'Disloyal' NSC Staffers Fired After Laura Loomer Brings Receipts To The White House

Three staffers on the National Security Council have been fired after journalist Laura Loomer met with President Trump in the Oval Office on Wednesday, where she presented him with a list of 'disloyal' employees, the NY Times reports, thanks to ongoing (and copious) leaks from the administration.

Mr. Trump may act on some of Ms. Loomer’s recommendations, two of the people said. Ms. Loomer walked into the White House with a sheaf of papers, which amounted to a mass of opposition research attacking the character and loyalty of numerous N.S.C. officials, two of the people said. She proceeded to excoriate them in front of their boss, the national security adviser Michael Waltz, who was also in the meeting. -NYT

The rest of the Times report amounts to a character assassination on Loomer, which was to be expected - writing that "Loomer’s rhetoric and actions have been so extreme that she has alienated others even on the far right."

The White House meeting came after weeks of Loomer posting about various 'disloyal' Democrats within the Trump administration - including deputy national security adviser Alex Wong, who she says added a journalist from The Atlantic to a DoD Signal chat on behalf of his boss, national security adviser Michael Waltz (Waltz was in Wednesday's meeting, according to the report). In posts to X, Loomer noted that Wong's wife worked as a DOJ lawyer for the Biden and Obama administrations, and her father is a large shareholder in a Chinese satellite manufacturer.

The roughly 30-minute meeting with Loomer was held shortly before Trump's major tariff announcement in the White House Rose Garden. Also in the meeting aside from Waltz were VP JD Vance, Sergio Gor - the head of presidential personnel, White House Chief of Staff Susie Wiles, and White House communications director Steven Cheung, according to the NYT's leakers.

Loomer Responds

"I woke up this morning to learn that there are still people in and around the West Wing who are LEAKING to the hostile, left-wing media about President Trump’s *confidential* and *private* meetings in the Oval Office," Loomer wrote on X in response to the news, adding that she would not divulge any details about her meeting.

I woke up this morning to learn that there are still people in and around the West Wing who are LEAKING to the hostile, left-wing media about President Trump’s *confidential* and *private* meetings in the Oval Office. I want to reiterate how important it is that people who gain…

— Laura Loomer (@LauraLoomer) April 3, 2025

According to Loomer, there's "More to come!"

“Exactly one hour before he received the termination email, Laura Loomer posted on social media about Mr. Schleifer, calling him a "Biden holdover.”

More to come! pic.twitter.com/ndc0qAXdf3

— Laura Loomer (@LauraLoomer) April 3, 2025

* * *

We've sold a TON of these lighter / flashlight combos...

Buy two for free shipping! (over $50) Satisfaction guaranteed or your money back Tyler Durden Thu, 04/03/2025 - 14:05

This Trump Shock Is A Reverse Nixon

By Michael Every of Rabobank

Hoot Small-ly and Reverse Nixon Again

In line with the Churchillian tone I had struck, yesterday’s US tariffs were historic and suggest a world-wide battle. It remains to be seen in what form, with what outcome, but global bifurcation is again on the cards. The US raised its weighted-average tariff to 29%, the highest in over 100 years, and above the Smoot-Hawley tariffs of the 1930s. That’s staggering, not just for the US, or inflation or GDP, but for the global system built on the US as consumer of last resort for everyone else’s overproduction and the US dollar as the lubricant for that trade and the US financial assets everyone accumulates as a result.

The US assumed a non-tariff barrier with each trade partner leading to reciprocal tariffs as the simple function of the US bilateral trade deficit as a ratio of exports to it, e.g., Indonesia runs a $17.9bn trade surplus with the US and exports $28bn to it, so $17.9/$28 = the 64% assumed Indonesian trade barrier, which the US offered a ‘discount’ on down to 32%. On one hand, this is nonsense. On the other, it’s exactly what Ricardian theory says should happen under free trade: all bilateral flows should balance, with the composition of the basket shifting with comparative advantage. That it never does for the US shows the theory isn’t true; so, the US is using both hands to pull down the system ostensibly based on it. It’s critical to understand that before talking about the numbers below and hooting small-ly about Smoot-Hawley.

We got massive increases in tariffs on Asian exporters like Bangladesh (37%), Cambodia (49%), China (34%), India (26%), Indonesia (32%), Japan (24%), South Korea (25%), Thailand (36%), and Vietnam (46%). Moreover, these are stackable on top of pre-exiting tariffs, so China faces 54% at least, with the threat of another 25% for buying Venezuelan oil and another 25-50% for buying Russian oil. That is a dramatic escalation between the world’s two largest economies.

The EU fared slightly better (20%), but which is four times higher than what we had presumed in our own model assumptions.

Most others, including the UK, Australia, and New Zealand got 10%, a divide-and-rule tactic we’d expected, as did Latin America, the Monroe Doctrine also expected, especially if the US now offers dollar liquidity to help shift supply chains in that direction. But what then for Brazilian agri trade to China?

Nobody --except Russia(but that's because it is under sanctions)-- was overlooked: even a small island off Australia got a 10% tariff for its population of penguins, and the closest of US defence allies like Israel and the Philippines face 17%, while Iran only sees 10%. The only exemptions apart from Canada and Mexico were on steel and aluminium, autos, copper, pharmaceuticals, semiconductors, bullion, energy and other minerals not available in the US; but the first three already have 25% tariffs in place, with the rest waiting for one.

The US postal de minimis loophole is also over for everyone with a tariff once systems are ready, except for bonafide gifts and items brought into the US while traveling. That upends a lot of e-commerce.

We now start the next phase of negotiation and/or retaliation. It’s hard to imagine the UK, Australia, or New Zealand will rock the boat, and the same is true for anyone getting just a 10% tariff. Indeed, Latin America may be rubbing its hands at the geostrategic windfall ahead.

But what about Asia? For example, will China allow CNY to move lower? Does that drag other FX down with it? Does the US then raise tariffs even higher? Or will China switch to domestic consumption, which would be inflationary? What are the options for Japan, South Korea, Vietnam, Cambodia, Thailand, and India? They can’t “trade more with China” unless it plays the US importer/consumer role, but it won’t want to import more. So, does all of Asia inflate domestically with the US, or sink into deflation? Or does everyone but China pivot to the US side vs. China?

We have already published a report on what we expect Europe to do and underlined the risks of escalation that risks rapidly moving from trade into other areas. Indeed, the US is already pressuring Europe to buy American weapons rather than local as it rearms: if Europe accepts, maybe the trade war and security issues are resolved in tandem; and if it refuses, Europe may face more US intractability on NATO, and trade, and energy, and perhaps even on dollar swaplines.

Another key point to stress is renewed talk of ‘dedollarisation’. Notably, US 10-year yields are going down, now at just 4.06%, even though inflation will almost certainly be seen and for some time. The DXY broad dollar index is dropping, and even Asian exporters hit by massive tariffs are only seeing slight selloffs in their FX. Indeed, JPY is rallying despite Japan being reliant on the US for its defense as well as exports, as is EUR, with Europe reliant on the US for energy and tech on top of security and exports. Crypto tumbled, but gold hit a new record high before dipping.

However, the initial FX reaction reflects repatriation of US assets; and it overlooks the CNY threat and that there can’t be a global system within which JPY and EUR can thrive without the dollar’s current role. That’s hard to accept, but it’s true.

An ECB speaker just said Europe has a unique opportunity to push the global use of the Euro. Yet besides requiring the issuance of Eurobonds, a huge hurdle, that would see Europe run capital account surpluses, as funds flood in, and matching current account deficits, as foreign goods flood in too. In short, Europe would follow the US in deindustrialising, financialising, and polarising just as it needs unifying and militarising. Yet Europe would also need a large military to have a true global reserve currency role, because those with such muscle won’t just roll over!

While US actions show it wants to stop the dollar being a lubricant for most exporters to it and conduit for financial assets back to them, it doesn’t want to lose its role in commodity pricing, and global trade, settlements, and debt. History shows a country can retain a global FX reserve even without a trade deficit, but it takes mercantilism to do it – which we are now seeing.

As I say, the implications are so large that markets don’t fully grasp them, or don’t want to. It’s one thing for them to have been forced to recognize that guns now matter as well as butter, but it’s another to realize life is now about gunship diplomacy (“We have 11 aircraft carriers: we get to say which currency commodities are priced in. Understand?”). Equally, macro models trying to capture what this means presume everything returns to mean and vast net trade deficits are absorbed by the system. If they don’t, the model breaks; here, the system does.

One may disagree with Yanis Varoufakis on many things, but he knows his economic history – which markets don’t. He begins a recent must-read (‘Will Liberation Day transform the world? The Nixon Shock set a radical precedent’) thus:

“My philosophy, Mr President, is that all foreigners are out to screw us and it’s our job to screw them first.” With these words, the US Treasury Secretary convinced the President to deliver a colossal shock to the global economy. In the words of one of the President’s men, the objective was to trigger “a controlled disintegration of the world economy”.

No, those words were not spoken by members of President Trump’s team in advance of their “Liberation Day” tariff splurge. While the “foreigners are out to screw us” certainly has a Trumpian ring, it was uttered in the summer of 1971 by then Treasury Secretary John Connally, who succeeded in convincing his President to unleash the infamous Nixon Shock a couple of days later.

Commentators should know better than to pretend that the shock Trump is now delivering is both “unprecedented” and bound to fail like all “reckless” assaults on the prevailing order. The Nixon Shock was more devastating than the one delivered today, especially for Europeans. And precisely because of the economic devastation caused, its architects achieved their main long-term objective: to ensure American hegemony grew alongside America’s twin (trade and government budget) deficits.

The success of the Nixon Shock in no way guarantees the success of Trump’s version, but it does remind us that what is good for America’s rulers is not necessarily good for most Americans or, indeed, for the world.

One of the smartest Nixon advisers, who helped to convince Connally of the need for a shock, articulated this point with brilliant clarity: “It is tempting to look at the market as an impartial arbiter. But balancing the requirements of a stable international system against the desirability of retaining freedom of action for national policy, a number of countries, including the US, opted for the latter.”

Then with one additional phrase he undermined all of the assumptions on which Western Europe and Japan had erected their post-war economic miracles: “A controlled disintegration in the world economy is a legitimate objective for the Eighties.”

And 10 months after giving this lecture, the man in question, Paul Volcker, rose to the Presidency of the Federal Reserve. Soon, US interest rates were doubled, then trebled. The controlled disintegration of the world economy, which had started when President Nixon was convinced by Connally and Volcker to dismantle the hitherto stable exchange rates regime, was now being completed with interest rate hikes that were far more devastating than Trump’s tariffs can ever be today.

Trump is therefore not the first President to seek the controlled disintegration of the world economy by means of a devastating blow. Nor is he the first to purposely damage America’s allies to renew and prolong US hegemony. Nor the first who was prepared to hurt Wall Street in the short run in the process of strengthening US capital accumulation in the long term. Nixon had done all that half a century earlier. And the irony is that the world the Western liberal establishment is grieving over today came into being as a result of the Nixon Shock.”

He concludes: “Every generation likes to think it is on a cusp of some historic transformation. But ours is cursed enough to actually be on such a cusp. So rather than focusing too much on the character of the man in the White House, we would do well to recall that the Nixon Shock was much more important than Nixon. If Nixon reshaped the world once, leaving it nastier and more unbalanced, Trump can certainly do it again.”

This Trump Shock is, again, a reverse Nixon: to take the US from trade deficits and financialisation back to raw US mercantilist power, using parts of the old system to do so. (As I have put it, using economic statecraft; or, using financial Fartcraft to shift back to Warcraft.)

That’s as: the US put sanctions on some Russian entities; Israel blew up the runway of the Syrian airbase Turkey is taking over; the US pours military equipment into the Middle East; the US senate pencils in $5 trillion in tax cuts over the next decade; and Elon Musk is rumored to be leaving the White House circle soon --stocks rallied (“No more DOGE corruption-cutting!”)-- which he denied.

Tyler Durden Thu, 04/03/2025 - 13:45

Auto Tariffs Pump Brakes On Jeep Owner; Stellantis Pauses Canada, Mexico Plants 

President Trump's 25% tariffs on imported vehicles took effect overnight, with the first signs of impact materializing Thursday morning—i.e., shares of U.S. carmakers tumbled in the early cash session, and Stellantis NV announced plans to temporarily suspend production lines in both Canada and Mexico.

Bloomberg reported that the global automaker overseeing 14 car brands will pause production at its Windsor, Ontario plant for two weeks starting next Monday. Details about how long production lines in Mexico would remain offline were not disclosed.

"With the new automotive sector tariffs now in effect, it will take our collective resilience and discipline to push through this challenging time," Antonio Filosa, head of the company's North American operations, told employees in a memo earlier. He said the move will affect employees at "several" of the company's U.S. powertrain and stamping facilities supporting Canada and Mexico operations. 

Bernstein analyst Daniel Roeska warned clients that a "25% automotive imports lasting beyond four to six weeks would likely have a chilling effect on the entire sector as [automakers] need to grapple with significant impact to the bottom line." 

TD Cowen's Itay Michaeli described the tariffs as "close to the worst case outcome vs. recent expectations," while Barclays' Dan Levy warned: "there are no 'winners' in the absolute – only relative winners."

Upcoming production changes at some of Stellantis' factories in Canada and Mexico are some of the first effects of Trump's 25% tariffs on auto imports. The administration's move is to revive America's industrial base, and the only way to do that is to use tariffs to force companies to re-shore operations. 

Wedbush analyst Dan Ives told clients that "the concept of a U.S. carmaker with parts all from the U.S. is a fictional tale that does not exist and would take years to make this concept a reality." 

CNBC noted, "Parts that are currently compliant with the USMCA trade deal will be tariff-free, but only until the secretary of commerce and Customs and Border Protection establish processes to impose levies on non-U.S. content." 

In markets, automakers were pressured lower with broader main equity indexes. General Motors dropped 2.4%, Ford -2.2%, Rivian -3%, Lucid -4%, and Tesla -3.5%

An analysis we shared with readers on Tuesday, "Trade War Hits The Gas: Trump's Auto Tariffs To Reshape Global Manufacturing," provides more color into how the repercussions of the auto tariffs could be far more impactful than initially appear—impacting everything from dealership showrooms to global supply chains.

The move to restore America's hallowed industrial core begins.

Tyler Durden Thu, 04/03/2025 - 13:25

Elon Musk's Neuralink Seeks Patients Globally To Try Its Brain Chips

Authored by Jesse Coghlan via CoinTelegraph.com,

Elon Musk’s brain-chip company, Neuralink, is recruiting participants worldwide to trial its device, which enables users to control a computer using only their thoughts.

Neuralink is looking for people with quadriplegia — those who are not able to use their arms or legs — to sign up for a clinical trial, it said in an April 2 post on X, the social media platform also owned by Musk.

As of January, Neuralink has said that three patients have been implanted with a device. All are quadriplegic and are testing a small brain implant that tracks neural activity to control a computer or smartphone as part of a clinical trial called the Precise Robotically Implanted Brain-Computer Interface, or PRIME study.

Neuralink is one of several companies and academic institutions developing and testing so-called brain-computer interfaces, which vary from small wire-like implants as part of clinical trials to non-invasive devices akin to a hat.

Source: Neuralink

Neuralink’s website says its clinical PRIME study, which will take around six years, is looking for quadriplegics with spinal cord injury or amyotrophic lateral sclerosis to use their thoughts to control a computer.

Musk also heads vehicle maker Tesla and is the Trump administration's government cost-cutting czar. He has said he wants Neuralink to move beyond just allowing humans to operate computers by thinking and wants to help “give people superpowers.”

First Neuralink patient reports no side effects after a year

Noland Arbaugh, Neuralink's first patient, said in a March 28 X post that he’s “had no negative side effects, neither physically nor psychologically” in the year after receiving his brain implant. 

Arbaugh, a quadriplegic, demoed his brain chip about a year ago by controlling a computer cursor to play chess and surf the web.

https://t.co/OMIeGGjYtG

— Neuralink (@neuralink) March 20, 2024

Arbaugh said he’s now using his brain chip “for all sorts of things” and guessed he’s using it for over 10 hours a day.

He said the company’s researchers were “figuring out how to control a wheelchair with the implant,” which he added he won’t use “unless it’s next to perfect. I think it benefits everyone if I don’t lose control and drive into traffic.”

Arbaugh said he had found work as a traveling keynote speaker thanks to Neuralink’s implant, which helps him write, research, and communicate online.

“I can’t tell you how much hope and purpose this technology has provided me,” he wrote. “It’s only a matter of time before the implant is in dozens, then hundreds, then thousands of people.”

Tyler Durden Thu, 04/03/2025 - 13:05

The Rio Reset: Inside The BRICS Scheme To Hotwire The Global Economy

Authored by Peter Reagan via Birch Gold Group,

BRICS+ leaders are meeting in Rio de Janiero this summer. Their dedollarization drive has made huge progress over the last two years. Here’s what they’ve accomplished so far – and why the Rio Reset will stun the world…

The warning signs were there (but most people missed them)

In August 2023, all eyes were on Durban, South Africa when the leaders of the BRICS alliance met behind closed doors. A few weeks before, Russia’s top diplomat Sergey Lavrov made global headlines claiming the BRICS alliance was close to launching a “gold-backed currency.”

Their intentions were clear: First to challenge, then to replace, the U.S. dollar. 

It was a bold claim – and for everyone who understood the role the dollar plays in the global financial system, it was a truly frightening moment. It would be an exaggeration to say the world held its breath – but I don’t mind telling you, I certainly held mine!

The meeting came and went. BRICS held press conferences and announced new committees… 

But the gold-backed international BRICS currency never materialized.

Ever since, we’ve been wondering what happened. Did Lavrov overplay his hand? Was the foreign minister (or perhaps Putin himself) simply trolling the Biden administration? 

The election of President Trump seemed to put the final nail in the coffin. He swore instant, punitive sanctions on any countries that replaced the dollar in their global transactions. 

Trump understands that dollar dominance is a matter of national security. And he understands the consequences of losing – “If we lost the dollar as the world currency, I think that would be the equivalent of losing a war,” he told The Economic Club of New York in September 2024.

The shared BRICS currency experiment was dead even before arrival. 

Or was it?

I’ve always had my doubts and my suspicions. As a result, over the last few weeks, I’ve called in every favor. Cashed in every chip I have with the movers and shakers in Washington D.C. Consulted analysts and insiders on three continents (trust me, it wasn’t cheap!) – and I think I finally understand what happened.

In hindsight, the real story wasn’t what Lavrov or any of the other BRICS officials announced – it was what they didn’t say.

At the Rio Reset in July, BRICS will reveal their real plan

Back in 2023, BRICS never revealed their real plan. The threat of an international, gold-backed BRICSbuck was a brilliant distraction. The mainstream media laughed it off. The alternative media engaged in doom-mongering. 

And BRICS members quietly pressed ahead with something far more ambitious:

A complete, parallel global financial system – a new, 21st century Bretton-Woods – designed to bypass the dollar completely.

What Lavrov called a “currency” was just a decoy. A distraction meant to keep us focused in the wrong direction.

This summer, July 6-7, 2025, BRICS leaders are meeting again in Rio de Janeiro, Brazil. I want you to join me in watching this meeting closely. Because I expect truly astonishing news. An event truly worthy of the name Rio Reset.

But not for a new currency announcement! Let me explain why I think this is just a distraction...

When I say “money” or “currency,” what do you think of? 

Most people think of something like this: 

Author’s personal collection of currencies from The Bahamas, Brazil, China, Nigeria, the UK, the U.S., Vietnam and Zaire.

Or this: 

A mock-up of a shared BRICS currency, revealed by Russian President Vladimir Putin at the 2024 BRICS meeting in Kazan, Russian Federation.

These are all examples of currencies. We're all familiar with currency, because we use it every day. Currency is the most visible part of the global financial system.

Compared to the scale of the global financial system, though?

Any single currency (even all currencies!) are just the tip of the iceberg… 

The true scope of the Rio Reset is staggering

This is what our global financial system looks like: 

Image via PlatON

That chart is not deliberately confusing, by the way. This really is what the global financial system looks like. Key institutions, clearing and settlement systems, domestic and international institutions, compliance and regulatory agencies – and that’s just the organizations. Each of them has its own set of compliance requirements, regulations, procedures and regulatory body at both the national and international levels.

Now, it would be silly to pretend that this entire post-World War II, Bretton-Woods global financial system was all carefully planned and painstakingly executed. Parts of it were – and the rest developed over time.

THAT is what BRICS have been working on!

What the Rio Reset really means

The term Rio Reset may be new – but the underlying idea is not.

This is the culmination of everything BRICS nations have worked toward since the Great Financial Crisis of 2008.

Their goal? To insulate themselves from dollar devaluation, dollar weaponization and the financial instabilities inherent in the dollar-based global financial system.

Tyler Durden Thu, 04/03/2025 - 12:20

Far-Left Maryland Lawmakers Pass Reparations Bill While Financial Crisis Looms

Far-left Maryland lawmakers, sitting high in their Annapolis castle, are completely detached from reality. They masquerade as public servants but are merely progressive activists who cannot govern properly. Instead of addressing the state's incoming financial crisis and worsening power crisis, these woke lawmakers have focused on condoms for kids and other disastrous left-wing policies. It's as if these politicians are sabotaging the state... 

Democrats in the state have been spending taxpayer monies like drunken sailors, driving the state to the brink of a financial crisis marked by a $3.2 billion deficit, heightened credit downgrade risk, and a worsening power crisis. Compounding the situation, DOGE-related cuts to the bloated federal bureaucracy threaten to trigger a devastating recession in the state, whose economy is mainly dependent on the federal government and produces little value in the private economy. 

On Wednesday, instead of addressing the mounting problems, Democratic lawmakers passed a bill in a 101–36 vote to establish a commission tasked with studying and recommending potential reparations for slavery and the lasting effects of racial discrimination in the state.

The bill now heads to far-left Gov. Wes Moore's desk, who has previously said he will consider signing the statewide reparations commission. Remember, Moore is being primed by the Democratic Party for a presidential bid in the upcoming elections. However, he has already been accused of stolen valor. 

The Maryland House gave preliminary approval Tuesday to a bill creating a statewide reparations commission to study and recommend benefits for Marylanders whose ancestors were enslaved or impacted by inequitable government policies. The legislation, a top priority for the… pic.twitter.com/v2nD5ekFcU

— The Baltimore Sun (@baltimoresun) April 2, 2025

"I have said and long stated that the history of racism in this state is real," Moore previously stated, adding that the impacts "are still very much being felt and they've been structurally felt within the state of Maryland."

The governor and Democratic leadership in Annapolis are in over their heads when it comes to effectively managing the state. The reason is simple: they're activists, not managers. 

Instead, these activist leaders are steering Maryland like a drunk driver on a busy highway—crashing into everything in sight while barreling toward a cliff. That cliff is a looming financial crisis, driven by reckless spending and further compounded by DOGE-related cuts.

The Democrats in Annapolis have no solutions to save the state. Actually, they do - it's taxes, taxes, and more taxes, such as a proposed service tax, and, more recently, a "sleeping tax," as we joked. "Is a Thinking Tax Next? "

Maryland Democrats Pass "Sleep Tax" - Is a Thinking Tax Next? https://t.co/ujScbAAnrT

— zerohedge (@zerohedge) March 29, 2025

Instead of addressing real crises—while tens of thousands, if not over 100,000, residents struggle with skyrocketing power bills caused by backfiring green policies—these lawmakers recently thought it was a good use of time to debate about installing vending machines filled with condoms for children. 

Maryland Democrats are pushing a bill to put VENDING MACHINE CONDOMS in KINDERGARTEN

Literally beyond parody pic.twitter.com/Ynd5X15vzP

— Libs of TikTok (@libsoftiktok) February 26, 2025

Maryland's current direction is disastrous and will likely spark an exodus of residents and businesses.

A large asset manager based in the state has already told us they're advising clients against investing in Maryland municipal bonds—and are encouraging clients living in the imploding state to relocate.

If the solution to an imploding state is reparations, condoms for kids, and a tax on sleep, then Maryland voters are in dire need of a wake-up call. Honestly, it might already be too late.

Tyler Durden Thu, 04/03/2025 - 12:00

Senate Votes To Block Trump Tariffs On Canada After Four Republicans Cross The Aisle

The Senate has passed a largely performative rebuke of President Donald Trump's ability to impose tariffs on Canada, after four Republicans crossed the aisle for a 51-48 vote.

Sen. Tim Kaine (D-Va.) (C) speaks alongside Senate Minority Leader Charles Schumer (D-N.Y.) (R) and Sen. Peter Welch (D-Vt.) at a press conference at the U.S. Capitol in Washington on April 2, 2025. (Kevin Dietsch/Getty Images)

The resolution - which has practically no chance of making it through the House (and Trump would veto anyway), passed hours after Trump announced his so-called "Liberation Day" of worldwide tariffs, would end Trump's emergency declaration on fentanyl trafficking used to justify tariffs on Canada, though both Canada and Mexico are exempt from Trump's 10% baseline rate, while products subject to CUSMA/USCMA are exempt.

"Tariffs on imports from Canada are still set to rise on Thursday. Auto tariffs announced last week will still push the average U.S. tariff rate on imports from Canada to about 3.5% from 2.5% by our count," said RBC's Nathan Janzen and Claire Fan.

"That increase will still matter, but looks small now compared to dramatically higher tariffs set to be imposed on other countries."

The four Republicans who joined all Senate Democrats were; Lisa Murkowski of Alaska, Susan Collins of Maine, Mitch McConnell of Kentucky and Rand Paul of Kentucky.

Following the vote, former Senate GOP leader Mitch McConnell (R-KY) said, "As I have always warned, tariffs are bad policy, and trade wars with our partners hurt working people most."

Trump has argued that Canada isn't doing enough to stop the flow of illegal drugs from entering the USA. In 2024, CBP seized 43 lbs. of fentanyl in its northern border sector vs. 21,000 at the southern US border. Since January, authorities have seized less than 1.5 lbs in the north, according to federal data cited by AP.

"This is not about fentanyl. It’s about tariffs. It’s about a national sales tax on American families," said Sen. Tim Kaine (D-VA), who initiated the resolution.

Democrats argued that Trump is using the tariffs to pay for proposed tax cuts that would benefit the wealthy, but will also make it more expensive to build homes, buy cars and pay for imported grocery products. Kaine pointed to aluminum imported from Canada that is used by businesses ranging from pie makers to shipbuilders. -AP

"Today, Donald Trump takes a sledgehammer to the American economy and even to the American dream," said Senate Democratic leader Chuck Schumer, who of course also had something to say, adding "Once the American people say, ‘I don’t want to embrace somebody, I don’t want to vote for somebody, I don’t want to support somebody who embraces Trump’s policies,’ things are going to change."

During Wednesday's presser, Trump singled out Canada as a chief beneficiary of "unfair" trading practices with the US despite not adding any new tariffs as part of the Lutnick plan.

"Why are we doing this? I mean, at what point do we say, ‘You’ve got to work for yourselves and you’ve got to’? This is why we have the big deficits," said Trump.

Standing up for Trump were several Senate Republicans - who insisted that Canada's punishment was more about fentanyl than the impacts of tariffs.

"There are unique threats to the United States at our northern border," said Majority Whip Sen. John Barrasso (R-WY) said during a floor speech, adding that former President Joe Biden had "also thrown open the northern border. The criminal cartels noticed and they took advantage."

"President Trump is taking the bold, decisive, swift action that is necessary to secure that border as well," he continued.

* * *

You can support ZeroHedge with the purchase of a high-quality, sharp, ZeroHedge Multitool.

Click pic... add to cart... (buy 2 for free shipping)... enjoy Multitool! Satisfaction guaranteed or your money back. Tyler Durden Thu, 04/03/2025 - 11:35

Watch: Sen. John Kennedy Destroys Nationwide Injunctions

Authored by Matt Margolis via PJMedia.com,

By now, you know that I’m a big fan of Sen. John Kennedy (R-La.) and his unmatched ability to dismantle weak arguments with his signature Southern wit. On Monday, during a Senate Judiciary Committee hearing, he was at the top of his game, systematically exposing the complete lack of legal authority for district judges to issue universal injunctions — a favorite tactic of the left to block President Trump’s agenda.

Questioning Assistant Attorney General nominee Brett Shumate, Kennedy systematically dismantled any justification for these sweeping judicial orders.

"Mr. Shumate, what's a universal injunction?" Kennedy asked.

Shumate explained, "Senator, a universal injunction is an order from a court enjoining the government in a way that goes beyond the parties to the case but applies nationwide or in some cases universally."

Kennedy pressed further, asking, "What's the statutory basis for a federal judge issuing an order that affects people other than the parties before the court?"

"I'm not aware of a statutory basis, Senator," Shumate admitted.

"There is no statutory basis, is there?" Kennedy reiterated.

"No, Senator," Shumate confirmed.

Kennedy then challenged Shumate to name a Supreme Court ruling that interprets the Constitution to allow such injunctions. 

"Can you name me that case?" he asked.

"I'm not aware of one, Senator," Shumate responded.

"There isn't one, is there?" Kennedy pressed.

"I'm not aware of one, Senator," Shumate repeated.

Kennedy then laid out the fundamental issue: 

"You have a plaintiff and a defendant, and the plaintiff files a lawsuit in federal court. The judge has jurisdiction over those parties. How can a federal judge issue an order that affects everyone else outside of that courtroom?"

"Uh, it shouldn't be possible, Senator, but district courts do it all the time," Shumate admitted. 

"I think on the theory that courts need to enjoin a federal policy from going into effect, and they often will enjoin it nationwide so that all non-parties are protected."

"I thought that if you wanted to affect parties who aren't in court, you had to file a class action," Kennedy countered.

"That's correct, Senator," Shumate agreed.

Kennedy pointed out that instead of filing class-action suits, plaintiffs often seek universal injunctions, which have no legal foundation. 

"Does this encourage forum shopping?" he asked.

"Yes, Senator. Not only does it encourage forum shopping, but also district shopping and filing multiple strategic lawsuits to find one judge who will enjoin a single policy nationwide," Shumate said. "If you have five lawsuits, only one of those cases needs to be successful."

Kennedy then turned to historical precedent. 

"Universal injunction is basically an equitable remedy. Did this exist in common law courts in England?" he asked.

"I don't believe so, Senator," Shumate responded, citing Supreme Court precedent that equitable relief was traditionally limited to the parties in a case.

Kennedy then pointed out that judges issued only about 27 universal injunctions in the entire 20th century.

"But 86 of them were issued against President Trump in his first term. Is that correct?" Kennedy asked.

"I don't know the specific number, but it was a high number," Shumate conceded.

"And so far in President Trump's second term, 30 universal injunctions have been issued against him. Have they not?" Kennedy continued.

"Senator, I don't have the specific number, but that sounds about right," Shumate said.

"The universal injunction has become a weapon against the Trump administration, has it not?" Kennedy asked.

"Yes," Shumate affirmed.

In his closing remarks, Kennedy highlighted the constitutional issue at hand: "Tell me the basis for universal injunction in Article III. Where does it mention universal injunction?"

"It does not, Senator," Shumate said. "It says courts are to decide the case or controversy before them, which is based on the parties to the case."

Kennedy concluded, "So Congress could act and say, 'Look, federal judges, you render a decision to a plaintiff or a defendant, but you can't impact people outside of your courtroom other than through a class action.' That's why God created class actions, isn't it?"

"Yes, Senator," Shumate agreed.

Kennedy’s questioning explained that universal injunctions lack any basis in statutory law, Supreme Court precedent, or historical common law and exposed their use as a judicial overreach that disproportionately targets President Trump’s policies.

The left's weaponization of universal injunctions against Trump continues unchecked, but Senator Kennedy just exposed their game. 

Tyler Durden Thu, 04/03/2025 - 11:25

'Luigi Mangione' Copycat Kills Pharmacy Worker In California

Authored by Luis Cornelio via Headline USA,

A copycat of alleged insurance executive assassin Luigi Mangione apparently harbored so much hatred toward large pharmacies that he targeted a Walgreens in California and fatally shot a vulnerable employee, police said. 

The accused perpetrator, Narciso Gallardo Fernandez, shot and killed Erick Valasquez inside a Walgreens in Madera, California during Velasquez’s shift in what investigators describe as a random attack, Madera Police Chief Gino Chiaramonte said. 

A chilling video widely shared on social media captured Gallardo Fernandez entering the Walgreens, waving his hands before firing at the camera.

He then targeted Valasquez, a husband and father of two young children. 

“He has generalized anger towards pharmacies through previous issues,” Chiaramonte said, according to local news outlet KSEE. 

In an apparent "Luigi style" shooting at a Walgreens in Madera, CA, 30-year-old Narciso Gallardo Fernandez murdered a father of two in cold blood due to a grudge against large pharmacies.

This is a deranged coward who deserves society's deepest contempt and punishment. pic.twitter.com/VCvKvS90Ni

— Charlie Kirk (@charliekirk11) April 2, 2025

The unhinged man, who reportedly drove 80 miles to reach the Walgreens, also shot other store workers and customers as they fled. He was reloading his weapon when law enforcement approached him in the parking lot. 

“He not only point blank murdered the store employee Erick Velasquez, but the store manager and a female victim after the shooting fled out the front door and he turned and started shooting towards them,” Chiaramonte said. 

The police chief said the alleged gunman told officers that he knew it was over by the large presence of police, lights and sirens coming. 

Local resident Alexis Miller-Jones expressed shock at the harrowing incident, noting that she often visits the store with her 11-year-old child. 

“I’ve not seen anything to this magnitude in our town,” Miller-Jones told KSEE. “One time somebody busted in the doors and stole a bunch of cigarettes, but that was the biggest, this is a lot more scary.” 

Walgreens reacted to the killing in a press statement, stating:

“We are deeply saddened by last night’s tragic event, which resulted in the death of one of our team members. Our thoughts and prayers are with their loved ones during this difficult time.” 

The killing comes less than four months after UnitedHealthcare CEO Brian Thompson was fatally shot by activist Luigi Nicholas Mangione in a New York City street. 

CCTV footage captured Mangione approaching Thompson and firing a 3D-printed pistol fitted with a 3D-printed suppressor in an assassination-style attack. 

Mangione now faces several state and federal charges for the murder, with the Trump-led DOJ seeking the death penalty. 

Tyler Durden Thu, 04/03/2025 - 10:45

Here Are The Three Goals That Trump Wants To Achieve Through His Global Trade War

Authored by Andrew Korybko via substack,

He hopes to strengthen the US’ supply chain sovereignty, renegotiate its ties with all countries with a view towards getting them to distance themselves from China, and shape the emerging world order.

Trump’s decision to tariff the entire world to varying extents as revenge for their tariffs against the US has shaken the global economy to its core. Instead of restoring free and fair trade like he claims to want, which would give American companies an advantage, he might inadvertently accelerate regionalization trends and the subsequent division of the world into a collection of trade blocs. Even in that scenario, however, he could still advance the three unstated goals that are responsible for this policy.

• The first is to strengthen the US’ supply chain sovereignty so as to eliminate the leverage that other countries have over it. This might not be pursued solely for the sake of it, but perhaps also as contingency planning, thus hinting at concerns about a major war. The two most likely adversaries are China and Iran, and a hot conflict with either would throw the global economy into turmoil. Trump might therefore want to prioritize reshoring in order for the US to preemptively minimize the consequences.

• The second goal builds upon the first and relates to the US prompting every country to renegotiate their bilateral ties, during which time the US could offer to reduce tariffs in exchange for certain concessions. These could take the form of distancing themselves from China to a degree and gradually replacing it with the US with their top trade partner. Other incentives could also be dangled such as technology-sharing and military deals. The purpose would be to weaken China by chipping away its foreign trade.

• And finally, the last goal is to shape the emerging world order, to which end the US had to speed up the end of the present one by shaking the global economy to its core like Trump just did. Obtaining supply chain sovereignty and replacing China as the top trade partner for as many countries as possible would give the US’ leverage over a sizeable portion of the world. While it’s premature to speculate the ways in which the US could exploit this, it’ll almost certainly be in the context of its systemic rivalry with China.

Even if Trump’s global trade war unintentionally turbocharges regionalization trends and the subsequent division of the world into a collection of trade blocs instead of serving as the unprecedented power play that he expects, the US could still take advantage of this to implement its “Fortress America” policy. This refers to the US restoring its unipolar hegemony over the Western Hemisphere, which would make it strategically autarkic if it receives preferential access to these countries’ resources and markets.

In that event, the US would survive and could even thrive even if it’s pushed out of the Eastern Hemisphere upon losing the major war that it might be planning or if the consequences thereof make that part of the world too dysfunctional for the US to manage, which could lead to the US returning to its 1920s-like isolationism. To be clear, the US is unlikely to voluntarily abandon the Eastern Hemisphere, but it would still make sense to plan for that possibility just in case circumstances compel it to do so.

All in all, Trump’s global trade war is an epochal event that’ll leave a lasting impact on International Relations regardless of its outcome, but it’s too early to say for sure exactly what’ll come from it. The only thing that can be said with any certainty is that Trump has a grand plan in mind even if he doesn’t ultimately achieve any of his goals, the three most likely of which were touched upon in this analysis. In any case, the old era of globalization is now over, but it remains to be seen what’ll replace it and when.

Tyler Durden Thu, 04/03/2025 - 10:15

ISM Services Slumps To 9-Month Lows; Employment Plunges

Following the significant decline in US Manufacturing 'soft' survey data (while hard data keeps rising with manufacturing jobs jumping most in years according to ADP), expectations for this morning's Services Sector PMIs are mixed.

• S&P Global's US Services PMI jumped from 15 month lows at 51.0 to 54.4 in March

• ISM Services PMI tumbled from 53.5 to 50.8 - its lowest since June 2024

Source: Bloomberg

Under the hood of ISM was not pretty as Employment plunged into contraction (46.2) and New Orders dropped significantly (while Prices Paid saw some respite)...

Source: Bloomberg

Baffle 'em with bullshit is back...

Chris Williamson, Chief Business Economist at S&P Global Market Intelligence, offered a silver lining after the Manufacturing survey's slump:

"March saw a welcome rebound in service sector business activity after a weak start to the year, with employment also returning to growth after a decline seen in February. 

However, the rate of expansion remains below that seen throughout the second half of last year. [ZH: but still stronger than the rest of the world.]

Combined with a weak manufacturing reading for March, the survey data point to GDP having risen at an annualized rate of just 1.5% in the first quarter, down sharply from the 2.4% rate seen at the end of last year. 

But, it's not all unicorns and rainbows:

"The focus turns to whether growth will also trend lower in the second quarter. 

In this respect, we note that some of the improvement in March reflected better weather, after adverse conditions dampened services activity in the first two months of the year at many companies. There’s a suggestion, therefore, that the expansion in March may exaggerate the true underlying growth momentum in the economy.

"This gloomier picture is supported by the PMI’s future activity index, which showed optimism edging lower again in March. 

Business sentiment is now the lowest since the end of 2022 barring only the heightened uncertainty seen ahead of last year’s Presidential election. 

"Companies report heightened concerns and uncertainty around the impact of political change, ranging from DOGE-related budget cutting to tariffs and the degree to which foreign demand may be affected by recent policy initiatives. 

Concerns have also risen in relation to costs, which rose in March at the fastest rate in nearly two years as firms across both services and manufacturing reported intensifying supplier-driven price hikes, fueled by tariffs."

While less dramatic than the signal from Manufacturing suirveys, there is still the stench of stagflation as prices are soaring and growth is flagging.

Tyler Durden Thu, 04/03/2025 - 10:06

VW Among Several European Automakers To Halt Vehicle Shipments, Raise Prices, In Response To Tariffs

Here come the price hikes...

European automakers are hiking prices and shifting production to the U.S. in response to Trump’s auto tariffs. Volkswagen will add import fees to vehicle prices, while Volvo and Mercedes-Benz are considering expanding U.S. manufacturing to avoid the 25% duties, according to Bloomberg.

German brands like BMW, Porsche, and Mercedes are especially exposed, but strong U.S. demand—particularly for SUVs—keeps the market attractive despite the rising costs.

Trump’s tariffs, which took effect Thursday, mark a “fundamental turning point in trade policy,” said Hildegard Müller, head of Germany’s auto lobby VDA. She warned the move would create “only losers,” including U.S. consumers facing “rising inflation and a reduced choice of products.”

The Bloomberg article says that Volkswagen notified U.S. dealers it will add import fees and temporarily pause shipments from Mexico and Europe, according to Automotive News. A spokesperson confirmed the memo but declined to elaborate.

The tariffs have already shaken the industry—buyers are rushing to make purchases, and shares of German automakers dropped sharply Thursday. Mercedes and Volkswagen fell over 3%, while BMW slipped as much as 4.3%.

Mercedes may move production of a model to Alabama to offset tariffs and is weighing pulling its cheaper cars from the U.S. after a 58% sales jump in its top-selling import, the GLC SUV. Germany’s economy minister backed EU talks with the U.S. but warned of a “clear and decisive response” if no deal is reached, calling the tariffs a risk to global stability.

Volkswagen, which builds cars in Tennessee, still imports key models from Europe and Mexico. The U.S. now makes up 20% of its revenue, helped by a 7% sales boost in 2024.

BMW imports 60% of its U.S. sales and depends on European parts for its South Carolina plant. Mercedes’ Alabama factory faces similar supply chain exposure.

Volvo plans to expand U.S. production, while Ferrari will hike U.S. prices up to 10%. British automakers warned Americans will likely pay more for iconic brands like Bentley and Mini.

“These tariff costs cannot be absorbed by manufacturers,” said Mike Hawes of the UK’s auto trade lobby, “thus hitting U.S. consumers who may face additional costs and a reduced choice of iconic British brands.”

Tyler Durden Thu, 04/03/2025 - 09:50

'DOGE Impact': Federal Govt Layoffs Dominate Biggest March Job Losses In 36 Years

Over the last two months, DOGE actions have been attributed to 280,253 layoff plans of federal workers and contractors impacting 27 agencies, according to Challenger tracking. 

Another 4,429 job cuts have come from the downstream effect of cutting federal aid or ending contracts, impacting mostly Non-Profits and Health organizations.

The Government led all sectors in job cuts in March with 216,215, all of which occurred in the federal government. 

So far this year, the Government has cut 279,445, an increase of 672% from the 36,195 cuts announced in the first quarter of 2024.

March’s total is the third-highest monthly total ever recorded.

The highest monthly total occurred in April 2020 when 671,129 cuts were recorded, followed by May 2020 with 397,016. It is the highest total for the month of March on record, since Challenger began reporting on job cut plans in 1989.

“DOGE Impact” leads job cut reasons this year.

“Job cut announcements were dominated last month by Department of Government Efficiency [DOGE] plans to eliminate positions in the federal government. It would have otherwise been a fairly quiet month for layoffs,” Andrew Challenger, Senior Vice President and workplace expert for Challenger, Gray & Christmas.

Companies’ hiring plans fell in March from 34,580 in February to 13,198. So far this year, companies plan to hire 53,867 workers, a 16% decrease from the 64,163 new hires announced in the first quarter of 2024. It is the lowest Q1 hiring total since 2012 when 52,540 new hiring plans were announced.

Meanwhile, according to the government's official data, the labor market is awesome with only 219k Americans filing for jobless claims for the first time last week - a level that has been basically consistent for the last three years

Kentucky, Illinois, and Iowa saw the biggest rise in initial jobless claims last week while Texas and Massachusetts saw the biggest decline...

And despite the surge in layoffs across the Deep 'Tri-State', initial jobless claims have been falling...

But continuing jobless claims broke out of its recent range and above its Maginot Line of 1.9 million Americans...

That is the highest since November 2021.

Continuing Claims across The Deep 'TriState' continue to rise...

So who are you going to believe - WARN notices, Challenger Grey, or the BLS?

Will tomorrow's payrolls print be the tie-breaker?

Tyler Durden Thu, 04/03/2025 - 09:36

"This Could Blow Up Apple" iPhone Maker Plummets; Most Impacted By Tariffs Among Mag7s

Apple shares are plunging almost 10% in premarket trading, as the iPhone maker is viewed as especially exposed to the Trump administration’s tariff announcements.

As Bloomberg economists write in an overnight report (available to pro subs), "the US reciprocal 34% tariff on China and other nations where Apple has manufacturing will likely amplify operating-margin deterioration, given we don’t expect the company to hike prices to offset the effects." They add that revenue growth "could remain under pressure if Apple does raise product prices, in addition to uneasy consumer sentiment, which might delay upgrades."

Below we excerpt from several other Wall Street research reports, all of which reach the same conclusion:

Rosenblatt Securities (buy, PT $263)

• “Our quick math on Trump’s tariff Liberation Day suggests that this could blow up Apple,” and “that suggests something is likely to give,” like Apple getting an exemption or Trump reaching a deal with China and/or Vietnam
• “It’s hard for us to imagine Trump blowing up an American icon,” but “this looks pretty tough”

Citi (buy, PT $275)

• “If Apple cannot get exempted this time and assuming Apple gets hit by the accumulative 54% China tariffs and does not pass it through, we estimate about 9% negative impact to the company’s total gross margin”

Jefferies (underperform, PT $202.33)

• “The simple thought is likely that Apple’s products will be subject to this tariff, and thus demand will get hit and thus the supply chain will suffer,” although “our base case remains AAPL will be exempted from China tariffs”

Wedbush

• The firm sees the tariffs as “the start of negotiations,” and the selloff could represent “a major buying opportunity to own the best tech winners on sale for a policy that will be temporary and not permanent,” especially China-exposed names like Apple
• However, “numbers are now going to have come down across the tech world as just the sheer uncertainty from this tariff announcement heard around the world will cause some IT budgets to freeze”

While Apple is crashing by almsot double digits, the rest of the tech giants are also broadly lower, including: Microsoft -2.6%, Nvidia -5.6%, Amazon -6.1%, Alphabet -3%, Meta Platforms -4.6%, and Tesla -5.9%, Skyworks -3.8%, Broadcom -6.2%.

Tyler Durden Thu, 04/03/2025 - 09:35

"Immense Consequences" - EU Warns Of Countermeasures As World Leaders Respond To US Tariffs

The European Union will unveil countermeasures to U.S. President Donald Trump’s latest tariffs if negotiations with the White House stall, European Commission President Ursula von der Leyen said on April 2, as leaders around the world responded to the new levies.

Trump on Wednesday unveiled a 10 percent minimum reciprocal tariff on most goods imported to the United States, while imposing a higher 20 percent levy on the European Union.

He said the tariffs were designed to help rebuild the U.S. economy and prevent cheating.

In a statement read out in Uzbek city Samarkand, von der Leyen said the newly unveiled tariffs were “a major blow to the world economy” that will have “immense consequences.”

“The global economy will massively suffer,” the EU chief said.

“Uncertainty will spiral and trigger the rise of further protectionism. The consequences will be dire for millions of people around the globe.”

Inflation will also soar, and the most vulnerable citizens will likely be impacted, von der Leyen stated.

“I agree with President Trump, that others are taking unfair advantage of the current rules,” she said. 

“And I am ready to support any efforts to make the global trading system fit for the realities of the global economy. But I also want to be clear: Reaching for tariffs as your first and last tool will not fix it.”

“That is why, from the outset, we have always been ready to negotiate with the US, to remove any remaining barriers to Transatlantic trade,” von der Leyen said. 

“At the same time, we are prepared to respond.”

As The Epoch Times Katabella Roberts reports, Von der Leyen said the EU is finalizing a package of countermeasures in response to tariffs on steel, referencing the 26 billion euro (roughly $28 billion) package of tariffs the EU plans to impose on some American goods this month after Trump’s U.S. steel and aluminum tariffs took effect on March 12.

“We are now preparing for further countermeasures, to protect our interests and our businesses if negotiations fail,” the EU chief said.

Her comments come as Trump announced tariffs on nearly all U.S. trading partners, part of what he said are efforts to balance trade deficits.

The rates include a flat 10 percent baseline levy, along with additional individualized rates that Trump said are designed to match each nation’s trade barriers on the United States. The tariffs are set to take effect at 12:01 a.m. on April 5.

Speaking from the Rose Garden at the White House, Trump declared it was “Liberation Day in America” and said the tariffs would “make America greater than ever before,” simultaneously boosting domestic manufacturing and lowering prices for consumers.

The president described the EU as pathetic and said it was “ripping off” the United States.

“Now we’re going to charge the European Union. They’re very tough. Very, very tough traders,” Trump said.

World Leaders Respond

Canadian Prime Minister Mark Carney vowed to fight the tariffs with countermeasures and “build the strongest economy in the G7.”

Swedish Prime Minister Ulf Kristersson expressed “deep regret” over the path the United States has embarked upon.

“We don’t want growing trade barriers. We don’t want a trade war. That would make our populations poorer and the world more dangerous in the long run,” Kristersson said.

“But – Sweden and the Swedish Government are well prepared for what’s happening now. We stand on solid economic ground, with world-class public finances.”

Kristersson added that he will “take every opportunity” to reverse the tariffs in the EU and hopes to be able to contain the new U.S. tariffs.

“We want to find our way back to a path of trade and cooperation together with the US, so that people in our countries can enjoy a better life. Sweden will continue to stand up for free trade and international cooperation,” he said.

Taoiseach (Irish Prime Minister) Micheál Martin said the tariffs “benefit no one.”

“My priority, and that of the government, is to protect Irish jobs and the Irish economy,” he said in a social media statement.

British Prime Minister Kier Starmer said a trade war was not in the UK’s national interest.

“Negotiations on an economic prosperity deal, one that strengthens our existing trading relationship - they continue,” he said.

Italian Prime Minister Giorgia Meloni said her administration will do “everything we can” to work towards an agreement with the United States. 

She said Italy hopes to avoid a trade war that “would inevitably weaken the West in favor of other global players.”

French President Emmanuel Macron will meet with representatives from business sectors hit by the new taxes at the Élysée Palace on April 3, the French presidency said.

Tyler Durden Thu, 04/03/2025 - 09:25

Maine Gets Final Warning on Males in Female Sports

Authored by Naveen Athrappully via The Epoch Times,

The U.S. Department of Education issued a final warning to the state of Maine, telling it to agree to protect female sports or suffer cuts in federal funding.

The seal of the U.S. Department of Education in Washington on July 16, 2019. Samira Bouaou/The Epoch Times

On March 19, the federal department’s Office for Civil Rights (OCR) sent a letter notifying the Maine Department of Education (MDOE) that its policies and practices violate Title IX rules by allowing males to partake in female sporting events.

Title IX prohibits discrimination based on sex in any education program or activity that receives federal funding.

The OCR proposed a resolution agreement on March 19 detailing corrective actions, including banning males from female sports. However, “MDOE has taken no action to protect women and girls from discrimination in sports or intimate spaces,” the federal agency said in a March 31 statement.

On Monday, the OCR notified Maine that “unless it signs a Resolution Agreement by April 11, OCR will refer the matter to DOJ (Department of Justice) for proceedings, which could result in termination of MDOE’s federal education funding.”

The investigation was launched by the Office for Civil Rights on Feb. 21.

The probe came following President Donald Trump’s presidential action on Feb. 5 opposing “male competitive participation in women’s sports.” It called for rescinding “all funds from educational programs that deprive women and girls of fair athletic opportunities.”

Allowing males to compete against females in sporting events is “demeaning, unfair, and dangerous to women and girls, and denies women and girls the equal opportunity to participate and excel in competitive sports,” it said.

Commenting on the final warning letter to MDOE, Department of Education Acting Assistant Secretary for Civil Rights Craig Trainor said the Maine education department’s “indifference to its past, current, and future female athletes is astonishing.”

“By refusing to comply with Title IX, MDOE allows—indeed, encourages—male competitors to threaten the safety of female athletes, wrongfully obtain girls’ hard-earned accolades, and deny females equal opportunity in educational activities to which they are guaranteed under Title IX,” he said.

On Feb. 21, Maine Gov. Janet Mills said that her state “will not be intimidated by the President’s threats.”

If federal funding is cut, her administration “will take all appropriate and necessary legal action to restore that funding,” she said at the time.

The Epoch Times has reached out to MDOE for comment.

Crackdown on MDOE

The March 19 letter to MDOE from the Office for Civil Rights outlined several steps the state had to take.

MDOE must direct all public school districts to comply with Title IX, “reminding them that noncompliance places their federal funding in jeopardy,” it said.

The directive must mention that compliance with Title IX requires schools to forbid “males to participate in any athletic program, or access any locker room or bathroom, designated for females,” it added.

The terms “man” and “woman” must be understood in the context that there are only two sexes, the letter also said.

Meanwhile, the federal Education Department’s Student Privacy Office recently launched another probe, looking at whether MDOE has violated the Family Educational Rights and Privacy Act (FERPA).

The investigation follows reports that dozens of school districts in the state were breaching parental rights.

The school districts’ policies allow schools to create “gender plans” that support a student’s transgender identity. The districts contend that these plans are not education records under FERPA and thus are inaccessible to parents.

“Parents and guardians have the right to access their child’s education records to guide and safeguard their child’s mental, emotional, and physical well-being. Any policy to the contrary is both illegal and immoral,” said U.S. Secretary of Education Linda McMahon.

“It is deeply concerning to hear that teachers and school counselors in Maine are reportedly encouraging and helping students to undergo so-called ‘gender transitions’ while keeping parents in the dark. The Trump Administration will enforce all federal laws to safeguard students and families.”

Tyler Durden Thu, 04/03/2025 - 09:05

Reign Of Tariffs Begins: Futures Crash, Dollar Craters

Well, Trump's "liberation day" is here... and it has liberated countless traders of their net worth and risk assets: the market's reaction to Trump's newly-instituted "much worse than expected" reign of tariffs is nothing short of a bloodbath, with a global selloff hitting stock markets everywhere but especially in the US where conventional wisdom, at least early on, is that the recession will be worst. As of 8:00am ET, S&P futures are down 3.5%, while Nasdaq futures tumble 4%, but should really be down more: Pre-market, AAPL (-7.5%), AMZN (-5.6%) and TSLA (-4.6%) are among the worst performing stocks within Mag 7, which is red across the board. As Trump unveiled yesterday (after the close), all US imports will have a minimum 10% tariff, with additional duties for big trading partners. China faces a tariff of well above 50% on many goods; the EU is subjected to a 20% levy. Bond yields crash in anticipation of a looming recession, down 4-10bp lower across the board, the Bloomberg US Dollar index is down -1.6%, set for its biggest drop . Commodities are all also sharply lower: WTI -3.9%, silver -3.4%, even gold is back under $3000. On today's calendar we get initial and con continuing jobless claims as well as the latest ISM Services data.

Roughly $1.7 trillion is set to be erased from the S&P 500 Index when trading opens Thursday amid worries that the sweeping tariffs could plunge the economy into a recession. The damage was heaviest in companies whose supply chains are most dependent on overseas manufacturing. Apple, which makes the majority of its US-sold devices in China, is on track to open down 7.7%. Lululemon Athletica and Nike among companies with manufacturing ties to Vietnam, are down at least 9%. Walmart Inc. and Dollar Tree Inc., retailers whose stores are filled with products sourced outside of the US, are trading at least 4% lower.

In premarket trading, Apple is the biggest laggard among the Mag7 as the iPhone maker is one of the firms most exposed to tariff risk given China is a key manufacturing hub (Apple -7.2%, Amazon -6.3%, Nvidia -5.5%, Tesla -5.9%, Meta -4.7%, Alphabet -3.0%, Microsoft -2.7%). In general, stocks linked to global trade and the health of the economy are sliding after President Donald Trump announced a minimum 10% tariff on all exporters to the US and additional duties on about 60 nations with large trade imbalances with the US.

• Tech: Broadcom (AVGO) -6.2%, Micron (MU) -6.6%, Dell (DELL) -8.4%, HP Inc. (HPQ) -7.0%
• Automakers: General Motors (GM) -2.4%, Ford (F) -2.3%, Rivian (RIVN) -5.3%, Lucid (LCID) -5.4%
• Financials: JPMorgan (JPM) -3.8%, Bank of America (BAC) -3.9%, Wells Fargo (WFC) -4.5%, Morgan Stanley (MS) -4.8%, Goldman Sachs (GS) -4.6%, Citigroup (C) -4.5%; crypto stocks also slide
• Consumer: Walmart (WMT) -4.7%, Target (TGT) 5.5% , Nike (NKE) -9.9%, Skechers (SKX) -12%, Deckers Outdoor (DECK) -12%, On Holding (ONON) -15%, JetBlue (JBLU) -4.8%, Carnival (CCL) -6.3%, DraftKings (DKNG) -5.9%
• US-listed Chinese stocks: Alibaba (BABA) -3.1%, Baidu (BIDU) -2.9%, PDD (PDD) -5.3%, JD.com (JD) -4.6%

Here are some other notable premarket movers:

• Lyft Inc. (LYFT) falls 11% after Bank of America downgraded the ride-sharing company by two notches to underperform, citing reasons that include Waymo’s rapid expansion in San Francisco and Los Angeles.
• RH (RH) tumbles 28% after the luxury home furnishing company’s annual revenue growth forecast trailed Wall Street expectations. Analysts note that new round of tariffs add “significantly more uncertainty.”

Here are the key sectors in focus this morning:

Tech and Chips

• Apple, which counts China as a key manufacturing hub, led the Mag 7 group lower. Among other Mag 7 movers: Amazon -5.1%, Meta -3.2%
• Chipmakers were broadly lower; Nvidia is down 3.2% while Broadcom and Micron also slip.

Automakers, Industrials, Transport

• Tariffs threaten to add thousands to car prices, and steep tariffs on the sector are already set to go into effect Thursday morning. EV-makers moving lower: Tesla -3.7%, Rivian -3%
• Industrial behemoths slip in postmarket trading as tariff risks may hurt companies with global supply chains. Watch: Caterpillar, Dover, General Electric, Lockheed Martin, Boeing, RTX and Eaton.

Financials

• Big banks trade lower and the SPDR S&P Regional Banking ETF falls 4.4%

Consumer

• Watch apparel stocks as tariffs on countries like Vietnam and Indonesia are poised to rattle the global shoe and clothing supply chain.
• Travel and leisure stocks are down on fears tariffs will raise prices for consumers and curb discretionary spending.
• Retailers — many of which source goods from China — are also falling, including Walmart -5.8% and Target -5.2%

Homebuilding

• From lumber to steel to building supplies, home construction is highly exposed to tariffs; Watch the ETF (XHB US) that tracks homebuilder and home improvement stocks and its members: Williams-Sonoma, Dream Finders Homes, Builders FirstSource.

Chinese Companies

• US-listed shares of Chinese companies decline, including Alibaba -2.7%

Fears about growth and inflation are front of mind, while investors are also dealing with a new level of risk related to volatility and positioning. UBS economists said that real GDP could be hit by 1.5-2 percentage points in 2025, while inflation could rise to close to 5% if tariffs are not reversed soon. RBC strategist Lori Calvasina, meanwhile, cautioned that a “growth scare drawdown” is likely if the S&P falls meaningfully below its mid-March low. In other US assets, Treasury yields slumped while the dollar also fell. Apple and Nike — which rely on global supply chains — are both down more than 6% premarket.

While the jury is still out on the final outcome of Trump's "reign of tariffs", which came in far more sever than expected,  one thing is emerging: for now, Trump's shake-up of the global trading system is hurting US assets more than those in many of the big economies he has just slapped with additional tariffs. As noted above, US index futures tumbled as much as 4% after and the dollar cratered, while the impact elsewhere was less extreme. The Stoxx Europe 600 was down 1.9% and a broad gauge of Asian stocks fell as much as 1.7%; while the euro was up 2.2% against the dollar, hitting its highest level since October in what was its biggest one-day jump in a decade. The yen likewise soared.

The tariff announcement has put more pressure on a US stock market that had already floundered this year, as investors braced for Trump’s policies to stir up inflation and raise the odds of a recession in the world’s largest economy. The S&P 500 was down 3.6% this year before the tariff announcement, while the Nasdaq 100 had shed about 7%. The Magnificent Seven tech stocks have also tumbled. By contrast, Germany’s DAX is up 10% in 2025.

“We aren’t buying the dip in the US,” said Aneeka Gupta, head of macroeconomic research at Wisdom Tree UK Ltd. “Investors are turning toward income as a source of refuge in these times of uncertainty as they wait and watch how countries essentially come back with their countermeasures.”

The widespread selloff in global markets makes clear that investors don’t expect any winners from the latest - and by the far the largest - salvo in a growing trade war. But they also suggest the US itself might be one of the biggest victims of Trump’s protectionist policies.

“Global asset allocators will be looking at the US in a very different way,” Neil Birrell, chief investment officer at Premier Miton Investors, said by phone. “Would international investors sell the US as a result of this and start moving money? Yes, they probably will.”

Meanwhile, the dollar headed for its worst day in over two years...

... as traders prepared for the economic impact. The Japanese yen gained 1.9% against the greenback, and Treasury 10-year yields hit their lowest level since October, further weighing on the greenback. The Euro meanwhile enjoyed its best 1 day against the dollar in the last decade: only the 3.1% surge in Dec 2015 was bigger.

“The aggravation of US growth concerns on the tariff news and related further falls in US stocks has meant that the dollar isn’t enjoying its traditional safe-haven, reserve currency status support,” said Ray Attrill, head of foreign-exchange strategy at National Australia Bank Ltd.

The Stoxx 600 falls 1.6% to the lowest since the end of January after Trump announced the steepest American tariffs in a century, including a 20% rate for the European Union, which said it will retaliate. Most sectors are sliding, with real estate and utilities among the rare gainers. Consumer products, banks and technology are the worst hit sectors. Here are the biggest movers Thursday:

• Most European sectors are under pressure following Trump’s tariff announcement. Banks, tech, industrials and commodity-linked sectors are the worst performers, while those that offer defensive charecteristics, such as utilities and real estate, are outperforming
  • European medical technology and healthcare services stocks drop after Trump said he will apply at least a 10% tariff on all exporters to the US, with even higher duties on some 60 nations
  • European luxury stocks slide after Trump unveiled a 20% tariff on EU imports and a 31% rate on Switzerland. Companies that make goods in the US and EU, like LVMH, could see less of an earnings hit, according to analysts
  • Logitech shares sink as much as 12%, the most in over a year, hit by escalating trade tensions from the US. The computer peripherals firm is seen more sensitive to higher tariffs as it generates bulk of sales from the US and owns production facilities in China
  • Diageo shares rise as much as 3.1%, leading gains for European distillers, as analysts say the US tariffs announcement avoided the worst-case scenario for the sector
  • South Africa’s key stock index drops as much as 2.6%, the most since August, as new US tarrifs weigh on global markets. A deepening dispute in the nation’s ruling coalition over proposed tax increases also hit the sentiment
• Roche shares drop as much as 2.9%, lagging behind European pharma peers, after the company said a high-dose version of its best-selling multiple sclerosis drug Ocrevus failed to outperform the original in a large study
• LPP drops as much as 7.7% after Poland’s biggest fashion retailer reported 4Q earnings missing estimates and confirmed an ambitious store opening plan that is seen by analysts as a profitability risk.

Earlier in the session, Asian stocks also tumbled: 

• Japan's Nikkei 225 suffered heavy losses with the index firmly beneath the 35,000 level after the US announced 24% tariffs for Japan, while notable losses were seen in the financial sector and automakers were also hit by the 25% auto tariffs.
• Hang Seng and Shanghai Comp were pressured after US President Trump imposed a 34% tariff on China, on top of the existing 20% tariffs, for a total 54% tariff rate which saw the Hong Kong benchmark conform to the broad selling in the Asia-Pac region although the mainland initially showed some resilience with downside somewhat cushioned after stronger-than-expected Chinese Caixin Services PMI data.
• Australia's ASX 200 declined with the index dragged lower by underperformance in tech and energy, while there were comments from Australian PM Albanese who said they will not impose reciprocal tariffs and will continue to make the case for these unjustified tariffs to be removed from exporters.

In FX, the Bloomberg Dollar Spot Index drops 1.7%, on course for its largest intraday fall since November 2022. The Swedish krona is leading gains against the greenback, rising 2.4%. The Japanese yen and Swiss franc are not far behind.

In rates, treasuries rally, pushing US 10-year yields down 7 bps to 4.06%. European bonds also gain, led by the short-end as traders boost bets on interest rate cuts by both the European Central Bank and Bank of England.

In commodities, WTI drops 3.9% to below $69 a barrel. Spot gold declines 50 to around $3,091/oz. Bitcoin falls 3% to below $83,000

Looking to the day ahead now, focus within a busy economic release schedule will likely center on March ISM Services at 10am ET, seen easing to 52.9, from 53.5. Other releases include Challenger job cuts report for March at 7.30am ET, Trade balance for Feb. at 8.30am ET and US weekly jobless claims at 8.30am ET.  Central bank speakers include Fed’s Jefferson and Cook's speech and the ECB’s account of the March meeting. NATO’s foreign ministers are also set to meet today until April 4.

Market Snapshot

• S&P 500 mini -3.2%
• Nasdaq 100 mini -3.8%
• Russell 2000 mini -4.4%
• Stoxx Europe 600 -1.5%
• DAX -1.7%
• CAC 40 -2.1%
• 10-year Treasury yield -5 basis points at 4.08%
• VIX +3.9 points at 25.45
• Bloomberg Dollar Index -1.3% at 1254.51
• euro +1.5% at $1.1018
• WTI crude -3.3% at $69.35/barrel

Top Overnight News

• Apple shares slumped premarket on the tariffs announcement despite efforts to insulate its supply chains. Other major tech stocks including Nvidia, Meta, Tesla and Alphabet also declined.  Nike, Adidas and Puma plunged given their reliance on Vietnamese manufacturing. BBG
• Here’s what the White House and its crack team of trade investigators seems to have done: Take the US’s goods trade deficit with any particular country, and divide it by the total amount of goods imported from that country. Cut that percentage in half, and there’s the US’s “reciprocal” tariff rate. FT
• US President Trump reiterated that tax cuts will be passed in one big beautiful bill in Congress, while he added they need to get permanent tax cuts.
• US President Trump posted on Truth Social that "Speaker of the House Mike Johnson and Senate Majority Leader John Thune have been working tirelessly on taking the next step to pass the plan for our ONE, BIG, BEAUTIFUL BILL, as it is known, as well as getting us closer to the Debt Extension necessary to continue our great work. The Senate Budget plan gives us the tools that we need to get our shared priorities done, including certain PERMANENT Tax Cuts, Spending Cuts, Energy, Historic Investments in Defense, Border, and much more. We are going to cut Spending, and right-size the Budget back to where it should be. The Senate Plan has my Complete and Total Support. Likewise, the House is working along the same lines. Every Republican, House and Senate, must UNIFY. We need to pass it IMMEDIATELY!"
• In the immediate aftermath of Trump’s tariff announcement, confusion reigned even among some White House officials about what rate the approximately $440 billion in Chinese imports would face. Policy experts were perplexed, too. Barron’s
• Fed Governor Kugler said the latest data indicates progress towards the 2% inflation target may have stalled and she supports keeping the current policy rate in place as long as upside risks to inflation continue, given stable activity and employment. Furthermore, she stated that inflation expectations have risen and upcoming policy changes hold upside risk, as well as noted that there may be reasons why tariffs have more prolonged effects.
• Goldman's bottom line on Tariff Announcements: The “reciprocal” tariff policy President Trump announced would impose a weighted average tariff rate of 18.3%, around 3pp higher than we expected. However, roughly 1/3 of total imports would be exempt, which reduces the impact to a 12.6pp increase in the effective tariff rate. We estimate this and other tariffs announced year-to-date would raise the US effective tariff rate by 18.8pp. While we assume that negotiations with trading partners will lead to somewhat lower “reciprocal” rates than announced today, the prospect for escalation following retaliatory tariffs and a high probability of further sectoral tariffs suggests a risk that the US effective tariff rate rises more than the 15pp increase we assume in our economic forecast. GIR
• China’s Ministry of Commerce held a briefing at 3pm today, just hours after US President Donald Trump declared a trade war with the world. The action includes a further 34 per cent tariffs on imports from China, raising American tariffs on China to 54 per cent. In a statement on Thursday morning, the ministry accused the US of “typical unilateral bullying” and vowed to take resolute countermeasures. It also said Beijing would urge Washington to remove the tariffs and solve disputes through dialogue. SMCI
• China’s Caixin services PMI came in ahead of expectations at 51.9, up from 51.4 in Feb and above the consensus forecast of 51.5. WSJ
• The BOJ’s policy normalization course has been thrown into doubt because of the risk of a domestic recession spurred by US tariffs, economists said. “This was beyond our worst case scenario.” BBG
• The EU has given itself a 4 week window to convince Trump to drop his 20% on the block, with retaliation ruled out before late April. FT
• Senate votes 51-48 to reject Trump’s Canadian tariffs as four Republicans (Collins, McConnell, Murkowski, and Paul) joined with the Dems (this vote is symbolic and won’t have any actual impact on policy, but it does send a small message of displeasure to the White House). Politico

A more detailed look at global markets courtesy of Newsquawk

APAC stocks mostly tumbled in the aftermath of the 'Liberation Day' tariff announcements in which US President Trump unveiled reciprocal tariffs which were mostly set at around half of the rate that individual countries were charging the US with the actual baseline at 10%, while he also announced 25% auto tariffs. ASX 200 declined with the index dragged lower by underperformance in tech and energy, while there were comments from Australian PM Albanese who said they will not impose reciprocal tariffs and will continue to make the case for these unjustified tariffs to be removed from exporters. Nikkei 225 suffered heavy losses with the index firmly beneath the 35,000 level after the US announced 24% tariffs for Japan, while notable losses were seen in the financial sector and automakers were also hit by the 25% auto tariffs. Hang Seng and Shanghai Comp were pressured after US President Trump imposed a 34% tariff on China, on top of the existing 20% tariffs, for a total 54% tariff rate which saw the Hong Kong benchmark conform to the broad selling in the Asia-Pac region although the mainland initially showed some resilience with downside somewhat cushioned after stronger-than-expected Chinese Caixin Services PMI data.

Top Asian News

• Japanese RENGO trade union third-round data: average wage increase 5.42% for fiscal 2025 vs. 5.40% in the second-round.

European bourses (STOXX 600 -1.2%) are entirely and markedly in the red in the fallout of US President Trump’s “Liberation Day”, where the reciprocal tariff announcement was viewed as worse than feared. Wedbush writes that the levies are a “worst case scenario” for Wall Street. European sectors are mostly lower and holds a clear negative bias, in-fitting with the risk tone. Healthcare is modestly in the green owing to the defensive risk tone and as the pharmaceutical industry avoided reciprocal tariffs (for now). Consumer Products is underperforming today, given the losses in the Luxury sector as trader’s brace themselves for the hefty tariffs set on China.

Top European News

• BoE Decision Maker Panel survey: firms 1-year ahead own price inflation expected at 3.9% (prev. 4.0%) in the three-month period to March.

Fixed Income

• USTs are bid given the US tariff announcement where the initial relief on reporting around a 10% baseline gave way to marked risk-off as the reciprocal levels were announced. In brief the average US effective tariff rate is (once the measures are implemented) around 23% from around 10%. Further insight into Trump’s tariffs and how the administration feels about the initial comments/responses to the measures from various nations may be provided VP Vance and Commerce Secretary Lutnick who are due to speak from around 13:00BST. US Challenger Layoffs, Jobless Claims and ISM Services are scheduled.
• Hit a 112-24+ peak in the hour after Trump’s speech, at best the benchmark posted gains of around 40 ticks and the 10yr yield hit a 4.04% low, a base which takes us back to November 2024 when the yield was below the 4.0% handle.
• Bunds peaked at 129.94 after Trump’s tariff announcement. A high that takes Bunds around half of the way back to the pre-fiscal change levels. With, as a function of the move lower on fiscal reform, the next chronological resistance point someway off at 132.04. While Bunds peaked at 129.94 and are in the green, they have been pulling back gradually throughout the morning. A pullback which is likely a function of European bourses picking up off worst levels in the morning, though still well into the red, and potentially as the knee-jerk move on growth concerns/general risk is tempered by inflationary concerns.
• Gilts are firmer albeit to a lesser degree vs peers. UK benefits as a function of leaving the EU, with the nation subject to just the 10% baseline tariff, for now at least. Nonetheless, the benchmark gapped higher by 58 ticks and then extended by another 41 to a 93.14 peak. Stopping just shy of a cluster between 93.33-79 from early-March.
• Spain sells EUR 6.24bln vs exp. EUR 5.5-6.5bln 2.40% 2028, 3.10% 2031 & 3.90% 2039 Bono and EUR 0.6bln vs exp. EUR 0.25-0.75bln 1.00% 2030 I/L.
• France sells EUR 12bln vs exp. EUR 10-12bln 3.50% 2033, 3.20% 2035, 3.75% 2056 OAT.
• UK sells GBP 3.25bln 4.375% 2040 Gilt: b/c 2.58x (prev. 2.89x), tail 0.9bps (prev. 0.6bps), average yield 4.917% (prev. 4.836%).

Commodities

• Crude is significantly lower, with Brent Jun'25 down by around USD 2.50/bbl, as the complex is swept away by the negative risk-tone following US President Trump's tariff announcement. Pressure since the European morning has continued and the benchmarks currently reside near lows.
• Spot gold climbed to a fresh record high of USD 3,167.74/oz in reaction to the tariff turmoil owning to its haven status. The European morning thus far has seen a slight unwind of that upside, and is now off by around USD 10.50/oz in a USD 3,116.55-3,167.74/oz range. As a reminder, US President Trump's tariff order exempts gold, according to Reuters citing a White House fact sheet.
• Base metals are entirely in the red, in-fitting with the risk tone. On the trade front, Trump excluded steel, aluminium, and gold from reciprocal tariffs, providing some relief to domestic buyers who are already paying 25% duties on these key metals used in industries like automobiles and appliances.
• Kazakhstan supplied 150k/T of oil to Germany via the Druzhba pipeline in March (100k/T in February), via Ifx.

Geopolitics

• US Treasury Secretary Bessent said the Ukraine deal is coming up and a team from Ukraine may be coming over as soon as this week, while he added that they could see more Iran sanctions

US Event Calendar

• 7:30 am: Mar Challenger Job Cuts YoY 204.8%, prior 103.2%
• 8:30 am: Feb Trade Balance, est. -123.5b, prior -131.38b
• 8:30 am: Mar 29 Initial Jobless Claims, est. 225k, prior 224k
  • Mar 22 Continuing Claims, est. 1870k, prior 1856k
• 9:45 am: Mar F S&P Global U.S. Services PMI, est. 54.2, prior 54.3
  • Mar F S&P Global U.S. Composite PMI, est. 53.45, prior 53.5
• 10:00 am: Mar ISM Services Index, est. 52.9, prior 53.5

DB's Jim Reid concludes the overnight wrap

I'm off on holiday for a couple of weeks from this afternoon. I think trying to work through the deluge of very confusing and bespoke tariffs headlines overnight is enough alone to justify the break. You'll be in the very safe hands of Henry Allen and Peter Sidorov while I'm away and last night Peter has been a great help interpreting all these once in a lifetime headlines coming out of the US. It has been a truely remarkable last 8 hours or so.

So one last attempt to navigate all the headlines before I have a lie down. In short the tariffs put in place last night were extraordinary both in terms of scale and in how they were calculated, with President Trump announcing reciprocal tariffs under the Internation Emergency Economic Powers Act (IEEPA) as he declared a national emergency over the trade deficit.

Our US economists will need to work through the full implications but their initial read is that if implemented this could easily knock around 1 to 1.5% off US growth this year while adding a similar amount to core PCE. See their brief comments here. So although the impact will be large in many places, the US will see a significant impact too.
In terms of the details, countries will face a minimum tariff of 10%, with much higher rates for many major trading partners. Some of the tariff rates appeared broadly in line with expectations, such as the 20% on the EU and 10% on the UK, but with higher than anticipated rates on most Asian economies, ranging from 24% on Japan to 46% on Vietnam. And in China’s case, a reciprocal tariff of 34% comes on top of a 20% increase in tariffs announced earlier this year. Our US economists estimate that the average tariff rate on US imports could now rise into the 25-30% range, a level clearly on the worst end of expectations. As shown in our CoTD yesterday (link here), that would be in line with levels at the very start of the 20th century.

As this morning has evolved, it has became clear that the scaling of the reciprocal tariffs used a simple formula based on the size of a country’s relative goods trade surplus with the US, with the 10% minimum for countries that run a trade deficit with the US. Quite an extraordinary calculation after months of work behind the scenes. The 10% baseline tariff is due to take effect from Saturday, with higher individual rates effective next Wednesday (April 9). Overall, the size of the tariffs added to the sense of a push for a radical policy reordering by the new US administration, which was strongly hinted at in the recent Lutnick/Bessent podcasts which we summarised here, but didn’t add much confidence on there being an in-depth strategic implementation plan.

The reciprocal tariff plans do contain several exemptions. Trade with Canada and Mexico has been excluded for the time being, though a part of this already faces a 25% tariff over the fentanyl and migration emergency announced under IEEPA. Critical minerals and gold/bullion, pharmaceuticals, semiconductors, lumber and copper are also outside of the scope of the reciprocal tariffs, but these are under separate sectoral trade investigations, while steel & aluminium and auto imports will still face 25% tariffs as recently announced. Trump’s comments did leave the door open for potential negotiations to lower tariffs but his executive order also left room for further escalation, saying that the President may further “increase or expand in scope the duties imposed” should any trading partners retaliate. So watch out for these headlines.

In other related news last night, the Senate voted 51-48 to pass a resolution against Trump’s IEEPA tariffs against Canada, with four Republican senators joining all Democrats on the vote. With the Republican leadership having set up a procedural obstacle to a similar vote being forced in the House, this Senate vote has little practical meaning, but it’s an interesting test of the support for Trump’s economic policies, not least with fiscal negotiations expected in the coming weeks.

Markets have seen a strong risk-off reaction to the tariff announcement, with S&P futures down -2.65%, which would bring the index back into correction territory if it materializes in the regular session today. NASDAQ futures are -3.18%. In Europe, STOXX 50 futures are down -1.64%. For bonds, 10yr Treasury yields are -7.75bps lower to a new four-month low of 4.05%, following a -3.7bps decline yesterday. This rally comes even as at the US 1yr inflation swap is trading at new two-and-a-half-year high of 3.45% (+5.3bps overnight after +14.6bps yesterday). Brent crude is -2.13% lower overnight, while gold is +0.48% higher after a +0.67% rise to a record close of $3134/oz yesterday. And in the currency space, the dollar is -0.72% weaker after a -0.43% slide yesterday. Our FX strategists see questions over the policy credibility of the US administration as supporting their bullish EURUSD view.

Asian equity markets are slumping with the Vietnamese stock market down -6.25% given they've faced the brunt of the tariffs. Elsewhere the Nikkei (-3.18%) is hitting its lowest level in almost eight months but was more than four percent lower earlier. China risk is holding in better with the Hang Seng (-1.58%) and the Shanghai Composite (-0.51%) down but not slumping. Meanwhile, the KOSPI (-0.80%) and the S&P/ASX 200 (-0.93%) are lower. Sovereign bonds are climbing across the board with yields on the 10yr JGBs (-12.6bps) and Aussie bonds (-15.1bps) seeing extraordinary moves.
In FX, the Japanese yen has strengthened +1.13% to trade at a three-week high of 147.59 against the dollar. The Chinese onshore yuan has fallen to its weakest since February 13, trading at 7.2982 per dollar while tracking its offshore counterpart, which bottomed at a two-month low earlier in the session. Meanwhile, the PBOC set the yuan’s reference exchange rate stronger than expected at 7.1889 per dollar, 735 pips stronger than the average estimate in a Bloomberg survey thus indicating the central bank desire to maintain currency stability despite the trade tensions. Our Asian FX colleagues have just put out a note looking at the implications. Please see it here.

In the parallel universe of life before last night's blitz, US markets actually put in a solid performance yesterday, with the S&P 500 (+0.67%) posting a third consecutive advance. The S&P had been -1.09% down early on so all of these past three days have followed the same slump then recovery pattern. Both the NASDAQ (+0.87%) and the small cap Russell 2000 (+1.65%) outperformed as cyclical stocks advanced. And the Mag-7 were up +0.99%, led by a +5.33% rise for Tesla. Tesla had initially fallen by as much as -6.40% after its Q1 results showed 336,681 deliveries (vs. 390,343 estimates), its lowest car sales since Q2 2022. However, the share price moved higher after Politico reported that Trump was reportedly saying Musk will soon “leave” the White House, even if the extent of what that actually means is still unclear, with denials of this story seen later.

Yesterday’s turnaround in equities came as investors hoped that the worst case tariff scenarios would be avoided, not least given Treasury Secretary Bessent’s reported comments to lawmakers that the tariffs were a “cap” that could be negotiated downwards. Bessent repeated this sentiment publicly last night, saying “This is the high end of the number barring retaliation”. So the market was too optimistic on this yesterday.

Yesterday's optimism also got a boost from solid economic releases with ADP’s report of private payrolls coming in at +155k in March (vs. +120k expected). So that was an upside surprise ahead of tomorrow’s jobs report. In addition, factory orders were up +0.6% (vs. +0.5% expected).

In Europe, the STOXX 600 fell -0.50%, though it pared back its initial losses following a Bloomberg report that the EU was preparing a package of emergency measures to support sectors that will be hit hardest by the US tariffs. So that was considered to be positive if the retaliation ended up being via fiscal policy rather than tariffs. Nevertheless, defence and healthcare stocks were among the worst performers, including Rheinmetall (-4.21%) as the worst performer in the DAX (-0.66%).

In other geopolitical news yesterday, the Washington Post reported that White House is studying how much it would take to buy Greenland. Iran’s Foreign Minister has also said that the country is ready to begin indirect negotiations with the US over Iran’s nuclear program. This comes as US Treasury Bessent is pushing for some of the world’s biggest banks to help the Trump administration ratchet up economic pressure on Iran.

To the day ahead now, we’ll get data releases including US March ISM services, February trade balance, initial jobless claims, China March Caixin services PMI, Italy March services PMI, Eurozone February PPI, and Switzerland March CPI. Central bank speakers include Fed’s Jefferson and Cook's speech and the ECB’s account of the March meeting. NATO’s foreign ministers are also set to meet today until April 4.

Tyler Durden Thu, 04/03/2025 - 08:21

Zero Dimensional Chess

Authored by Peter Tchir via Academy Securities,

This administration had delivered on the border as the voters wanted. I wanted to start with something positive.

Today, I’m sure we will hear some hot takes about how the administration is playing 5D chess which everyone who doesn’t think tariff approach will work, is simply to simple to see.

I think they have just exposed themselves as playing zero dimensional chess.

Reciprocal tariffs, to almost anyone I talk to meant:

• You tariff me at X% on ABC good, I now tariff you at X% on ABC good.

I would argue that at least 90% of market participants and countries thought that was the definition of reciprocal tariffs.

Apparently, the calculation was:

• Trade Deficit with Country / Imports from that Country

Then the U.S. took 50% of that (rounded up) and called that reciprocal.

I guess they wanted a “big” or “huge” “simple” number for each country? That is all my little mind can come up with.

I DO NOT SEE HOW YOU “NEGOTIATE” WITH THAT

That is such a weird calculation that it is incredibly difficult to figure out a starting point for negotiations.

The government pulled back tariffs on potash (they should have read our T-Report from two weeks ago and saved themselves the trouble).

I bet the administration will cancel the tariffs on chips from Taiwan.

• Markets will briefly rally as this was self-inflicted wound.

• Markets will then sell off, because a mistake so obvious as this demonstrates, that there are probably so many mistakes in here, that countries will wait and watch the policies implode before coming to the table (Americans, as we have learned, HATE inflation and that is coming, since there were big tariffs, virtually everywhere).

• I though Chinese solar had 100% tariffs (initially under Trump and bumped up under Biden) do those come down now? (sounds stupid, but who the heck knows given the policy!)

I do not see countries coming to the table in a rush.

I see inflation spiking as it takes time to bring manufacturing back and there is no one to turn to who didn’t get whacked (making it far more likely tariffs get passed on).

Bottom Line

Rates will come down a bit – economic problems – but not as much as expected because inflation will rise and foreign buying will dwindle.

The lows are NOT yet in for stocks. I cut some shorts here, but remain bearish on the Nasdaq 100 and S&P 500 – though will be watching for bounces.

I will be adding specific chip makers with a U.S. foundry presence (and plans to build that are underway).

While I recommended reducing all global holdings a week or more ago, I will be adding back China holdings here – despite the new tariffs, I see them benefitting.

Good luck, hopefully I’m wrong, but this was worse than I expected, and I was on the pessimistic side to begin with.

Tyler Durden Thu, 04/03/2025 - 08:05

Nashville Police Claim Transgender Christian School Shooter Never Had 'Manifesto'

Authored by Ken Silva via Headline USA,

The transgender shooter behind the 2023 Nashville elementary school attack that killed six people, including three children, had been planning it for years while struggling with mental health issues, according to a police report released Wednesday.

The nearly 50-page investigative case summary by Metro Nashville Police closes the agency’s probe into the shooting at the Christian, private Covenant School in March 2023.

Contrary to widespread media reports, the investigation said that no manifesto existed.

“In this case, a manifesto didn’t exist. Hale never left behind a single document explaining why she committed the attack, why she specifically targeted The Covenant, and what she hoped to gain, if anything, with the attack,” the Nashville police report states.

Instead, the shooter, Audrey Hale, left behind “a series of notebooks, art composition books, and media files created by Hale documenting her planning and preparation for the attack, the events in her life that motivated her to commit the attack, and her hopes regarding the outcome of the attack,” police determined. 

Hale, who once attended Covenant, was killed by police.

Hale identified as a man at the time of the attack, but the police report uses female pronouns. The report doesn’t refer to Hale as transgender.

“She began to use the name ‘Aiden Williams’ in the years prior to her death and used male pronouns on her social media and networking accounts. Nothing has been found to suggest she initiated or was undergoing a transition at the time of her death, including medical documentation,” the report states.

“During her autopsy following her death, it was determined she was biologically female.”

Factual, but not truthful. https://t.co/MLD8pGV61F pic.twitter.com/OvxojCPYNc

— Ken Silva (@JD_Cashless) April 2, 2025

Hale began receiving treatment at Vanderbilt University Medical Center on April 23, 2001, when the shooter was just six years old. She first fantasized about committing a mass shooting in November 2017, after watching documentaries about school shootings and “remembering her social struggles in middle school,” according to the Nashville police report.

By December 2018, Hale also began planning an attack at a different middle school where she had once been a student, the report says. Months later, her therapist became “concerned,” and recommended Hale take part in a psychological assessment at VUMC, according to the police report. That assessment occurred in June 2019.

“Based on records from the assessment, VUMC confirmed the mental health disorders Hale was already known to have and identified her depression and anxiety as the largest aggravating factors. They made no mention of psychosis and noted Hale denied having any plans to harm herself or others, nor the means to do so,” the Nashville police report states.

After her assessment, Hale participated in an eight-week “intensive outpatient program.”

“For a short period of time, the treatment seemed to work, as Hale’s writings tended to be more positive, and fewer mentions of depression and anxiety were present. She seemed more hopeful about life and the possibility of finding independence and success,” the police report states.

“But these feelings quickly faded, as the social and personal factors that drove her depression in the first place never left. Hale quickly sunk back into deep rage and despair.”

Hale continued to fantasize about school shootings for the next several years until she carried one out the morning of March 27, 2023. Hale’s shooting spree lasted about 20 minutes before police killed her.

Transgender Christian school shooter Audrey Hale began receiving treatment at Vanderbilt University Medical Center in 2001, when she was 6.

According to the Nashville police report released today, Hale first fantasized about committing a mass shooting in November 2017.

In 2019,… pic.twitter.com/rlDSRZCmXh

— Ken Silva (@JD_Cashless) April 2, 2025

“Due to the audible fire alarm, the earplugs she was wearing throughout the attack, and the sound of her own gunfire, Hale never heard the police officers as they entered the lobby behind her. One officer then fired a 5.56mm caliber rifle at Hale, striking her and knocking her to the ground,” the Nashville police report states.

“As the officers approached Hale to take her into custody, they saw she still had possession of her firearms and her arms were moving. A second officer fired a 9mm caliber pistol at her. She was fatally wounded by the officers’ gunfire.”

The people killed in the shooting at Covenant were: Evelyn Dieckhaus, Hallie Scruggs, and William Kinney, all 9 years old; Cynthia Peak, 61; Katherine Koonce, 60; and Mike Hill, 61.

The Tennessee Star still has an ongoing lawsuit to compel MNPD and the FBI to release Hale’s full writings. 

The Star reported Wednesday that it’s extended a settlement offer to FBI Director Kash Patel, who had called for Hale’s “manifesto” to be made public before he became director.

“FBI Director Kash Patel indicated that he would release Hale’s writings if made the agency’s director, and SNDM has extended a settlement offer that would see the lawsuit dropped in exchange for Patel dropping the agency’s opposition to their release around the time of his confirmation. The FBI has yet to respond to the offer,” the Star reported.

The evidence held by law enforcement on Hale includes more than 100 gigabytes of data, which includes over 900 pages of her writings.

Tyler Durden Thu, 04/03/2025 - 07:45

Beijing Slams Trump's "Unilateral Bullying" Tariffs, Signals Retaliatory Action

President Trump's late afternoon announcement on Wednesday—"Liberation Day"—unveiled a far more aggressive tariff policy than top Wall Street analysts had anticipated, prompting panic dumping in global equities and futures markets overnight.

Of particular concern is Trump's stance toward China. The total effective tariff rate on Chinese imports surged to 54%, a dramatic increase of 34% from the previously imposed 20% in additional levies tied to fentanyl and earlier duties.

Trump's Liberation Day has drawn swift condemnation from Beijing, which has described the escalating tariff war as "unilateral bullying." 

Nikkei Asia quoted China's Ministry of Commerce, warning that it "firmly opposes" Trump's tariffs and "will resolutely take countermeasures to safeguard its own rights and interests."

The Commerce Ministry noted that the US "ignored" the benefits of a global trading system, adding, "The so-called 'reciprocal tariffs,' which are based on subjective and unilateral assessments by the United States, are not in line with the rules of international trade, seriously jeopardize the legitimate rights and interests of the parties concerned, and are typical of unilateral bullying." 

The ministry did not discuss specifics on the countermeasures. A ministry spokesperson told reporters that Beijing hopes to "resolve various issues through equal consultation." 

In other words, it's just a matter of time before Beijing mounts a countermeasure against the US, whether that's targeted tariffs, export controls, or other measures (such as targeting US Big Tech). Or as we've recently seen: Beijing Derailing Panama Port Deal.

Guo Jiakun, a spokesperson for China's Ministry of Foreign Affairs, sang the same tune: China "firmly opposes" Trump's trade war escalation, which "seriously undermines" the rules-based global trading system. He urged Washington to resolve trade differences through talks. 

However, President Trump tried that with the Chinese Communist Party in his first term with the so-called "Phase One" agreement. Beijing committed to purchasing $200 billion of additional US exports. Yet, the phase one deal with the CCP was derailed by Covid disruptions. 

The Trump administration's goal with reciprocal tariffs against literally the entire world, including some cases of near triple-digit reciprocal tariffs that will lead to a historic emerging markets shock, is to reverse a half-century or more of de-industrialization policies in the US that have hollowed out the nation's core and produced a national security threat as the world fractures into a bipolar state.

pic.twitter.com/fSHTQWcauf

— Crypto_Maximaliste (@Crypto__Maxi) April 2, 2025

In financial markets, the People's Bank of China set the daily reference rate for the yuan at 7.1889 per dollar, weakening the currency. This allows the yuan to depreciate and support export competitiveness. A move like this will only draw accusations of currency manipulation from Trump.

"We maintain our view that the PBOC will not allow a sharp [yuan] depreciation given capital outflow risks and the government's objective to restore confidence in the Chinese economy," HK Mizuho Securities analyst Ken Cheung wrote in a note earlier.

Goldman analysts Andrew Tilton and others told clients:

On April 2, President Trump announced "reciprocal" tariffs on trading partners with exclusion of products that are subject to sectoral tariffs, resulting in what we estimate to be an increase of 26pp in the average effective US tariff rate on China, which would bring the total effective tariff rate on Chinese goods to 58%.

This is much higher than we and the market had expected. Similar to the experience when the previous two 10% tariff increases were imposed on China earlier this year, we think the Chinese government is likely to retaliate with some targeted tariffs on US products as well as non-tariff measures like export controls.

We expect policymakers to continue to resist significant CNY depreciation. We believe the government will step up easing measures to offset the additional growth drag from higher tariffs. We are not changing our 2025 full-year GDP growth forecast of 4.5% at this time due to better-than-expected Q1 data and increased policy easing expectations, as well as remaining uncertainties regarding whether some of the tariffs could be negotiated down in the coming months. That said, we acknowledge downside risk from slowing global growth after the large, across-the board US tariff increases.

S&P Global Ratings credit analyst Ming Tan warned that Trump's tariffs could exacerbate China's weak economy:

"The drag on China's economy from higher tariffs will transmit to banks. We expect problem loans will rise over the next few years and could leap as high as 6.4% of total loans in a downside scenario."

Fred Neumann, chief Asia economist at HSBC, had a big-picture view for clients: "The era of Asia's export manufacturing-led development has come to an end, and the region will need to develop markets closer to home." 

Tyler Durden Thu, 04/03/2025 - 07:20