Welcome to the Euro Intelligence Podcast. I'm Wolfgang Munchau and with me are Susanna Monshank and Jack Smith.

Today we want to talk about the tariffs, what they will do to our economies and how we should react to them.

This is Wednesday, the 9th of April, is the day number one when the new tariffs on China have been implemented.

It's a 104% tariff on Chinese industrial goods, slightly lower tariffs for cheaper goods.

It's a massive escalation in the trade.

Well, fast escalation.

The Chinese implemented a 34% tariff only on the weekend, and Trump is already

not only announced a tariff, but implemented another 304% within a day or two. Today, Wednesday,

the European Commission is also expected to endorse a package of retaliatory measures.

So the world is heading into what one might call a trade war, characterized by tit-for-tat sanctions

and tariffs.

The economic implications are very serious.

We saw over the last few days, very serious disturbances in the global bond markets,

the 10-year treasury bond, went up by almost 60 basis points from its low point.

It reached in early April, early just a few days ago, to now about 4.5% as we speak for the yield

on the 10-year.

These are massive distortions happening in such

as short period time. It's not a level thing because when Trump came to power in January,

the bond yields were much higher. They were over 4.7, 4.7 to 4.8% territory. So they're actually

still lower than they were back then. But what matters in these

situations always is the speed of change. And the speed of change in the last few days would suggest to me

that there must be some level of financial stress. There must be panic selling going on in some

...