President Trump’s policies
In the previous part of this series, we looked at some of President Donald Trump’s successful economic policies. However, there is also a flip side. Harley-Davidson (HOG) and Tesla (TSLA) are now paying counter-tariffs on some of their overseas shipments. Companies such as Ford (F) and Coca-Cola (KO) have seen higher input costs since US steel and physical aluminum premiums have risen following President Trump’s tariffs. The Dow Jones Industrial Average (DIA) has underperformed some of the other sectors this year. The industrial sector has been facing cost pressures from higher metal, energy, and labor costs.
The Trump administration has also been hot and cold on actions against Russia. Earlier this year, it imposed sanctions on Russian aluminum giant Rusal, which pushed aluminum prices to multi-year highs. However, the sanctions were subsequently watered down, triggering a sell-off in aluminum prices.
President Trump faced criticism after his meeting with Vladimir Putin. Trump is now threatening sanctions on some Russian banks. Russia has reacted strongly to the move. While terming the move “a declaration of economic war,” Russian Prime Minister Dmitry Medvedev said, “And it would be necessary, it would be needed to react to this war economically, politically, or, if needed, by other means. And our American friends need to understand this.”
It remains to be seen if Trump will take a hard line against Russia for its alleged meddling in the US elections. But in the meantime, the Trump administration is getting close to achieving its objectives with the Section 232 tariffs. We’ll look at that in the next part.