Trump's point of no return

Caveat One: Trump might not the bumbling egoistical educationally sub-normal maniac we are told to think he is, he might be an all-seeing, all-knowing genius whose only aim is free trade and world peace and who can predict his opponents’ moves several moves in advance.

Caveat Two: Countries don’t trade with countries; individuals and businesses in Country A buy stuff from, and sell stuff to, individuals and businesses in Country B. But for short-hand, let’s accept that Country A trades with Country B.
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OK, here goes, from the BBC:

US President Donald Trump has issued a strong warning to anyone trading with Iran, following his re-imposition of sanctions on the country.

“Anyone doing business with Iran will NOT be doing business with the United States,” the president tweeted.

If a large country or trading bloc imposes sanctions on a smaller country, then the loss, in absolute terms is probably the same for each side, but the larger country/bloc only loses 1% of its GDP and the smaller country loses 10%. So the larger country/bloc should ultimately ‘win’.

So if the choice is between trading with the USA or trading with Iran, most countries would prefer to trade with the USA. But the USA has imposed sanctions on Cuba, Iran, North Korea, Russia, Sudan, Syria, and Venezuela and imposed fairly hefty tariffs on certain imports, especially those from PR China. By extension, any country – if not already the victim of the USA’s import tariffs – that trades freely with those countries ends up itself on the USA’s naughty list.

Surely, there must come a stage at which so many countries are on the naughty list, that they form a trade bloc which is actually larger than the USA, so third countries can benefit by turning their backs on the USA and freeing up trade between themselves and ‘everybody else’, thus accelerating the long term fall in USA’s GDP as a percentage of global GDP?

Unlikely to happen, but theoretically possible.