CNBC, Thursday:

Stocks plummeted Thursday, sending the S&P 500 back into correction territory for its biggest one-day loss since 2020, after President Donald Trump unveiled sweeping tariffs, raising the risk of a global trade war that plunges the economy into a recession.

A recession would be an unfortunate but necessary step on the way to all-out depression.

The broad market index dropped 4.84% and settled at 5,396.52, posting its worst day since June 2020. The Dow Jones Industrial Average tumbled 1,679.39 points, or 3.98%, to close at 40,545.93 and mark its worst session since June 2020. The Nasdaq Composite plummeted 5.97% and ended at 16,550.61, registering its biggest decline since March 2020. The slide across equities was broad, with more than 400 of the S&P 500′s constituents posting losses.

China, one of the hardest hit, retaliated, as expected, leading to even steeper declines in the market today. Since Trump’s announcement, the major indices have nosedived:

• DJIA: -9.26% (-3,910.46 points)
• Nasdaq: -11.44% (-2,013.26 points)
• S&P 500: -10.53% (-596.89 points)

That’s not a month, or a year. It’s two days.

Apple, the company I follow the closest, got walloped Wednesday after the tariffs were announced, plunging over 9% in after-hours trading. As of Friday’s close, they’re down over 16% since Wednesday, and off over 27% from its Boxing Day high.

These tariffs are being described, wrongly, as “reciprocal”—Trump said “That means they do it to us, and we do it to them”—yet are being imposed on places that have no tariffs on the US, or even little to no trade with the US at all.

Mike Masnick writes in a fantastic piece for Techdirt, headlined “Trump Declares A Trade War On Uninhabited Islands, US Military, And Economic Logic”:

This is the core problem with Trump’s “Liberation Day” trade policy: it fundamentally misunderstands what trade deficits are. And if you think that’s bad, just wait until we get to the part where this policy declares economic war on penguins and our own military base.

The policy, unveiled yesterday afternoon, is called a “reciprocal tariff plan,” which is a bit like calling a hammer a “reciprocal pillow.” The premise is that since other countries have high tariffs on us (they don’t), we should have high tariffs on them (we shouldn’t). But that’s not even the weird part.

At the heart of this policy is a chart. Not just any chart, but what might be the most creative work of economic fiction since, well, Donald Trump launched his memecoin. Trump proudly displayed these numbers at a White House event, explaining that they showed the tariffs other countries impose on the US. He emphasized repeatedly that the US was being more than “fair” because our reciprocal tariffs would be less than what other countries were charging us.

There was just one small problem: none of the numbers were real tariff rates. Not even close. Vietnam, according to the chart, imposes a 90% tariff on US goods. This would be shocking news to Vietnam, which does no such thing.

It’s hard to imagine that a man who’s gone bankrupt six times—with casinos!—would lack such a fundamental grasp of basic economic principles.

James Surowiecki (former financial writer for The New Yorker, author of The Wisdom of Crowds) is credited as the first to crack the administration’s math:

Just figured out where these fake tariff rates come from. They didn’t actually calculate tariff rates + non-tariff barriers, as they say they did. Instead, for every country, they just took our trade deficit with that country and divided it by the country’s exports to us.

So we have a $17.9 billion trade deficit with Indonesia. Its exports to us are $28 billion. $17.9/$28 = 64%, which Trump claims is the tariff rate Indonesia charges us. What extraordinary nonsense this is.

The White House tries to dress this up with fancy math symbols and academic citations, but if you follow the numbers, it pencils out just as Surowiecki surmised: deficit divided by exports, which has nothing to do with what a country is “charging” us for our goods.

It gets worse. Dominic Preston, at The Verge:

A number of X users have realized that if you ask ChatGPT, Gemini, Claude, or Grok for an “easy” way to solve trade deficits and put the US on “an even playing field”, they’ll give you a version of this “deficit divided by exports” formula with remarkable consistency. The Verge tested this with the phrasing used in those posts, as well as a question based more closely on the government’s language, asking chatbots for “an easy way for the US to calculate tariffs that should be imposed on other countries to balance bilateral trade deficits between the US and each of its trading partners, with the goal of driving bilateral trade deficits to zero.” All four platforms gave us the same fundamental suggestion.

These politically preposterous, mathematically farcical tariffs, which have already tanked the nation’s 401(k)s, are poised to do even greater damage: 

J.P. Morgan on Monday had predicted that the probability of a recession stood at 40 percent, citing “heightened trade policy uncertainty” as “weighing on sentiment.”

A day after Trump announced the reciprocal tariffs, J.P. Morgan predicted the probably [sic] of a recession now stands at 60 percent.

Wiping out trillions of dollars of individual and corporate wealth is an acceptable outcome though, because it’s a useful negotiating tactic:

“The tariffs give us great power to negotiate,” Trump said, adding that “every country has called us.”

“If somebody said that we’re going to give you something that’s so phenomenal, as long as they’re giving us something that’s good,” Trump said.

No doubt many companies are also seeking remedy. By levying these punitive taxes against countries crucial to the bottom line of many American businesses, Trump can offer “relief” by demanding compliance or payment.

Apple, for example, has certainly reached out to the administration in hopes of an exemption, as it faces prices so high it threatens sales of their flagship iPhones. The $1 million Tim Cook “personally” donated to Trump, and the $500 billion US investment Apple announced was clearly insufficient. What will Trump demand of Apple next?

It seems remarkably like extortion and bullying.

On “Truth” Social, Trump blathers on about another aspect of these tariffs:

TO THE MANY INVESTORS COMING INTO THE UNITED STATES AND INVESTING MASSIVE AMOUNTS OF MONEY, MY POLICIES WILL NEVER CHANGE. THIS IS A GREAT TIME TO GET RICH, RICHER THAN EVER BEFORE!!!

He just can’t help himself, he must make sure his grift is transparently obvious to everyone: I’m destroying the American and global economy so we can all be filthier rich.

How many of his people sold the stock market short the last few days? How many are salivating at snatching up stocks at a massive discount?

Meanwhile, the retirement savings of millions of Americans have been decimated.