wall Street is in the midst of a reality check stocks tumbled today giving back most of the gains from Wednesday's historic rally following President Trump's announcement of a 90-day pause on some of his reciprocal tariffs but investors remained rattled as one trade war eases it appears another is just beginning the president singling out China slapping even higher tariffs on those goods economists say that trade war poses a big threat to the economy which won't easily recover from the fallout for more insight I'm joined by Ruter's economist Tom Prussa tom thanks for coming on the show a lot of questions for you folks are watching their retirement accounts their savings their investments yo-yo the market comes back with this historic rally but do consumers have good reason to still be concerned absolutely we've taken a step back from what looked like an absolutely calamitous trade policy uh it still may in fact happen because technically it paused but we need to keep in mind that the 10% across the board tariffs are still in place and that will have a still have a significant effect on the American economy and it's a it's a negative for the American economy in what way i mean are should we still expect to see big uh you know surges in prices for for everyday goods or in in what way will it still hit our wallets oh so first let me say that an acrosstheboard tariff is uh economically far more desirable than these vastly different tariffs on different countries uh that by itself the uh you know 47% on Vietnam but 10% on New England that alone is extremely bad for the economy um but what we should expect is higher prices tariffs of this magnitude somewhat will be absorbed by the exporter and somewhat on the US side by the importer or the retailer but there still will be higher prices i mean the best analogy which I'm sure you've heard is you can think of the tariffs as a sales tax so okay we know that there's a 10% across the board um we're still I suppose um anticipating uh taxes on foreign steel on pharmaceuticals how does that factor in here and how much does that weigh on what happens with with our economy right so steel tariffs are already in place uh 25% across the board and similar for aluminum and there's talk of uh tariffs on pharmaceuticals we're seeing press stories both from European companies and American companies saying that this will be a very disastrous rather than bringing production into the United States it's going to cause the Europeans to be less committed to the United States and it's if nothing else drive up pharmaceutical prices and that's already one of the things that many consumers complain about especially seniors how expensive pharmaceutical products are so let's talk a little bit about um specifically the target that's on China's back right now um the number has been increasing throughout the day today the latest is 145% obviously we get a ton of goods from China um it seems like a game of chicken right now but how do you anticipate this might play out so uh well I I think we're going to continue to see during the first Trump administration uh we had approximately it varied a little bit but approximately 20% tariffs imposed on about 2thirds of the goods we were importing from China at that time trade in those goods have fallen significantly so once we get to the levels that we're talking about 50 60 70% when you mention 100% or 150% on once you get below above a certain level it doesn't matter we're just not going to import from China so that appears to be now the main target although there's a lot of uncertainty about what President Trump still has in mind for a candidate in Mexico remember they were largely outside these uh tariffs that were announced on Liberation Day last week uh so there still remains a lot of uncertainty but Americans should assume uh there's going to be a lot less trade from China and the other thing to Americans should remember is that during the first Trump administration they were very careful not to have the tariffs on China apply to consumer goods they applied on intermediate goods and capital goods so we weren't seeing iPads going up we were seeing iPhones going up televisions the plastic toys that you might be buying your children or grandchildren at Christmas none of those were affected in the previous wave they are affected now and we will see higher prices for those products ruters economist Tom Prussa good to talk to you thanks for helping to put it in perspective you bet [Music]