Trump didn’t sugarcoat it – when reporters asked if America was heading for a trade war with China, he shot back: “Well, we’re in one now.”
That blunt admission on Wednesday confirmed what markets already feared – the US and China are locked in their worst economic fight since Trump took office in January 2025… and it’s about to get much worse.
Trump now threatens to slap a 100% tariff on all Chinese goods starting November 1. That would basically kill trade between the world’s two biggest economies. “If we didn’t have tariffs, we would be exposed as being a nothing,” Trump told reporters, calling the measures critical for national security.
The numbers tell everything – Trump’s tariffs will pull in $171.3 billion this year, that’s 0.56% of GDP, and the biggest tax increase since 1993. But China isn’t taking it lying down either. So, they’ve already cut US oil imports by 90% and stopped buying American soybeans completely, switching to suppliers in Argentina, Uruguay, and Brazil.
Treasury Secretary Scott Bessent fired back at China on Wednesday: “If some in the Chinese government want to slow down the global economy through disappointing actions and economic coercion, the Chinese economy will be hurt the most.” Bold words, but economists say both countries will bleed from this fight.
The latest explosion came after China tightened controls on rare earth minerals on October 9. These metals, with names such as holmium and ytterbium, power everything from iPhones to fighter jets – yet, China controls most of the world’s supply, and they’re using that leverage hard.
Markets freaked out immediately. On October 10, when Trump posted his 100% tariff threat on Truth Social, stocks tanked. The Dow dropped 879 points, S&P 500 fell 2.71%, while the Nasdaq crashed 3.56%.
But crypto got absolutely destroyed, and Bitcoin plunged from $121,560 to below $103,000 in just hours – an $18,000 wipeout. More than $19 billion in leveraged crypto positions got liquidated in 24 hours, which is almost 20 times bigger than the COVID crash, which only saw $1.2 billion in liquidations. Even the FTX collapse only triggered $1.6 billion. Traders compared it to getting hit by a nuclear bomb.
The crypto bloodbath has pushed many investors toward alternative platforms. As traditional exchanges struggled with the chaos, traders turned to crypto casinos that offer instant withdrawals. These platforms let you keep control of your Bitcoin without lengthy verification hassles or withdrawal limits – and while markets melt down, such casinos can give you everything from poker to slots, all while keeping transactions anonymous and funds accessible within minutes.
Some industries are getting hammered harder than others, though. Bitcoin miners now pay 57.6% tariffs on Chinese mining equipment and 21.6% on gear from Malaysia, Thailand, and Indonesia. Desperate to beat the tariffs, some miners spent $3 million chartering flights to rush equipment into the country – but despite the pain, no bigger US mining operations have moved overseas yet.
Regular businesses are panicking as well. On April 21, retail CEOs warned Trump that Americans would see empty shelves and higher prices within two weeks. So, with the Christmas shopping season just around the corner, consumers will feel this at the register.
But the scariest part is that America hasn’t seen tariffs this high in almost a century. The average US tariff rate hit 27% earlier this year – the highest since the 1930s. Remember the Smoot-Hawley Tariff Act that helped cause the Great Depression? Well, we’re in that territory now.
Trump and Xi Jinping were supposed to meet in South Korea later this month. Trump threatened to skip it, then classic Trump style, posted “Don’t worry about China, it will all be fine!” Nobody knows what comes next.
The trade war Trump confirmed isn’t just rhetoric anymore. China turned from buying $20 billion in US soybeans per year to zero. But America’s targeting China’s tech sector – and both sides keep raising stakes.
Global trade could shrink 0.2% from these tariffs alone. Developing countries are getting crushed between the two superpowers. November 1 is coming fast, and neither side shows signs of backing down.
Trump wanted a trade war – now, he got one, but everyone’s paying the price.
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