Trump's 'Punitive' Tariffs Could Lead To US Job Losses, Warns Former Envoy: 'We’re In For A Bit Of Bad News In The Near Term' Trump's 'Punitive' Tariffs Could Lead To U.S. Job Losses, Warns Former Ambassador. 'We’re in for a bit of bad news in the near te - General Motors (NYSE:GM), Cleveland-Cliffs (NYSE:CLF)

Frank Lavin, the former U.S. envoy to Singapore, cautioned that the tariffs imposed by President Donald Trump are “Punitive” and could result in job losses in the U.S.

What Happened: Lavin, in his conversation on CNBC’s “Street Signs Asia,” highlighted that the tariffs are not just symbolic but will “cost jobs” in the U.S. He further pointed out that the auto industry could face significant negative impacts.

"We're in for a bit of bad news in the near term."

Moreover, as Trump pledges a “reciprocal” approach to tariffs, Lavin stated that global trade will decline, making it challenging for other nations to respond effectively. Lavin also expressed concerns that the tariffs could create inefficiencies in the economy and drive up inflation, which might prompt the U.S. Federal Reserve to delay rate cuts.

Why It Matters: President Trump’s push for tariffs has already started impacting the financial markets. Mirroring Lavin’s opinion, Former Treasury Secretary Larry Summers warned that the proposed tariffs would lead to "fewer American jobs, more American inflation, and probably a bigger trade deficit," questioning potential national security benefits from tariffing allies.

Additionally, the Economic Policy Institute stated U.S. exporters will not only lose international markets, but the decline in exports will lead to a surge in the domestic supply of their goods, driving prices down and ultimately lowering corporate profits.

Meanwhile, Wharton finance professor Jeremy Siegel, in a podcast, forecasted that the stock market’s response would be entirely contingent on the duration of the tariffs. "As long as these tariffs are in effect and are not lowered, it's very hard to see the stock market going up,” stated Siegel.

Yesterday, the shares of U.S. automakers like General Motors GM and Lucid Motors LCID lost close to 2% amid concerns over a rise in production costs due to the tariffs on metal imports. However, the announcement had a positive impact on the U.S. steelmakers. Cleveland-Cliffs CLF surged over 17%, while Nucor NUE climbed 5.5% at the market close yesterday.