{"id":33311,"date":"2025-07-08T13:07:20","date_gmt":"2025-07-08T13:07:20","guid":{"rendered":"https:\/\/financialrush.com\/?p=33311"},"modified":"2025-07-08T13:07:20","modified_gmt":"2025-07-08T13:07:20","slug":"inside-donald-trumps-latest-tariff-threats","status":"publish","type":"post","link":"https:\/\/financialrush.com\/?p=33311","title":{"rendered":"Inside Donald Trump\u2019s latest tariff threats"},"content":{"rendered":"

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This is an on-site version of the White House Watch newsletter. You can read the previous edition\u00a0here<\/a>. Sign up for free here<\/a> to\u00a0get it on Tuesdays and Thursdays. Email us at\u00a0whitehousewatch@ft.com<\/a><\/p>\n<\/div>\n<\/div>\n<\/div>\n

Good morning and welcome to White House Watch!<\/p>\n

Let\u2019s dive into:<\/p>\n

Donald Trump is back to making tariff threats.<\/p>\n

The carrot: he gave US trading partners another three weeks beyond the original July 9 deadline to negotiate trade deals before his so-called reciprocal tariffs go into effect. The stick: if agreements are not reached by then, countries risk being slapped with roughly the same sweeping tariffs Trump announced on \u201cliberation day\u201d in April.<\/p>\n

Yesterday, Trump sent letters to Japan and South Korea<\/a> \u2014 two of the US\u2019s biggest trading partners \u2014 saying he\u2019d hit them with 25 per cent levies from August 1. A bunch of other countries received similar letters.<\/p>\n

In the letters posted on his Truth Social platform, Trump called the trade deficit with Tokyo and Seoul a \u201cmajor threat to our economy and indeed our National Security\u201d.<\/p>\n

He wrote that should either country raise its tariffs on Washington in retaliation, \u201cthen, whatever the number you choose to raise them by, will be added on to the 25 per cent that we charge\u201d.<\/p>\n

Trump\u2019s letters also suggested that, if the nations open their markets, that number could be negotiated down: \u201cThese tariffs may be modified, upward or downward, depending on our relationship with your Country.\u201d <\/p>\n

Trump yesterday also said any country embracing the \u201canti-American policies\u201d of the Brics bloc of nations<\/a> would face an extra 10 per cent tariff on exports. The 11-nation group \u2014 which includes China, Russia, Iran and Brazil \u2014 lashed out in response<\/a>.\u00a0<\/p>\n

Several proposals have come from weeks of negotiations between the US and Japan, including Tokyo buying more American energy and agricultural products. However, Japan has demanded a full exemption from Trump\u2019s 25 per cent auto tariffs. Meanwhile, Trump has complained about Japan\u2019s refusal to buy more US rice, calling the country \u201cspoiled\u201d.<\/p>\n

As for South Korea, its talks were delayed by political turmoil after the impeachment of its former president Yoon Suk Yeol.<\/p>\n

Despite the three-week reprieve, markets were not impressed by the continuing trade tensions<\/a>. The S&P 500 closed down 0.8 per cent yesterday. Japan and South Korea\u2019s currencies declined about 1 per cent against the US dollar.<\/p>\n

Follow the latest trade developments on the FT\u2019s <\/em>live blog<\/em><\/a>. <\/em><\/p>\n

The latest headlines<\/h2>\n

What we\u2019re hearing<\/h2>\n

The trajectory of Elon Musk\u2019s business empire is not moving in a straight line as the billionaire feuds with Trump.

<\/strong>Tesla shares tumbled<\/a> yesterday after Musk said he\u2019d create a new political party to combat the \u201cone-party system\u201d.<\/p>\n

And Trump\u2019s \u201cbig, beautiful bill\u201d puts at risk a crucial profit source for Tesla<\/a> by neutering rules that allow the electric-vehicle maker to sell billions of dollars in emissions credits. The president has also suggested his administration should cancel Tesla and SpaceX\u2019s federal contracts.<\/p>\n

At the same time, private space companies such as SpaceX and Jeff Bezos\u2019s Blue Origin \u2014 which are leading the modern-day space race \u2014 stand to benefit from a preferential tax treatment tucked into the BBB<\/a>.<\/p>\n

The bill allows spaceports to be financed in the municipal debt market through what are known as private activity bonds. They offer tax-free interest, lowering financing costs compared with typical corporate bonds.\u00a0<\/p>\n

The addition of the spaceport clause \u201cspeaks to the advocacy and lobbying taking place in Washington\u201d, Jason Appleson, head of municipal bonds at PGIM Fixed Income, told the FT\u2019s Will Schmitt.<\/p>\n

The clause also covers spacecraft manufacturing facilities and mission control operations, making it \u201ca little more expansive than the definition of an airport\u201d, said Leslie Powell, a partner with law firm Kutak Rock focused on public finance.<\/p>\n

Democratic US senator Ron Wyden slammed the \u201cspecial new tax break for SPACEPORTS\u201d as \u201cTrump\u2019s wedding gift to Bezos and birthday gift to Musk\u201d in a social media post.<\/p>\n

Viewpoints<\/h2>\n