The tariff drama currently ongoing with China has been, arguably, the ultimate end game of President Trump. Yes, he wants other countries to pay their fair share, and tariffs are essentially a long-term game at refinancing the United States massive national debt. In theory, this should bring in more revenue for the United States and increase American production. But China has always been the golden nugget in the equation.
For years, the Chinese have broken the rules and not played on a level playing field. They have raked the U.S. over the coals for decades, with no President willing to call them out. But along comes President Trump, who has hit them hard. So, the two sides continue their back and forth, with neither side willing to budge. It has all created some turmoil in the markets, and for businesses, as no one truly knows what is going to happen next.
Former Trump campaign adviser Roger Stone recently predicted a rapid economic rebound under the President, saying the economy will be 'cooking' within two years, despite all the current drama unfolding. As of right now, that tends to be trending the right direction. Inflation has been falling, egg prices have fallen, and optimism has been at a peak since Trump took office.
Economist Vance Ginn says tariffs have created uncertainty, which businesses hate. But there is reason for optimism.
"I would hope we get closer to zero tariffs, and allow for more economic growth," he says. "Along with the Trump tax cuts getting extended, and deregulation...if those things get extended, then we definitely could be cooking."
If China managed to toe the line, and come to the table for negotiations, this tariff stare down could be broken in the next couple months. President Trump put a 90-day pause on tariffs for other countries, except China, which currently has a 145-percent tariffs and growing by the day. The Chinese also refuse to lose face over the situation. If they do not negotiate, this drags out and then tariffs actually start to hurt. It is all one big game of chess.
So, we are basically in a waiting game until China decides to negotiate a trade deal. To use the age-old expression, "only time will tell."
"Over the last couple of weeks we have seen $11 trillion in wealth evaporated, particularly from tariffs, I am hoping that will end quickly. Then, we can get back to sound, pro-growth policies that will let people prosper across the country," says Ginn.
After all, President Trump is a businessman. He loves the art of the deal and thrives on playing games of chess like he is with China. During his time in office, and as a real estate mogul, it has worked in his favor.
This time it is a little different though and requires a little more finesse.
"There is a difference between negotiating in the private sector, and with other countries, and which tools you want to use to do so," Ginn says.
So, it is a fine line to walk for President Trump. But if all goes to plan, and so far, it has, then we could be looking at an economic boom we have not seen in America for quite some time.
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