Panic over global trade wars persists in the world economy. While the US stock market saw its sharpest drop in 5 years, $2.7 trillion evaporated from the market. The cost of customs duties for Americans was estimated to be $3,500 per household. President Donald Trump’s tariff policy has turned global markets upside down. The customs duties announced by Trump were recorded as the strictest restrictions on trade the US has imposed in over 100 years. Under this scope, the US implemented additional customs duties to 185 countries. Tariff rates ranged from 10% to 50%. Higher taxes were imposed on countries with which the US had significant trade deficits. The main trading partners of the country, such as the European Union, China, and Vietnam, were subjected to additional taxes of 20%, 34%, and 46%, respectively. Following the decision, the European Union and China announced retaliatory measures. Concerns about customs duties have disrupted trade and supply chains. Fears have increased that a widespread trade war could cause global economic slowdown. Concerns have also escalated about potential disruptions in global trade due to tariffs. Additionally, forecasts that tariffs will raise inflation have strengthened. WILL THE FED CUT INTEREST RATES? Concerns about a recession in the global economy in the US resulted in expectations regarding the Federal Reserve’s (Fed) actions. Expectations that the Fed will adopt a more aggressive interest rate cut policy to support economic growth have strengthened. Fed funds futures imply a 96-basis-point reduction by December. Prior to Trump’s announcement of customs duties, a 70-basis-point interest rate cut was expected. JPMorgan indicated in a research note titled “Blood Will Spill” that Trump’s new tariff decision raised the risk of a global economic downturn by 20 points. $2.7 TRILLION VANISHED The New York Stock Exchange closed the day sharply lower amid concerns that President Donald Trump’s tariffs announced yesterday could push the economy into a recession. The S&P 500 and Nasdaq indices experienced their largest daily declines since 2020. The S&P 500 index lost 4.84%, the Nasdaq index dropped 5.97%, and the Dow Jones index fell by 3.98% in the New York Stock Exchange. Following the tariff announcements, attention was drawn to the decline in shares of companies with global supply chains. Shares of Apple dropped over 9%, Nike’s shares lost over 14%, while retailers that mainly sell imported products, like Five Below, saw a drop of approximately 28%, and Dollar Tree’s shares declined by 13%. TRUMP: CONDITION OF THE PATIENT IS SEVERE President Trump commented on the fall in the New York Stock Exchange, saying, “I think everything is going very well. Markets will explode, the stock exchange will explode.” Stating, “There were a lot of problems in the economy,” Trump likened the US economy to a patient in need of surgery. Trump used the expression “The condition of the patient was severe. He underwent an operation. It will be a booming economy. It will be great.” THE BILL WILL BE PAID BY AMERICANS Research on how customs duties will affect American citizens has also begun. The think tank Advancing American Freedom, founded by Former Vice President Mike Pence, estimated that the latest taxes would cost American families more than $3,500 annually. The analysis stated that tariff-related increases would eliminate three years’ worth of income hikes for most families. Yale University calculated that the tariffs announced on April 2 would cost each household an average of $2,100. Moreover, it was emphasized that all additional taxes announced so far could cost households around $3,800.