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Trade Policy

Every Crypto Coin Show story tagged Trade Policy, newest first, alongside the guides and interviews that give it context.

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Trump scrapped a proposed 20% Strait of Hormuz transit fee within 24 hours
Regulation & Policy

Trump scrapped a proposed 20% Strait of Hormuz transit fee within 24 hours

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BlockchainJuly 14, 2026·6 min read

President Trump abandoned a proposed 20% transit fee through the Strait of Hormuz within 24 hours of announcing it, citing offers of “massive” investment deals from Gulf states as an alternative. The reversal followed immediate pushback from maritime industry bodies, international law experts, and members of Trump’s own cabinet who argued the toll had no legal basis under international maritime law.

  • Trump proposed then scrapped a 20% fee on vessels transiting the Strait of Hormuz in less than 24 hours
  • A fully loaded liquefied natural gas carrier would have paid approximately $17 million per transit under the plan
  • The International Maritime Organization and State Department both opposed the fee as violating international maritime law
  • 20% Proposed transit fee on Strait of Hormuz shipping, now replaced with investment deals
  • $17 million Estimated per-transit cost for a loaded LNG carrier under the toll structure
  • 24 hours Time between Trump’s announcement and reversal of the controversial shipping fee

President Donald Trump announced and then rapidly reversed a sweeping proposal to impose a 20% fee on commercial vessels transiting the Strait of Hormuz, one of the world’s most critical chokepoints for energy trade.

The announcement, made via Truth Social on Tuesday, sparked immediate condemnation from maritime regulators, industry bodies, and international law experts who declared the proposal violated established international conventions.

Within hours, Trump pivoted to claiming Gulf nations had offered substantial investment commitments to the United States in lieu of the transit tax, though he provided no details on which countries, signed agreements, or implementation timelines.

The proposal’s sudden collapse reveals deeper tensions within the Trump administration and signals the difficulty of imposing unilateral trade mechanisms on chokepoints that handle roughly one-third of global seaborne traded oil.

For institutional investors with exposure to shipping, energy, and emerging market assets, the episode underscores both the administration’s willingness to test the boundaries of international maritime law and the speed at which such policies can face reversal when institutional and diplomatic resistance materializes.

LNG carriers would have faced $17 million per-voyage charges under the toll structure

Industry analysts quickly quantified the economic impact of the proposed toll. According to Lloyd’s List, a fully loaded liquefied natural gas carrier would have faced approximately $17 million in charges per transit through the Strait.

For oil tankers, the burden would have been similarly substantial: a vessel carrying 2 million barrels of crude at $60 per barrel prices would have incurred a $24 million charge per trip, while the same cargo at $80 per barrel would have generated $16 in additional cost per barrel.

These figures translate to material supply-chain friction across energy markets. The Strait handles roughly 21 million barrels of oil per day, accounting for approximately one-third of seaborne traded petroleum.

A 20% toll would have restructured shipping economics across Asia, Europe, and North America, likely forcing refiners and traders to either absorb costs, renegotiate long-term contracts, or shift sourcing patterns. Insurance and freight forwarding firms flagged that the fee would have been passed downstream to consumers, raising gasoline, diesel, and heating oil prices across importing economies.

The proposal gained no public support from any commercial shipping operator or energy trader.

International Maritime Organization and State Department both rejected the fee as illegal under treaty law

The International Maritime Organization, the UN body responsible for maritime safety and law, issued a formal statement opposing the toll within hours of Trump’s announcement.

The IMO stated it was “firmly against charging fees for passage through straits used for international navigation” and that “there is no legal basis through which to introduce mandatory tolls simply to transit through a strait.” This position reflects the United Nations Convention on the Law of the Sea, which grants vessels of all nations the right of transit passage through international straits, explicitly prohibiting tolls on such passage.

Within the Trump administration itself, opposition had already crystallized. Secretary of State Marco Rubio stated last month that charging fees on straits used for international navigation would violate international law.

His position aligned with the consensus view among maritime law scholars, who noted that the Strait of Hormuz qualifies as an international strait under UNCLOS, meaning the U.S. government, or any nation, lacks legal standing to unilaterally impose transit fees.

Petras Katinas, a research fellow in climate, energy, and defense at RUSI Europe, warned that such a policy would establish a dangerous precedent, enabling other nations to impose tolls on their own strategic waterways and fragmenting the rules-based maritime system that underpins global trade.

Richard Meade, editor of Lloyd’s List, was explicit about the legal vulnerability: “There is no legal basis for charging vessels to exercise their right of transit passage through an international strait,” he stated, adding that the source of the demand, whether Washington or Tehran, was “largely beside the point.” The universality of that legal principle reflected broad consensus that the proposal, if implemented, would have invited immediate challenge in international arbitration and potentially triggered retaliatory trade measures from affected nations.

Trump cites unnamed Gulf investment pledges but provides no signed agreements or timelines

In reversing the policy, Trump stated that conversations with Middle Eastern leaders had convinced him to pursue “Trade and Investment Deals” instead of the transit tax. He wrote on Truth Social that Gulf states would be making “massive” investments into the United States.

When pressed by reporters, Trump said several foreign leaders had called requesting a different approach, claiming they wanted to invest “billions of dollars” in America rather than pay the toll.

However, Trump neither named any countries, announced any finalized agreements, nor provided implementation timelines. No Gulf government had publicly confirmed any investment commitment as of Tuesday evening.

The absence of concrete detail, specific nation names, dollar amounts, deal structures, or signing ceremonies, left open questions about whether the pivot represented genuine investment pledges or served primarily as a face-saving exit from a legally indefensible policy.

For institutional investors evaluating the credibility of Trump administration statements on trade policy, the lack of specificity presented a challenge to assessing the sustainability of the reversal.

No Gulf governments had publicly responded to Trump’s claims by end of business Tuesday.

Reversal signals limits on unilateral tariff authority, even in strategically sensitive waterways

The swift collapse of the Strait of Hormuz fee proposal reveals the structural constraints on U.S. authority to unilaterally reshape maritime commerce, even in regions where American military presence is substantial. The Strait is nominally adjacent to Iran and Oman, neither of which controls it; international law vests no single nation with toll authority.

Trump’s administration tested whether claims of national security or reimbursement for naval protection could override UNCLOS protections, but encountered immediate resistance from maritime law bodies, allies, trading partners, and members of his own cabinet.

The episode also illustrates how quickly commercial and diplomatic constituencies can mobilize opposition to policies perceived as economically disruptive. Industry groups, the IMO, and allied governments moved within hours to publicly signal opposition.

The administration’s receptiveness to that pressure, and its rapid reversal, suggests that while Trump may pursue aggressive trade policies, proposals targeting core international legal frameworks face higher barriers to implementation than tariffs on specific goods or countries.

Institutional investors should monitor whether any of the claimed Gulf investment deals materialize with specific announcements in coming weeks, and whether the administration attempts different approaches to extracting payments from maritime commerce or energy trade corridors. The absence of named countries or timelines on investment pledges remains the concrete follow-up point: if no deals are announced within 30-60 days, the reversal will have been purely tactical rather than strategic, suggesting the administration retreated without securing compensatory commitments.

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Trump to skip Supreme Court hearing on legality of his global tariffs
AI News

Trump to skip Supreme Court hearing on legality of his global tariffs

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The incoming Trump administration’s use of emergency powers to impose sweeping global tariffs faces a pivotal Supreme Court test next week, with the President signaling he will absent himself from the proceedings. The legal challenge centers on whether the President’s invocation of a Cold War-era emergency statute to unilaterally set tariffs on trading partners—both allies and competitors—exceeds constitutional limits on executive authority.

The Constitutional Question at Stake

Two consolidated cases will come before the Supreme Court on November 5, each questioning the legal foundation of the tariff regime. The lawsuits argue that the President overstepped statutory and constitutional boundaries when invoking the International Emergency Economic Powers Act (IEEPA), a 1977 statute designed to address threats posed by hostile foreign powers during genuine national emergencies.

The IEEPA grants the President extraordinary authority to act swiftly without congressional approval when facing immediate threats to national security. However, the administration’s application of this mechanism to routine trade disputes with both friendly and rival nations—framed as matters of economic security—represents an aggressive expansion of the law’s original scope.

The case is one of the most important in U.S. history, yet the President will not attend to avoid distracting from the legal merits of the decision itself.

— White House Statement

Legal observers across the ideological spectrum view this case as consequential for the balance of power between the executive and legislative branches. A ruling upholding the President’s authority would significantly strengthen unilateral presidential control over trade policy. Conversely, a decision limiting such emergency powers could require the administration to seek congressional approval for future tariff actions.

The President’s Economic Rationale

The administration frames tariffs as essential tools for protecting American manufacturing and workers from what it characterizes as decades of unfair trade arrangements. Officials argue that without tariff authority, the United States cannot negotiate effectively with trading partners or respond rapidly to economic threats.

According to administration statements, the tariff regime has already increased domestic production and reduced reliance on foreign imports for critical goods. The argument centers on national resilience: only through tariff leverage, the President contends, can America maintain economic and geopolitical strength in competition with other major powers.

Key Context

The President stated that losing tariff authority would fundamentally compromise America’s bargaining position and could trigger long-term economic decline. This assertion underpins the administration’s position that emergency economic powers are not merely helpful but existential to national wellbeing.

The President communicated his position to reporters aboard Air Force One on November 2, explaining his decision to skip the hearing. He emphasized that the case transcends his personal interests and should be evaluated on legal grounds alone, free from the distraction of presidential attendance.

Business Impact and the Cases Before the Court

Two American companies have challenged the tariff regime through separate lawsuits now consolidated into a single Supreme Court proceeding. Learning Resources, Inc. filed the first action, asserting that tariffs on imported manufacturing components have made it prohibitively expensive to produce and market affordable educational products domestically.

V.O.S. Selections, Inc. brought the second suit, arguing that tariffs significantly increased the cost of imported spirits and beverages, forcing substantial price increases that harm consumer purchasing power and business competitiveness. Both companies represent sectors where imported raw materials and finished goods figure prominently in production and distribution.

These cases illustrate the tension at the heart of tariff policy: while some domestic producers may benefit from reduced foreign competition, downstream industries that depend on imported inputs face higher costs. This dynamic has generated broad business opposition from retailers, manufacturers, and importers who argue that tariffs function as a tax on consumers and businesses alike.

Industry Context and Market Implications

The tariff regime has already reshaped supply chains across multiple sectors. Manufacturing-dependent industries including apparel, electronics, automotive components, and consumer goods have reported margin compression and inventory challenges. Retailers ranging from large box stores to specialty shops face difficult choices: absorb tariff costs, raise prices and risk sales volume, or relocate production to jurisdictions outside the tariff framework.

The broader macroeconomic implications are substantial. Tariffs function as a regressive tax on consumers, with lower-income households spending a higher percentage of disposable income on tariffed goods. Inflation expectations have shifted upward in markets tracking tariff developments, affecting Federal Reserve policy calculations and Treasury yield curves. Currency markets have also reacted volatilely, with the U.S. dollar strength complicating American export competitiveness—a counterintuitive effect that complicates the administration’s narrative about tariff benefits.

Beyond immediate price impacts, tariff uncertainty has chilled business investment in expansion and modernization. Companies delay capital expenditures pending clarity on long-term tariff policy, creating headwinds for productivity growth. This hesitation extends to international partnerships and joint ventures, as foreign companies reassess their U.S. market commitments under tariff pressure.

Broader Implications

The outcome will shape not only this administration’s trade authority but also establish precedent for how future presidents invoke emergency powers. For investors tracking asset valuations and market volatility, tariff policy remains a significant macroeconomic variable affecting everything from inflation expectations to sector rotation.

The International Trade Dimension

America’s trading partners have responded with retaliatory tariffs on American agricultural products, manufactured goods, and intellectual property. This has strained relationships with longstanding allies including Canada, Mexico, and European nations while intensifying competition with China and other strategic rivals. The World Trade Organization faces mounting pressure as members challenge tariff actions through dispute resolution mechanisms, potentially triggering a cascade of legal challenges that could undermine the post-World War II trading system.

The stakes extend beyond trade balances and exchange rates. Retaliatory tariffs threaten American farmers, technology companies, and service providers that depend on export markets. Agricultural communities in particular have voiced concern about losing access to markets developed over decades, potentially causing permanent damage to export relationships.

What Legal Experts Anticipate

The Supreme Court’s decision will likely hinge on how strictly the justices interpret the IEEPA’s language and legislative intent. The statute permits tariffs in response to threats to national security, but courts have historically applied this concept narrowly to military or geopolitical risks rather than economic competition.

A key interpretive question: does “national security” encompass industrial capacity and economic resilience, or does it refer primarily to defense and foreign military threats? The answer will determine whether presidents can routinely invoke emergency powers for trade policy, or whether such actions require explicit congressional authorization in most circumstances.

The decision will likely be narrow and closely divided. Some justices may distinguish between tariffs imposed on genuinely hostile actors versus those applied to trading partners, while others may view all such uses as unlawful overreach of emergency authority. The court’s final ruling could reshape the legal landscape for executive power in trade and economic policy.

For stakeholders in cryptocurrency and blockchain markets, tariff policy carries indirect significance. Tariffs affect inflation, economic growth, and currency strength—factors that influence digital asset valuations and institutional adoption of crypto as a hedge against macroeconomic uncertainty. Bitcoin and other digital assets have historically demonstrated positive correlation with uncertainty around trade policy and currency stability.

Conclusion: A Pivotal Moment for Executive Power

The November 5 hearing will attract intense scrutiny from constitutional scholars, business groups, and international observers watching how America’s courts address the boundaries of presidential emergency power. The outcome will reverberate across trade policy, business strategy, and investment decisions for years to come.

Beyond the immediate tariff question, this case establishes broader precedent for how future presidents may invoke emergency authorities in economic contexts. Whether the Supreme Court constrains or validates expansive executive power will influence policy approaches for generations. A decision upholding the administration’s tariff authority would effectively grant presidents a powerful unilateral tool for economic statecraft, while a ruling against the tariffs would reassert congressional primacy in trade policy and limit emergency executive authority to its original purpose—responding to genuine foreign threats rather than managing commercial relationships.

The business community, international trading partners, and market participants await clarity on whether emergency economic powers represent a sustainable policy tool or an unconstitutional overreach. The answer will shape everything from inflation trajectories to capital allocation strategies in a world where executive authority over economic policy remains undefined.

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Trump signed an executive order to enforce the US-UK trade pact
AI News

Trump signed an executive order to enforce the US-UK trade pact

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The Trump administration’s enforcement of the US-UK trade agreement signals a critical shift in bilateral trade policy, with immediate implications for tariff-sensitive sectors including automotive, aerospace, and energy. Institutional investors tracking transatlantic trade dynamics and supply chain exposure should closely monitor the asymmetric benefits across sectors, particularly the unresolved steel and aluminum negotiations that could reshape manufacturing competitiveness.

US President Donald Trump has signed an executive order directing federal agencies to operationalize the US-UK trade agreement, which was originally unveiled in May. The landmark bilateral pact dramatically reduces tariffs on British exports while expanding American market access to key UK sectors, marking a significant realignment of transatlantic trade relations. The executive order was signed during a bilateral meeting between Trump and UK Prime Minister Keir Starmer at the G7 summit in Canada, with immediate implementation of core provisions. The deal’s centerpiece reduces the US automotive tariff from 27.5% to 10% for the first 100,000 UK-manufactured vehicles shipped annually to the American market—a substantial concession for British carmakers. Additionally, the agreement shields British exports of jet engines and aerospace components from US national security-linked tariffs, contingent on UK commitments to exclude Chinese entities from sensitive defense and technology supply chains. “This is a very good day for both of our countries, a real sign of strength,” Starmer stated, underscoring the immediate activation of new trade terms.

Sectoral Winners and Losers: The Uneven Impact Across UK Industries

While automotive and aerospace sectors celebrate the tariff reductions, the agreement has triggered significant controversy within domestic UK industries facing increased import competition. The most contentious provision grants the US a tariff-free quota of 1.4 billion liters of ethanol annually—equivalent to Britain’s entire domestic demand—effectively opening the UK market to American bioethanol producers. This concession has alarmed domestic UK bioethanol producers, who warn that the unrestricted access threatens the long-term viability of domestic production capacity. The bioethanol sector’s concerns reflect broader anxieties about the agreement’s asymmetric structure, where export-oriented industries receive tariff relief while import-competing sectors face new competitive pressures. Similarly, the UK has agreed to expand market access for American beef and industrial goods in exchange for reduced US tariffs on British exports, further tilting market dynamics in favor of American producers in certain commodity sectors.

The agreement’s treatment of steel and aluminum remains incomplete, creating uncertainty for one of the UK’s historically significant manufacturing sectors. While the deal promises to eliminate US tariffs on British steel and aluminum exports, substantial technical and legal obstacles have delayed final implementation. British officials continue negotiations with their American counterparts to establish a quota system that would allow UK steelmakers to circumvent Trump’s 25% global steel tariff, which was imposed under national security provisions. However, US regulations require steel to be “melted and poured” in the country of origin to qualify for tariff relief—a criterion that disqualifies much of Britain’s steel production, which is reprocessed from imported raw materials. This technical hurdle has complicated negotiations and created uncertainty for British steelmakers dependent on imported feedstock. Trump has offered the UK a temporary exemption from his newly doubled 50% global steel tariff, providing negotiating time to resolve the definitional and quota issues before permanent provisions take effect.

The sectoral divisions revealed by the trade agreement underscore the inherent tensions within bilateral trade negotiations, where broad-based support masks concentrated losses for specific industries. Starmer faced mounting domestic pressure to secure tariff relief for industries battered by US trade actions, making the automotive and aerospace provisions politically essential despite their narrow focus. The asymmetric structure—where visible winners in export sectors contrast with vulnerable import-competing industries—reflects Trump’s negotiating priorities and the relative bargaining leverage of each nation’s key economic constituencies. For institutional investors with supply chain exposure to UK automotive, aerospace, steel, or agricultural sectors, the patchwork implementation creates both opportunities and risks that warrant careful sector-by-sector analysis.

Regulatory Architecture and Supply Chain Security Implications

The agreement’s aerospace provisions introduce a novel regulatory framework linking tariff relief to geopolitical alignment, specifically excluding Chinese entities from UK defense and technology supply chains. This provision reflects broader US security concerns regarding Chinese access to advanced manufacturing capabilities and sensitive technologies, effectively extending American national security doctrine into bilateral trade terms. The US had previously launched a national security investigation into the aerospace sector, and this agreement resolves that investigation by conditioning tariff relief on explicit UK commitments to supply chain security. Such linkage between trade relief and security requirements represents an increasingly common feature of contemporary bilateral agreements, where tariff reductions become instruments for enforcing geopolitical alignment. For institutional investors with exposure to aerospace supply chains, this provision creates clarity regarding market access while imposing compliance obligations regarding supplier selection and manufacturing location.

The “melted and poured” requirement for steel tariff eligibility illustrates how technical trade regulations can fundamentally reshape manufacturing competitiveness and supply chain economics. This standard, rooted in US trade law, essentially requires that steel products undergo complete smelting and casting within the country of origin, excluding reprocessed or refined materials that originate from imported inputs. For UK steelmakers dependent on imported scrap metal or iron ore, this requirement creates a significant technical barrier that cannot be resolved through tariff rate quotas or exemptions alone. Resolving this issue would require either changing UK manufacturing processes to source primary materials domestically—an economically unfeasible alternative—or modifying US regulatory definitions to accommodate reprocessing operations. The ongoing negotiations highlight how trade disputes increasingly turn on technical specifications and regulatory definitions rather than simple tariff rates. For investors analyzing UK manufacturing competitiveness, the steel resolution remains critical to understanding long-term viability of the sector.

The temporary 50% steel tariff exemption granted to the UK provides a negotiating window but creates regulatory uncertainty for manufacturers dependent on cost predictability. Temporary exemptions introduce timing risk—investors and manufacturers must plan capital investments and supply chain decisions against the possibility of tariff reimposition if negotiations stall. The two-tier tariff structure (27.5% baseline for automobiles with the reduced 10% rate for the first 100,000 vehicles annually) similarly creates capacity constraints that could incentivize reshoring or redirected investment. These regulatory mechanisms effectively embed geopolitical and economic leverage into tariff structures, allowing the administration to reward compliance or punish non-cooperation through tariff rate adjustments. Institutional investors must monitor not only current tariff rates but also the regulatory definitions and temporary exemptions that determine actual compliance costs and market access eligibility.

Implications for Institutional Investors and Long-Term Trade Dynamics

The executive order’s immediate operationalization signals the Trump administration’s commitment to implementing bilateral trade agreements rapidly, potentially signaling a broader pattern of bilateral deal-making over multilateral frameworks. For institutional investors with transatlantic exposure, this approach creates both opportunities and complexities: automotive and aerospace investors benefit from tariff reductions, while agricultural commodity traders and renewable energy investors face new competitive dynamics. The agreement’s patchwork nature—with certain sectors fully resolved, others partially implemented, and steel remaining under negotiation—creates a complex risk environment where some supply chains gain certainty while others face extended uncertainty. Institutional portfolios tracking UK manufacturing competitiveness must now incorporate sector-specific tariff dynamics rather than treating US-UK trade relations as a monolithic policy area. The automotive provisions particularly warrant attention, as the 10% tariff reduction on the first 100,000 vehicles could significantly improve margins for British carmakers while creating capacity constraints that incentivize investment decisions.

The supply chain security provisions linking tariff relief to Chinese exclusion represent a broader trend toward weaponizing trade agreements to enforce geopolitical alignment. Investors in sectors dependent on advanced manufacturing—aerospace, defense, semiconductors—should anticipate similar linkage between market access and supply chain governance in future bilateral agreements. The UK’s acceptance of these terms suggests a pattern where American tariff relief implicitly requires alignment with US policy objectives regarding China, effectively extending American strategic doctrine into allied economies. This approach could become a template for future US trade negotiations, particularly as the administration prioritizes bilateral agreements with security implications. Institutional investors managing technology and defense-related portfolios should monitor how supply chain security provisions evolve and whether they become standard components of trade relief packages.

Looking forward, the steel negotiations remain the critical barometer for whether the agreement will stabilize UK-US trade relations or merely defer contentious issues. If negotiations successfully establish a quota system accommodating UK reprocessed steel, the agreement could serve as a template for resolving technical trade barriers through compromise. Conversely, if the temporary exemption expires without resolution, renewed tariff enforcement could severely damage UK steelmakers already facing margin pressure. For institutional investors, the agreement’s success ultimately depends not on the automotive tariff reduction but on whether the two countries can resolve technical regulatory issues in low-profile sectors like steel and aluminum.

Treasury Secretary Scott Bessent says final OBBB terms will reinforce U.S. investment leadership
Legal & Crime

Treasury Secretary Scott Bessent says final OBBB terms will reinforce U.S. investment leadership

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Treasury Secretary Scott Bessent revealed on Wednesday that there’s a lot of misinformation about Section 899 in the One Big Beautiful Bill. He said the final text of OBBB will ensure that the U.S. continues to be the most investable country in the world while undergoing Biden’s bad tax policies.

Bessent reiterated that the U.S. has been the victim of unfair trade practices, extraterritorial taxes, non-tariff barriers, and tariffs for too long. He also acknowledged that U.S. President Donald Trump is creating a fair playing field for trade and tax, getting foreign governments to the table, and putting American businesses first.

Section 899 to ensure growth in the U.S.

Section 899 in the OBBB aims to introduce retaliatory tax measures against entities from nations with tariffs, such as the Digital Service Taxes and the OECD’s global minimum tax rules. If the legislation is passed into law, it could impact investors from the European Union, the UK, Canada, Australia, and Switzerland, among others.

The White House Council of Economic Advisors (CEA) argued that the bill would produce significant economic growth. The entity projects the legislation would increase gross domestic product by up to 3.5%, raise investment by up to 7.5%, and raise wages by up to $11,600 per worker. CEA also believes that the OBBB would boost the U.S. economy by up to 5.2% in the first few years after enactment.

“We put out a report from the Council of Economic Advisers that if the bill doesn’t pass, then they estimate that this would cause a reduction of GDP by 4%, we’d be in a deep recession, we’d lose six or seven million jobs.”

–Kevin Hassett, Director at the National Economic Council.

In an April analysis, the CEA confirmed their modeling is accurate because their 2017 Tax Cuts and Jobs Act (TCJA) projections were correct. The entity estimated an increase in GDP growth between 2 and 4 percent and a $4,000 boost to per-worker wages. CEA said that macroeconomic data validated their projections and showed that real GDP was 2.5% higher than CBO’s pre-TCJA baseline, and real wages increased by $4,9992 per worker.

The Tax Policy Center argued that though some more recent casual papers show positive effects on corporate investment, they do not support the magnitudes implied by CEA’s claims. Macroeconomic data suggest that overall investment in two assets the TCJA targeted, equipment and structures, barely budged in 2017.

ICI expects Section 899 to impact foreign investments

According to data from Apollo Global Management, foreign investors own $19 trillion in U.S. stock markets, $7 trillion in U.S. government bonds, and $5 trillion in U.S. credit. The Rhodium Group also estimated on June 9 that nearly all states face the threat of lost investment from the House bill, which totals $522 billion nationally, with the top 10 states comprising 62% of the investment.

The Investment Company Institute (ICI) warned that the bill in its current form impacts most foreign investments in U.S. stock markets. The entity believes that portfolio investors are likely to retreat from U.S. equities, leading to capital outflows from the U.S. 

In a letter sent to Senator Mike Crapo, the chairman of the Senate Finance Committee, the ICI argued that if sustained selling by foreign investors depresses U.S. equity markets, it would harm both U.S. companies and investors. The entity also suggested that the U.S. fund management industry, which has invested around $18 trillion in U.S. stock markets, would be collateral damage due to the impact of Section 899.

Trump also issued a warning on June 5 that there would be a 68% tax hike if the OBBB legislation does not pass. However, independent analyses of the controversial bill found that Trump’s estimate is about 10 times bigger than the expected increase would be if the cuts expire. The Urban Institute-Brookings Institution Tax Policy Center, a nonpartisan think tank, has estimated, on average, Americans’ taxes would rise by about 7.5% if the 2017 tax cuts fully expired, not 68%. 

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Tariff deadline nears as US weighs extensions
AI News

Tariff deadline nears as US weighs extensions

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President Donald Trump announced Wednesday that he plans to send letters to major US trading partners in the coming weeks. He outlined unilateral tariff rates and offered what he described as a “take it or leave it” trade proposition.

“At a certain point, we’re just going to send letters out,” Trump told reporters at the Kennedy Center. “And I think you understand that, saying this is the deal, you can take it or leave it.”

Tariff deadline nears as US weighs extensions

Trump’s comments arrive just days before a July 9 deadline, when a temporary pause on the president’s steepest tariffs is set to expire. While the pause had initially provided markets with a measure of stability, Trump’s latest remarks injected fresh uncertainty into the outlook for global trade.

Earlier in the day, Treasury Secretary Scott Bessent told the House Ways and Means Committee that it is “highly likely” the administration will extend the tariff freeze for nations negotiating in “good faith.”

“There are 18 important trading partners — we are working toward deals on those,” Bessent said. “It is highly likely that those countries…will see the date rolled forward.”

In a significant development, the US and China reached a tentative framework for easing trade tensions, including an implementation plan. Trump called the deal “done,” pending formal approval by both him and Chinese President Xi Jinping. The agreement reportedly addresses long-standing concerns over China’s export controls on rare earth minerals and magnets, though sources later clarified China would only relax restrictions for six months.

In a notable concession, Trump also announced the US would continue allowing Chinese students to study at American universities — a contentious point in recent talks.

Tariff policy sparks legal battles

Trump said that the total tariffs on Chinese imports would reach 55%, a figure that reportedly includes existing tariffs rather than any new levies. According to Yahoo Finance’s Ben Werschkul, the number was derived by aggregating the full scope of current duties.

While Trump’s sweeping tariff agenda has faced legal challenges, the administration scored a legal win this week. A federal appeals court overturned a lower court’s ruling that had blocked the tariffs, allowing them to remain in place temporarily. The US Court of International Trade had earlier declared the methods used to enact the tariffs as “unlawful.”

As the July 9 deadline approaches, pressure is mounting on foreign governments and global markets to interpret Trump’s mixed signals. The threat of unilateral action and the uncertain fate of ongoing trade negotiations leaves little clarity on what US policy will look like in the coming weeks.

For now, all eyes are on Washington and the letters Trump has promised to send. Whether they open a new chapter in international trade relations or trigger a wider backlash remains to be seen.

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Federal court weighs first legal challenge to Trump's 'Liberation Day' tariffs
AI News

Federal court weighs first legal challenge to Trump’s ‘Liberation Day’ tariffs

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A federal court has invalidated the sweeping global tariffs imposed by President Donald J. Trump. According to the Court of International Trade ruling, an emergency law invoked by the White House does not provide unilateral authority to impose tariffs on nearly every country.

The ruling offers a major check on executive power and could have long-lasting implications for the US trade policy.

The Manhattan-based court said the US Constitution grants Congress exclusive powers to regulate commerce with other nations. This is not superseded by the president’s remit to safeguard the economy.

The lawsuit, filed by the nonpartisan Liberty Justice Center on behalf of five small US businesses that import goods from countries targeted by the duties, was the first major legal challenge to Trump’s tariffs.

According to the firms, the tariffs will hurt their business.

Federal court weighs first legal challenge to Trump’s ‘Liberation Day’ tariffs

The lawsuit is one of seven court challenges to Trump’s tariff policies, along with challenges from 13 U.S. states and other groups of small businesses.

The hearing at the Court of International Trade in Manhattan marks the first time a federal court has addressed the legality of President Trump’s “Liberation Day” tariffs.

Earlier this month, Jeffrey Schwab, a lawyer from the conservative Liberty Justice Center representing the plaintiffs, argued that the case is straightforward. He stated that the International Emergency Economic Powers Act (IEEPA) — a 1977 law granting the president authority to regulate commerce during national emergencies — does not empower Trump to impose tariffs unilaterally.

Schwab further contended that Trump’s declared emergency, based on trade deficits, fails to meet the legal criteria of an emergency, which must be brief, rare, and not ongoing. He then noted that the case is so far outside what constitutes an emergency or an unusual and extraordinary threat that this Court can easily rule it is not an emergency.

When the three-judge panel — appointed by Presidents Obama, Trump, and Reagan — asked for guidance on the legal standards to apply in their decision earlier this month, Schwab urged them not to overcomplicate matters. 

“I’m asking this court to be an umpire and call a strike. You’re asking me, where’s the strike zone? Is it at the knees or just below? I say it’s a wild pitch, far off the plate, hitting the backstop — no debate needed.”

The lawsuit was filed in April by a group of small businesses — including a New York liquor distributor, a Utah pipe company, a Virginia electronics store, a Pennsylvania tackle shop, and a Vermont cycling company. These businesses rely heavily on imports from countries such as China and Mexico and argued that Trump’s tariffs represent an unprecedented power grab that would cause irreparable harm.

They maintained that the IEEPA does not grant the president the authority to impose tariffs like those announced, which included a broad tariff rate plus higher rates on certain countries. They described the national emergency Trump cited as “a figment of his own imagination,” pointing out that the US has run massive trade deficits for years without suffering economic damage.

“If such power were granted by statute, it would represent an unlawful delegation of legislative authority to the executive branch without any clear limit on discretion,” the plaintiffs argued.

At the beginning of May, Department of Justice lawyers countered, asserting that Congress does allow the president to impose some tariffs and that Trump’s invocation of a national emergency expands that authority, justifying the broad tariffs. They warned that a court order blocking the tariffs would unlawfully interfere with the president’s constitutional and statutory authority.

“Plaintiffs’ proposed injunction would be an enormous intrusion on the President’s conduct of foreign affairs and efforts to protect national security under IEEPA and the Constitution,” the DOJ stated.

States and businesses take Trump’s tariffs to court in landmark trade dispute

At least six separate lawsuits have challenged Trump’s tariffs, including one filed by California and a coalition of twelve state attorneys general. While many were initially filed in district courts they were gradually transferred to the Court of International Trade.

In April, the court rejected an emergency request for a temporary order to block the tariffs, finding that the businesses failed to prove that “immediate and irreparable harm” would stem from the tariffs.

A three-judge panel conducted the hearing: Gary S. Katzmann, Timothy M. Reif, and Jane A. Restani — appointed by Presidents Obama, Trump, and Reagan, respectively.

Located in a corner of New York’s Foley Square, the Court of International Trade has nationwide jurisdiction over trade disputes. It typically handles niche issues, such as honey customs and mattress imports. Tuesday’s oral argument promises to be the court’s most high-profile hearing in recent memory.

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How Trump’s tariffs made AI a business lifeline
AI News

How Trump’s tariffs made AI a business lifeline

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Donald Trump’s aggressive trade policies increased the costs of importing goods and complicated trade rules, making them unpredictable.

Businesses worldwide had no choice but to quickly change how they manage supply chains, plan pricing, and choose global partners.

Companies relying on overseas factories had to pass the new costs on to customers, find new suppliers in other countries, or figure out how to work with a confusing and constantly changing tariff system that made every shipment more expensive and difficult to track.

Many businesses realized that their old systems weren’t fast or smart enough to handle all the changes because tariff laws could now shift overnight and expose their operations to risks they couldn’t predict.

AI has become a lifeline for companies to understand their supply chains, reduce their tariff exposure, and find new ways to cut costs.

Trump started a trade fight, and companies turned to AI

Donald Trump’s administration introduced tariffs that made global trade more tense and unpredictable for companies that had spent decades building international supply chains.

The Trump tariffs affected electric vehicles and batteries, while others targeted raw materials, machinery, consumer electronics, and simple goods like textiles and furniture.

Since the US customs system has more than 20,000 product categories, each one could face a different rate or rule depending on the country of origin and trade status. 

This uncertainty forced companies to go back and analyze thousands of product categories, track long Harmonized Tariff Schedule codes, and figure out which parts of their inventory were now affected.

Businesses quickly needed smarter tools to read tariff schedules, track product codes, analyze costs, and react instantly to customs office updates. So, they turned to artificial intelligence to survive a new era of fast, deep, and unpredictable tariffs.

Companies turned to AI to keep up with tariffs

Companies discovered that AI could read huge volumes of complex documents, connect the dots across departments, and react faster than human teams ever could.

Salesforce created a powerful AI agent that could instantly scan and understand the US. Harmonized Tariff Schedule (4,400 pages) for businesses to identify every possible product category and associated duty. 

Kinaxis used AI to let businesses run live supply chain simulations that showed what would happen if they changed one part of their operation. This way, companies will know how to keep production running while lowering costs and avoiding new tariffs.

Wipro combined traditional machine learning with new generative AI systems to quickly analyze global trade routes, supplier locations, shipping lanes, and tariff exposure. The system would then recommend how to reroute cargo, switch to cheaper vendors, or adjust sourcing strategies so businesses could stay flexible and competitive even as the rules kept shifting.

These AI systems took over work that was simply too large, fast, and complex for human teams to manage independently. These tasks include tracking new trade policies as they happened, scanning global supplier data for vulnerabilities, modeling what-if scenarios for cost impact, and suggesting better decisions that balance speed, savings, and compliance.

A lifeline for big companies, but what about everyone else?

Large corporations have the money, talent, and data to train AI tools properly. AI made them flexible and intelligent enough to respond instantly to changing trade rules and protect their profit margins in ways that older systems or manual processes simply couldn’t match.

But many small businesses don’t have enough money to buy AI tools, hire experts to build custom models, or collect the clean, real-time data AI systems need to work properly and deliver useful insights. 

AI is often portrayed as magic, but the truth is that it’s only as good as the data it works with. If a company can’t afford clean, updated, and well-organized data about its products, suppliers, logistics, and costs, then even the best AI system won’t be able to deliver the results that big businesses already see.

AI has become a lifeline in this context, helping companies navigate unpredictable policies. But the deeper question going forward is whether this lifeline will also act as a ladder, giving smaller businesses and under-resourced players a way to climb into the future, or whether it remains just a crutch for the most powerful to keep their lead while others fall further behind.

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