04/15/25 Afternoon CommStock Report – Expect “Anything Other” than Capitulation from China

The Yale Budget Lab put out their numbers for how much the tariffs would cost an American household at the tariff rates that existed last Friday to be $4700. They also explain that the cost will not be that high because high tariffs will destroy demand and consumers will find alternatives or go without. They do not have $4700. This would be crazy inflation prompting the Fed to increase rather than reduce interest rates. China did not respond to the last US tariff rate hike to 145%, calling the tariff rate escalation a “joke”. What they meant by that is that after tariffs get so high, orders are canceled and business collapses. Beijing put out a White Paper which stated that by their estimation that when the tariff rate bests 54%, it becomes irrelevant as the exchange of business stops.   The Chinese White Paper asserted: “With tariffs at 54%, most models – including our own – have exports to the U.S. falling almost to zero,” they said in a research note. They calculated the total damage from the 2025 tariffs to be roughly 2.2 percentage points off in GDP. A large hit but one that Beijing is capable of offsetting. Rory Green,…