Bill Ackman Warns Against Launching 'Economic Nuclear War,' Wants A 90-Day Time Out On Trump Tariffs

Listen up, folks! Bill Ackman, the billionaire investor and Trump supporter, just dropped a bombshell. He’s warning that President Trump’s new tariffs could trigger an “economic nuclear war.” Ackman is calling for a 90-day pause on these tariffs to give time for negotiations and avoid a global loss of confidence in the U.S. economy. Let’s break this down and see what it means for you and your investments.

Why Ackman’s Warning Matters

Ackman’s warning is not to be taken lightly. He’s a high-profile supporter of Trump and has been out front during the 2024 campaign. His call for a 90-day pause is a clear signal that even Trump’s biggest backers are worried about the potential fallout from these tariffs.

The Potential Impact of Trump’s Tariffs

Trump’s tariffs are set to take effect on April 9, 2025, and they could have devastating consequences for the global economy. Here’s what you need to know:

- Disruption of Supply Chains: The tariffs will increase the cost of imported goods, which could disrupt supply chains that rely on these imports. For example, the tariffs on steel and aluminum could affect industries that use these materials, such as construction and automotive. The American Apparel and Footwear Association noted that 97% of clothing is imported from overseas, including from Vietnam (46% tariff) and Bangladesh (37% tariff), which could lead to significant price increases for consumers.

- Increased Production Costs: Higher tariffs will increase production costs for businesses that rely on imported materials. This could lead to higher prices for consumers and reduced competitiveness for U.S. companies in the global market. For instance, Bank of America estimates that U.S.-assembled vehicles are set to increase by $3,285 per vehicle due to Trump’s tariffs on vehicles and auto parts, with sales expected to drop by 2.5 million this year.

- Retaliatory Measures: Trading partners may retaliate with their own tariffs, leading to a trade war. China, for example, has already imposed a 34% tariff on American goods in response to Trump's tariffs. This tit-for-tat approach could further disrupt global supply chains and trade networks, leading to reduced trade volumes and economic growth.

- Economic Uncertainty: The tariffs could introduce more market uncertainty, which can lead to fluctuations in the stock market. For example, the S&P 500 and the Nasdaq Composite both declined close to 5% on April 4, 2025, due to fears of a prolonged trade war. This uncertainty could also deter businesses from making long-term investments, leading to slower economic growth.

- Impact on Low-Income Families: Low-income families will be disproportionately affected by the tariffs, as they spend a larger share of their income on essential goods. For example, Gustavo Flores-Macías, a professor of government and public policy at Cornell University, noted that even relatively small price increases will have disproportionate impacts on low-income households.

- Potential for Job Losses: The tariffs could contribute to unemployment or lower incomes down the road. For example, Susan Helper, former senior adviser for industrial strategy at the White House Office of Management and Budget, said that there are some cases where tariffs could raise wages, but this doesn’t look likely to be one of them. She added, "There isn’t enough certainty for businesses to invest and create new and better jobs."

- Long-Term Economic Consequences: The tariffs could lead to a reduction in consumer spending and slower economic growth. For example, the Budget Lab at Yale projects that Trump’s tariffs announced to date will increase U.S. prices by 2.3 percent in the near term—the equivalent to an average consumer loss of $3,800 per household. Households near the bottom of the income distribution will see a decrease in disposable income that is 2.5 times larger than that experienced by those in the top decile.

The Benefits of Ackman’s Proposal

Ackman’s proposal for a 90-day pause has several potential benefits:

- Time for Negotiations: A 90-day pause would provide ample time for negotiations. Ackman states, "The president has an opportunity to call a 90-day time out, negotiate and resolve unfair asymmetric tariff deals, and induce trillions of dollars of new investment in our country." This delay could allow for more constructive dialogue and potentially lead to more favorable trade agreements.

- Preventing Economic Nuclear War: Ackman warns that implementing the tariffs without negotiation could lead to an "economic nuclear war." He explains, "If we go forward with this, markets will crash, consumers will stop spending, and companies will cut investment and jobs." A delay could prevent this catastrophic scenario and allow for a more measured approach to trade policy.

- Maintaining Global Confidence: Ackman emphasizes the importance of maintaining global confidence in the U.S. economy. He notes, "The country is on the verge of losing its reputation as a reliable trade partner and place to invest." A delay could help preserve this confidence and prevent a loss of trust in the U.S. as a stable trading partner.

The Drawbacks of Ackman’s Proposal

However, Ackman’s proposal also has potential drawbacks:

- Uncertainty and Market Volatility: A delay could introduce further uncertainty into the market, potentially leading to increased volatility. As Ackman himself acknowledges, "Business is a confidence game. The president is losing the confidence of business leaders around the globe." This uncertainty could deter investment and harm economic growth.

- Retaliatory Measures: Countries may interpret a delay as a sign of weakness and continue or even escalate retaliatory measures. For example, China has already imposed a 34% tariff on American goods in response to Trump's tariffs. A delay could embolden other countries to take similar actions, further complicating negotiations.

- Economic Impact: The delay could also have immediate economic impacts. For instance, the Budget Lab at Yale projects that Trump’s tariffs announced to date will increase U.S. prices by 2.3 percent in the near term—the equivalent to an average consumer loss of $3,800 per household. A delay could mitigate some of these immediate impacts but could also prolong the uncertainty and potential economic damage.

The Impact on Negotiations

A 90-day pause could provide a window for constructive dialogue and negotiations. Ackman suggests that early dealmakers could receive fairer deals, stating, "I expect Trump will reward the early dealmakers with fairer deals than those that wait to sit down at the negotiating table." This could lead to more balanced and mutually beneficial trade agreements.

However, a delay could also lead to stagnation in negotiations. Countries might use the delay to further entrench their positions, making it harder to reach a compromise. As Ackman warns, "Countries that respond with additional tariffs on our goods will be severely punished." This could lead to a prolonged trade war and further economic damage.

The Impact on the Global Economy

If the delay leads to successful negotiations and the resolution of unfair trade practices, it could pave the way for economic recovery. Ackman notes, "This is a critically important issue that needs to be resolved, and we finally have a president committed to getting this done." Successful negotiations could lead to increased investment and economic growth.

However, if the delay fails to produce meaningful results, it could exacerbate the economic downturn. As Ackman warns, "When markets crash, new investment stops, consumers stop spending money, and businesses have no choice but to curtail investment and fire workers." This could lead to a prolonged economic crisis and further harm to the global economy.

What You Need to Do Now

So, what does all this mean for you? First, stay informed. Keep an eye on the latest developments in trade policy and be prepared to adjust your investment strategies accordingly. Second, diversify your portfolio. Consider investing in sectors that are less likely to be affected by tariffs, such as technology and healthcare. Third, be patient. The market is volatile right now, but with the right strategy, you can weather the storm and come out ahead.

Remember, folks, this is a critically important issue that needs to be resolved. We finally have a president committed to getting this done. But we need to do our part too. Stay informed, stay diversified, and stay patient. And above all, don’t let the market’s volatility scare you away from making smart investment decisions.



So, buckle up, folks! The next few months are going to be a wild ride. But with the right strategy and a little bit of luck, you can come out on top. Stay tuned for more updates, and remember: this is a no-brainer!