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Summary:The White House announces a 40% tariff on all Burmese products entering the United States starting August 1, 2025, directed at Min Aung Hlaing, Chairman of the State Administrative Council of Myanmar, citing persistent trade deficits and barriers as a major threat to the US economy and national security, with the possibility of no tariffs if manufacturing shifts to the US, and a warning of increased tariffs if Myanmar retaliates.
Sentiment:Directive
Key Claims:
  • The United States will impose a 40% tariff on all products from Myanmar entering the US, effective August 1, 2025.
  • This tariff is a response to a significant and persistent trade deficit caused by Myanmar's tariffs, non-tariff policies, and trade barriers.
  • The trade deficit with Myanmar is considered a major threat to the US Economy and National Security.
  • No tariffs will be applied if Myanmar or companies within Myanmar choose to build or manufacture products within the United States.
  • Any tariffs Myanmar decides to impose will be added onto the 40% tariff charged by the United States.
Potential Market Impact (S&P 500):2/10

The announcement of a 40% tariff on all products from Myanmar, a specific country, and the linkage of trade deficits to national security could signal an aggressive protectionist trade policy stance. While Myanmar is not a major global trading partner for the United States, the precedent of such high tariffs and the explicit warning against reciprocal actions could create uncertainty regarding future trade relations with other countries. However, the direct impact on the S&P 500 from tariffs on a single, relatively smaller economy would likely be limited, unless this is perceived as a precursor to broader trade conflicts involving larger economies.

Potential Geopolitical Risk:3/10

The post describes the trade deficit as a "major threat to our Economy and, indeed, our National Security," which elevates an economic dispute to a matter of strategic concern. The imposition of significant tariffs and a warning against reciprocal actions represent a strong diplomatic and economic challenge that could strain bilateral relations between the United States and Myanmar. However, it does not directly involve military threats or ultimatums that would immediately escalate to international conflict.

Potential Global Cross-Asset Impact:2/10
  • Commodities: Gold (XAU) might experience a minor uptick as a safe-haven if the strong trade rhetoric is perceived to indicate broader global trade tensions. Oil (WTI) impact is minimal unless Myanmar is linked to major supply disruptions. Short-Term Watchlist: XAU/USD price action. Medium-Term Focus: Broader trade policy trends from the United States.
  • Currencies (Forex): The US Dollar Index (DXY) could see a slight firming as the US asserts a strong trade stance, but significant moves are unlikely. Pairs like USDJPY, EURUSD, and USDCNH might show minor reactions based on general risk appetite if the news is interpreted as a shift towards more protectionist policies. Short-Term Watchlist: DXY reaction to trade rhetoric. Medium-Term Focus: US trade policy and its implications for global trade flows.
  • Global Equities: Direct impact on S&P 500, Nasdaq, and European indices like STOXX 600 is expected to be negligible due to Myanmar's limited direct economic ties. However, Asian equities, particularly those with exposure to Myanmar or similar trade dynamics with the US, might experience some localized volatility. Short-Term Watchlist: Asian market open, especially Southeast Asian indices. Medium-Term Focus: Potential for trade policy shifts affecting other, larger economies.
  • Fixed Income (Bonds): US 10Y and 2Y yields are unlikely to see significant movements from this specific announcement. A very slight flight to safety could occur if the "national security" framing elevates broader risk perception, potentially leading to marginal yield compression. Credit spreads are not expected to be significantly affected. Short-Term Watchlist: UST 10Y yield levels for minor shifts. Medium-Term Focus: Overall macroeconomic policy uncertainty.
  • Volatility / Derivatives: The VIX is unlikely to experience a significant spike. A modest increase could be observed if the rhetoric contributes to a general sense of trade policy uncertainty. Options positioning is not expected to be greatly impacted by this specific event. Short-Term Watchlist: VIX levels for marginal changes. Medium-Term Focus: Broader volatility regimes influenced by macro policy.
  • Crypto / Digital Assets: Bitcoin (BTC) and other digital assets are unlikely to show a strong direct correlation or significant impact from this specific trade policy announcement. Their movements would largely follow broader macro liquidity and risk sentiment trends. Short-Term Watchlist: BTC/USD for general market correlation. Medium-Term Focus: Regulatory news impacting digital assets, overall macro liquidity.
  • Cross-Asset Correlations and Systemic Risk: No significant systemic risk or breakdown in normal cross-asset correlations is anticipated from this specific trade measure against Myanmar. The impact is too localized. Short-Term Watchlist: No immediate watch for systemic stress. Medium-Term Focus: Broader trade policy escalation.
  • Retail Sentiment / Market Psychology: Unlikely to directly trigger widespread retail speculation or a significant shift in market psychology. The specific nature of the tariffs against Myanmar is not typically a driver for broad retail interest. Short-Term Watchlist: No specific immediate watch for retail-driven market movements. Medium-Term Focus: General sentiment towards trade policy.
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