Has the sky stopped falling? Too civil, lately?
The economic sky is still falling—it’s just happening slowly enough that most people haven’t noticed.
U.S.–EU trade talks have stalled. The EU offered to eliminate tariffs on industrial goods, including cars, but the U.S. rejected the proposal. Consequently, tariffs remain in place, with no clear resolution in sight.
Meanwhile, South Korea and Vietnam are strengthening their trade relations, aiming to boost bilateral trade to $150 billion by 2030. This move is partly in response to U.S. tariffs that pose challenges for both economies.
Hong Kong has suspended its postal service for goods going to the U.S., citing high costs linked to U.S. tariffs.
Trump’s message? “The ball is in China’s court… we don’t have to make a deal with them.” That might fire up a crowd, but it doesn’t stabilize markets—or signal strategy.
Additionally, the U.S. has restricted Nvidia from selling its H20 AI chips to China, a move that Nvidia projects could result in a $5.5 billion revenue loss.
Federal Reserve Chair Jerome Powell has warned that the current scale of tariffs is “significantly larger than anticipated” and could lead to higher inflation and slower growth. The Fed is adopting a cautious “wait-and-see” approach, delaying interest rate adjustments until there is more clarity around trade policies.
This isn’t just a series of isolated events; it’s a slow-moving economic breakdown. Barring a significant reversal or an unforeseen solution, this situation is on track to become increasingly severe later this year. The warning signs are everywhere. Most people just haven’t looked up yet.
I’m increasingly worried that 300 million Americans are about to get a hard lesson in macroeconomics that they didn’t know they signed up for. The “find out” phase so to speak…
