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President Trump has refused to 'pause' tariffs despite the plummeting global stock markets - as China vows to 'fight to the end' in response to the retaliatory measures.
The Asian nation threatened to "resolutely take countermeasures to safeguard its own rights and interests" on Monday, in response to US President Donald Trump's threat of an additional 50% tariff on Chinese imports.
In a statement, China's Commerce Ministry labelled the US's use of "so-called 'reciprocal tariffs'" against China "completely groundless and is a typical unilateral bullying practice".
The ministry hinted more retaliatory tariffs are to be expected in the coming days.
It comes as Trump warned Americans not to be 'a Panican' - the US President's newly coined terminology referring to “a new party based on weak and stupid people” - an apparent reference to those panicking within the Republican Party.
The global market turmoil comes as Sir Keir Starmer is due to be questioned by senior MPs on Tuesday over the impact of US tariffs.
Nick Ferrari is joined by Jeremy Hunt's former adviser Simon Finkelstein and editor Freddy Gray to discuss the anticipated trade war.
Listen to the full show on Global Player: https://app.af.globalplayer.com/Br0x/LBCYouTubeListenLive
#nickferrari #trump #trumptariffs #donaldtrump #president #economy #whitehouse #uspolitics #netanyahu #stockmarket #recession #china #keirstarmer #ukpolitics #LBC
LBC is the home of live debate around news and current affairs in the UK.
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0:00
Few, if any of you, I imagine, were around for the Wall Street crash
0:04
You'd have to be, I don't know, about 100, no, just about 98 or something
0:08
So this is some of you, and a memory of the time, I think it was 1928, 1929. Many of you will remember Black Monday, I'm sure
0:15
That's far more contemporaneous. Well, are we now in a Trump slump
0:20
Yesterday morning, traders woke up to signals of carnage across their screens
0:25
Hong Kong's Hang Seng Index closed down over 13%. That made its worst single-day fall since 1997
0:34
It is difficult, actually, to understate how dangerous and dramatic the situation has become
0:42
In Europe, the FTSE, the UK's FTSE, I should say, fell to a one-year low
0:46
And at one point, the DAX, which is in Germany, was down 10%
0:50
Then, as US markets opened, the S&P 500, that dropped 4%, having already shed $5.4 trillion in market value
1:00
since President Donald Trump's unveiled his Liberation Day back on April 2nd
1:05
It is extraordinary, but the man is not for moving. Now, the latest twist came yesterday afternoon, as was reported on LBC
1:14
when President Trump took to social media to threaten China with an additional 50% tariff on Chinese imports
1:21
That would take the total import tax on some goods in excess of 100%
1:26
It came amid a day of market turmoil across the world, but particularly, as you've heard, in the States
1:30
There's all major markets, and as I've detailed for you, went from major losses to significant gains back to steep losses
1:35
in a matter of minutes. Now, much of the fluctuation was sparked by this comment
1:40
from one of President Trump's top economic advisers, Kevin Hassett, when he was asked by Fox News
1:45
whether Trump would consider a 90-day pause on tariffs. The president is going to decide what the president's going to decide
1:51
There are more than 50 countries in negotiation with the president. We've got the prime minister of Israel coming today
1:56
But speaking later from the Oval Office, the president confirmed there would not be any pause
2:01
He was standing firm. We have many, many countries that are coming to negotiate deals with us
2:07
and they're going to be fair deals. And in certain cases, they're going to be paying substantial tariffs
2:13
We've been ripped off and taken advantage of by many countries over the years
2:18
and can't do it anymore. Just can't do it anymore. Can't be the stupid people anymore
2:23
And what of the UK aspect? Well here Sir Keir Starmer visited a Jaguar Land Rover manufacturing site in the West Midlands and conceded that Trump tariffs pose a huge challenge to the future of UK trade We got to rise together as a nation to the great challenge of our age
2:40
and it is the great challenge, which is to renew Britain so that we're secure in this era of global instability
2:50
And nobody is pretending that tariffs are good news. You know that better than anyone
2:58
25% tariffs on automotive exports and 10% on other goods. That is a huge challenge for our future
3:09
And the global economic consequences could be profound. Let's get some expert advice to prompt our conversation now
3:15
Simon Finkelstein served as special advisor to Jeremy Hunter's Chancellor as recently as last year
3:21
Also with Dominic Raab as Foreign Secretary and joins me now. Good to have you on, Mr Finkelstein. Thank you
3:26
How likely is this to make America great again then, in your view? Good morning
3:31
Good morning. Thanks for having me. Very unlikely. And as you can see with the global stock market reaction
3:39
that if you place an enormous tax on everybody, the likelihood is going to be a dramatic slowdown in demand
3:46
And, you know, the prices are definitely going up for a global recession. What's the next shoe to drop, Simon
3:52
Well, I think what we'll see is the start of negotiations between President Trump and a host of other countries
4:00
And we may see some reductions in tariffs somewhere. However, that won't be nearly enough to offset the numerous tariffs that will be still levied on many countries around the world
4:11
So, you know, I actually don't think we're going to see an enormous amount of movement. Simon, the Financial Times writes there's a bit of a split in the White House
4:19
There are those who say that the president basically has gone nuts and others who say that this is a necessary global repositioning
4:25
Which side would you concur? Well, this is one of Donald Trump's core beliefs
4:31
He's been talking about it for 30, 40, 50 years. So actually, this is a totally rational view that the president has taken
4:39
I think, you know, regardless of what you think about it, I think the real problem is why lots of people didn't necessarily expect it
4:45
Why were the markets so surprised that President Trump, after saying all campaign that he was going to levy tariffs on the entire world, that he went ahead and did it
4:54
And now we're going to have to deal with the fallout. So we going to have to negotiate very quickly to try and negotiate down these trade barriers How significant is the latest development the so China crisis with the escalation of tariffs with that country
5:07
Incredibly significant. And I think we're seeing a decoupling between the Chinese and the US
5:14
And that is going to mean a significantly less amount of trade between China and the US
5:19
And companies who do any trade with China and the US having to completely reorient their supply chains
5:24
And that's going to be hugely economically disruptive. But on the other hand, I think it also has the effect of making European countries closer to China, given the US is erecting all these trade barriers themselves
5:36
What does Sakhir and or Chancellor Rachel Reeves need to do confronted with this, Simon
5:41
Well, I think actually, you know, and it might surprise you as a former Conservative special advisor to say this
5:46
but actually I think they're taking broadly the right path, which is not retaliating to US tariffs
5:52
because while it might be politically expedient in the short term, in the long run, it will be economically damaging
5:58
And I think what they're going to need to do is going to need to find ways
6:01
to support domestic industry, which is going to have enormously hit by both rising costs and also the impact of trade diversion
6:09
as cheaper goods from China and other places end up here. So I think the industrial strategy is going to be an enormous part of that
6:16
Finally, you worked in the Treasury. You're a special advisor with the Chancellor. How nervous are you
6:22
I'm pretty nervous, because ultimately, a slowdown in global demand, even if the UK is slightly better off than other countries
6:29
means lower living standards to people around the country. And that's going to be a very sad thing
6:34
And unfortunately, it's something that's totally self-inflicted by the President, and we don't have a lot of control over it
6:39
I really enjoyed our conversation. Thanks for your time so early in the morning. Simon Finkelstein served as Special Advisor to Jeremy Hunt
6:44
As Charles of the Exchequer, as recently as last year also worked with the Dominic Roberts, Foreign Secretary, 12 After 7
6:49
listening. Freddie Great, who's Deputy Editor of the Spectator magazine, editor of its US edition
6:53
Freddie, let's pick up on what Simon said. This has been the Trump mantra for decades, so why the level of surprise, some would say. How would you respond
6:59
to that? Good morning. Good morning, Nick. Well, I would completely agree. I mean, it's been
7:05
very, very obvious that Trump was going to do this. He has said it
7:09
repeatedly. He has said that tariffs are the most beautiful word in the dictionary
7:15
He told Bloomberg last year that they were all idiots sort of speaking to a large audience of very big financial experts
7:23
He told them they were all idiots for thinking that tariffs were bad tariffs are good And yet the world somehow convinced himself that he was bluffing and the world is still convincing himself that he is bluffing And to some extent there is grounds for hope
7:40
that this is a bluff. But I think this is a very, very peculiar form of bluffing because I think the
7:45
person who is bluffing doesn't himself even know or think that he is bluffing
7:50
Right. You edit the Spectators US edition. So you're closer to all the players I'm about to
7:56
run through. So the world's 500 richest people have lost, between them, £417 billion. So when
8:03
you have allies like Elon Musk, who's lost £25 billion, Mark Zuckerberg, £21 billion
8:11
Jeff Bezos, £18.4 billion, don't they start to lobby their mate, the President
8:17
They are, it seems. Elon Musk is apparently not just tweeting mildly critical things of the
8:24
presidency. He is directly lobbying, according to reports yesterday, Trump himself to change his
8:30
mind on tariffs. The key figure here is Scott Besant, the Treasury Secretary, who is himself
8:35
a billionaire, was brought in to be the person that calms markets, but loves tariffs. And he
8:42
seems to be playing a very, very pivotal role in trying to sort of put the shine on the president's
8:48
rougher edges. It's understood that yesterday he reached out to Trump and then Trump started
8:55
to tweet a little bit more about other countries coming to the table. And I think the really key
9:02
thing here is China, because I think the way out of this for some people, for the kind of
9:06
more free trade people within the Trump administration, is that they will make the focus
9:11
a trade war with China rather than a trade war with the world. And it will be the message will
9:17
be that they had to shock the rest of the world into coming to their free trade terms
9:23
And I think that will be the way this may play out, or it could play out in any other direction
9:29
Who knows? Well, keep reading, Spectator. Freddie, thanks. Freddie Gray, deputy editor of the Spectator for Edits
9:34
It's US edition. China crisis. But are we, is the world indeed, the developed world, too dependent on, of course, that cheap
9:41
Chinese chipe, cheap Chinese labour and all those imports. and when you get the world's richest men lobbying, you would have thought
9:49
why is Trump someone... Or do you admire a politician who stays..
9:53
I'm absolutely sticking with this. Goodness knows we have enough flip-flopping going on. We may as well be by the side of the pool with our flip-floppers here
9:59
But this is a man who does not appear for turning. Is that to be admired
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