Warren Buffet’s controversial take on Trump’s tariffs that MAGA supporters may not like: “they’re an act of war”

The effects of the tariffs imposed by the Trump administration on goods from Canada, Mexico and China are starting to be seen in global stock markets.

The three major stock market indexes in the United States fell following Trump’s announcement that he would proceed to slap 25% tariffs on goods from Canada and Mexico, plus doubling levies from 10% to 20% on all Chinese imports.

On Monday, the NASDAQ was down 2.64% to 18,350.19, the S&P 500 dropped 1.8% to 5,849.72 and the Dow Jones fell 649.67 points, or 1.5% to 43,191.24.

Canada impose tariffs on $107 billion of American goods

Apart from starting a trade war, with Canada and Mexico already threatening reprisal tariffs on US imports, it’s clear that there will be a a knock-on effect further down the line with extra costs passed on to consumers.

One man who is not quite as sure as Trump that heavy import taxes are the right way forward is legendary value investor, the ‘Oracle of Omaha’ Warren Buffett.

“Tariffs are actually — we’ve had a lot of experience with them — they’re an act of war, to some degree‚” Buffett told CBS’ Norah O’Donnell on Sunday. “Over time, they’re attacks on goods. I mean, the Tooth Fairy doesn’t pay ‘em! You always have to ask the question: ’And then what?‘ Prices will be higher 10 years from now, 20 years from now and 30 years from now”.

Buffett refuses to comment on Trump or Musk

Buffett wouldn’t be drawn into giving his thoughts on the current administration or Elon Musk. “Washington is Washington. The problem with politics is that you tend to have to make tiny compromises as you go along,” was all he would offer.

As for the Tesla CEO, Buffet responded, “I’d better not get into that! I’ve spoken to Elon a couple of times...” but that was as far as he would go.

Tariffs, taxes, trade restrictions and embargoes are nothing new and have been going on for centuries but many economists expect Trump’s tariff hike to increase the cost on everyday goods that rely on international supply chains - from electronics to vehicles.

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