Trump Tariffs Struck Down By US Courts, ‘Buy Everything’ Says Arthur Hayes

On Wednesday, US Federal court decided to strike down Trump tariffs, right from the “Liberation Day’ last month, citing the overreach of power. The U.S. Court of International Trade further stated that under the economic emergency laws, President Trump lacks the authority to unilaterally impose global tariffs. This might help ease the ongoing trade tensions while allowing the Federal Reserve to boldly make decisions by eliminating uncertainties. Crypto market veteran Arthur Hayes believes that it’s time to ‘buy everything’.

What’s Next As US Court Strikes Down Trump Tariffs?

If the US court upholds its decision on “reciprocal tariffs”, it could have far-reaching implications, such as the refunding of all tariffs collected since April 2. This could amount to $10 billion worth of refunds as per the calculations of 2024 U.S. import levels.

The decision covers the 10% baseline tariff applied to all nations, along with higher rates imposed on specific countries. Notably, China alone shall receive a refund of around $3.5 billion, highlighting the potential economic fallout of the court’s ruling, noted The Kobeissi Letter. All eyes will now be on the EU’s trade agreement with US to avoid the 50% tariff onslaught, as they would be in a better bargaining position after the court decision.

The Trump administration has already announced plans to appeal the decision. This shows that as the legal battle continues, uncertainty in trade tariffs is likely to persist. Veteran economist Peter Schiff had earlier called Trump tariffs ‘illegal’ back in early April, when the trade war escalated to its peak. Reiterating his stand, Schiff wrote:

“Today a court ruled exactly what I said from the beginning: the power to tax lies with Congress, not one man, and tariffs must originate in the House. So if House Republicans want to impose tariffs, let them vote to enact them”.

‘Buy Everything,’ Said Arthur Hayes

At the FOMC meeting, the US Fed stated that it continues to take a ‘cautios approach’ while adjusting to the reality of Trump tariffs. With no interest rate cuts at the moment, the central bank said that it would wait for clarity on the trade tariff matter. Speaking on the development, former BitMEX CEO Arthur Hayes said that this is the second round to “buy everything”, hinting major rally ahead in the market.

Last weekend, Bitcoin price crashed 4% as Trump escalated the tariff war with the European Union, raising it to more than 50%. Following yesterday’s development, BTC still remains down 0.76%, trading at $107,857 levels.

S&P 500, EU Market, and Apple (AAPL) Stock Shoots

The development of Trump tariffs led to an instant surge of 100 points in the S&P 500 futures. Furthermore, the futures of the European indices such as the EU Stoxx 50, FTSE 100, and DAX Index are all up, as per the Barchart data. On the other hand, the Apple stock price also surged 3.5% in the after-market hours.

In order to avoid the 50% tariff scare, the EU has been rushing to reach a trade agreement with the US on an immediate basis. However, it will be interesting to see how negotiations move ahead following the recent development.

US Treasury Yields Surge Despite Trump Tariffs Struck Down

The U.S. Court of International Trade’s decision to strike down tariffs sent ripples through financial markets, with the 10-year Treasury note yield climbing above 4.50% shortly after the announcement.

Despite the upside in stocks and positive shifts in trade policy, Treasury Yields continue to rise regardless. The Kobeissi Letter noted that the climb reflects broader economic factors influencing fixed-income markets, underscoring the resilience of upward pressure on yields.