President Donald Trump speaks to reporters at the White House in Washington, DC, on January 30. Chip Somodevilla/Getty Images
CNN
—
Just about everyone thought it was a bluff. Top analysts from the biggest banks on Wall Street said it was highly unlikely. Stocks were trading like it wouldn’t happen. Some companies built contingency plans, but they weren’t exactly rushing to make changes.
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But the tariffs are coming — in full force. President Donald Trump announced Saturday that a massive 25% tariff on all goods from Mexico and most imports from Canada will go into effect Tuesday. An additional 10% tariff on Chinese goods will be enacted the same day.
Trump in a message posted on Truth Social Sunday said, “We don’t need anything they have. We have unlimited Energy, should make our own Cars, and have more Lumber than we can ever use.” But America’s supply chains are reliant on its trading partners, and even for goods that could be grown or produced exclusively in the United States, the complex web of interconnected global trade cannot easily be unwound.
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So the additional costs on foreign-made goods will be paid by American importers, who typically pass those costs onto retailers, who pass them onto inflation-weary consumers. That means prices will rise — although, for most items, not immediately. Businesses’ profits will be squeezed as they bear the cost burden of the tariffs or pay to adjust their carefully constructed and at times inflexible supply chains.
That’s why stocks on Monday were set to tumble. Dow futures were more than 600 points, or 1.3% lower. S&P 500 futures sank 1.5%. and Nasdaq futures were 1.7% lower.
Globally, stocks fell, too. Major European indexes were down across the board, and Asian markets closed sharply lower. Bitcoin and other cryptos tumbled, brought down by growing fears of a recession. The US dollar rose sharply.
Energy costs surged: US crude oil rose 2.3% and natural gas spiked 7%. Despite a lower 10% tariff on Canadian electricity, natural gas and oil exports to the United States, the energy industry said it will not be able to quickly or easily find alternate sources. Diesel and jet fuel costs in particular will rise, according to Angie Gildea, the US energy sector lead at accounting firm KPMG, adding costs to all shipped goods and air travel.
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“Any infrastructure upgrades would not happen overnight,” Gildea told CNN. “Tariffs on Canadian oil would increase costs for US refiners, leading to price hikes for consumers.”
Auto industry stock futures were particularly hard-hit, because virtually all American-made cars are manufactured at least in some part in Mexico or Canada — what was a free-trade zone. GM (GM) fell more than 6%, Jeep and Chrysler maker Stellantis (STLA) was down 5% and Ford (F) fell more than 3%.
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Ukraine is developing a “drowning not waving” problem. It is struggling to say clearly how badly the war is going.
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Giving a candid public assessment of how poorly a conflict is going can be an unwise move as it can result in morale and support draining. After Obama boosted troops in Afghanistan, public support declined over the years, in part because of a lack of realism about how the war was going.
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Ukraine’s acutely bad presentation of its troubles is mostly due to the myopia of its allies.
The lack of understanding in parts of US Congress is breathtaking. A congressman this week suggested Ukraine should name a finite price tag and a specific, simple goal. It’s staggering after two American wars of choice in two decades, costing trillions of dollars, that congressional memories are so short, and comprehension so limited.
Instead, Kyiv consistently points to past successes and future goals. They have reclaimed about half the territory Russia took last year; they have damaged its Black Sea presence strategically. They have a plan for 2024, Zelensky said, but it is secret.
Yet in truth, the most useful headline for Kyiv should be how unutterably bleak the frontlines are for them now. In nearly every direction, the news is grim. Russian forces are hiving off parts of the eastern city of Avdiivka, yet another town Moscow seems content to throw thousands of lives at despite its minimal importance. Along the Zaporizhzhia frontline, where the counteroffensive was focused but ultimately slow and unrewarding, Russian units have come back with renewed vigor and the defense is costly for Ukraine. Ukraine has made a plucky (or foolhardy) dash across the Dnipro River, with some small progress into Russian lines. The casualties have been immense, their supply lines are problematic, and their prospects dim.
Ukraine is developing a “drowning not waving” problem. It is struggling to say clearly how badly the war is going.
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Giving a candid public assessment of how poorly a conflict is going can be an unwise move as it can result in morale and support draining. After Obama boosted troops in Afghanistan, public support declined over the years, in part because of a lack of realism about how the war was going.
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Ukraine’s acutely bad presentation of its troubles is mostly due to the myopia of its allies.
The lack of understanding in parts of US Congress is breathtaking. A congressman this week suggested Ukraine should name a finite price tag and a specific, simple goal. It’s staggering after two American wars of choice in two decades, costing trillions of dollars, that congressional memories are so short, and comprehension so limited.
Instead, Kyiv consistently points to past successes and future goals. They have reclaimed about half the territory Russia took last year; they have damaged its Black Sea presence strategically. They have a plan for 2024, Zelensky said, but it is secret.
Yet in truth, the most useful headline for Kyiv should be how unutterably bleak the frontlines are for them now. In nearly every direction, the news is grim. Russian forces are hiving off parts of the eastern city of Avdiivka, yet another town Moscow seems content to throw thousands of lives at despite its minimal importance. Along the Zaporizhzhia frontline, where the counteroffensive was focused but ultimately slow and unrewarding, Russian units have come back with renewed vigor and the defense is costly for Ukraine. Ukraine has made a plucky (or foolhardy) dash across the Dnipro River, with some small progress into Russian lines. The casualties have been immense, their supply lines are problematic, and their prospects dim.
Russian energy giant Gazprom and the China National Petroleum Corporation (CNPC) have signed an agreement on additional gas shipments to China, the Russian company announced on Thursday.
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The deal was struck during a meeting between Gazprom CEO Aleksey Miller and CNPC Chairman of the Board of Directors Dai Houliang on the sidelines of the Belt and Road Forum for International Cooperation in Beijing.
“During the meeting, Gazprom and CNPC signed an additional agreement to the gas purchase and sale contract via the East Route for an additional volume of Russian gas supplies to China until the end of 2023,” Gazprom wrote on its Telegram channel.
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