Trump is using the threat of tariffs to force countries to negotiate. This is why there is a constant stream of announcements-- a tariff is threatened, a tariff is applied, a tariff is delayed, a tariff is withdrawn, and so on. I expect this to continue, and for some tariffs to actually be applied --for a short time, at least-- if he doesn't get what he wants.
It's difficult to gauge the long term effects because the US has so much spending power. Other nations apply tariffs to US goods already, in order to try to keep a healthy balance and support their own economies. Trump is trying to find ways to increase revenue while keeping taxes low, which is also the thrust behind the DOGE actions and investigations.
Because these actions are deliberate and not the result of market forces, global markets will likely rebound if/when things settle down. While it might seem that Trump won't ever settle down, he does understand that unstable markets will hurt the Republicans in 2026, so I expect that he will draw back in the early part of that year. Otherwise, Democrats will regain control of Congress, which will give them the ability to slow him down for the following two years.
As for the issue of trust, it is the problem that I have described before-- both parties here have spent decades putting more and more power in the hands of the President, and the last few administrations have shown why this is a terrible idea. Now, every new President starts his term by making a large number of sweeping executive orders and pushing the boundaries of what he can do. Everything Trump does might be completely undone in less than four years. It's insane. Who can operate in this kind of environment??
