Facts About The Recent Volatility And Fears Of A Trade War
Stocks soared in January, hitting new all-time highs after the tax bill was enacted and then plunged 11% from January 26 to February 8. By March 9, prices had largely recovered when President Trump slapped $50 billion of tariffs on China and fears of a trade war triggered another selloff and capped off Friday with a 2.2% plunge. For whipsawed investors, here are the straight facts.
On March 22, President Trump signed a memorandum officially targeting "China's economic aggression," and proposing $50 billion in tariffs on Chinese imports into the United States. China responded within days by imposing tariffs on the United States. On Thursday, the president added another $100 billion of proposed new tariffs on Chinese goods, triggering Friday's 2.2% selloff.
These actions followed an investigation initiated at the request of President Trump on August 18, 2017 by the U.S. Trade Representative (USTR) under Section 301 of the Trade Act of 1974 into the government of China's acts, policies and practices related to technology transfer, intellectual property, and innovation.
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