Subject: Re: Spy down another 4 percent,
They key insights for me are

* the tariffs are mostly a side show, it's the geopolitical side that matters. The taxes on imports are there, their size is changing literally hour by hour, they will settle into some level, some folks will be wiped out, but life will probably go on for most people.
* current policy moves are not a rational and coherent part of any grand unified plan, it's all being made up as it goes, BUT there are a few underlying goals that are pretty consistent and (dare I say it) some of them are not unreasonable goals.

On the latter point,
* There is a strong and consistent policy to reduce the US trade deficit, which isn't a terrible idea. There are sensible ways to do that, and I haven't seen those tried yet, but hey, one step at at time.
* There is also a strong and consistent policy goal to re-industrialize the US in the specific areas (like steel, low-tech and high-tech fabrication) that would indeed lead to improved security resilience. Again, there are ways to do this that are more effective and less damaging and, well, more considered--but the goal of security resilience in this sense of specific types of manufacturing capacity is not entirely unreasonable for any country. A big country without machinists is indeed a bit vulnerable. There is no need for the US to make its own running shoes, but there is a case to be made for not being reliant on China for cotton linters for artillery.

That's a view of tariff chaos and a few kernels of sanity among the motivations for recent moves. (some subset of the motives, if not the actions themselves...)

To me the big problem for the world's countries, economies, and stock markets is the separate goal of hegemony. Wanting to define and completely control (indeed, annex) a sphere of influence of tributary or vassal states is kind of 15th century, but they seem entirely serious. My own assessment of the fall in the true value of most stocks (the well founded portion) comes more from this than from the tariff noise. The problem isn't the sound of cannon, it's the metaphorical encroaching army over the hill. And slightly less-than-metaphorical in some places. Among other things, there are serious investment implications arising from the fact that no country will trust the US again for many many years, and that will hit virtually every firm bigger than a barber shop. Decoupling, divestiture, falling trade intensity, falling world production, lower incomes, more conflicts. And not a whit of this can be undone by another speech announcing a change in policy like a change in the weather, or by another election--the trust is already gone.

Forget the tariffs, look at the geopolitics.

Jim