The Cost of Tariff Chaos

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Thanks for reading! If you haven’t subscribed, please click the button below:Subscribe nowBy subscribing you’ll join over 60,000 people who read Apricitas!This afternoon, Donald Trump is set to implement possibly the single-largest tariff hike in modern American history—and we know functionally zero details about it. Reporting indicates the White House team was still cooking up possible options for the president as late as yesterday, with basic information like the tariff rates and countries affected still up in the air. These tariffs will supposedly go into effect “immediately”, likely having the same midnight-on-April 3rd implementation date as Trump’s automobile tariffs, thus leaving businesses zero time to digest the information and formally prepare. This chaotic approach has sent measures of trade policy uncertainty skyrocketing to record high levels—and that alone imposes significant economic costs by making spending, investment, hiring, and transport decisions harder.Indeed, unclear and belligerent trade policy has already terrified American consumers, who are increasingly scared about tariffs’ impact on prices and the wider economy. Inflation expectations have risen dramatically in the University of Michigan’s national survey, with long-run expectations jumping to the highest levels in more than 30 years. Variance in inflation expectations has also skyrocketed, underscoring the profound uncertainty most people have about the near future. A record high share of respondents are complaining about government economic policy, mostly citing the negative impact of tariffs,…