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No, the U.S. doesn’t have a $1 trillion trade deficit with China. What Trump got wrong. - MarketWatch

1. Trump claims U.S. runs $1 trillion trade deficit with China; it's $263 billion. 2. U.S. trade deficit in 2024 totals $918 billion, down from $944 billion in 2022. 3. Tariffs imposed on China remain, affecting stock market value significantly. 4. Manufacturing jobs fell by 20% from 2000 to 2007, impacting U.S. employment. 5. Experts cite transshipping of Chinese goods, but extent remains unclear.

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FAQ

Why Bearish?

The article highlights negative trade dynamics and sustained tariffs, which may impact S&P 500 companies relying on international trade. Historical examples include drops in indices during trade disputes.

How important is it?

The issue of trade deficits and tariffs directly affects investor sentiment and market dynamics, influencing S&P 500 valuations.

Why Short Term?

Immediacy of tariffs and trade deficits can create volatility in the market; historically, stock markets react negatively to trade war news.

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