Trump's tariffs surge by 100% in retaliation against China's rare earth controls! Full analysis of the new round of trade conflict between China and the U.S.

U.S. President Trump announced a 100% new tariff on Chinese goods and canceled the planned meeting with China's top leader, triggering a new round of U.S.-China trade conflicts. Trump's tariff policy directly targets China's rare earth export controls, causing U.S. stocks to plummet, with the Dow experiencing a big dump of nearly 900 points, putting pressure on the global Supply Chain to reorganize.

Trump's Tariff Policy Three Core Contents

Trump's new tariff policy was officially announced on October 10, targeting retaliatory measures against China's rare earth controls. This tariff measure includes three main points: imposing a 100% tariff on all imported goods from China, implementing export controls on critical software, and canceling the meeting plans with Chinese leaders.

· Trump Tariff Effective Date and Scope

Key Time Node:

November 1: Trump's tariffs officially take effect, covering all Chinese goods.

November 1: The United States implements export controls on "all critical software"

December 1: New regulations on China's rare earth exports officially implemented

End of October: Originally scheduled meeting between Trump and China's top leader during APEC (now canceled)

The trigger for Trump's tariff measures was China's dual decision announced on October 9: to implement export controls on overseas rare earth materials and rare earth technologies, and to require case-by-case approval for logic chips, memory chips, and AI with military applications. Beijing's new regulations adopt a "long-arm jurisdiction" model, requiring permits for any product containing more than 0.1% of Chinese rare earth materials.

Why did China's rare earth restrictions trigger Trump’s tariff retaliation?

China mines about 70% of the world's rare earths and refines 90% of the market share. This rare earth control is like choking the throat of the US military and chip industry, directly impacting the supply chains of tech giants like Nvidia and Apple. Trump's tariff policy is a direct response to this "economic weapon."

Core Regulations on China's Rare Earth Controls:

1. Products containing more than 0.1% of Chinese rare earth materials must apply for permission.

2. Rare earths using Chinese mining and refining technologies are regulated.

3. Companies related to foreign military forces are generally unable to obtain permits.

4. New restrictions on electric vehicle battery manufacturing equipment

Technology stocks were hit hardest that day, with Nvidia's stock price falling nearly 5%, AMD experiencing a big dump of nearly 8%, and the semiconductor sector overall dropping more than 5%. Wall Street reacted strongly to Trump's tariff policy, with the S&P 500 index plunging 2.7%, marking the largest single-day fall since April.

Trump Tariffs and the Escalation Path of the US-China Trade War

In the past six months, the US and China have continued to grapple through non-tariff barriers. Last month, the US Department of Commerce expanded its corporate blacklist, while China launched an antitrust investigation against Qualcomm on October 10 and imposed new fees on American ships docking at Chinese ports. Trump's tariff policy is the latest peak in this confrontation.

Analysis indicates that Trump's tariff measures, although tough, still retain room for maneuver. Trump himself stated that he might withdraw the Trump tariffs before November 1 and has not completely ruled out the possibility of meeting with China's top leader. The Wall Street Journal believes that despite the market turmoil triggered by the Trump tariffs, there remains a critical time window for negotiations between both sides.

· The Chain Reaction of Trump's Tariffs on the Global Economy

Trump's tariff policy not only affects Sino-American bilateral trade but could also disrupt the global AI training data centers, electric vehicle Supply Chain, and semiconductor industry layout. The TikTok transaction is also complicated by new tensions arising from Trump's tariffs, as ByteDance still requires final approval from Beijing to sell its U.S. operations.

Think tank analysts believe that China's rare earth controls may be aimed at accumulating bargaining chips ahead of the Xi-Trump meeting, but they did not expect Trump’s tariff response to be so intense. Experts from the Quincy Institute pointed out that Trump has threatened to 'destroy' bilateral relations at least three times, but each time he ultimately returned to the negotiating table, 'because he knows that the damage China can inflict on the U.S. is no less than what the U.S. can do to China.'

Three Key Observations on the Developments Following Trump Tariffs

Trump's tariff policy highlights the extreme fragility of US-China relations, but there are still solutions to the conflict. Treasury Secretary Mnuchin and Trade Representative Lighthizer are most outraged by China's rare earth controls, with some government members advocating for a "reset" in negotiations with Beijing. The three weeks before the implementation of Trump's tariffs are a critical turning point.

Investors need to pay close attention:

Whether the Trump tariffs will be withdrawn or adjusted before November 1

Is the Xi-Trump meeting being rescheduled?

Will China's rare earth controls be implemented as scheduled on December 1?

The Trump tariff controversy shows that even after months of tariff truces and multiple talks, the mutual trust between the world's two largest economies remains fragile. Trump's tariff policy and China's rare earth controls form a pattern of "mutually assured destruction"; excessive pressure from either side could trigger a global economic chain reaction.