Trump launches his protectionist offensive, causing a stock market storm.

The stock market experienced the perfect storm in the United States yesterday. The uncertainty created by President Donald Trump with his signing of sweeping reciprocal tariffs on 68 countries, plus the European Union (EU) on Thursday night— although he once again postponed their implementation until August 7 —was compounded by the shock of a dismal jobs report. Only 73,000 jobs were created in July, a substantial drop from the numbers reported in previous months.
Wall Street opened shakily. The Dow Jones opened with a drop of almost 2% (800 points). As the morning progressed, the damage to investors lessened, although it continued to fall sharply, with a loss of more than 500 points. The session ended with the worst week since May. The same was true for the Nasdaq and S&P 500, which also closed the day and the week in the red after a long period of positive results. In Europe, stock markets recorded their biggest drop since April.
Trump's response? The expected one. He continues to escalate his trade war despite the signs of pressure on businesses due to rising prices for goods, which is beginning to be felt in supermarkets due to the tariffs.
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No. The blame for everything lies with the usual suspect, Jerome Powell, chairman of the Federal Reserve. This time, he fired a cannonball at the Fed's ignoring of his pressure to lower rates and the response of the stock and labor markets. He called Powell a "stubborn idiot" before calling for some kind of coup at the central bank.
"If he continues to refuse to lower interest rates, the board must take control and do what everyone knows must be done," the Republican leader wrote on his social media account. "Strong dissent on the Fed board, which will only get stronger, but too late," he insisted in his outburst. He concluded with a call to put Powell "out to pasture."
Only 73,000 jobs were created in July: the US labor market is beginning to weaken.Trump set out to change the global market system, and he's doing just that. In a new version of "Liberation Day," on April 2, when he announced his so-called reciprocal tariffs .
After several postponements and with exceptions, its announcement near the August 1 deadline was no coincidence and gives the White House more time to reach favorable deals and lay the groundwork for the implementation of these taxes.
The highest tariffs are imposed on goods from Syria, Laos, and Myanmar, at around 40%, and on Brazil, at 50%, although this is more a political revenge against President Lula for the impeachment proceedings against his predecessor, Jair Bolsonaro.
One of the most surprising developments was the imposition of a rate on Switzerland at 39%, the highest rate, a severe blow to the European country.
While the negotiation period with China continues (expiring mid-month) on temporary tariffs of 30% and 15% respectively, Trump indicated that there is a 30-day extension with Mexico given the difficulties posed by trade between the two countries.
Read also The president again insults Jerome Powell for resisting rate cuts: "Stubborn idiot."Canada fares worse. Trump signed an immediate-effect order imposing 35% tariffs on its neighbors, except for goods covered by the USMCA pact between the three North American nations. The US president said there had been no negotiation and justified his decision by the entry of fentanyl from Canada and Prime Minister Mark Carney's decision to support recognition of the State of Palestine at the next UN General Assembly meeting if the Israeli attack on Gaza does not end.
In addition to the general and basic 10% tax, these high taxes could paralyze these countries' exports to the US, one of the main markets for most of them. In India, they wonder what good Prime Minister Narenda Modi's supposed friendship has done them if Washington punishes them with 25% taxes.
The global average of these rates, if they start as they are on August 7, will be 18.3%, the highest percentage since 1934.
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Despite the optimism of economists close to the president, who see only a portion of the enormous revenues going to the US treasury, the White House came under renewed pressure yesterday to mitigate the potential negative impact of tariffs following the weak jobs report.
The massive levies risk jeopardizing the United States' global standing, as allies feel compelled to accept hostile agreements. As taxes on raw materials used in American factories and basic goods, tariffs also threaten to force inflation and hinder economic growth—concerns the Trump administration dismisses.
But the general implementation of this import tax becomes a major test of the political theory preached by the president. Until now, most of this inflationary pressure from the taxes has been borne by businesses, not consumers. Until now, while tariffs have remained at 10% for most imports, business leaders have said it was manageable. However, with the increases expected within a week and the end of the accumulated stockpile, everything indicates that they will be felt much more strongly by citizens and their wallets.
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