Trump's "Reciprocal Tariff" Plan: Negotiation Strategy or Long-term National Policy?

Recently, Trump announced a widely discussed "reciprocal tariff" proposal. The calculation method of this proposal seems simple: divide the trade surplus of major trading partners over the U.S. last year by their total goods exports, and then divide by two to arrive at the new "reciprocal" tariff rate. This move has triggered turmoil in global markets, and the cryptocurrency market has not been spared.

Currently, there is a divide in the market's view on Trump's tariff plan. The key question is: does this signify that the United States is heading towards isolationism, or is it merely a negotiation strategy? If it is the former, it could have long-term adverse effects on the global economy. However, if it is the latter, then this may just be short-term market fluctuations, and as negotiations progress, market fears may gradually dissipate.

Despite Trump emphasizing the importance of tariff policies multiple times during his campaign and presidency, describing them as a "national policy" aimed at promoting the return of manufacturing and fulfilling promises to voters, there are viewpoints suggesting that tariffs may just be his bargaining chip, with the ultimate goal of securing enough political achievements for himself. These achievements may include: increasing overseas orders, creating more domestic job opportunities, and reasonably suppressing competitors.

In addition, the economic fluctuations caused by tariff policies may also serve as a means of putting pressure on the Federal Reserve. Although Trump cannot directly intervene in the Fed's decisions, economic recession and stock market turbulence may indirectly influence monetary policy.

It is worth noting that the Trump team's stance on tariffs seems to have begun to soften. The Director of the National Economic Council stated that more than 50 countries have contacted the White House to initiate trade negotiations. The U.S. trade advisor also mentioned that Trump is seeking to reduce tariffs and non-tariff barriers.

However, there are still uncertainties in this process. In particular, if negotiations with important trading partners such as the EU and China do not go smoothly, it may lead to a deadlock in negotiations or an escalation of conflicts in the short term. However, considering that most countries are likely to actively negotiate with the United States, the likelihood of an overall deterioration of the situation is not high.

For Trump, winning more "achievements" before next year's midterm elections is a core task. High inflation and stock market volatility may affect his second term. Therefore, starting negotiations early is more favorable for Trump.

As a maker of "uncertainty," Trump also hopes to eliminate the uncertain factors he faces before next year's midterm elections. The final outcome of this tariff game will gradually become clear in the coming months.