Trump’s Tariffs: Economic Disaster or Political Power Play?
CoinBureau dives into the chaos surrounding President Trump’s new tariffs. Are they a strategic maneuver, or are they setting the U.S. up for economic turmoil?
1. Trump’s Tariff Strategy – The Logic & The Reality
Trump’s aggressive tariffs hit China (10%), Canada (25%), and Mexico (25%) right out of the gate.
His argument?
✅ Foreign countries pay the U.S. to access its market
✅ Tariffs will bring jobs and investment back to the U.S.
✅ Higher U.S. manufacturing → More growth and economic strength
The problem?
❌ Tariffs are actually paid by U.S. importers, not foreign exporters
❌ 2018-2019 tariffs led to higher costs for businesses and job losses
❌ Retaliation from other nations could disrupt trade and spike inflation
2. Canada & Mexico: The Unexpected Targets
While Trump justified the tariffs as a way to combat illegal immigration and fentanyl trafficking, the numbers don’t support the claim.
- Canada: Barely contributes to U.S. fentanyl inflows (only 0.2% of seized fentanyl in 2024 came from Canada).
- Mexico: Stronger link to fentanyl trade, but already deploying 10,000 National Guard troops to address border issues.
Despite initial outrage, both Canada and Mexico negotiated temporary relief, proving they lack the leverage to fight a full trade war with the U.S.
3. China’s Response – Trade War 2.0?
China has threatened countermeasures, including:
📌 10-15% tariffs on U.S. goods
📌 Export restrictions on critical minerals
📌 Google under antitrust scrutiny
With U.S. tariffs on Chinese imports now averaging 33%, markets fear a return to the brutal 2018-2019 trade war cycle.
4. The European Union – The Next Target?
Trump has now set his sights on the EU, threatening a 25% tariff on cars and other goods.
His reasoning? “The EU was formed to screw the United States.”
The EU has vowed retaliation, leveraging its Anti-Coercion Instrument, which could escalate tensions further.
5. Impact on Markets & Crypto – What Comes Next?
Who wins?
✅ U.S. industries protected by tariffs (manufacturing, steel, some agriculture)
✅ Companies with deep pockets who can stockpile goods before tariffs fully hit
Who loses?
❌ Small businesses – Higher import costs without capital to absorb them
❌ Consumers – Inflation could spike, worsening cost-of-living struggles
❌ Crypto markets – Less disposable income means fewer retail investors
The biggest question: Will Trump stick to his tariffs, or is this just a negotiation tactic?
If tariffs remain, economic uncertainty could delay the next big crypto bull run as investors hold onto cash.
Final Take: Trump’s tariffs are shaking up global trade, but their true impact remains unclear. If inflation spikes and markets panic, expect risk assets like crypto to struggle in the short term. However, institutional investors could step in, shifting the crypto landscape away from retail dominance.
