
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Earlier in the day, Bessent told Fox Business that the trade imbalance with China is so great that its tariffs on U.S. goods will have relatively little impact.
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"Their exports to the U.S. are five times our exports to China," Bessent said. "They can raise their tariffs, but so what?"
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Bessent also blasted China for failing to curb the flow of fentanyl into the U.S., an issue that Trump has repeatedly mentioned as he jacked up the tariff on Chinese goods.
..... Any country that aligns itself with China over the U.S. on trade would be making a serious mistake, he told the American Bankers Association's summit: "that would be cutting your own throat."
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However, Bessent said the U.S. and other allies could approach China about a potential trade deal after the Trump administration reaches agreements on tariff with allies.
Markets, financiers react
..... Some financiers had been begging Trump to hit the breaks. Among them were billionaire Bill Ackman, a vocal supporter of Trump, who pleaded for a White House to rethink the trade war.
..... "If the president doesn't pause the effect of the tariffs soon, many small businesses will go bankrupt,: the influential hedge fund manager said in a post on X. "Medium-sized business will be next."
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After Trump unveiled his tariffs on April 2, [2025] the S&P 500 shed more than $5.83 trillion in market value and teetered on the edge of a bear market, 20% below its record high. As of Tuesday's [04/08/2025] close, it was down 19% form tis peak.
..... The CBOE volatility index, which is known as Wall Street's "fear gauge," at one point Wednesday [04/09/2025] hit 51 points, tis highest since the COVID-19 panic of 2020. JPMorgan Chase CEO James Dimon told Fox Business he believed the financial markets turmoil was likely to tip the U.S. economy into recession.
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Before making his midday announcement, Trump urged Americans to "BE COOL!" writing on social media, "Everything is going to work out well. The USA will be bigger and better than ever before!"
..... He again made a pitch for companies to open manufacturing plants in the U.S., writing "ZERO TARIFFS, and almost immediate Electrical/energy hook ups and approvals. No environmental Delays. DON'T WAIT, Do IT NOW!"
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In an earlier post, Trump described himself as "president for the workers, not the outsourcers; the President who stands up for Main Street, not Wall Street; who protects the middle class, not the political class; and who defends America, not trade cheaters all over the globe."
..... Many wealthy and high-profile allies have spoken out against Trump's global trade war, but there are still some who think waging it against China is the right move.
..... Kevin O'Leary, "Mr wonderful" on the reality TV series "shark Tank,: said China has never played by international trading rules.
..... "This is not about tariffs anymore," O'Leary said on CNN.
..... "Nobody has taken on China yet. Not the Europeans, no administration for decades. As someone who actually does business there, I've had enough.
..... Democrats have been searching to chip away at Trump's support among working-class voters, with progressive lawmakers accentuating their distaste for free trade policies. In that vein, Senator Tammy Baldwin, D-Wisconsin, said in a press lease earlier Wednesday [04/09/2025] that while Trump's trade policies will "jack up costs for working families," she is glad loophole for China that allows illegal substances and counterfeit goods to enter the country.
..... Contributing: Reuters; Jorge L. Ortiz, Andrea Riquire and Susan Miller, USA Today