President Trump Threatens New Tariffs on the EU and Smartphones
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What tariffs did President Trump threaten on the EU?
President Trump threatens 50% tariffs on the European Union.
What are the ongoing frustrations from the U.S. side regarding the EU?
You're seeing a number of things build up here. It's hard to know which one is the straw that broke the camel's back, but there's a lot of ongoing frustrations from the U.S. side.
Plus, what's behind the recent turmoil around U.S. bonds? And a federal judge halts the government's move to prevent Harvard from enrolling international students. It's Friday, May 23rd. I'm Alex Ozola for The Wall Street Journal. This is the PM edition of What's News, the top headlines and business stories that move the world today. President Trump fired new salvos in the global trade war today. He threatened a 50 percent tariff on imported goods from the European Union, as well as new duties on iPhones made overseas. In comments at the Oval Office this afternoon, the president said he's not looking for a tariff deal with the EU.
I'm not looking for a deal. I mean, we've set the deal. It's at 50 percent. But again, there is no tariff if they build their plant here.
I'm joined now by Gavin Bade, who covers trade for The Journal. Gavin, where are the president's comments about the EU coming from? Are they out of the blue here?
Well, certainly for the EU, they feel out of the blue for them. The European diplomats really felt like they were making progress in these trade talks. Certainly, they did not go to lunch on Friday expecting to see this sort of online missive from the president. But when you ask the administration, the frustrations are kind of multifold here.
How might the EU respond to President Trump's tariffs?
We've heard Trump talk often about tariffs and non-trade barriers, about European Union lawsuits against companies like Google, something he brought up in the Oval Office today again. And then I think there are some unstated frustrations as well, especially when it comes to how they want the EU to approach China. And then you just see that this is a little bit of art of the deal stuff, right? Like Trump is dissatisfied with the pace of these negotiations. He and his team certainly don't like to be lectured by EU officials like we saw this week at the G7. And so I think you're seeing a number of things being build up here, there's a lot of ongoing frustrations from the US side.
Has the EU responded to any of this?
What impact will tariffs have on iPhones and other smartphones?
Not publicly yet, but I think there's going to be a redoubling of an effort to get to a deal here. Treasury Secretary Scott Besson said on Fox this morning, we want to light a fire under the EU. The president is dissatisfied with the pace here. And so far from blowing up the negotiations, I think the two sides are still going to come back to the table. And maybe this just is the push they need to get some of the more intractable issues solved here.
How are recent bond market fluctuations affecting the economy?
Let's shift now to talk a bit about Apple. So Trump was threatening a tariff of at least 25 percent on iPhones made overseas. During his comments in the Oval Office this afternoon, he said that could be expanded to other phone makers like Samsung. But what is going on here with Apple and Trump?
Tim Cook is probably one of Trump's closest corporate contacts. However, a 25% tariff is going to be felt by consumers of phones in the United States. We're just not going to see another economy or Apple eat that entire tariff. It's going to be significant. But I don't think they can do soup to nuts entire iPhone in the United States for anywhere near the price point. But it's all about the industrial ecosystem. We simply don't have that here yet. So there's going to be significant challenges to building anywhere near the amount of iPhones that are demanded by U.S. consumers in this country.
That was WSJ reporter Gavin Bade. Thank you, Gavin. Thanks, Alex. President Trump's threats against the EU and Apple sent U.S. stocks lower, with the iPhone maker's stock ending the day down 3%. Major indexes closed lower today. The Dow dipped about 0.6%, the S&P 500 dropped roughly 0.7%, and the Nasdaq fell 1%.
We're exclusively reporting that Apple has recently stepped up efforts to fight Texas legislation that would require the iPhone maker to verify the ages of device users. Apple CEO Tim Cook called Texas Governor Greg Abbott last week to ask for changes to the legislation, or failing that for a veto. That's according to people familiar with the call.
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Chapters
7 chapters
1
What tariffs did President Trump threaten on the EU?
0:03–0:07
2
What are the ongoing frustrations from the U.S. side regarding the EU?
0:07–1:32
3
How might the EU respond to President Trump's tariffs?
1:32–2:12
4
What impact will tariffs have on iPhones and other smartphones?
2:12–2:38
5
What challenges does Apple face in U.S. manufacturing?
2:38
6
How are recent bond market fluctuations affecting the economy?
0:43–4:40
7
What political implications do AI chip deals have?
4:40–11:20
Speakers
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