Newsom taunts Trump: ‘It’s raining tacos’
Courts Strike Down Trump's Tariffs, Blue States Celebrate Legal Victory
Hey Small Biters,
In a significant legal development, two federal courts have ruled against former President Donald Trump's sweeping tariffs on imports from numerous countries, declaring them unconstitutional. The U.S. Court of International Trade and a D.C. District Court concluded that Trump exceeded his authority under the emergency economic powers granted to him, leading to a temporary halt in the enforcement of these tariffs.
Democratic-led states, including California, Colorado, New York, and Illinois, which had challenged the tariffs due to their economic impact, welcomed the decisions. California Governor Gavin Newsom remarked, "It's raining tacos today," referencing the TACO acronym ("Trump Always Chickens Out") used by Wall Street investors to describe the volatility of Trump's tariff policies.
The court rulings have been seen as a check on presidential overreach, with the judiciary affirming its role in upholding constitutional boundaries. The economic uncertainty caused by the tariffs had led to decreased imports, canceled shipping bookings, and concern at major U.S. ports, particularly affecting states with significant trade activities.
Despite the legal setbacks, the Trump administration has appealed the decisions, and a federal appeals court has temporarily reinstated some tariffs. Industry leaders and officials remain cautious as the long-term effects and future trade policies remain uncertain.
The rulings have also impacted international trade negotiations, with key trading partners such as the EU, Japan, and Canada gaining leverage. These countries plan to continue trade talks, hoping to reduce or eliminate specific industrial tariffs, though concerns persist about potential new sector-specific tariffs authorized under alternative laws.
In response to the court decisions, former President Trump criticized the judges, including one he appointed, and blamed conservative figure Leonard Leo for recommending them. The administration has vowed to pursue tariffs through other legal means and may escalate the issue to the Supreme Court.
The legal challenges and subsequent rulings underscore the ongoing debate over the extent of presidential authority in trade matters. While the executive branch seeks to implement policies it deems necessary for national interests, the judiciary serves as a counterbalance, ensuring adherence to constitutional provisions.
As the situation evolves, businesses and consumers alike are monitoring developments closely, given the potential implications for pricing, supply chains, and international relations. The outcome of the appeals and any subsequent Supreme Court decisions will likely have lasting effects on U.S. trade policy and executive power.
✍️
"In courts where justice holds its sway,
The gavel struck, tariffs held at bay.
States rejoiced, their voices heard,
As laws upheld each written word.""From ports once clogged with goods delayed,
To markets where the prices swayed.
Relief now comes, though battles loom,
In legal halls, decisions bloom.""A balance struck 'twixt power and law,
Ensuring checks without a flaw.
The nation's path, though still unsure,
Finds guidance in the courts' demure."
🧭 A Small Bite to Carry
Federal courts ruled that Trump's tariffs exceeded presidential authority, deeming them unconstitutional.
Democratic-led states celebrated the rulings, citing relief from economic disruptions caused by the tariffs.
The Trump administration has appealed the decisions, with some tariffs temporarily reinstated pending further legal proceedings.
US Stocks
US stocks hang on to some gains on a topsy-turvy day for tariffs
US stocks opened well in the green after a court order Wednesday evening saw many of President Trump’s tariffs blocked. But that wouldn’t stop the president from potentially pursuing other avenues to tax imports, and, by the way, that court order was overruled by another court before the day was out. Whew.
Stocks closed well off their highs, with the S&P 500 up 0.4%, the Nasdaq 100 rising 0.2%, and the Russell 2000 gaining 0.3%.
Communications services was the lone S&P 500 sector ETF to close negative, while real estate, energy, utilities, and healthcare were prominent gainers.
Nvidia’s strong earnings and solid outlook released after the close on Wednesday were key to the index’s gains, with Wall Street excited about improving rack supply and its ability to generate revenues even without being able to access the Chinese market. The chip designer’s impressive results initially buoyed a lot of its peers, but that didn’t last. Most notably, CoreWeave, which was up double digits, completely fell out of bed to close down 9%.
Even though the blocked tariffs that didn’t stay blocked for a full day did not affect auto stocks, carmakers like Stellantis, Nissan, and Toyota put in big gains anyway.
Plane maker Boeing hit a 52-week high after CEO Kelly Ortberg said China would once again accept deliveries.
Best Buy’s earnings had the opposite effect, sending shares sharply lower as sales were lower than anticipated and management trimmed its full-year revenue forecast.
What Else Are We Biting
Hugging Face unveils two new humanoid robots.
Delaware attorney general reportedly hires a bank to evaluate OpenAI’s restructuring plan.
Tesla pleads for Senate to spare its booming energy business.
Biting Fact Of The Day
Just one company (Aamco) accounts for roughly 40% of Saudi Arabia’s GDP.
In a significant legal development, two federal courts have ruled against former President Donald Trump's sweeping tariffs on imports from numerous countries, declaring them unconstitutional. The U.S. Court of International Trade and a D.C. District Court concluded that Trump exceeded his authority under the emergency economic powers granted to him, leading to a temporary halt in the enforcement of these tariffs.
Sadly, the Court of Appeals for the Federal Circuit has consolidated those cases and temporarily stayed those orders.