Businesses Worldwide and Economists Worry About Higher Prices Under Trump’s Tariff-Heavy Economic Strategy
Jamie Dimon, CEO of JPMorgan Chase, believes there’s too much worrying and not enough faith in President Donald Trump’s tariff-related economic strategy. Dimon, who is the head of the world’s largest bank, sees tariffs as an “economic tool” or “economic weapon” depending on how they’re used. He believes there’s nothing to be worried about if tariffs are slightly inflationary but lead to more favorable trade terms.
Trump is threatening to impose 10% tariffs on all Chinese goods and 25% tariffs on Mexican and Canadian goods starting February 1. However, Dimon believes these threats can be used effectively to bring countries to the negotiating table. He thinks Trump administration is using them in that way.
As the date for the new tariffs approaches, Ngozi Okonjo-Iweala, the director-general of the World Trade Organization, urged caution, saying, “Let’s wait and see what actually gets done. Right now, there’s a lot of speculation on what might be done, it hasn’t been done yet.” Trump himself has set a deadline for February 1, leaving room for negotiation.
The tariffs, if imposed, could result in higher prices for a wide range of goods, including consumer electronics, toys, cars, and produce. The auto sector, in particular, is worried about the potential impact, as some car companies have become successful by hiring lower-wage workers in Mexico.
Despite having a rocky past with Tesla CEO Elon Musk, Dimon says they have since “hugged it out”. Dimon testified in court that Musk had said, “JPMorgan hates Tesla, in a nutshell.” However, their relationship has improved, and Dimon wishes to be helpful to Musk’s companies.