Apr 04, 2025
“The market could have certainty that this is the number, barring retaliation”
There’s no getting around this week’s elephant in the room: Liberation Day, has turned out to be quite the volatility extravaganza. As equities puked (with the biggest one-day losses since 2020) and bonds went bid, analysts and commentators were furiously working to discover what exactly was behind the “reciprocal tariffs”. The official response, per the Office of the U.S. Trade Representative, was that they were “calculated as the tariff necessary to balance bilateral trade deficits between the U.S. and each of our trading partners”, taking into account “a combination of tariff and non-tariff factors that prevent trade from balancing”, some numbers sleuths had a more direct explanation, “they took the trade deficit the US has with each country and divided it by our imports from that country”.
SUBSTACK LINK TO ENTIRE PIECE: (20) Thoughts From The Divide: Grief – by MI2 Partners