WASHINGTON (AP) — The stock market was soaring and the sun was shining when President Donald Trump stepped out of the Oval Office on Wednesday afternoon. Less than two hours earlier, he had retreated from his plans to increase tariffs on many U.S. trading partners, and investors were rejoicing after bracing for a global economic meltdown.
“You’ve got the markets seeing your brilliance,” Sen. John Barrasso, a Republican from Wyoming, told the president.
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Containers with Yang Ming Marine Transport Corporation, a Taiwanese container shipping company, are stacked up at the Port of Los Angeles with the the Long Beach International Gateway Bridge seen in the background on Wednesday, April 9, 2025 in Los Angeles. (AP Photo/Damian Dovarganes)
President Donald Trump speaks after signing an executive order in the Oval Office of the White House Wednesday, April 9, 2025, in Washington, as Treasury Secretary Scott Bessent and Commerce Secretary Howard Lutnick listen. (Pool via AP)
People work on the floor at the New York Stock Exchange in New York, Wednesday, April 9, 2025. (AP Photo/Seth Wenig)
President Donald Trump is displayed on a television on the floor at the New York Stock Exchange in New York, Wednesday, April 9, 2025. (AP Photo/Seth Wenig)
President Donald Trump speaks after signing an executive order in the Oval Office of the White House Wednesday, April 9, 2025, in Washington. (Pool via AP)
U.S. Trade Representative Jamieson Greer testifies during a House Committee on Ways and Means hearing on Capitol Hill, Wednesday, April 9, 2025, in Washington. (AP Photo/Rod Lamkey, Jr.)
Shipping containers are stacked up at the Port of Los Angeles Wednesday, April 9, 2025, in Los Angeles. (AP Photo/Damian Dovarganes)
A crane lifts an imports container from the cargo ship Epaminondas while it is docked at the Port of Baltimore, Wednesday, April 9, 2025, in Baltimore. (AP Photo/Stephanie Scarbrough)
Workers stitch garments at a factory run by the Bangladesh based Urmi Group in Narayanganj, Bangladesh, Tuesday, April 8, 2025. (AP Photo/Mahmud Hossain Opu)
A visitors looks from the Lookout viewing point, in London, Wednesday, April 9, 2025. (AP Photo/Alberto Pezzali)
Export vehicles are parked at Daikoku Pier in Yokohama, near Tokyo, Tuesday, April 8, 2025. (AP Photo/Hiro Komae)
A woman labourer plucks tea leaves in a tea garden on the outskirts of Guwahati, India, Wednesday, April 9, 2025. (AP Photo/Anupam Nath)
Treasury Secretary Scott Bessent and White House press secretary Karoline Leavitt depart after speaking to reporters outside the West Wing of the White House, Wednesday, April 9, 2025, in Washington. (AP Photo/Evan Vucci)
President Donald Trump listens to Jeff Crowe speak during an event on energy production in the East Room of the White House, Tuesday, April 8, 2025, in Washington. (AP Photo/Alex Brandon)
Trump agreed. “Nobody’s ever heard of it,” he declared.
It was a typical bit of hyperbole that, in this case, was true. Even by the standards of Trump’s second term, the saga that had played out over the past week left the world struggling to catch its breath.
The president, of his own doing, had single-handedly pushed the global economy to the brink of chaos with new tariffs. The stock market cratered, businesses tore up their plans and foreign leaders prepared for a future without the world's richest nation at the center of international trade.
And then Trump backed down. Seven days after announcing what would have amounted to America’s largest tax hike since World War II in an elaborate Rose Garden ceremony, he rolled back most of the tariffs in a surprise post on his social media website.
"I think the word would be flexible," he said later despite days of insisting that he wouldn't bend. “You have to be flexible.”
It was unclear what the president had accomplished, beyond the satisfaction of, in his words, having other countries “kissing my ass” to try to talk him out of the tariffs. No new trade deals have been reached, although administration officials said negotiations are underway.
However, real damage has been done. The back-and-forth over tariffs shook confidence in U.S. leadership, exposed fractures within Trump’s team and rattled companies that rely on global sources for products and international customers for sales. Americans who use the stock market to save for retirement and college suffered days of angst.
The turmoil isn’t over yet, either. Trump's 10% blanket tariffs initially imposed on Saturday are now applied to dozens of nations. He also jacked up tariffs to 125% on imports from China, leaving the world bracing for a showdown between the first and second largest economies. There are 25% tariffs on Canada and Mexico, America’s largest trading partners, as well as 25% taxes on imported autos, steel and aluminum.
Other tariffs — including 24% on Japan, 25% on South Korea, 20% on the European Union — are on hold for 90 days to allow for trade talks.
“This just accentuates the policy uncertainty and sense of unreliability Trump is creating,’’ said William Reinsch, a former U.S. trade official now at the Center for Strategic and International Studies. While Reinsch said it’s good news that Trump didn’t move forward with some of his highest tariffs, “how does anybody know that he won’t change his mind on Friday or next week?”
U.S. flags were draped along the White House colonnade for a red-white-and-blue backdrop when Trump announced his tariffs on Wednesday, April 2.
“My fellow Americans, this is Liberation Day,” he said. The president held up a poster listing the tariffs that he would slap on each country — 32% for Thailand, 49% for Cambodia, 26% for India, and on and on. People around the world squinted to decipher the numbers that would reset critical economic relationships.
The day after the announcement, Trump jetted to Florida for the weekend.
“The markets are going to boom, the stock is going to boom, the country is going to boom,” he promised while leaving the White House, the whirring rotors of Marine One sometimes overpowering his voice.
But the market was crashing, posting its biggest single-day loss since the outbreak of the coronavirus pandemic five years earlier. And around the country and the world, the fallout spread over the weekend.
Fulcrum Coffee Roasters in Seattle braced for rising costs for beans from Southeast Asia and espresso machines from Italy. Stellantis, the automaker behind brands like Jeep and Ram, announced it would pause production at plants in Mexico and Canada, leading to temporary layoffs at other facilities in Indiana and Michigan, a reminder of how interconnected vehicle supply chains have become.
The Dutch division of Tata Steel said it would cut 1,600 employees, about a fifth of its workforce. Ireland Prime Minister Michael Martin said “there is no way to sugar coat” the situation as business with the U.S. started tapering off.
The markets were still in a panic on Monday when an unverified report circulated that the president was considering a 90-day pause on the tariffs. Stocks briefly soared before investors realized the information was wrong.
“We’re not looking at that,” Trump said as hopes for the rumored reprieve vanished.
With fears of a recession growing, Republican lawmakers returning to the Capitol for the workweek were peppered with questions about the tariffs and what they would do in response.
Sen. Ron Johnson of Wisconsin was asked on Tuesday if he understood Trump’s strategy, and responded by asking “does anybody?” Some of his state’s premier companies like Kohl’s expected higher costs, while its dairy farms expected to struggle to sell milk and cheese. Harley-Davidson was a target of planned reciprocal tariffs by the European Union.
Sen. Thom Tillis of North Carolina was even more blunt that day during a hearing with Trump’s top trade representative, Jamieson Greer. If the tariff plans don’t work, he said, “I’m just trying to figure out whose throat I need to choke.”
The tariffs on allies like Japan, South Korea and the European Union took effect at 12:01 a.m. on Wednesday, and there were no signs that Trump would back down when the sun came up in Washington.
“BE COOL! Everything is going to work out well,” he posted on Truth Social.
Trump also wrote: “THIS IS A GREAT TIME TO BUY!!!” — advice that turned out to be fortuitous. The president later said he'd been talking with his aides that morning about pausing the tariffs, an announcement that would send the stock market soaring.
Greer was back on Capitol Hill for another hearing when Trump made his announcement.
Rep. Steven Horsford, a Nevada Democrat, asked if Trump's trade representative knew that the tariffs he had just spent at least two hours defending had been paused.
“I understand the decision was made a few minutes ago,” Greer said.
Horsford erupted, saying “this is amateur hour, and it needs to stop.”
At the White House, press secretary Karoline Leavitt scolded reporters for not understanding the president's plans.
“Many of you in the media clearly missed The Art of the Deal,” she said, referencing Trump’s book from 1987. “You clearly failed to see what President Trump is doing here.”
But the administration sent mixed messages even as it rolled back the tariffs.
Treasury Secretary Scott Bessent said the decision had nothing to do with the markets.
“This was driven by the president’s strategy,” he told reporters outside the West Wing. “He and I had a long talk on Sunday, and this was his strategy all along."
Trump himself later contradicted Bessent.
“I was watching the bond market," he said. “That bond market is very tricky.”
Reporting was contributed by Scott Bauer in Madison, Wisconsin, Martha Bellisle in Seattle, Stephen Groves in Washington, Jamey Keaten in Geneva, Bharatha Mallawarachi in Sri Lanka, Brian Melley in London, Molly Quell in Amsterdam and Gary Robertson in Raleigh, North Carolina.
Containers with Yang Ming Marine Transport Corporation, a Taiwanese container shipping company, are stacked up at the Port of Los Angeles with the the Long Beach International Gateway Bridge seen in the background on Wednesday, April 9, 2025 in Los Angeles. (AP Photo/Damian Dovarganes)
President Donald Trump speaks after signing an executive order in the Oval Office of the White House Wednesday, April 9, 2025, in Washington, as Treasury Secretary Scott Bessent and Commerce Secretary Howard Lutnick listen. (Pool via AP)
People work on the floor at the New York Stock Exchange in New York, Wednesday, April 9, 2025. (AP Photo/Seth Wenig)
President Donald Trump is displayed on a television on the floor at the New York Stock Exchange in New York, Wednesday, April 9, 2025. (AP Photo/Seth Wenig)
President Donald Trump speaks after signing an executive order in the Oval Office of the White House Wednesday, April 9, 2025, in Washington. (Pool via AP)
U.S. Trade Representative Jamieson Greer testifies during a House Committee on Ways and Means hearing on Capitol Hill, Wednesday, April 9, 2025, in Washington. (AP Photo/Rod Lamkey, Jr.)
Shipping containers are stacked up at the Port of Los Angeles Wednesday, April 9, 2025, in Los Angeles. (AP Photo/Damian Dovarganes)
A crane lifts an imports container from the cargo ship Epaminondas while it is docked at the Port of Baltimore, Wednesday, April 9, 2025, in Baltimore. (AP Photo/Stephanie Scarbrough)
Workers stitch garments at a factory run by the Bangladesh based Urmi Group in Narayanganj, Bangladesh, Tuesday, April 8, 2025. (AP Photo/Mahmud Hossain Opu)
A visitors looks from the Lookout viewing point, in London, Wednesday, April 9, 2025. (AP Photo/Alberto Pezzali)
Export vehicles are parked at Daikoku Pier in Yokohama, near Tokyo, Tuesday, April 8, 2025. (AP Photo/Hiro Komae)
A woman labourer plucks tea leaves in a tea garden on the outskirts of Guwahati, India, Wednesday, April 9, 2025. (AP Photo/Anupam Nath)
Treasury Secretary Scott Bessent and White House press secretary Karoline Leavitt depart after speaking to reporters outside the West Wing of the White House, Wednesday, April 9, 2025, in Washington. (AP Photo/Evan Vucci)
President Donald Trump listens to Jeff Crowe speak during an event on energy production in the East Room of the White House, Tuesday, April 8, 2025, in Washington. (AP Photo/Alex Brandon)
