Marc Ross Daily | April 9
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Happy Wednesday.
Here’s today’s Marc Ross Daily:
*** Ross Rant ***
The actual cost of Trump's trade war: How 104% tariffs will strangle American businesses
While you were sleeping, the Trump administration imposed a 104% tariff on Chinese imports at midnight.
This new economic reality doesn't just represent a policy shift—it will create a financial tsunami for American businesses caught in the undertow. When Team Trump grandstands about getting tough on trade, they rarely mention the small business owner who watches their profit margins vanish overnight or the consumer who pays double at checkout.
Consider this straightforward example: A typical wholesale product priced at $50 suddenly carries an additional $52 tariff burden, transforming its landed cost to $102 before accounting for shipping, warehousing, or marketing expenses. This mathematical reality demolishes business models across the country without fanfare or headlines.
It is no wonder Elon Musk called Trump's top trade adviser Peter Navarro a 'moron' and 'dumber than a sack of bricks.'
These overnight dramatic cost increases will destroy the careful economic calculations that power the American economy. For the restaurant equipment supplier in Milwaukee, the furniture store in Buffalo, or the bicycle retailer in Detroit, such tariffs don't punish foreign competitors—they punish American entrepreneurs who built businesses on reliable supply chains and long-term cost expectations.
Many small businesses you frequent and support in your hometown operate on margins thinner than most Americans realize. Your neighborhood hardware store might maintain just 15-20% profit margins, making doubling wholesale costs catastrophic rather than merely challenging. When politicians speak of tariffs as "getting tough," they ignore the impossible choices forced upon small business owners: drastically raise prices, slash quality, lay off workers, or close entirely.
This economic ripple effect will extend far beyond local small businesses. More prominent American manufacturers dependent on Chinese components face similar dilemmas when their supply costs skyrocket. Consider a Midwest factory producing e-bikes with imported motors, which now confronts component costs exceeding the previous retail price of its finished goods. This manufacturing disruption will create economic instability that tariff proponents claim to address.
Team Trump will argue that businesses can source elsewhere, but this oversimplification ignores market realities.
China's manufacturing ecosystem has developed over decades, combining specialized expertise, infrastructure, and economies of scale that are unmatched in most regions. Shifting supply chains requires years, not months, leaving small businesses vulnerable during transition periods when competitors might gain decisive market advantages.
The historical precedent of the US government using tariffs paints a sobering picture. When steel and aluminum tariffs were implemented in 2018, studies from the Federal Reserve found they directly contributed to reduced manufacturing employment and higher consumer prices. Far from strengthening American industry, these tariffs weakened the sectors they intended to protect by increasing input costs across industrial supply chains.
The psychological impact on business planning creates additional damage.
Uncertainty paralyzes investment decisions, expansion plans, and hiring initiatives. Headlines are already highlighting slowing employment and investment decisions, and this is all before this 104% tariff rate has been implemented. When small businesses cannot predict their cost structures six months ahead, they rationally retreat to defensive positions—preserving cash, delaying improvements, and avoiding commitments that might prove fatal under shifting trade policies.
For consumers, these tariffs will manifest as inflation by another name.
The family shopping for summer camp supplies or household necessities will experience price increases indistinguishable from other inflationary pressures. Tariffs effectively function as a regressive tax, hitting working families hardest while offering no corresponding benefit to most American workers.
Team Trump's proposed 104% tariffs don't represent tough negotiating positions or strategic trade policy.
They represent a fundamental misunderstanding of global commerce's functioning in the 21st century.
When a wholesaler watches their $50 product transform into a $102 liability overnight, the damage occurs not in foreign capitals but in American communities where businesses struggle, workers lose jobs, and consumers pay the ultimate price for economic policies that mistake punishment for progress.
Enjoy the ride + plan accordingly.
-Marc
*** Globalization + Geopolitics ***
CNN: Tariffs on China set to rise to at least 104% on Wednesday, White House says
Nikkei: Trump awaits tariff call from Beijing as China vows to 'fight to the end'
NYT: Markets slide again in afternoon slump as trade tensions escalate
WP: S&P 500 reaches its lowest level in more than a year as signs of negotiations fail to calm markets
Bloomberg: US stocks tumble again with tariffs set to roil global economy
Why Trump’s global tariff war is America’s Brexit Merryn Somerset Webb
Bloomberg: JPMorgan model shows recession fear in markets spiking up to 79%
Trump’s tariffs and China collide to shock the $115 trillion global economy: Investors the world over are trying to reprice risk in an age of uncertainty inflamed by dueling US and Chinese visions for the future. Bloomberg
Why China thinks it might win a trade war with Trump: The country’s officials vow to “fight to the end.” Economist
China weakens currency as trade war escalates: The Times reports Beijing boosts its export competitiveness and lowers the cost of its goods and services in face of extra Trump tariffs.
Reuters: Trump's port fees on Chinese ships threaten US maritime industry, say executives
CNBC: US Customs starts collecting new tariffs on imports from 86 countries at midnight
CEOs break silence on Trump trade war: Business leaders have avoided voicing concerns about tariffs for weeks, but some are getting vocal. WSJ
Companies stung by tariffs explore lawsuit against Trump: Trade groups are weighing the risk that a lawsuit could prompt Trump to dig in on tariffs. WSJ
Wall Street bursts with anger over tariff ‘stupidity’: Billionaire investors are in an unfamiliar position, watching and cringing as tariffs roll on and the stock market reels. NYT
Trump’s tariffs are already reducing car imports and idling factories: NYT reports a few carmakers have closed factories, laid off workers or shifted production in response to the auto tariffs that took effect last week.
Trump and the mob boss approach to global markets: The US president discovers that it is easier to shake down a law firm than to reshape the international trading system. Gideon Rachman
Trump has no idea what he has unleashed: There is no school of foreign policy realism or trade mercantilism that could explain the US president’s actions. Edward Luce
Trump’s tariffs will damage the world: The trade deficits will remain roughly unchanged — the globe will just end up poorer. Martin Wolf
How global trade could survive Trump’s tariffs: Whether world trade collapses, like it did the 1930s, depends on whether other countries retaliate and Trump negotiates. Greg Ip
The hopeful tariff endgame isn’t so hopeful: Even if Trump backs down he will have succeeded in building uncertainty, which is itself a sort of tariff. Jason Furman
Lutnick’s strategy flummoxes business leaders and White House aides: Some executives have come away from meetings with the commerce secretary confused and exasperated. WSJ
Musk disparages Trump’s trade adviser, exposing rift in president’s inner circle: NYT reports the feud between two of President Trump’s top advisers is playing out as the administration’s new tariffs have caused huge losses across global financial markets.
From Apple to Samsung, Trump's tariffs force supply chains to adapt -- fast: Nikkei reports Asian suppliers to HP, Dell and more reckon with a deeper, longer trade war.
US tariffs threaten almost $2tn of investment pledges by global companies: FT reports businesses with supply chains vulnerable to sweeping duties had been hoping to negotiate concessions from Washington.
In a tiny Gulf town, big cheers for Trump’s tariffs: Imported shrimp overwhelms local shrimpers, who now are hopeful they can come back. WSJ
The stock market will go down 80% ‘when this is over,’ says bearish investor Mark Spitznagel: MW reports Spitznagel still believes we haven’t entered the main event and the recent stock-market plunge is just a ‘trap.’
CNBC: Tech analyst responds to Trump wanting Apple to make iPhones in US: ‘I don’t think that’s a thing’
Reuters: Brazil, Egypt and Singapore among potential winners from tariff onslaught
Singapore warns end of free trade era ‘very hostile’ for small nations: City-state’s foreign minister fears collapse of world trading system after Trump’s tariffs. FT
Canada’s economy is starting to crack under trade-war pressure: WSJ reports expectations of a recession rise along with unemployment as the outlook for consumer demand shrinks.
Wayne Gretzky, former Canadian hero: His countrymen aren’t mourning the loss of his scoring record. Chris Jones
USA-ITA: Italian Prime Minister Giorgia Meloni will visit the White House on April 17 to meet President Trump.
Spain’s government said it would spend an additional €2bn ($2.2bn) on defence this year as Europe seeks to rearm.
Europe prepares AI charm offensive as industry trembles from tariff shocks: Politico reports draft strategy shows EU wants to woo tech leaders with computing, data, skills — and simpler rules — to run AI.
London falls out of top five wealthiest cities as millionaires leave: The Times reports the UK capital has lost 11,300 dollar millionaires over the past year, a higher proportion than anywhere other than Moscow.
Volodymyr Zelenskyy says Chinese men fighting for Russia captured in Ukraine: FT reports Ukrainian president demands explanation and accuses Beijing of actively participating in Moscow’s war.
Ukraine thinks it can hold off Russia as long as it needs to: Russia may have Chinese volunteers, but Ukraine has drones. Economist
Russia, Iran + China are strategizing on their response to US efforts to pressure Tehran into talks on its nuclear program, as Russian state media reports today.
North Korea is using a technology called THORChain, which allows crypto swaps without intermediaries, to contravene sanctions and move stolen digital assets between networks.
Hackers intercepted about 103 bank regulators’ emails for more than a year, gaining access to highly sensitive financial information, according to two people familiar with the matter and a draft letter to Congress seen by Bloomberg News.
China’s biotech advances threaten US dominance, warns congressional report: WSJ reports the commission urges the US to invest at least $15 billion in biotech research and other measures.
China criticizes JD Vance for calling its people ‘peasants’: NYT reports a spokesman for China’s foreign ministry denounced the vice president’s comments as “ignorant and impolite.”
While war rages, Congo’s neighbors smuggle out its gold and mineral wealth: Vast country struggles to prevent Rwanda and Uganda from seizing valuable assets. WSJ
Brazil and Argentina need to leave their rivalry on the pitch: South America’s two largest economies have a lot to gain from working together in an uncertain geopolitical world. Juan Pablo Spinetto
At least 44 people were killed and 160 injured after the roof of a nightclub in Santo Domingo, the capital of the Dominican Republic, collapsed on Tuesday morning.
Panama to file criminal complaint over canal concession: FT reports the move comes hours before visit by Pete Hegseth as US raises pressure over Chinese influence on waterway.
Trump administration weighs drone strikes on Mexican cartels: NBC News reports the administration has increased surveillance flights over Mexico as it tries to track the powerful cartels that dominate the fentanyl trade.
Pentagon considering proposal to cut thousands of troops from Europe, officials say: NBC News reports experts warn that the timing of the potential drawdown could alarm NATO allies and embolden Russian President Vladimir Putin.
Meet the warriors trying to teach the West how to fight in the Arctic: Melting sea ice, rising tensions and the relearning of what it will take to master the art of Arctic warfare. FT
*** US Politics + Elections ***
Americans give early Trump foreign policy actions mixed or negative reviews: More Americans see the president favoring Russia too much than striking the right balance. Pew Research Center
A new Navigator Research poll finds that the share of Americans who say the economy is “getting worse” is now higher than it was before Donald Trump won the election in November 2024, and that 58% of Americans disapprove of his tariffs, while only 30% approve.
Trump is replacing the nanny state with a daddy state: The president is using the powers of his office in an aggressive, paternalistic way without precedent. Is an old form of intrusive government being replaced by a new one? Gerald F. Seib
Musk's DOGE using AI to snoop on US federal workers, sources say: Reuters reports while much of Musk’s Department of Government Efficiency remains shrouded in secrecy, the surveillance would mark an extraordinary use of technology to identify expressions of perceived disloyalty in a workforce already upended by widespread firings and severe cost cutting.
The cabinet secretary who wants his cookies freshly baked: The unusual requests made of Interior Secretary Doug Burgum’s staff are raising concerns all the way to the White House. Michael Scherer + Ashley Parker
Bloomberg: Republicans fracture over how much debt to run up for tax cuts
MI-GOV: Rep. John James (R-MI-10) announced Monday that he'll run to be Michigan's next governor in 2026.
NH-SEN: Gov. Chris Sununu (R-NH) won’t run for the US Senate.
USA Today: ESPN's Stephen A. Smith is thinking about running for president
The Hill: Judge orders Trump White House to restore AP access
Will AI save the news? Artificial intelligence could hollow out the media business—but it also has the power to enhance journalism. Joshua Rothman
Bloomberg has a rocky start with AI summaries: NYT reports the outlet has issued dozens of corrections to AI-generated news summaries since it started using the technology to write them this year.
*** Distribution + Innovation ***
Google DeepMind is urging a renewed focus on long-term AI safety planning even as rising hype and global competition drive the industry to build and deploy faster.
DeepMind slows down research releases to keep competitive edge in AI race: FT reports Google’s AI arm led by Demis Hassabis makes it harder for its researchers to publish studies in major change in approach.
If Anthropic succeeds, a nation of benevolent AI geniuses could be born: The brother goes on vision quests. The sister is a former English major. Together, they defected from OpenAI, started Anthropic, and built (they say) AI’s most upstanding citizen, Claude. Wired
Shopify says no new hires unless AI can’t do the job: WSJ reports employees now required to integrate artificial intelligence into teamwork, Shopify chief says.
CNBC: Fake job seekers are flooding US companies that are hiring for remote positions, tech CEOs say
+ Companies are facing a new threat: Job seekers who aren’t who they say they are, using AI tools to fabricate photo IDs, generate employment histories and provide answers during interviews.
+ The rise of AI-generated profiles means that by 2028 globally 1 in 4 job candidates will be fake, according to research and advisory firm Gartner.
+ Once hired, an impostor can install malware to demand a ransom from a company, or steal its customer data, trade secrets or funds.
Google’s AI Mode can now see and search with images: TC reports AI Mode adds multimodal capabilities and is rolling out to more users in the US.
Amazon debuted a new generative AI model, Nova Sonic, capable of natively processing voice and generating natural-sounding speech. Amazon claims that Sonic’s performance is competitive with frontier voice models from OpenAI and Google on benchmarks measuring speed, speech recognition, and conversational quality.
Reuters: Andreessen Horowitz seeks to raise $20 billion megafund amid global interest in US AI startups
Meta said that it would require Instagram users under 16 to get parental permission to view some live-streamed features.
Tailscale, a security startup based in Toronto, has raised $160 million from investors — a significant haul for the Canadian company. The deal values the startup at about $1.5 billion.
Why managers fear a remote-work future: Like it or not, the way we work has already evolved. Ed Zitron
*** Culture ***
Variety: Tom Cruise’s ‘Mission: Impossible — The Final Reckoning’ sets Cannes Film Festival premiere
When the Going Was Good by Graydon Carter review: In his memoir the former Vanity Fair editor and man-about-town recalls the golden age of glossy magazines, when sales were in the millions and ‘the budget had no ceiling.’ Guardian
First trailer for Wes Anderson’s The Phoenician Scheme launches: The director’s 13th film, an ‘espionage thriller’, stars everyone from Benicio del Toro to Scarlett Johansson, Tom Hanks, Mia Threapleton and Richard Ayoade. Guardian
*** Sport ***
At $378 million, North Carolina’s men’s basketball team has the highest valuation in the sport, according to a new analysis by Ryan Brewer, an associate professor of finance at Indiana University Columbus.
Enjoy the ride + plan accordingly.
-Marc
Marc A. Ross | Chief Communications Strategist @ Caracal
Marc Ross Daily | April 9
