Sheer folly

Hat tip to Seth Abramson 

Imports are roughly 13% of US GDP.  So this single step will add 3.8% to US inflation.  But because of the huge uncertainty (e.g., the Republicans will prolly face heavy losses in the midterms) the investment needed to build out new capacity to replace imports won't happen.  So there won't be new jobs created.  At the same time, either wages will rise because American business will face less competition, or, wages will not rise, in which case real incomes will plunge, driving down the economy.  And this is before the increased uncertainty of businesses and consumers affects demand.

This will cause an economic crash, which is exactly what the markets are telling us:  stock markets are plunging; bond yields are falling; and commodity prices are in free fall, except for gold, which is in a strong uptrend.

Every month this farrago of stupidity and nonsense continues will deepen this impending crash.  

The worst is that the Fed will be reluctant to cut interest rates in case in validates the jump in inflation expectations.  So there is no policy tool available to offset the crunch.