Updated Story: Uncertainty Over Trump Tariffs Rattles Wall Street \ Newslooks \ Washington DC \ Mary Sidiqi \ Evening Edition \ President Trump’s mixed messaging on new tariffs has sent shockwaves through the stock market and left global leaders, investors, and lawmakers scrambling for clarity. While Trump calls the tariffs a powerful negotiating tool, his aides present conflicting views. With a 104% tariff on China set to take effect, concerns about recession and global trade instability are growing.
Quick Looks:
- Trump says tariffs are both permanent and negotiable.
- Markets slide after initial gains, ending with S&P down 1.57%.
- White House yet to define clear goals for trade talks.
- Lawmakers from both parties express frustration over ambiguity.
- China retaliates with 34% tariffs; Trump threatens 50% more.
- Stock and business leaders grow increasingly wary of economic fallout.
- Trump calls deals “tailored,” but lacks firm timelines or conditions.
- Economic experts warn goals are contradictory and confusing.
Deep Look
Markets Jitter as Trump Sends Mixed Signals on Tariffs, Global Trade Tensions Escalate
Just before the stock market closed Monday, journalists packed into the Oval Office seeking clarity from President Donald Trump on whether his aggressive new tariff measures are firm policy or just leverage for new trade deals. What they got instead was more ambiguity.
“It can both be true,” Trump said when asked whether the looming tariffs—set to take effect Wednesday—were meant to force negotiations or represent a permanent policy shift. “There can be permanent tariffs, and there can also be negotiations.”
The president’s vagueness did little to calm markets. After rising early on hopes of diplomatic breakthroughs, the S&P 500 fell 1.57%, closing deep in the red. The drop capped days of volatility as investors tried to interpret White House intentions amid conflicting public statements from Trump and his senior advisers.
While officials like Treasury Secretary Scott Bessent and economic adviser Kevin Hassett have pitched the tariffs as bargaining chips, Trump has continued to insist they are essential to restoring economic fairness and raising revenue. He’s long promoted tariffs as a means to correct trade deficits and revive domestic manufacturing—a view he’s held since long before his presidency.
A Clash Between Messaging and Market
The resulting paradox is leaving markets and foreign leaders in limbo. “There’s some uncertainty about what the president’s objective is,” said Sen. John Kennedy (R-La.), who blamed conflicting statements from Trump’s aides for deepening confusion.
While some officials say the administration is open to talks, there are few specifics on what concessions would be required. Stephen Miran, chair of Trump’s Council of Economic Advisers, described the internal debate as “healthy,” but critics say it’s creating chaos.
At a panel hosted by the Bipartisan Policy Institute, economist Michael Strain warned that the tariffs “cannot both be an instrument to reshape the global trading order… and also be a tool to negotiate lower trade barriers.”
Even Republicans have begun to express unease. Sen. Thom Tillis (R-N.C.) said the administration must define an endgame: “The perception as to whether or not there’s an end game is very important,” he said. “You’ve got to get it done as quickly as you can.”
Tariffs on the Rise, Allies on Edge
On Wednesday, the White House plans to impose a combined 104% tariff on Chinese goods, following China’s decision to retaliate with its own 34% tariffs. Trump responded by threatening to add another 50%, pushing the trade conflict to new extremes.
Other allies are uncertain how to respond. On Tuesday, Trump praised trade talks with South Korea, calling their surplus “tremendous and unsustainable,” but offered little detail. He also brushed off an offer by Israeli Prime Minister Benjamin Netanyahu to eliminate Israel’s trade deficit with the U.S.
“Maybe not,” Trump said when asked if Israel would be spared. “Don’t forget, we help Israel a lot,” he added, referencing U.S. military aid.
Talks in Motion—But With No Clear Goals
Trump continues to tout the tariffs as the foundation for future trade deals. “I call them tailored deals,” he said Tuesday. “Not off the rack. Highly tailored deals.”
Scott Bessent, speaking on Fox News, said negotiations could stretch into “April, May, maybe June,” and confirmed that up to 70 countries had reached out to start discussions. Still, the administration has yet to publicly define what specific terms it’s demanding in return.
Lawmakers who met with Bessent on Capitol Hill said they were told the tariffs represent a “high-level mark” intended to create leverage—but would ideally be reduced through negotiations unless nations retaliated.
Japan Talks Boost Markets—Briefly
Trump also pointed to recent conversations with Japanese Prime Minister Shigeru Ishiba as positive. The Japanese stock market soared Tuesday, with the Nikkei index jumping 6%, following reports of progress in U.S.-Japan trade discussions.
But even here, Trump’s stance appears rigid. Japan faces a 24% tariff, and U.S. tariffs on auto imports are set at 25%—far above Japan’s average 1.9% tariff, according to WTO data. Trump has called some of these tariffs “permanent,” suggesting limited room for negotiation.
Meanwhile, House Speaker Mike Johnson (R-La.) stood by the president, saying Republicans are willing to give Trump “the space necessary” to pursue trade reform.
Still, as Peter Navarro, a longtime Trump trade adviser, wrote bluntly in the Financial Times, “This is not a negotiation. For the U.S., it is a national emergency triggered by trade deficits caused by a rigged system.”
Outlook: Market Instability and Policy Uncertainty
While the White House insists Trump is simply giving himself maximum negotiating leverage, analysts remain skeptical that such a volatile and unclear approach will yield lasting benefits.
Investors are increasingly concerned about the lack of cohesion within the administration. Economic consequences are already being felt, with businesses hesitating on hiring and investment due to unpredictability.
As the new tariffs take effect, the markets, global trading partners, and U.S. industries are left to wonder: Is this Trump’s long-promised trade revolution—or an improvised escalation with no clear destination?
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