What’s going on here?

Despite unsteady American stock markets and concerns of global trade wars, the US president reaffirmed his commitment to tariffs earlier this week – issuing a lesson in self-belief, at the very least.

What does this mean?

The president updated his famous political slogan, vowing that tariffs will “make America rich again” – even if they cause “a little disturbance” in the process. But clearly, not everyone agrees. Americans, from analysts to business owners and shoppers, predict that tariffs will push up prices across the board. Now, it’s reported that the president may grant carmakers a month’s delay on the levies, but that’s only a small concession. No wonder investors – concerned that a pullback in spending will tranquilize the economy – have pulled out of US stocks, stripping the S&P 500 of any gains made since the election.

Why should I care?

Zooming in: The chips are going down.

Placing unwavering confidence in tariffs’ ability to attract foreign investment to the US, the president revealed intentions to scrap the Chips Act. That’s the $52 billion subsidy program designed to support American semiconductor firms. The move came soon after the Taiwanese chipmaker TSMC decided to spend another $100 billion on its stateside plant this week – an investment that’s thanks to tariffs, according to the government. But running production sites in the US is more expensive than elsewhere, so many analysts think that TSMC will be an exception rather than the rule.

For you personally: Everything’s bigger in… Europe, apparently.

For the first time in years, investors are being rewarded for exploring stocks outside US borders. In fact, European stocks are outperforming their American counterparts by the most since 2000. The region’s financial stocks have picked up between 20% to 25% this year, while Germany’s DAX index has risen nearly 16% in the same period. The S&P 500, meanwhile, has stayed mostly horizontal.

What’s going on here?

In the face of adversity, China set an ambitious target with a go-getting gameplan to match – and investors met the country’s gusto with… uh, barely a blink.

What does this mean?

China’s thrown all the classic tools at its economy: rate cuts, funding injections, and widespread infrastructure spending. So far, so not good. The country’s prices remain on the slide – a bad economic omen – and its property market is still failing. Remember, real estate woes undermine homeowners’ confidence, so they spend less as a result. And yet, China’s confident that it can grow its economy by 5% this year. Its roadmap suggests a focus on encouraging consumer spending. And the method: more money. The country’s set a fiscal deficit target – that’s the difference between how much it spends and makes – of 4% of the economy, the biggest since 1994.

Why should I care?

For markets: There’s nothing to see here.

Those bold promises weren’t enough to reassure investors. See, US tariffs are threatening to curb China’s export industry, as well as complicate supply chains and political relationships around the world. And because investors already expected China to bump up its budget, the news wasn’t enough to balance out the risks. The Chinese economy better start doing the heavy lifting then: if it can’t show results soon enough, investors may become even more doubtful.

The bigger picture: We’re all in this together… unfortunately.

Maybe investors should be more skeptical about the world’s biggest economy, too. A famous strategist believes that markets are underestimating the risk of a US recession. He thinks there’s a 25% to 30% chance of one this year – 10% higher than his prediction from earlier in the year. Three indicators are flashing, he says: lower-income households are struggling to pay off their debt, businesses are pausing investment plans, and escalating US tariffs seem set to complicate global trade.