US Inflation Starting to Stir as Trump Tariff Threat Looms

To Vince Golle and Craig Stirling, Bloomberg News:

Kindly explain why you say in your article that the PCE Index increased in March 2025 by 0.1, which is true but it is also a two months old piece of data,

while you disregard the recent economic data for April 2025 that show a DROP of 0.5 in the PCE Index.
Unhappily, this entirely invalidates the premise of your article as portrayed in its title:

www.forexfactory.com

On the face of it, this may indicate a nefarious intention to erroneously portray the state of the national economy in a bad light just to criticize president Trump's action.

You may even hold it as a given that president Trump's tariffs may or MUST cause a damage to the US national economy.

If you have a better explanation for your article, please advise.

For my part, I regret that for decades we have known the situation in the international trade and did nothing about it until president Trump's second term.

You must understand that when BMW was imported into the US for decades with a tariff of 2.5% (and it was cheaper in New York than in Munich where it was made - been there, seen that) whereas the tariff on Chevrolet, not a luxury car by any means, imported into Germany or Japan has been 10% to 15% PLUS 15% to 25% of VAT, then there was something wrong. (The German tariff on American pickups is 22% plus VAT.)

As a European visitor told me here: "Americans have more money so they can pay!"

The wrong was in the fact that such American foreign trade policy favored foreign car manufacturers and foreign labor at the expense of the American car manufacturers, the American labor and the American national economy.

In addition, this faulty foreign trade policy has created for decades the astronomical trade deficit with other major countries of the world and the balance of payments that has been according to most economists unsustainable.
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A note: I do understand that we want to import goods that are either (a) cheaper than the domestically produced goods or (b) that are cheaper by virtue of the international pricing including transportation.

The good example is the domestic oil production and the oil export and import. The United States is the lagest producer of oil in the world, larger than Saudi Arabia, producing over 20 million barrels a day. While we consume slighly less than that but still over 20 million barrels a day, we export about half of our daily production and import an equal amount simply due to the vagaries of the international pricing of oil.

This only shows how complicated the world economy is. Thus, it is improper to claim that president Trump will
damage the US national economy by reducing imports via tariffs.
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I would like you to understand that president Trump's tariffs are designed to lower the dollar volume of imports to achieve the following goals, while the president Xi's dire warnings of severe shortages of goods in the United States have been highly exaggerated:

- Lower the dollar amount of imports, as we said above
- Reduce the trade deficit with major industrialized countries to uphold the American national economy and the currency and to change the balance of payments with these countries
- Replace parts of the imports with the domestically manufactured goods to benefit the American manufacturers and the American labor
- Increase the Federal revenue by the income from tariffs to (a) lower the income tax rates, (b) to eliminate the income tax on Social Security to benefit seniors, (c) to eliminate income tax on tips to benefit hourly workers in the restaurant and hospitality industry and (d) the eliminate the income tax on overtime over 40 hours a week also to benefit American workers.

In addition, president Trump is using the tariffs as a negotiating tool. It is therefore also entirely improper to accuse president Trump of blundering when he withdraws a specific tariff or puts a time-limited moratorium on its execution.

It is incumbent upon you as the writers for a major business media both to understand the purpose of president Trump's tariffs and to understand the science of economics in general.

Instead, we get a steady barrage of one-sided, uninformed articles expressing the unfounded fears, as contradicted by readily available economic data, that president Trump's tariffs are damaging the American and world economy and that president Trump "started an unprecedented trade war" for no reason whatsoever. All such articles appear in the media without considering or even knowing the facts of the matter described above.

It does not help that some of your colleagues in the media can obtain today a Doctorate in "journalism" by studying courses (I checked) such as "Internet and You" and "How to Understand Science" without actually studying any science or economics. Instead of helping the public to understand these difficult subjects, they pontificate freely on these subjects and are guided mostly by their political proclivities, an opposition to and a distaste for president Trump and even by their political bias.

Kindly contact me by email or at the telephone number below if you find that I remain off base on some of these issues. I will be glad to correct my views.

With kind regards,

Ivan Orisek, M.Sc. (Eng.)

Annual inflation rate year to year is 2.3% as of this morning
Month to month inflation rate is 0.2% (2.4% annualized)

We may want to ask those who claim that president Trump has caused the inflation (please see also the "forecast") by "trying to crash the national economy" and "starting the unprecedented trade war:" Where is the inflation?

IO
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See www.forexfactory.com, Tuesday, 5/13/2025

Try learning how to read MAGAt.

"In March, the so-called core consumer price index inched up just 0.1%."

https://www.forexfactory.com/calendar/79-us-core-cpi-mm