China fired back in the trade war with the US, and Wall Street took the first hit. The Dow dropped 617 points after China announced it was hiking tariffs on $60 billion worth of imported American goods. More than 4,000 US goods are targeted. 

Most of them now carry tariffs of 25% -- up from 10% when they were first levied last September. These new tariffs are in retaliation for hikes on $200 billion worth of Chinese goods, announced last week. 

The Trump administration hopes this economic brinkmanship will force the Chinese into cutting a trade deal, but there's no guarantee that's going to happen. China's tariffs will also hit US farmers especially hard, and some farmers are getting nervous. They have a message for President Trump: "This can't go on."

For all the panic about China’s rising global influence, we should all just settle down a bit, China’s ambitions involve regional territorial claims with historical precedent, he writes—not world domination. Its military doesn’t threaten America, and it remains surrounded by competitors, like South Korea and Japan, that will naturally contain it. China’s influence will grow, and that will pose some problems, but the US shouldn’t treat China as an “enemy,” Bandow argues; doing so would only turn it into one.

Well,  now it’s getting real. The Trump administration raised tariffs on $200 billion worth of Chinese imports just after midnight. The tariffs went from 10% to 25%. China promised it will hit back. US and Chinese negotiators will resume trade talks later today in Washington. US consumers haven't really felt the bite of tariffs so far, but that could change with this round because these expanded tariffs could result in a 25% tax on almost everything else the US imports from China. So that means your shoes, toys and iPhones could become more expensive. 

They could all get more expensive if President Donald Trump follows through on his threat to expand tariffs on Chinese imports to include an additional $325 billion in goods left out last year. 

The administration is already moving ahead with plans to hike existing tariffs starting Friday on industrial components and other goods, from 10% to 25% — a warning shot to Beijing amid ongoing negotiations toward a comprehensive trade agreement. 

Most consumer electronics, toys and shoes have so far been shielded, a strategic move that made the trade war almost invisible to American shoppers.   But Trump is running out of goods to tax, and the expanded tariffs he threatened over the weekend could result in a 25% tax on almost everything else the US imports from China.

That would hit 100% of the toys and sports equipment imported from China to the United States, as well as 93% of the footwear and 91% of textiles and clothing, according to an analysis by the Peterson Institute for International Economics. 

One business group estimates the 25% tariff on apparel imports alone would cost a family of four an extra $500 a year.

Hong Kong (CNN Business)The United States has escalated its trade war with China, hiking tariffs on $200 billion worth of Chinese exports hours after trade talks held in Washington failed to produce a breakthroughTariffs on the targeted exports increased from 10% to 25% at 12:01 a.m. ET on Friday, prompting a swift rebuke from Beijing.

The Chinese government expressed “deep regret over the development" and pledged to take "necessary countermeasures."  "We hope the United States will meet us halfway, and work with us to resolve existing issues through cooperation and consultation," China's Ministry of Commerce said in a statement. The ministry did not give specifics on how it would respond.Liu He, China's vice premier, arrives at the Office of the U.S. Trade Representative in Washington on Thursday.

The Trump administration's decision to impose new taxes on Chinese exports comes after the United States accused China of backtracking on commitments made during recent negotiations on trade.   Trump has repeatedly slammed China for indulging in what he says are unfair trade practices, particularly with regards to access to its giant market, intellectual property and technology transfers.   The talks are aimed at settling the dispute, which has hurt Chinese exporters, damaged some US companies and slowed global growth since it began last July.

China overplayed its hand with T-RUMP on trade, and it could cost them dearly  A Chinese delegation led by the country's top trade negotiator, Vice Premier Liu He, arrived in Washington on Thursday for the latest round of discussions. 

Under the current circumstances, Liu said he "hopes to engage in rational and candid exchanges with the US side," according to China's state news agency. Liu added that raising tariffs is not a solution to the problems.   T-RUMP said hours before talks began on Thursday that he had just received an upbeat letter from his Chinese counterpart, Xi Jinping, suggesting a deal was still attainable.   "It's possible to do it," Trump said when asked about the prospect of an agreement that would prevent a tariff hike on Chinese goods. "I have no idea what's going to happen."