'Economic nuclear winter' ahead if US doesn't axe tariffs, Trump-backing billionaire warns as markets plunge again
7 April 2025, 10:18
The world is heading for an "economic nuclear winter" if Donald Trump doesn't reverse his tariffs, a billionaire who supports the president has said, as markets continued to plummet on Monday.
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Hedge fund manager Bill Ackman called on Trump to pause and fix the tariff system, which he branded "unfair".
"Alternatively, we are heading for a self-induced, economic nuclear winter, and we should start hunkering down," he warned.
Trump announced the tariffs last week, prompting warnings of retaliation and a trade war - and the markets were plunged into turmoil.
The chaos continued on Monday in Asia and Europe, with the US expected to follow suit again when the markets open. The FTSE 100, the UK's benchmark stock index, fell 2.64% as it opened.
The news followed plunging stock markets plunged overnight in Asia. Investors are braced for further sharp falls in New York later.
Trump appeared to double down on his tariffs despite the market turmoil, declaring "sometimes you've got to take the medicine".
Financial commentators labelled the fiscal landscape a "bloodbath".
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The implementation of Trump's tariffs comes as the president branded a member of the press "stupid" aboard Air Force One for suggesting he might consider a major U-turn if markets don't respond.
Japan's Nikkei was down more than 8 per cent upon opening - a trend that follows more than $6 trillion being wiped off the US economy in recent days since Trump's tariffs announcement.
The Singapore benchmark index fell 6.8 per cent overnight, Australia's S&P/ASX 200 fell more than 6 per cent, and South Korea's Kospi plummeted 4.4 per cent.
Meanwhile, the US stock market continued to weaken into Monday, with the S&P 500 losing a further 4.2 per cent, the Dow Jones Industrial Average falling 3.5 per cent and the future for the Nasdaq lost 5.3 per cent.
Trump continued to back his tariffs move on Monday, despite a growing number of companies stopping exports to the US - the latest being UK car giant Land Rover.
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The bold move by the British car manufacturer comes as the Prime Minister is set to announce changes designed to help British car manufacturers later today.
Sir Keir Starmer is expected to bring back the ban on the sale of new petrol and diesel cars from 2030.
The PM is also expected to relax rules linked to fines for manufacturers who do not selling enough electric vehicles.
Speaking late on Sunday, the US President confirmed he had spoken to European and Asian leaders over the weekend in relation to the tariffs.
International nations have been attempting to convince Trump to lower what are fundamentally reciprocal tariffs in a bid to maintain exports to the US.
"I spoke to a lot of leaders, European, Asian, from all over the world," Mr Trump said.
"They're dying to make a deal. And I said, we're not going to have deficits with your country. We're not going to do that because to me, a deficit is a loss. We're going to have surpluses or, at worst, going to be breaking even."
The PM confirmed on Monday that the 2030 phase-out date for new petrol and diesel car sales, with hybrid vehicles allowed to be sold until 2035.
Small manufacturers will be exempt from the mandate, and firms will be given more flexibility in how they meet the target, reducing pressure on the industry.
To support this transition, the government says it is investing £2.3 billion to boost the manufacturing of zero-emission vehicles and help working people make the switch to electric cars.
Starmer said new era means we must go "further and faster" in the bid to spur growth.
Richard Holden, the Conservatives' Shadow Paymaster General, said the government should be trying to get a trade deal "as quickly as practically possible."
He told LBC News' Vanessa Baffoe: "I wish that the Labour government had already started those negotiations as soon as President Trump was elected. In fact, they didn't do that.
"And Sir Keir Starmer said he didn't even have any conversations properly about it until he went to the White House literally last month. They wasted months and months and months when we could be having negotiations. And why did that happen? That's because Labour politicians have been going around for party political reasons having a go constantly at President Trump, calling him and his team every name under the sun."
