A Tariff Tantrum: the Upheaval from Trump’s Trade Policies -OxBig News Network

Meltdown

The markets have spoken.

The S&P 500 is on track for its worst weekly loss since the collapse of the Silicon Valley Bank crisis two years ago. And investors have wiped out post-Election Day gains as President Trump’s dizzying start-stop tariff policy fuels volatility on trading floors and in boardrooms.

Another test comes this morning with the jobs report due out at 8:30 a.m. Eastern. It’s expected to show solid growth in hiring even as federal workers brace for mass layoffs. Economic alarm bells are ringing elsewhere. Mohamed El-Erian and Ed Yardeni, two longtime market watchers, see a downturn in the making, with Yardeni warning of a “tariff-induced recession.”

Those jitters are colliding with concerns about shifting White House policy. Maximalist moves — freezing funding, axing government jobs, engaging in a trade war — that get rolled back have made it tough for world leaders and corporate chiefs to decipher Trump’s end game. Jim Farley, Ford’s C.E.O., sees only “costs and chaos” from tariffs.

A recap: Trump yesterday gave Mexico and Canada a partial tariff reprieve — exempting levies for one month on products covered by the U.S.-Mexico-Canada Agreement, the trade pact Trump signed in his first term. Presumably, that buys time to negotiate a truce, though Trump and his trade team have signaled they’re not willing to budge much.

Traders still hit the sell button. Trump, who has long cited stock market rallies as a sign his policies are working, blamed “globalists” for tanking stocks. “I’m not even looking at the market, because long term the United States will be very strong with what is happening here,” he told reporters in the Oval Office yesterday.

Tariffs and tensions are up. Trump’s levies on aluminum and steel are to go into effect next week, and next month could bring tariffs on agricultural products and automobiles. Prime Minister Justin Trudeau of Canada upped the ante, announcing countermeasures on U.S. imports and ominously predicting: “We will continue to be in a trade war that was launched by the United States for the foreseeable future.”

That prompted Scott Bessent, the Treasury secretary, to call Trudeau a “numbskull” at an Economic Club of New York event yesterday. Meanwhile, some Canadian retailers have pulled California wine, Kentucky bourbon and other American products off store shelves. “That’s worse than a tariff because it’s literally taking your sales away,” Lawson Whiting, the chief executive of the corporation that owns the Tennessee whiskey brand Jack Daniel’s, said on an analyst call this week.

Another data point to consider: China, another country high on Trump’s tariff hit list, reported today a $540 billion surge in exports, a sign that tariff fears are scrambling global trade with companies stockpiling goods to limit the hit.

HERE’S WHAT’S HAPPENING

President Trump tells cabinet chiefs, not Elon Musk, to take the lead on job cuts. The president has changed tack on his signature streamlining effort after mass firings and unorthodox directives from the Department of Government Efficiency prompted lawsuits and the outright ignoring of cuts by high-level officials. Cabinet secretaries “can be very precise as to who will remain, and who will go,” Trump announced on his Truth Social platform, marking a potentially big shift from Musk’s rapid-fire strategy.

Trump’s funding freeze hits a roadblock. A federal judge yesterday blocked the president’s hold on billions of dollars worth of congressionally approved funds earmarked for state agencies and governments. The ruling directs all federal agencies to keep the grants flowing, reversing a White House directive from January. This follows yesterday’s Supreme Court decision rejecting Trump’s request to freeze billions in foreign aid.

Stephen A. Smith can now talk politics after striking a new $100 million contract. The five-year deal with Disney’s ESPN, first reported by The Athletic, makes him one of the highest paid figures in television. Smith had been an N.B.A. commentator for most of his career but in recent years he has been outspoken on a wide manner of topics — and has criticized both Trump and the Democratic Party. That said, the new deal means he’ll be a regular on ESPN’s “First Take” show, but will be less visible elsewhere on the network.

Trump’s call to repeal the Biden-era CHIPS Act gets a cold shoulder from Republicans. G.O.P. lawmakers point out that the money has already been spent, and they defend the Biden administration program as a way to shore up national security by encouraging foreign manufacturers to build in the United States. Republicans said they’d be willing to work with Trump to make changes, but not to scrap it altogether.

A deal drought and Musk dominate M.& A. conference

At cocktail receptions and dinners in New Orleans this week for attendees of the M.& A. industry’s big conference, the drinks and good times have been flowing freely. So, too, have the complaints that deals aren’t doing the same.

Much of the chatter at Tulane University’s Corporate Law Institute focused on how company leaders have hesitated to strike big takeovers, in large part because of the market uncertainty unfolding in the early days of the second Trump administration, DealBook’s Michael de la Merced reports.

“There’s a lack of predictability right now,” Scott Barshay, a partner at the law firm Paul, Weiss, Rifkind, Wharton & Garrison said onstage yesterday. A C.E.O. recently told him that he didn’t want to do a $20 billion deal only to see the market tumble the next day. (Scott, feel free to tell us more!)

Privately, lawyers, P.R. consultants and others told DealBook the same. The slowdown had less to do with the politics of deal-making under a Trump administration and more to do with the broader worries about whipsawing markets and his tariffs.

Some said there’s reason to hope things will pick up, noting the gradual lowering of interest rates and the huge amount of cash on corporate balance sheets — about $3.4 trillion as of Dec. 31. “There’s a lot of interest in M.& A.,” Audra Cohen, a partner at the law firm Sullivan & Cromwell, said onstage. Barshay added, “It feels more like a pause to let things stabilize a bit.”

But the bigger debate was about the state of Delaware. As DealBook has written, legislation meant to shore up the First State’s status as corporate America’s preferred home base was sure to be a prominent topic of discussion.

That led to some feisty back-and-forth about the merits of the bill, known as S.B. 21, which would protect controlling shareholders of companies and could limit shareholder lawsuits. Corporate lawyers defended it as a way to persuade companies to stay put. “It’s very important that this legislation gets passed,” Barshay said.

Those representing shareholder plaintiffs deplored the bill. “We are disempowering Delaware Courts,” said Ned Weinberger of Labaton Keller Sucharow, arguing that it would lead to the overturning of several key court decisions.

And Jeroen van Kwawegen of Bernstein Litowitz Berger & Grossmann — the firm that represented an investor who challenged Elon Musk’s big Tesla payday — said such a law was unnecessary. “It hurts the Delaware franchise,” he said.

Bonus: Of course Musk figured into the discourse. Two trucks parked outside the hotel hosting the conference displayed digital billboards criticizing the bill and linking it to Musk, whose repeated criticism of Delaware for the denial of his payout has inspired others to consider leaving the state.

“Don’t Let Billionaires Take a Chainsaw to Delaware’s Economy,” read one of the billboards, featuring an image of Musk wielding a chain saw.

StubHub finally looks at a public offering

The I.P.O.s keep rolling in. StubHub, a ticketing software company, has held preliminary talks with bankers in recent weeks about holding an initial public offering before the end of the year, two people with knowledge of the matter told DealBook’s Lauren Hirsch and The Times’s Mike Isaac.

StubHub told Wall Street analysts in an investor meeting on Thursday that it was aiming to raise more than $1 billion in a public offering, according to one attendee. It joins Discord and CoreWeave in pursuing I.P.O.s despite rocky market conditions.

Investors were expecting a blockbuster 2025 for deals and public offerings under a Trump administration, but the opposite has happened. The president’s trade battles have led to market volatility, leading to an uncertain business environment.

It took a long time for StubHub to get here. People could use the site, founded in 2000 by Eric Baker and Jeff Fluhr, to buy tickets on the secondary market for everything from concerts to sporting events. Baker left the company amid tensions with Fluhr and in 2006 founded Viagogo, a competitor focused on the European market. Baker eventually bought StubHub through his company Viagogo. The deal closed last year and operates under the name StubHub Holdings.

The company considered an I.P.O. last year at a $16.5 billion valuation, the people with knowledge of the talks said, but shelved the idea amid a dearth of public listings of similar companies.

Its renewed I.P.O. plans come as ticketing companies are seeing slower sales growth with fans cooling on concerts after an initial surge of post-pandemic interest. Shares of Live Nation, which owns Ticketmaster, are up around 1.5 percent this year, outperforming the S&P 500.

Quiz time, Magnificent Seven edition

The Magnificent Seven is anything but this year.

The grouping had been on a tear ever since the Microsoft-backed OpenAI introduced ChatGPT in November 2022, and investors caught A.I. fever.

But that trade seems to have unwound as a combination of factors — the arrival of DeepSeek, the low-cost Chinese chatbot competitor; tariff and economic growth fears; an investor exodus into rallying European stocks — seems to be taking the shine off megacap U.S. tech stocks.

Last week, the Magnificent Seven fell into correction territory, meaning the seven stocks have collectively fallen by more than 10 percent.

Question: There is one component of this septuplet whose shares are still positive for this year. Which is it?

• Amazon

• Apple

• Google’s Alphabet

• Meta

• Microsoft

• Nvidia

• Tesla

Answer: Meta. Shares in the social media giant fell 4.3 percent yesterday, but were still up roughly 5 percent thus far in 2025.

THE SPEED READ

Deals

• Sycamore Partners has agreed to acquire Walgreens Boots Alliance and take the struggling pharmacy chain private as part of a $10 billion deal. (NYT)

• Citadel Securities reportedly saw a huge jump in trading revenue to a record $9.7 billion, vaulting past European giants like Deutsche Bank and Barclays. (Bloomberg)

Politics, policy and regulation

• Republican senators introduce a “debanking” bill that calls for looser rules on who can get a bank account after President Trump accused major lenders of refusing to do business with his supporters. (WSJ)

• Democratic senators are asking regulators to investigate whether Elon Musk is using his ties to Trump to bully marketers into buying ads on his X platform. (WSJ)

Best of the rest

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