In the aftermath of today’s surprising WTO decision, in which the global trade mediator sided with the US in finding some $7.5BN in European Airbus subsidies illegal, moments ago the US Trade Rep confirmed that the US will waste no time in retaliating to what – for years – were illegal trade practices.
According to the USTR office, the US will impose a total of $7.5 billion in retaliatory tariffs on EU imports starting October 18, with 10% tariffs on large commercial aircraft, and 25% on agricultural and other industrial goods.
- U.S. WILL IMPOSE TARIFFS ON $7.5 BILLION OF EUROPEAN UNION IMPORTS BEGINNING OCT. 18, USTR SAYS
- U.S. WILL IMPOSE 10% TARIFFS ON LARGE COMMERCIAL AIRCRAFT AND 25% TARIFFS ON OTHER AGRICULTURAL AND INDUSTRIAL GOOD
In addition to single-malt tariffs on airplanes, Irish and Scotch whiskeys and wine, other items covered by the tariffs include:
- Edam, Gouda, Reggiano, Cheddar, Swiss, Stilton, Emmentaler and Pecorino cheese
- Pork sausages
- Prune juice
- Clams, Mussels, Cockles
- Sweet biscuits
- Tweezers, Pliers, Screwdrivers
Ray Dalio, the founder of the world’s largest hedge fund, says the Trump administration may be “inching toward bigger moves” in its tit-for-tat trade hostilities against China, amid reports of limiting capital flows to Beijing.
“That’s why the proposed step of limiting American portfolio investments in China makes me both think about the implications of this step and wonder if it is an inching toward bigger moves,” said the co-chief investment officer at Bridgewater Associates, in a post to LinkedIn.
Dalio, known for his provocative takes, says wealth and political inequality is causing populism on both the left and the right, and that the limited ability of central banks to stimulate the economy will lead to more far-reaching actions — very large fiscal spending and large budget deficits that will have to be funded by substantially hiking taxes on the rich, printing money and the buying of debts coming from the deficits.
“Typically, this has led to capital flight as investors seek to escape these things, which has quite often led to capital controls that are intended to keep capital in the country and the currency so that it can more easily be taxed and/or devalued. So, naturally, I can’t help but wonder whether this extraordinary (i.e., nothing like this has happened in my lifetime) deviation from convention to restrict capital flows to China could be followed by these other steps when/if the circumstances that I’m describing unfold.”