Peter Schiff Slams Trump's EU Tariff Threat as a Market Manipulation Tactic

Economist Peter Schiff has slammed U.S. President Donald Trump's recent threat to impose a 50% tariff on European Union imports, labeling it a tactic for market manipulation that benefits insiders.

Economist Peter Schiff slammed U.S. President Donald Trump’s recent threat to impose a 50% tariff on European Union imports as a tactic for market manipulation that benefits insiders.

According to Schiff, the new tariff proposal, which would see Americans effectively paying more for imports from China, allows insiders to “trade before the tariffs are called off with a fake win.”

The economist, who has on occasion been critical of Trump’s tariff policies, made the remarks shortly after the U.S. president issued the threat on his social media platform on Monday.

In the post, Trump was seen to be continuing his argument that the EU was created to take advantage of the United States on trade. According to the U.S. President, the tariffs are expected to become effective on June 1.

The European Union is stiphling trade with the U.S., and they have no intention of changing their ways. They prefer to continue ripping off America with their Smart tariffs and dumping products in the U.S. at record rates. As a result, the U.S. trade deficit with the EU is fast spiraling out of control. To counter this imbalance and protect American jobs and industries, the U.S. will have no choice but to increase the tariffs on EU goods to 50% on June 1. It’s time for the EU to wake up and start treating the U.S. fairly in our trade dealings. Otherwise, the consequences will be severe. #TradeWar #Economy

— Donald J. Trump (@realDonaldJTrump) May 23, 2023

On April 10, just hours before he announced a 90-day pause on reciprocal tariffs imposed on U.S. trading partners, Trump told his Truth Social followers, “This is a great time to buy!!! DJT.”

The post sparked immediate controversy, which intensified after Trump’s suspension of tariffs ignited a rally that wiped out most of the post-Liberation Day losses. Some Democrats in the U.S. Congress have since demanded an insider trading investigation over Trump’s tariff pause.

However, Schiff, who is known for his skepticism of the mainstream financial narrative, argued that Trump’s actions are not surprising given his history of touting stock picks and boasting about market movements.

The economist, who is also a staunch critic of the Federal Reserve’s monetary policies, further claimed that Trump’s interest in personally benefitting from market fluctuations is a common occurrence among those in positions of power.

According to Schiff, those "in the know" can use their inside information to make trades that will benefit them financially before the broader market becomes aware of the news, which will generate a "fake win" as the tariffs are called off and prices adjust accordingly.

Schiff dismissed suggestions that Trump’s latest tariff threat is a “bold” negotiating tactic ultimately intended to protect U.S. industries and jobs. Instead, he pointed to America’s tariff war with China, from which the U.S. “got nothing,” as evidence supporting his argument that Trump’s threats are nothing more than “political theater.”

The macroeconomic impact of Trump’s latest threat was almost immediate, with key U.S. indexes, including the Dow Jones Industrial Average and S&P 500, sustaining steep drops. In the cryptocurrency market, Bitcoin (BTC) dropped by 2.6%.