U.S. trade policy has entered the great in-between, a liminal state in which high tariffs on major trading partners are ostensibly imminent, yet also forever just over the next horizon.

Why it matters: The good news for American consumers and businesses is that potential price shocks and other disruptions from an all-out global trade war remain at bay — and Wall Street is taking this confusing landscape in stride.

• The bad news is it's hardly the kind of policy landscape conducive to companies making long-term investments.

State of play: With a much-balleyhooed 90-day negotiation period set to expire tomorrow, President Trump issued a slew of letters announcing new tariffs on major trading partners that are close to those originally announced on the April 2 "Liberation Day."

• The most economically consequential are 25% tariffs on imports from Japan and South Korea, major trading partners and traditional geopolitical allies.
• But they are not set to go into effect until Aug. 1, three weeks away.

Driving the news: This morning, Trump insisted that the onset of higher tariffs is real this time, suggesting it's not just a negotiating feint.

• "TARIFFS WILL START BEING PAID ON AUGUST 1, 2025. There has been no change to this date, and there will be no change," he wrote on Truth Social.
• "No extensions will be granted," he added.

Zoom in: Markets have largely shrugged off those threats, betting that Trump envisions further deal-making — and, implicitly, further punting of tariffs — ahead.

• Stock, bond, and currency markets have seen only modest moves on the news, in contrast to their early April sell-off.
• Meanwhile, inflation data came in soft for April and May, contrary to warnings from business leaders and economists that tariff-fueled price spikes and shortages could loom.

Between the lines: The combination of a booming stock market and lack of evident economic damage from the earlier rollout of tariffs seems to have empowered Trump to keep pushing tariff talk, rather than strike quick deals and move on.

What they're saying: These are, as Bob Elliott of Unlimited Funds wrote, "Schrodinger's Tariffs," simultaneously alive and dead.

• The administration "has had room to swing back to a more aggressive policy stance on the trade war because so far the effects are not being felt significantly across the economy," he wrote in his newsletter, Nonconsensus.
• "But a big reason why there has been no impact here is simply because it's taking time to ramp up the prospective tariff collection, and that then is taking time to flow into the real economy given normal lags," Elliott argued.

The fact that negotiations with countries like Japan and South Korea were at such a stalemate that Trump has reignited the trade war is a sign of a new normal.

• "At a very basic level, nothing actually happened based on Trump sending these letters, so there's no reason to panic over headlines," wrote Tobin Marcus at Wolfe Research in a note.
• "But we think these moves do contain some signal about where the trade war is heading, and that signal is mostly hawkish," he added.

By the numbers: If the tariffs announced yesterday go into effect and remain in place, it would translate to a 17.6% average effective tariff rate on U.S. imports, the Yale Budget Lab estimates, the highest since 1934.

• That's up from 15.8% previously and up from 2.4% as of January.
• If sustained, the currently announced tariff regime would translate to a 1.7% rise in consumer prices, costing the average household $2,300 per year, per the Yale Budget Lab.

The bottom line: There is good reason to believe Trump's latest letters to trading partners are a negotiating strategy, but the fact that they exist is a warning sign about the new global trade landscape.

• As long as the economy holds up and markets are copacetic, the trade war isn't going away.