Why Did Trump Exempt China-made iPhones from Tariffs? | Vantage with Palki Sharma | N18G

So, Trump is putting caveats on his trade war. Or the question is why? After all the bravado, why is he backpedaling now? Mainly because of two reasons. The first is America's dependency on China. And the second is public backlash. We look at both these factors. Electronics is the biggest category of U.S. imports from China. Your smartphones, your laptops and computers. These make up 20% of the total imports from China. Imagine a 145% tariff on this trade. It would have made electronics unaffordable for Americans. Just consider the iPhone. The 16 Pro Max sells for $1,200. The tariffs would have increased that price by a lot to almost $2,150 per phone. And why is that? Because China assembles almost 90% of all phones. It is basically a monopoly. Same with computers. China makes 81% of laptops and personal computers. So if you tariff China, all of this becomes more expensive. A lot more expensive. American tech companies would have raised the price of their products. We're talking about a visible and sharp hike here. And Trump cannot afford that right now. Which is the second reason. Around 56% of Americans disapprove of Trump's handling of the economy. That's seven points up from last month. Clearly, this is a tariff effect. The White House is trying to spin it as a masterstroke, but ordinary people are not buying it. They can see the wild swings in the stock market. They can see the public U-turns of their president. And they can also see prices rising. Perhaps this is what prompted Trump to exempt certain goods. He has not explained why he did it. He simply attributed the exemptions to obvious reasons. 10% is a floor, Mr. President? Pretty close, yeah. It could be a couple of exemptions for obvious reasons, but I would say 10% is a floor. Could we see more such exemptions? Well, it's certainly possible. Trump's exemptions only apply to the 145% rate. His fentanyl tariffs still apply on Chinese electronics, and that's around 20%. You won't see this impact immediately. Most companies will have stock lying around. For example, Apple has inventory for almost six weeks. But what happens after that? After that, prices will increase. And that is when Trump will face a reckoning. He was elected on the promise of lowering prices. If the opposite happens, expect a backlash. And that's just the start. The tariffs could hurt the economy beyond inflation. Top banks are predicting a recession in 2025, in this year. Billionaire Ray Dalio is predicting something worse than a recession. Now, Dalio, as you would know, is a head fund manager. He founded Bridgewater Associates in 1975. Today, it manages around $92 billion in assets. And Dalio feels something bad is coming, something worse than a recession, as he put it. What would that be? A breakdown of the current global order. He feels emerging powers will bring down the post-World War system, and this would create major conflicts. Basically, a breakdown in global relations. I know it sounds far-fetched, but Ray Dalio has a knack for these kind of things. He predicted the recession of 2008. And this time, he says, the U.S. is very close to another one. All of this will build pressure on Donald Trump. His tariffs were supposed to shock the world into action, but that may not be possible anymore. For starters, the shock effect is almost gone. These exemptions show that Trump is also worried. He's concerned about the blowback on U.S. companies and consumers. Rest assured, other countries will capitalize on this. Secondly, there's a lot of confusion. We are seeing conflicting messages from Washington. Last week, the White House was pushing for iPhones made in America. Listen to this. But iPhones specifically, is that something that he thinks is the kind of technology that can move to the U.S.? Absolutely. He believes we have the labor, we have the workforce, we have the resources to do it. And as you know, Apple has invested $500 billion here in the United States, so if Apple didn't think the United States could do it, they probably wouldn't have put up that big chunk of change. Well, then why exempt tariffs on them? Why stick with Chinese-made iPhones? All this confusion will weaken Trump's position. It gives the impression that there is no method to this madness, that Trump is simply going with the flow. I'm afraid such a strategy does not qualify as the art of the deal. Greeting you with aloha and namaste. I love India. The presence, occupation of a territory by another country pertains to India, what we saw in Kashmir. How do you see Trump's America? Yes, the current administration behaves differently from the previous administration. Are you saying that there are foreign powers who are trying to bring down the current government in Syria? Exactly. Prime Minister Modi committed to a South-South cooperation. Is Ukraine prepared to pay the price for that peace? No compromises at the cost of territorial integrity and sovereignty.