London – President Donald Trump’s trade tariffs are a major concern between the US and international business leaders, with industry titans warning of problems ahead.
Speaking at CNBC’s Live Converge in Singapore, Bridgewater Ray Dalio founder warned of “fighting” between tasks.
“Tariffs will cause fighting between countries … I’m not necessarily talking about the army. But think of us, Canada, Mexico, China … There will be fighting, and that will have consequences,” he said, speaking about Sara Eisen of CNBC on Wednesday.
Trump’s 25% tariffs on aluminum and steel imports came into force Wednesday, with the EU, Australia and Canada between regions and affected countries. US markets have been in the unrest for tasks this week.
Dalio said the current environment is “an extension of history models” – giving Germany in the 1930s as an example.
There was an increase in tariffs to increase revenue and a country’s internal base construction, as well as a written debt at the time, Dalio said. “Be nationalist, be protective, be a militarist. This is the way these things work,” Dalio said. “Issuance is really the confrontation of all this,” he said.
Sale force CEO Marc Benioff described reciprocity between countries as “good” if they treat each other the same way. But he said “what and how” are “very important.” “If you can’t decide what and how in a sustainable, clear and significant way, then you can end up with high levels of instability and conflict,” Benioff said, speaking in converge.
The risk of recession
Alec Kersman, managing director and chief of Asia-Pimco, heralded an increased risk of recession due to tariffs. There is a “perhaps 35% probability” that the US will enter a recession this year, Kersman told CNBC Martin Soong in the Live Converge, from Pimco rating in December 2024 of 15%.
Despite this, Kersman said, the scenario of Pimco’s basic issue is that the US economy will grow 1% to 1.5%, “quite a significant decline” from its previous predictions.
Kersman advised market participants to be “more patient” in terms of investment reprints. “There is a lot of noise in the markets now, and you want to give them three to six months before you do that,” he said. Tariffs will create “more special winners and losers”, and will be added, “The tendency of globalization is being redirected, and there are no more universal laws on how capital will behave”.
Consumer
However, Kamal Bhatia, president and CEO of main asset management said that trade wars caused by tariffs can actually mean that consumers spend more at home.
Most people will underestimate this possible increase in spending due to the focus on the “external effects” on the GDP, Bhatia said in Live Converge. Countries can “turn into being insulating,” he said, leading to patriotism and better growth than expected from the domestic product.
The potential for increasing internal spending was also brought by Alibaba Joe Tsai President. China’s internal consumption “needs an incentive”, thanks to “tariffs and geopolitics”, Tsai said in Converge Live – the average effective US task for Chinese goods is set to reach 33%, according to nomy estimates.
“Look at the Chinese consumer. They are very, very healthy. The family’s balance is very, very strong. You are watching over $ 20 trillion bank deposits from households. So they are staying in the borders they expect to cross,” Tsai said.
Tsai said he is “half -glass full” about Trump’s trade policy. “The Trump administration will want to have more US companies doing business in China,” he said. “Eventually, you know, tariffs are a negotiating tool maybe, but at one point things will get better,” he added.
EU reaction
Europe quickly retaliated against steel and aluminum tariffs, saying it would impose counter-directors on 26 billion euros ($ 28.33 billion) worthy of American goods starting next month. “Tariffs are taxes, they are bad for business and worse for consumers, they are disrupting supply chains, they bring uncertainty to the economy,” European Commission President Ursula der Leyen told reporters during a press conference on Wednesday.
CNBC Balakrishner Amala, Anniek Bao, Katrina Bishop, Holly Ellyatt and Sam Meredith contributed to reporting.