A week ago, the world breathed a sigh of relief after the end of an unexpected round of volatility that rocked equity markets. Then came a second shock wave, this time emanating from the mouth of US president Donald Trump. Trump proposed slapping tariffs on the import of steel and aluminium to the US in an effort to protect the domestic industry against alleged "dumping". As Trevor Kincaid wrote for Reuters: "With the stroke of a pen, he could unravel the global trading system, raise prices on basic goods, make American businesses less competitive, drive a wedge between the US and its European allies and open the door for China to construct new national security based trade barriers." Even for Trump, this would represent a new level of policy chaos. It didn’t take economists long to figure out that the ban, while protecting US steel companies, would lead to higher costs being passed on to consumers and threaten more jobs than it set out to protect. Justin Fox, author of The Myth of ...

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