The power to negotiate

Good morning. Don’t worry, the stock market will eventually boom again, according to President Trump and several acolytes. We try to decipher the Greek formula that his tariffs are based on. And after a chaotic week, how about a chilled Chablis. Listen to the day’s top stories.

Move on. Nothing to see here. Yesterday’s rout in global stocks was little more than a blip on the path to a glorious future, Vice President JD Vance told Newsmax. “We’re going to have a booming stock market for a long time because we’re reinvesting in the United States of America,” he said, as GOP politicians were wheeled out to preach the message.

President Trump defended his tariff program, saying it gives the US "great power to negotiate" and that he’d be open to reducing levies if other nations offer something “phenomenal." Canada’s response is unlikely to curry favor with the White House. Foreign Minister Melanie Joly said Canada, currently the biggest buyer of US vehicles, intends to pivot to Europe and Asia to find new markets.

As for the markets today, stocks are heading for another big drop after China announced tariff measures of its own. Give it time, said Trump. Some traders are even wondering whether they should just throw in the towel on trying to predict Trump’s market jolts. As one hedge fund manager, sleeping three hours a night, put it: There’s so much chaos and risk that any trade placed one day can blow up the next.

Trade wars, tariff threats and logistics shocks are upending businesses and spreading volatility. Understand the new order of global commerce with the Supply Lines newsletter.
The next focus for investors, assuming the White House doesn’t make up more trade formulas (see John Authers in Opinion below), comes in the form of jobs data and a speech by Federal Reserve Chair Jerome Powell. Weaker-than-expected payroll numbers will sharpen the debate over when, and by how much, borrowing costs will fall to avoid a potential recession.
In what looks like a departure from normal GOP thinking, Republicans are weighing the creation of a new tax bracket for those earning $1 million or more. For anyone who doesn’t quite make that, maybe it’s time to have another look at where to invest $10,000.

Deep Dive: The Amazon and Wall Street

Brazil plans to launch a $125 billion fund at COP30 (which it’s hosting in November) to protect tropical forests by harnessing Wall Street's financial prowess.

The Big Take

An exclusive look at what Israel’s upgraded air defense system can (and can’t) do holds lessons for the US as it pushes for a missile shield.

Opinion

If trade flows are going to fall, as is more or less inevitable if these tariffs are imposed for any period of time, the risk is that capital flows will have to follow, John Authers writes. That’s bad for the US. And in a Bloomberg Opinion video, Authers explains why the Greek formula that forms the base of Trump’s tariff program is absurd.
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Before You Go

How to enjoy top-rated French wines and get around Trump’s tariffs? Our wine expert recommends Chablis and highlights six top buys, ranging from $38 to $230. The wines—2022s and some 2023s—are in stores now, so no tariffs, and the price is right.

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