Washington’s newest tariff salvo—up to 41 % on imports from 68 nations and the EU—signals that President Trump’s trade doctrine has shifted from tactical leverage to systemic rewiring. The duties cover almost $3 trillion in annual trade and lift average U.S. tariffs to heights unseen since the 1930s Smoot-Hawley era, yet equity indices barely flinched—proof, perhaps, that markets now treat protectionism as policy baseline rather than shock event. (apnews.com, reuters.com, ft.com)

Seen through a historical lens, the White House is betting that scale trumps retaliation: post-1930, U.S. import volumes collapsed 40 % within two years, but today global supply chains disperse the pain and soften immediate feedback loops. That diffusion buys the administration time—and revenue (customs takings already top $100 billion this fiscal year)—yet it also masks creeping inflation now running 2.6 % on the Fed’s preferred gauge. (apnews.com, weforum.org)

The deeper contradiction lies in calling tariffs “reciprocal” while targeting surplus countries indiscriminately; by weaponising deficits, Washington risks entrenching them as partners redirect trade away from the U.S. toward China-centric blocs. Unless negotiations before the August 7 activation yield carve-outs, the world may relearn an old lesson: beggar-thy-neighbour ends up bankrupting everyone. “Protectionism is a drug—its first dose numbs the pain, every subsequent dose addicts the body politic.” — Branko Milanović, 2023.

The Gist AI Editor

New Tariffs Roil Global Markets

The Trump administration has imposed new tariffs on goods from over 68 countries, escalating global trade tensions. The tariffs, which take effect August 7th, range from 10% to 41% and are aimed at countries with which the U.S. has a trade deficit. Notably, tariffs on Canadian goods not covered by the US-Mexico-Canada trade agreement will increase to 35%, while India faces a 25% tariff. The European Union secured a deal for a 15% tariff on most goods. This aggressive protectionist stance is intended to bolster domestic manufacturing but is likely to increase costs for American consumers and disrupt international supply chains.

Apple Surges on iPhone 16 and China Rebound

Apple announced its quickest revenue growth in over three years, with a 9.6% increase to $94 billion for the fiscal third quarter. This growth was largely driven by strong demand for the new iPhone 16 and a significant recovery in the Chinese market, where sales rose by 4.4%, reversing previous declines. iPhone revenue jumped 13% to $44.58 billion, while the services division also saw a 13% increase to $27.4 billion. These figures, exceeding Wall Street estimates, underscore Apple’s resilience amid global economic headwinds.

Starbucks Weighs China Stake Sale

Starbucks is considering selling a stake in its China operations, with about a dozen private equity firms and tech companies advancing to the second round of bidding (Bloomberg). The potential deal values the business at up to $10 billion. Bidders include major players like Tencent, Hillhouse Capital, Carlyle Group, and KKR. Starbucks may retain a significant stake of around 30%, with the remainder divided among several buyers. This move reflects the increasing competition and dynamic nature of the Chinese consumer market, where the company aims to expand from its current 7,800 stores.

China’s Property Sector Still Unstable

Chinese developer Fantasia Holdings plans to introduce a new debt restructuring plan in the coming weeks, highlighting the persistent struggles within China’s property sector (Bloomberg). This follows a previous attempt that failed to gain sufficient support from creditors. The ongoing property crisis, which began in 2021, continues to be a major drag on the world’s second-largest economy, with new home prices experiencing their fastest drop in over nine years. While the government has announced measures to stabilize the market, including allowing local governments to purchase unsold apartments, the sector’s recovery remains uncertain.

Stay tuned for the next Gist—your edge in a shifting world.

Prabowo’s political rivals among over 1,000 granted clemency before Indonesia’s Independence Day
— Strait Times

China prepares to unseat US in fight for AI market
— Strait Times

AI researchers are negotiating multi-million pay packages, just like NBA stars
— Strait Times

Tencent, Hillhouse Among Dozen PE and Tech Firms on Shortlist for Starbucks China Investment
— Bloomberg

Apple Growth Rebounds on Strength of iPhone 16 Line, China
— Bloomberg

Chinese Builder Fantasia Plans to Unveil New Restructuring Plan
— Bloomberg

US Tariff Detour

The Trump administration has unexpectedly delayed the implementation of its latest round of tariffs, which were scheduled to take effect on August 1. This move offers a brief respite for international markets, which have been bracing for impact. Simultaneously, however, new levies targeting additional countries were announced, signaling that the strategic direction on trade remains unchanged. This stop-and-go approach to trade policy injects significant uncertainty into global supply chains, making long-term capital planning difficult for businesses. Forcing companies to constantly re-evaluate sourcing and investment based on unpredictable political timelines is a tax on efficiency and a drag on economic growth. The core issue remains: tariffs are a barrier to free exchange, and this continued reliance on them, even with delays, suggests a fundamental misunderstanding of market principles (Zdf).

China’s Taiwan Red Line

Beijing has issued a stark warning against Taiwanese independence, with its Defense Minister stating the military is prepared to crush any separatist movements and counter foreign interference. The declaration, made during a celebration of the 98th anniversary of the People’s Liberation Army, is a clear message to both Taipei and its international partners. This saber-rattling has immediate implications for market stability in Asia and beyond. Taiwan is a lynchpin in the global semiconductor industry, and any military escalation would trigger catastrophic disruptions to supply chains. The rhetoric raises the geopolitical risk premium, forcing investors to weigh the real possibility of conflict in their valuations and capital allocations. This is a stark reminder that authoritarian regimes pose a persistent threat to the open international order upon which global prosperity depends (Ansa).

Catch the next Gist for the continent’s moving pieces.

Wadephul warnt Israel vor Isolation
— Zdf

Millennial women were told to chase our dreams. That’s left us burnt out, broke and dreaming of a rich patron | Carolin Würfel
— Theguardian

Oscars : la productrice Lynette Howell Taylor élue présidente de l’Académie
— Lemonde

Diese Drohnen-Strategie fährt Putin im Ukraine-Krieg
— Zdf

Trump verschiebt Inkrafttreten von Strafzöllen
— Zdf

Trump, ‘costruirò una sala da ballo da 200 mln alla Casa Bianca’
— Ansa