$3.2 billion: Market gains for bug-out bags

29: Turnips to be substituted into average American’s weekly diet

1 in 3: Americans currently screaming “SELL! SELL!” into cell phone

9: Quantity of eggs 401(k) worth now

1, 2, 3, 4: Numbers chanted by Trump before saying, “I declare a trade war!”

5: Days until you have to start making own soap

80%: Increase in Oliver Twist adaptations set in present day

48: Hours Youngstown, OH has been given to get a thriving banana industry up and running

U.S. President Donald Trump has long been of two minds about the dollar. He has said he wants it weaker to make American products cheaper in global markets, but he has also said he wants it strong so it remains the world’s dominant reserve currency.

Those two objectives never made sense together. And now, as his tariff war threatens the U.S. economy, we’re seeing reality bite. Trump is getting the weakness he wants. The dollar has fallen 5 percent against other major currencies since his inauguration in January. But the strength he promised is nowhere to be seen.

Last year, one of Trump’s key advisors, Stephen Miran, imagined a so-called Mar-a-Lago Accord in which the United States would essentially require its trading partners to help bring down the dollar’s value. That would have been, the theory goes, engineering a devaluation from a position of strength.

Instead, the dollar is falling because of perceptions of American weakness. Investors are worried that in the short run, the trade war will cause a recession in the United States, and that in the long run, loss of confidence in the United States will jeopardize the dollar’s role at the center of global commerce. “The blowback of U.S. tariffs onto the U.S. domestic economy leaves the dollar naked,” Chris Turner, ING’s global head of markets, wrote in a client note.

Trump is right that a strong dollar is a mixed blessing. By making imports cheaper and exports more expensive, it hurts workers in businesses that compete in global markets. Trump has vowed to reverse what he calls the hollowing out of the American economy, and bringing down the dollar is, along with tariffs, a key part of his platform. (...)

Then there’s the perennial question of whether Americans or foreigners will bear the cost of the Trump tariffs. On paper, the tariffs are paid at the point of importation, but that doesn’t answer the question of who ultimately bears their cost. Bessent thinks he knows. Echoing his boss, he told CBS News in early March that China “will eat any tariffs that go on.”

But that all depends on which side has market power, economists say. If a Chinese producer feels it must swallow the cost of the tariff to retain its American customers, then it will bear the full cost of the tariff. That’s Bessent’s scenario. On the other hand, if the Chinese producer can get away with pushing the cost of tariffs onto its customers, then the final price will go up by the amount of the tariff, and Americans will bear their full cost.

The reality is most likely somewhere between those extremes. China and other exporters didn’t “eat” the tariffs the last time Trump was president. Americans did. “U.S. tariffs continue to be almost entirely borne by U.S. firms and consumers,” the economists Mary Amiti, Stephen J. Redding, and David E. Weinstein found in a 2020 article about the tariffs imposed in 2018 and 2019.

Many mainstream economists agree that tariffs can be legitimate tools in certain circumstances. For example, the World Trade Organization allows countries to levy tariffs to protect themselves from unfair practices by trading partners, such as subsidies. Some economists also defend tariffs that protect “infant industries”—ones that need to be sheltered from competition as they get going. (...)