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Trade war u-turn: Why did Trump blink first?

It’s been a hell of a week and 24 hours.

president-donald-trump-looks-at-the-solar-eclipse-at-the-white-house-monday-aug-21-2017-in-washington-ap-photoandrew-harnik Trump famously staring at the solar eclipse in August 2017. Alamy Stock Photo Alamy Stock Photo

WELL, IT HAPPENED.

US President Donald Trump has caved, for now, on his move to completely upend the world’s trading regime after instituting a 90-day ‘pause’ on the new punishing tariffs on most of the world’s economies.

Just five days after saying his policies “will never change”, Trump yesterday conceded that the “medicine” he has administered has made enough people “yippy” to warrant a change of course.

Saying that people “were getting a little bit yippy” was a gross understatement from a man more known for exaggeration, given that it followed a week of global market panic.

So what exactly took place and why did Trump change his mind?

First of all, WTF happened?

Basically, the new tariffs that Trump announced on ‘Liberation Day’ last week and which came into effect yesterday morning will now instead be ‘paused’ for 90 days.

All except for the tariffs on China, which Trump says will continue.

The move was announced by Trump in a post on Truth Social that was dissected and acted upon by traders in the seconds after it was posted.

“I have authorized a 90 day PAUSE, and a substantially lowered Reciprocal Tariff during this period, of 10%,” Trump wrote in a post on his social media site.

Hours earlier, the first sign that something was up came as markets braced for another brutal session.

PastedImage-47374 Truth Social Truth Social

“BE COOL!” Trump urged Americans on Truth Social at 9:37 am in Washington (2.37pm Irish-time) before adding that it was a “GREAT TIME TO BUY!!!”

The post subsequently gave rise to many questioning whether Trump was engaged in insider trading, by encouraging people to buy stocks just before his dramatic reversal on global tariffs.

As Richard Painter, a former chief ethics lawyer for former President George W. Bush, out rather diplomatically put it:

“This is a scenario that could expose the president to accusations that he engaged in market manipulation.”

Others were less generous, with Democratic Congressman Mike Levin saying: “This is market manipulation to help his base profit. How is this legal or OK?”

“Who in the administration knew about Trump’s latest tariff flip flop ahead of time? Did anyone buy or sell stocks, and profit at the public’s expense?” California Democratic Senator Adam Schiff posted on X.

Regardless of the many ethics questions that surround how Trump made the announcement, the consequences were immediate and huge.

After a week in which company stocks traded on exchanges had taken a battering, the rest of yesterday saw stocks climbing to erase many of the losses taken in recent days.

The result was a composite increase in the value of shares on a historic scale.

The main S&P 500 index of leading companies increased by 9.52% yesterday, the third largest daily increase since World War II. The tech-focused Nasdaq rose by 12.2%, its biggest increase since 2001.

Both Apple and Boeing piled on more than 15%t, while Disney, Goldman Sachs and Nike were among the names winning more than 10%.

In summary, the markets were very pleased with the tariff pause.

But Trump and his team had shown little or no concern for the value of companies for the past week, so what was it that prompted yesterday’s change of heart?

The name’s Bonds, Treasury Bonds

Most analysts agree that what forced Trump into a retreat was not the battering company stocks were taking but the impact this was all having on US bond markets.

US government bonds, also known as Treasurys, had been coming increasingly volatile in recent days and a mass sell off could have been catastrophic for the US economy.

The sovereign bond markets are where a country’s debt is traded over a repayment horizon of up to 50 years.

The more risky the debt is seen to be the more its yield may increase and US bond yields jumped in recent days, with the 10-year yield rising above 4.5% before Trump’s announcement.

However, when company stocks are in a downward spiral government bonds tend to look like a safer bet and their yield decreases.

While investors initially flocked to US 10-year Treasurys as the stock market tanked last week and the yield went down, a selloff of bonds in recent days forced it back up, really spooking economists.

Former US Treasury Secretary Larry Summers called it a “highly unusual pattern” that suggested the US could be heading for a “serious financial crisis”.

Ipek Ozkardeskaya, senior analyst at Swissquote Bank, said the “red line” for Trump was a sell off of US government bonds.

“It was the flash sell off of last the couple of days across the US Treasury bonds that made Donald Trump take a step back from his tariffs,” she said.

“He didn’t care about the equity market sell off. He couldn’t care less about the global risk sell off.

He was certainly even happy to see the Chinese assets and crude oil tank but the fire sale of the US Treasuries in a couple of days increased the pressure on Donald Trump to an extent that it apparently became unbearable, even for Trump.

The Art of The Deal

Of course, Trump’s team were on message to claim that the u-turn was nothing to do with market pressure but that it was all part of a plan to bring countries to the table on tariffs.

Current US Treasury Secretary Scott Bessent claimed that Trump’s “strategy” had played out as planned.

“This was his strategy all along, and you might even say that he goaded China into a bad position,” Bessent told reporters at the White House after Trump’s abrupt backtrack.

“Many of you in the media clearly missed the art of the deal,” Press Secretary Karoline Leavitt told reporters.

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    Mute Thomas Meaney
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    Apr 10th 2025, 2:12 PM

    It’s all a game. He’s playing his own game and cares nothing about the consequences for everyone else.

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    Mute thomas molloy
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    Apr 10th 2025, 2:35 PM

    @Thomas Meaney: His concern is for his people’s jobs and industries. We needed someone like him in Ireland when our sugar production industry and jobs were threatened by imports. Our sugar factories are closed and the jobs gone and only the anti enterprise left who also hate Trump are happy.

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    Mute eoin fitzpatrick
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    Apr 10th 2025, 3:04 PM

    @thomas molloy: yes such a crying shame our youth don’t aspire to work in sugar factories after finishing school any more

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    Mute P. J.
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    Apr 10th 2025, 3:20 PM

    @thomas molloy:
    I’ll ask you again Thomas, since you ignored the question the last time.
    If sugar production was such a profitable crop why did 3 separate private companies that tried to restart it all fail?

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    Mute Oweke 68
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    Apr 10th 2025, 3:23 PM

    @thomas molloy: thanks for the laugh and the fantasy story. Trump is looking after 3 things me,myself and I. It’s all about him

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    Mute Gearoid MacEachaidh
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    Apr 10th 2025, 3:27 PM

    @thomas molloy: Hahaha

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    Mute Kevin Dillon
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    Apr 10th 2025, 3:43 PM

    @thomas molloy: trump doesn’t give a rats about the people. A narcissist, sociopath only cares about themselves.

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    Mute thomas molloy
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    Apr 10th 2025, 3:47 PM

    @P. J.: A valid point. If Trump allows car, truck manufacturer and other industries be destroyed it is almost impossible to get them started again. So you understand Trump’s urgency. Enemies of US also know this and hate Trump. Just listen to Pat Kenny and his comrades.

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    Mute Tricia G28
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    Apr 10th 2025, 4:18 PM

    @thomas molloy: This is a truly moronic take.

    Let me quote Derek Thompson of the Atlantic who has a better way of working it than me.

    “A policy to grow U.S. manufacturing in areas core to our national interest would be fine. It might involve public subsidies for new manufacturers; a concerted effort to work with friendly trading partners in Europe, Asia, and North America to expand supply chains; and a clearly communicated set of rules to govern trade for the next generation, to encourage billions of dollars of private-sector investment. It might even look a bit like the CHIPS and Science Act. Passed under President Joe Biden, this law authorized hundreds of billions of dollars for the manufacture of high-end computer chips and other science and tech projects that could be central to U.S. national security, including unmanned aerial vehicles, spacecraft, and quantum computing.

    The Trump plan, however, manages to achieve the opposite of all of these goals, all at once. Rather than build on the CHIPS and Science Act, Trump has called to destroy it. Rather than build a trade alliance with American allies, he kicked off this whole mess by announcing 25 percent tariffs on Mexico and Canada, alongside threats to conquer and annex the latter. Rather than deepen our supply-chain resilience in Europe to build a bulwark against China, he’s slapped tariffs on European countries without consultation or guidance. Rather than increase confidence in financial markets to encourage long-term investment in U.S. manufacturing, he’s unleashed chaos.

    Trump’s policies are burning the very house he intends to save in so many different ways that it’s hard to keep track. “

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    Mute Paul O'Mahoney
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    Apr 10th 2025, 4:59 PM

    @thomas molloy: US cars and trucks are 20% American the rest 80% comes from the world. And this is what the Americans wanted , now it’s gone “tits up” they are whinging . They caused their own problems and the world isn’t willing to bail them out and the selling of the bonds and the debasing of the dollar proves that.

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    Mute Doctors and Engineers
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    Apr 10th 2025, 5:26 PM

    @eoin fitzpatrick: no doubt you’re an alphabet cult pushing member

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    Mute smatrix mantra
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    Apr 10th 2025, 5:40 PM

    @thomas molloy: Hope lobotomy is going well..

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    Mute Mark Gaffney
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    Apr 10th 2025, 5:56 PM

    @thomas molloy: delusional much. Even the vehicles that are stamped as being US made get almost all of their components from other countries. That is the model USA have had for years now. If you can’t see that Trump US just manipulating the market you need a white stick

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    Mute Robert McDonnell
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    Apr 10th 2025, 5:58 PM

    @thomas molloy: nonsense

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    Mute SerotoninWars
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    Apr 10th 2025, 6:29 PM

    @thomas molloy:

    ‘ His concern is for his people’s jobs and industries’

    Ahahahahahaha! Lol!

    Meanwhile in reality…his concern seems to be further enriching the already rich, stamping on the lower tiers by making life even harder for them and making sure the worlds sex preds feel like they have a friend in the White House. Oh and dodging all those pesky legal cases. The presidency is clearly THE dream job if you’re a crook.

    The idea that silver spooned rich kid billionaires are worried about the regular guy and gal is pure comedy. Their only worth is supplying the votes on the way to power and unaccountability. The clue – in case you missed it – is the way he did a complete 180 on making life more affordable for voters. He lied repeatedly on the campaign trail then did what he really wanted once he had power. Sad to watch the con play out, but it was absolutely inevitable.

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    Mute David Harries
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    Apr 10th 2025, 6:49 PM

    @thomas molloy: Seriously

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    Mute Trevor Donoghue
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    Apr 10th 2025, 8:39 PM

    @thomas molloy: He literally just admitted to insider trading on his on social platform today.

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    Mute Gary Kearney
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    Apr 10th 2025, 9:07 PM

    @thomas molloy: those industries outsourced to increase profits. To try and bring all those factories back, to train the staff etc would take years and they couldn’t afford to do that. US workers cost a lot more.
    Pat Kenny is politically right of center, the idea of him having “comrades” is hilarious. The Dalkey cell of the Irish Communist Party

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    Mute Chris Foley
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    Apr 10th 2025, 2:44 PM

    It was the plan all along.. it was just a grift / swindle on a global scale. By announcing the tariffs he caused the stock markets to drop rapidly then posted on his platform yesterday morning that it was a “great time to buy”… and a few hours later announced a pause on the tariffs which caused a market rebound making those who bought lower priced shares a huge amount of money.

    All this was stock market manipulation!!

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    Mute thomas molloy
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    Apr 10th 2025, 3:02 PM

    @Chris Foley: Any trader not keeping an eye on major platforms is asleep or negligent. A public announcement is a PUBLIC announcement. Sorry if you don’t understand modern free market economics.

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    Mute Tricia G28
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    Apr 10th 2025, 4:23 PM

    @Chris Foley: That’s just a by-product.

    It’s a shakedown to other countries but he chickened out when he the Bond Markets practically collapsed.

    “Start a pointless, globe-encompassing trade war, rationalized solely by your own boneheaded innumeracy. Step two: Tank the markets. Step three: Pare the war back to a hot conflict with one of the United States’ most important trading partners and a warm conflict with every other country on Earth. Step four: Watch the market rebound and declare victory. ”

    Who the hell can trust what these lunatics are going to do going forward?

    “What has the country gotten for all of this chaos? Nothing. Trump tarnished the United States’ long-standing trading relationships and boosted the cost of imports, and evidently won zero concessions in return.”

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    Mute Richard Ford
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    Apr 10th 2025, 5:45 PM

    @Tricia G28: . Exactly. Well said.

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    Mute Joe Beirne
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    Apr 10th 2025, 6:51 PM

    @thomas molloy: you really are thick

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    Mute David Glynn
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    Apr 10th 2025, 9:30 PM

    @Tricia G28: Spot on

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    Mute Gerard Smith
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    Apr 11th 2025, 12:35 AM

    @thomas molloy: you clearly have no clue about free market economics or how it works. You also clearly have no understanding of capitalism or why globalism is an unavoidable and necessary result of it, particularly for a Hegemony that has embraced it utterly to the expense of all else. All Trump has succeeded in doing is to further weaken US strength and influence and to further strengthen China’s influence in Asia Pacific. Irrespective of Trump U turns, countries, corporations and investors will look to protect their profits by broadening the markets they do business in and further weaken and dilute US economic dominance. He couldn’t have been more idiotic if he tried.

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    Mute john salmon
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    Apr 11th 2025, 6:03 AM

    @Chris Foley: now is the time for the EU to impose huge tarrifs on the US . We’d see Trump grovelling for a deal in no time as the US can’t afford rising costs on the bond market. Trump by his stupidity has left America exposed to bankruptcy and the EU and the rest of the world should unite and teach the clown a economic and diplomatic lesson.

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    Mute Eddie Garvey
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    Apr 10th 2025, 2:26 PM

    Because A, he was about to blow up US Bonds, B, China retaliating meant he knew he couldn’t take on China and the rest and C, he’s running a country like a business and you can’t do that because people bite back (inflation, pensions etc). As an aside how he is getting away with blatant market manipulation is a clear indication that fundamentally the whole thing is designed to keep the elite….the elite, gangsters.

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    Mute Stanley Marsh
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    Apr 10th 2025, 4:00 PM

    @Eddie Garvey: He gets away with it because he’s sacked everyone in the Securities and Exchange Commission and replaced them with his own cronies.

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    Mute Gerard Smith
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    Apr 11th 2025, 12:42 AM

    @Eddie Garvey: no real business would be or is run like this. He’s not even close to running it like a business

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    Mute John Moylan
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    Apr 15th 2025, 1:01 PM

    @Gerard Smith: well, he just runs it like the other Trump businesses: into the ground. This’ll be his Biggest Bankruptsy Ever. Bigly.

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    Mute Jack Hayes
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    Apr 10th 2025, 2:18 PM

    And all these individual state deals he’s theoretically going to make, 50, 70 countries or what ever he’s imagined … they don’t have the personnel at ports etc. anyway. He remains as deluded and as dishonest as he’s always been. The grift continues…

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    Mute Colm O' Shea
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    Apr 10th 2025, 4:02 PM

    @Jack Hayes: the penguins of Norfolk Island will never do a trade deal with Trump

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    Mute Caroline Urch
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    Apr 10th 2025, 3:44 PM

    Simply because all he wants is to be the centre of attention!! He doesn’t actually care about anything else.

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    Mute Eric Gaffney
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    Apr 10th 2025, 6:28 PM

    @Caroline Urch: grow up for phucks sake.

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    Mute Andrew Harrington
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    Apr 10th 2025, 8:21 PM

    @Eric Gaffney: Trump is a narcissist. They have to be the centre of attention.

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    Mute Housing Hunger Games
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    Apr 10th 2025, 2:28 PM

    Bottler

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    Mute Bomber
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    Apr 10th 2025, 2:45 PM

    Trump is afraid that penguins might retaliate of his senseless tariffs.

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    Mute ray murphy
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    Apr 20th 2025, 11:08 AM

    @Bomber: why do we have tariffs and USA none I can buy a pair of levies in NY for 35$ , same jeans here 90 euro ?

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    Mute michael powell
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    Apr 10th 2025, 5:12 PM

    Stock market scam for him and his buddies.

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    Mute Thomas Sheridan
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    Apr 10th 2025, 5:19 PM

    @michael powell: Talking of scams, no mention of our Travelling cultural ambassador who is arrested in NY for $1 million fraud in a buildings repair racket

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    Mute Louis Jacob
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    Apr 10th 2025, 3:23 PM

    Does this mean I can continue exporting fentanyl to the US for the next 3 months?

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    Mute Anthony Ross
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    Apr 10th 2025, 6:37 PM

    Insider trading he should be in jail

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    Mute Derek Moran
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    Apr 10th 2025, 4:47 PM

    It reminds me of a nutjob stabbing you, then putting a plaster on you and saying how wonderful he is.

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    Mute Del Ray
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    Apr 10th 2025, 6:27 PM

    The damage is done. Liquidation Day has become Liquidation Quarter. 90 days gives investors time to ditch American shares, bonds etc in an orderly fashion. Canada / Japan / EU / UK a better bet for investment now. All open to trade. All stable. When best to liquidate and where to go – the big question for every investor now. Good luck to Irish pension funds!

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    Mute thomas molloy
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    Apr 10th 2025, 2:25 PM

    So rather than thank Trump for forbearance the =+-=+-=S want to wallow in another negative bunker.

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    Mute DJ Bermo
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    Apr 10th 2025, 2:33 PM

    @thomas molloy: so in your world, you “thank” the bully when they “pause” beating you up? Interesting take on matters.

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    Mute Paul O'Mahoney
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    Apr 10th 2025, 4:49 PM

    @thomas molloy: That’s hilarious he had coal miners in the White house either Monday or Tuesday saying the tariffs were ” 2bn a day” and he was going to use that money to create more coal mines and jobs. And this was before the majority of the tariffs had come into force.

    So what now for the coal workers or indeed any blue collar worker in the US? You mentioned Hyundai in another post and they will be producing ” low carbon steel and aluminium ” and the plant will be almost fully automated and run 100% electricity…..I suppose the steel workers of America will rejoice but their skills probably won’t be needed.

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    Mute Gary Kearney
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    Apr 10th 2025, 9:10 PM

    @Paul O’Mahoney: he had the car makers unions in as well. While they were in the WH. Their employer announced shutdowns due to the tariffs on Canada and Mexico.

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    Mute Del Ray
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    Apr 10th 2025, 7:04 PM

    As US stocks liquidate and investment flows elsewhere, the dollar will drop. Hence eventually it will become possible to manufacture in the US and export – foreign buyers will have stronger currencies. The end of US hegemony.

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    Mute ian
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    Apr 10th 2025, 5:33 PM

    The fool managed to decimate my pension

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    Mute Maurice Byrne
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    Apr 10th 2025, 6:55 PM

    He didn’t blink. Trump planned stock market crash with ridiculous tarrifs. He and business buddies buy the deprecated stock shares at bargain price. Trump abandons tariffs for 90 days, the market responds instantly, “all right lads sell your recently bought shares as quick as possible”

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    Mute Johnny King
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    Apr 10th 2025, 9:27 PM

    Remember last time when he was in and the media reported on his every move and action? Yeah, 4 years of utter nonsense fear talk from the media
    Oh but this time it’s different is it???
    No it’s not.Dont worry about the nonsense because feck all will change.
    It’s just the media stoking the small fires once more.Enjoy the great weather,enjoy your life.Cheers.

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    Mute Tim Brennan
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    Apr 10th 2025, 6:45 PM

    The

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