President Donald Trump is backing away from his hardline tariff threats after being hit with a blunt warning from America’s top retail CEOs: keep going, and stores could run out of products within weeks.
In a private meeting on Monday, the heads of Walmart, Target, and Home Depot told the president that while prices were still stable, the impact of his aggressive trade policies was about to hit fast and hard. According to Axios, they warned him that disrupted supply chains would mean soaring prices and bare shelves.
“This wasn’t about food. But he was told that shelves will be empty,” a source told the outlet.
That message got through.
By Tuesday, Trump had dramatically changed his tone. Speaking to reporters, he said he didn’t want to “play hardball” with China and that he was confident a deal could be made to reduce tariffs. He also backed away from previous threats to fire Federal Reserve Chair Jerome Powell, saying he had “no intention” of doing so.
The shift wasn’t just about shelves. Wall Street was spooked too. After Trump launched verbal attacks on Powell last week, markets tanked. Stocks, bonds, and the dollar all took a hit. Then, as Trump toned it down, things started to stabilize.
Behind the scenes, Treasury Secretary Scott Bessent appears to be pulling Trump away from the brink. While Commerce Secretary Howard Lutnick is pushing for aggressive tariffs, Bessent is reportedly rushing into the Oval Office whenever he can to make the case for a more “market-friendly” approach.
Meanwhile, the International Monetary Fund has issued a stark warning. It said Trump’s economic moves have delivered a “major negative shock” to the global economy. Markets worldwide have been hammered, with trillions wiped off stock values and even U.S. bond markets—normally a safe zone—taking a hit.
Earlier this month, Trump rolled out what he called “Liberation Day,” announcing universal 10 percent tariffs on all goods entering the U.S., with steeper penalties for countries running trade deficits with America. These import taxes are paid by U.S. companies and often passed straight on to consumers.
Other countries, including China, have hit back. China slapped a massive 125 percent tariff on all American products in response, escalating the trade war.
Facing growing fears of a recession—and, worse, a depression—Trump has now agreed to pause new tariffs for 90 days for dozens of countries. But the duties on Chinese goods are still in place.
Publicly, Trump says he isn’t worried about a recession. But privately, he’s rattled. And after getting a reality check from corporate America and the markets, the president appears to be changing course—at least for now.
