Posted on 07/07/2025 10:06:20 AM PDT by DFG
The United States will impose 25% blanket tariffs on imports from Japan and South Korea starting Aug. 1, President Donald Trump revealed Monday.
Trump, in a pair of Truth Social posts, shared screenshots of letters apparently sent to Japanese Prime Minister Ishiba Shigeru and South Korean President Lee Jae-myung dictating the new tariff rates.
The two form letters appear to be the first of what Trump said could be as many as 15 letters sent between Monday and Wednesday, the deadline when his so-called reciprocal tariffs on dozens of countries were scheduled to snap back to the higher levels he had set in April.
U.S. financial markets fell to session lows on news of the letters. The Dow Jones Industrial Average shed 447 points, or 1%. The S&P 500 lost 0.8%, and the Nasdaq Composite dropped 0.9%.
Both letters say that the 25% tariffs are separate from additional sector-specific duties on key product categories.
The letters also note, “Goods transshipped to evade a higher Tariff will be subject to that higher Tariff.” Transshipping in this case appears to refer to the practice of transferring goods to an interim country prior to their final shipment to the U.S., in order to skirt tariffs.
The form letters assert that the new tariff rates are necessary in order to correct for persistent U.S. trade deficits with the two countries.
Trump, an avowed tariff fan and a skeptic of free trade deals, regularly points to those deficits as evidence that the U.S. is being taken advantage of by its trade partners. Experts have criticized the view that trade deficits are inherently bad and questioned whether the U.S. can or should seek to close them.
(Excerpt) Read more at cnbc.com ...
DJI down 500 at the moment.
And the market drops 500 points.
They will come to a deal, and the market will pop up 500 points.
None of this is a surprise.
China and the EU are our biggest trade...and political...enemies. Not Japan and Korea.
Fine, we’ve seen this movie play out, they will negotiate now.
“...Threatening our friends...”
Nations don’t have friends, they have interests.
I believe that's what Trump is doing.
South Korea finds 'Made in Korea' breaches intended to bypass US tariffs
It’s amazing to see how few understand tariffs and free trade. Yes, tariffs are part of free trade. It’s just the government taking its cut up front.
These countries have been heavily contributing to politicians’ coffers in exchange for allowing them to tariff American exports and acquire US industries. Now Trumps says no cuz he’s not on their take and all their dogs are howling. Their food bowl is gone.
Lol! “Friends.” Have you ever been to South Korea? There are virtually NO American made cars there. Maybe 1 in 10,000 cars on the road there are U.S.made. Why is that? Koreans are true isolationists. EVERYTHING in that country is made there.
“They will come to a deal, and the market will pop up 500 points.”
**************
Yes, some solidified deals will be good for the market but it seems that the deals are proving to be more challenging than assumed. Despite the administration’s optimism these deals are very complex and could take awhile to negotiate. Ultimately they will, but there’s no telling when. Probably later than sooner. But I could be wrong.
If there’s a late session drop off I’ll be picking up some shares opportunistically. I don’t mind the wait. ;)
Trade is a form of economic warfare.
He’s not threatening, he’s negotiating.
The Art of The Deal - on how to crash the US stock market with erratic, confusing, and contradictory trade policies subject to change on a whim.
From a near record high.
Sell! Sell! Sell! /sarc
EC
Insightful post. The bribes worked for these countries but with Trump’s arrival the game has changed.
Wow...didn’t know that. Yes,come to think of it that makes sense. My girlfriend is Korean American so I pay attention to Korea and get info from her as well. For example: there are hoards of Chinese tourists all over Japan and other parts of East Asia and SE Asia. They are hated in those areas for many reasons...including their boorish,filthy habits and attitudes. So now the trick is for them to pretend to be Taiwanese or Korean (both being respected nationalities in Asia).
This whole cluster fu59 started in 1946-47 when Uncle Sugar GAVE trade benefits to the whole world because we were the only large country that didn't get bombed out in WW II.
It was in our interests to help the rest of the world get back to commerce and recover from WW II, but that time has long since passed.
After 80 + years, Uncle Sugar has said (via DJT) that enuff is enuff.
Trade with fair rules or shove your flip-flops and cheap junk up your own trade rules.
We own the biggest market in the world and if you want to ship your junk to the USA, play by OUR NEW RULES.
The US is strongly respected in South Korea. I know that a) because I’ve been there and b) because my girlfriend is Korean American. We’re also well liked in Japan...except maybe in Okinawa.
Counterpoint: Doing this to allies, perhaps with their tacit consent, leaves hostile states less room to maneuver and for their US agents to complain about a tariff being racist.
I.E., the Chinese will not be able to complain about being singled out for tariffs through their catspaws in the US MSM when we can point to similar steps taken against SK and Japan to get them to the table.
That’s because most American made cars are junk and they know it.
Same thing here in the US. The majority of people won’t buy a US made car, to the point where Ford doesn’t make cars any more (SUVs and trucks only) with the exception of the Mustang, GM’s severely curtailed their production and Chrysler’s down to just two cars. They’re junk.
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