The Lighthizer Effect #

As investors, economists, and world leaders assess the potential of Donald Trump securing another presidential term, a major question arises: how will global trade be affected? Recently, Trump announced plans to introduce the ‘Trump reciprocal trade act,’ aiming to impose tariffs on the European Union for allegedly not purchasing sufficient American-made goods. Trade has emerged as a pivotal election issue, with criticism from Democrats regarding Trump’s impact on blue-collar voters. Despite this, could his threats of increased tariffs signal future policies?

A key figure to watch is Robert Lighthizer, who previously served as Trump’s top trade official and significantly influenced the administration’s aggressive tariff strategies. Lighthizer, known for his background as a formidable trade lawyer, might be considered for positions such as Treasury or commerce secretary. He has also hinted at the possibility of early tariff implementations if Trump is re-elected.

This potential for new tariffs has increased anxiety among investors about a revived trade war. Businesses are preparing for possible impacts. Columbia Sportswear’s CEO indicated plans to raise prices due to increased tariff-related costs. Meanwhile, Airbus, the European aircraft manufacturer, is also bracing for potential heightened U.S. levies.