Trump's Tariff Threats: Markets Play the Waiting Game

Trump's recent move to impose new tariffs on 14 countries didn't shake up global markets as much as expected. The president announced tariffs ranging from 25% to 40% on goods from countries like Japan, South Korea, and others, set to start on August 1. But markets in Asia and Europe barely reacted. Japan's stock market even went up a bit, and Europe's main stock index stayed almost flat. Trump's threat might not be as scary as it sounds. He said the deadline isn't set in stone and that he's open to talks. This makes markets think he might back down, just like he has in the past. Some experts call this the "TACO" trade—Trump Always Chickens Out. But this back-and-forth isn't good for anyone. Businesses and consumers are stuck in limbo, not knowing what to expect. The U. S. already raised tariffs a lot since 2024, and without deals, they could go even higher. Europe seems a bit more hopeful. They think a deal with the U. S. might be close, which would avoid the 20% tariff Trump threatened. Talks between EU leaders and Trump seem to be going well, which is why European stocks didn't freak out. Experts think the final tariff rates might not be as bad as Trump's initial threats. They expect rates to settle around 15%, with some products getting special treatment. But until deals are signed, the uncertainty will keep everyone on edge.