Editor-in-Chief: SHAPOUR-T
Introduction The tariff war launched by Donald Trump during his presidency against China and other major trading partners was far from a fleeting economic episode. These measures triggered a wave of instability across global supply chains, financial markets, industries, and even the international monetary system. Today, years after the beginning of that economic conflict, stock markets, gold, digital currencies, and regional economies continue to experience its ripple effects.
1. Stock Markets vs. the Tariff War: Volatility, Risk, and Opportunity
As the trade war between the U.S. and China began, global stock markets witnessed intense volatility. Indices like the Dow Jones, Nasdaq, and S&P 500 plummeted at times due to escalating tariff announcements or suspended trade talks. Companies deeply reliant on global supply chains and Chinese consumers—such as Apple, Boeing, and major automakers—suffered the most.
In Asia, indices such as Japan’s Nikkei and Hong Kong’s Hang Seng also experienced steep declines. Markets responded dramatically to every piece of trade news, oscillating between optimism and fear.
On the flip side, U.S. domestic-oriented industries, defense contractors, and companies aligned with protectionist policies benefited, reflecting a market split based on trade exposure.
2. Gold: A Safe Haven in an Era of Uncertainty
Gold, the perennial safe-haven asset, gained renewed importance amid the trade war, geopolitical tensions, and global inflation. Each time economic or political tensions escalated, investors fled from riskier assets and poured into gold.
Gold prices, which hovered around $1,200 per ounce in 2018, surged past $1,500 as the trade war intensified and crossed $2,000 during the COVID-19 pandemic in 2020. In 2025, the price of gold has broken the $3,000 threshold, signaling deep and sustained market uncertainty and inflationary pressures.
3. Cryptocurrencies: A Moment to Rise
Digital currencies also benefited from the instability. Investors sought assets outside of government control. Bitcoin, Ethereum, and other cryptocurrencies saw a significant uptick in demand.
Distrust in the U.S. dollar as the sole global reserve currency was a key driver. China accelerated its digital yuan project to reduce dependency on the dollar, incorporating national and alternative cryptocurrencies into international trade platforms.
As a result, crypto assets transitioned from fringe speculation to a strategic financial instrument within the evolving global monetary landscape.
4. Europe: Caught in the Fire of an Unchosen War
The European Union, though not a direct party in the trade war, suffered substantial collateral damage. With significant export dependency on both China and the U.S., Europe faced reduced demand and disrupted supply chains, stalling economic growth.
Trump’s threats against German auto exports to the U.S. added pressure on key brands like Volkswagen, BMW, and Mercedes-Benz. Moreover, trust in the U.S. as a stable trade partner eroded, prompting the EU to consider strategic economic autonomy more seriously.
5. Asia: Realigning Power Structures
Asia, particularly China, was the primary target of Trump’s tariff strategy. China’s growth slowed during certain periods but was cushioned by state support and pivoting exports to alternative markets.
Countries like Vietnam, Indonesia, India, and Thailand capitalized on shifting supply chains, becoming new hubs for manufacturing that had previously been centered in China.
Regionally, Asian nations pursued new trade agreements such as the RCEP (Regional Comprehensive Economic Partnership) to decrease reliance on the U.S. market.
6. South America: Unexpected Opportunities Amid Chaos
Some South American countries, like Argentina and Brazil, found unexpected opportunities in the trade war fallout. When China sought alternatives to U.S. soybean exports, these nations stepped in to fill the gap.
Nevertheless, South America overall still faced challenges: economic slowdowns, commodity price volatility, inflation, and reduced foreign investment reflected the broader global instability.
7. Long-Term Effects: A Reimagined Globalization
Ultimately, Trump’s trade war signaled the end of globalization in its previous form. Governments began redefining their roles in economic strategy. Concepts such as “strategic self-sufficiency,” “smart protectionism,” and “domestic production-first” entered mainstream policy discourse.
This shift, combined with emerging technologies like blockchain, artificial intelligence, and digitalization, is forging a new global economic order—one defined by strategic competition not only over goods and services but over data, currencies, resources, and supply security.
Conclusion
Trump’s trade war was not merely a temporary economic policy—it marked the beginning of a structural transformation in the global economy. Reevaluation of trade systems, volatile financial markets, rising safe-haven assets, booming cryptocurrencies, and regional power realignments are just part of its legacy. The future of global economics is now being shaped in an environment of selective, cautious multilateralism and strategic rivalry.
