The tariff wars begin

[Rideback]

Christianne Amanpour interviews Canada's trade minister
https://www.youtube.com/watch?v=z3rIlAITjXk

[PAL]

https://www.commondreams.org/news/trump ... ng-economy

[mister_coffee]

So again this is just abusive drama to freak everyone out. And tank the stock market.

I wonder who was short-selling into this?

[Rideback]

Likely all goods covered under the USMCA agreement will be exempted
https://bsky.app/profile/muellershewrot ... qj4uuouk2q

[just-jim]

.
From’Occupy Democrats’….

Canadian Prime Minister Justin Trudeau unleashes a historic speech scorching Donald Trump's idiocy over his disastrous new tariffs: "This is a very dumb thing to do."

This is what an actual world leader sounds like...
"The United States launched a trade war against Canada, their closest partner and ally, their closest friend. At the same time, they're talking about working positively with Russia, appeasing Vladimir Putin, a lying murderous dictator," began Trudeau.
"Make that make sense."
Trump's 25% tariffs on Canada and Mexico took effect today and the markets are in free fall. The Dow Jones Industrial Average has already plummeted 662 points after plunging 650 points on Monday. The S&P 500 lost 1.3% and the Nasdaq Composite lost 0.9%
The gullible fools who thought that Trump would be "good for the economy" have had the rug pulled out from under them in record time.
"Canadians are reasonable and we are polite," Trudeau continued. "But we will not back down from a fight, not when our country and the well-being of everyone in it is at stake. At the moment, the U.S. tariffs came into effect in the early hours of this morning and so did the Canadian response."
"Canada will be implementing 25% tariffs against $155 billion worth of American goods starting with tariffs on $30 billion worth of goods immediately and tariffs on the remaining $125 billion of American products in twenty-one days time," said Trudeau. "Our tariffs will remain in place until the U.S. tariffs are withdrawn and not a moment sooner."
"And should these tariffs not cease, we are in active and ongoing discussions with provinces and territories to pursue several non-tariff measures, measures which will demonstrate that there are no winners in a trade war," he threatened.
"Now just like I did a month ago, I want to speak first directly to the American people. We don't want this," said Trudeau. "We want to work with you as a friend and ally and we don't want to see you hurt either."
"But your government has chosen to do this to you," he stated bluntly. "As of this morning, markets are down and inflation is set to rise dramatically all across your country."
"Your government has chosen to put American jobs at risk at the thousands of workplaces that succeed because of materials from Canada or because of consumers in Canada or both," he went on.
"They've chosen to raise costs for American consumers on everyday essential items like groceries and gas, on major purchases like cars and homes, and everything in between," he continued.
"They've chosen to harm American national security, impeding access to the abundant critical minerals, energy, building materials, and fertilizers that we have and that the United States needs to grow and prosper," he explained.
"They've chosen to launch a trade war that will first and foremost harm American families. They've chosen to sabotage their own agenda that was supposed to usher in a new 'Golden Age' for the United States," said Trudeau, taking a direct shot at MAGA's latest inane rhetoric.
"And they've chosen to undermine the incredible work that we've done together to tackle the scourge that is fentanyl, a drug that must be wiped from the face of the Earth," he added. "So on that point, let me be crystal clear. There is absolutely no justification or need whatsoever for these tariffs today."
Trudeau then shifted gears to go after Donald Trump directly, the clueless mastermind behind this entire disaster—
"Now I want to speak directly to one specific American: Donald. In the over eight years you and I have worked together, we've done big things," said Trudeau, appealing to Trump's ego.
"We signed a historic deal that has created record jobs and growth in both of our countries. We've done big things together on the world stage as Canada and the U.S. have done together for decades, for generations," he continued. "And now we should be working together to ensure even greater prosperity for North Americans in a very uncertain and challenging world."
"Now, it's not in my habit to agree with The Wall Street Journal but Donald, they point out that even though you're a very smart guy this is a very dumb thing to do. We two friends fighting is exactly what our opponents around the world want to see," said Trudeau.
"And now to my fellow Canadians: I won't sugarcoat it. This is going to be tough even though we're all going to pull together because that's what we do," he added. "We will use every tool at our disposal so Canadian workers and businesses can weather this storm."
Canadians are lucky to have someone like Trudeau steering the ship of state through the geopolitical waters of Hurricane Donald. The Canadian Prime Minister is sane, thoughtful, and well-intentioned, all of the things that Trump is not.
The worst part about this economic nosedive is that it's absolutely pointless and completely avoidable. Trump's demands make absolutely no sense. He's just trying to look tough to appease his MAGA base and dragging all of us along for the ride.
Buckle up. The Trump economy might soon be the worst in American history.
.

[Rideback]

Andrew Coyne today, Globe and Mail. March 4, 2025
“What he wants is to see a total collapse of the Canadian economy, because that will make it easier to annex us.”
After all the pretexts, after all the fake grievances – migrants, fentanyl, trade deficits, banks – there is no longer any doubt. After months of attempting to mollify Donald Trump, only to be struck by the same 25-per-cent, across-the-board tariff first announced in November, the Prime Minister at last saw no reason not to lay out the reality of our situation in the starkest possible terms.
The President of the United States is trying to destroy us.
This is not a trade war. Mr. Trump does not have any legitimate issue he wishes to raise with us, using the tariff to impress upon us how serious he is. It is not a negotiation, in which each side brings something to the table it is willing to trade for something else. But neither can it even be dignified as extortion. The tariff is not intended to extract concessions from us. If it were, we would have heard some sort of concrete demand from him by now. It is intended, purely and simply, to harm us.
And it will not end here. More tariffs are coming, on our steel, on our lumber, plus a “reciprocal” tariff designed to punish us for the crime of collecting a national value-added tax, the GST. That pretext is as baseless as the rest: the GST does not discriminate against imports, but applies equally to all goods and services sold in Canada, domestic or foreign. Again, there is no demand here, or none that could possibly be met. The point is not to force us to the negotiating table. The point is to break us.
As ever, it is necessary to step out of conventional modes of analysis, to wrap our minds around the full insanity of Mr. Trump’s ambitions. Sucker-punching your nearest neighbour and closest trading partner, even as you are cozying up to Vladimir Putin’s Russia, may not seem to make any sense, until you recall that Mr. Trump has been attacking every other democracy in sight, from Ukraine to Europe to Taiwan.
At which point the penny drops: he sides with the expansionist dictatorships because he agrees with them – because he aims to establish one himself. When he talks about invading Greenland or seizing the Panama Canal – or using “economic force” to annex Canada – he means it.
The good news is that the weapons of economic warfare are, by their nature, mutually punitive. Mr. Trump’s tariffs may hurt our exporters, but they will hurt American consumers, workers and businesses just as much. That’s particularly true in a tightly integrated continental economy such as ours, where parts might move back and forth across the border half a dozen times en route to making the finished product.
Sticking a spoke in the wheels of trade, as Mr. Trump has now done, can only result in higher prices, stalled production lines, broken supply chains, and lost jobs – in America, not just in Canada. Just the threat alone seems already to have spooked investors: not only are stock markets cratering, but the Atlanta Federal Reserve projects that first-quarter GDP in the U.S. will fall by 2.8 per cent annualized.
Of course, the retaliatory measures Canada has announced will do much the same to our consumers and workers. So be it. If this were an ordinary trade war, a spat over this product or that industry, that might be seen as needlessly escalatory.
But this is something quite different. The tariff fight has to be seen in the context of the larger struggle, which – if it were not clear before, it should be crystal-clear now – is existential.
Whatever harm we do to the Americans will probably be only a fraction of the harm they do to themselves. But what is essential at this moment is the demonstration effect: to show that we are unafraid, our resolve is ironclad, and we are willing to pay whatever price we must to preserve our independence.
That cannot, however, be the end of it. Fending off Mr. Trump’s advances may be the immediate imperative. But we must be no less vigilant to reduce our exposure to such attacks in future – by making our investment climate so attractive that businesses will want to locate here, notwithstanding the Trump tariffs; by increasing our productivity enough to offset the efficiency losses from such unwarranted restrictions on trade; by diversifying our trade as much as possible, in favour of more reliable partners.
In time, perhaps, the Americans will come to their senses. But the damage is done. Mr. Trump will never realize his dream of annexation. He has, however, succeeded in destroying the trust between our two nations, probably permanently.

[Rideback]

Trump delays tariffs on auto manuf for a month. I'm sure they appreciate the 'get on it' response he gave them.
https://www.cnn.com/2025/03/05/business ... 1202870600

[Rideback]

Jay Kuo:
'It was a perfect encapsulation of the chaos that Trump has wrought. As he announced yesterday that he was going to proceed with 25 percent tariffs against Canada and Mexico and hike another 10 percent on China, a widget on the Fox Network showed the Dow Jones crashing in response.

By the end of the day, the Dow had erased over 800 points as investors braced for economic impact. Then last night, Trump rolled the dice, allowing the new tariffs to go into place, citing a failure by our trading partners to control the flow of fentanyl.
That was a red herring, of course. Trump wants something to point to in order to demonize our biggest trading partners. Now American consumers will suffer. And U.S. exporters also are about to see tens of billions in retaliatory tariffs. The pain will likely only grow from there.
**The impact on consumers
Unless Trump reverses himself, expect prices to rise on pretty much everything. China, Canada and Mexico provide most of the manufactured goods, raw materials and agricultural products imported by U.S. companies. Cars, cell phones, computers, tequila, fresh vegetables and fruit, gasoline—nearly everything we buy will see an impact, on top of the already high price of eggs.
Across-the-board tariffs means importers will either need to absorb those extra costs or pass them along to consumers in the form of higher prices. And as the cost of imported products rise, it will be tempting for U.S. companies to raise domestic prices as well in order to take advantage of the surge in inflation and pad their profits.
At least, that’s how most economic experts see it. Not so the White House. In February, Trump acknowledged that his new tariffs could cause “some pain” but insisted our trading partners, and not U.S. consumers, would bear the brunt of it. Similarly, Trump’s top trade advisor, Peter Navarro, who recently went to prison for refusing to testify before Congress about January 6, claimed on Monday that inflation from tariffs would be “second-order small.”
The U.S. imports over $900 billion annually from Canada and Mexico, so it’s hard to see how a 25 percent hike would only produce small amounts of inflation. Indeed, most economists and studies show that the effect will be noticeable and widespread.
“Because of the combination of these three countries, it’s going to be difficult to go down an aisle of a grocery store and not see some sort of inflationary effect,” Jason Miller, a professor of supply chain management at Michigan State University, told the New York Times.
**The impact on exporters and manufacturers
There’s a flip side to U.S. tariffs: our partners’ retaliatory ones.
China, Canada and Mexico have all been preparing for the possibility that Trump would do just this, though they tried hard to dissuade him from this course, including expending considerable energy, with notable success, in reducing fentanyl flows across the border.
For Canada, this is particularly frustrating because it doesn’t really have a fentanyl border smuggling problem to begin with. As the Times reported,
Just 19 kilograms of fentanyl were intercepted last year at the Canada-U.S. border, compared with almost 9,600 kilograms at the border with Mexico, according to U.S. Customs and Border Protection. And an investigation by The Globe and Mail, a newspaper in Toronto, found that the Canadian figure was inflated by the inclusion of seizures that were not related to the border.
Prime Minister Justin Trudeau said in a statement,
“Today, after a 30-day pause, the United States administration has decided to proceed with imposing 25 per cent tariffs on Canadian exports and 10 per cent tariffs on Canadian energy. Let me be unequivocally clear – there is no justification for these actions.”
He went on to lay out what Canada planned in response.
Should American tariffs come into effect tonight, Canada will, effective 12:01 a.m. EST tomorrow, respond with 25 per cent tariffs against $155 billion of American goods – starting with tariffs on $30 billion worth of goods immediately, and tariffs on the remaining $125 billion on American products in 21 days’ time. Our tariffs will remain in place until the U.S. trade action is withdrawn, and should U.S. tariffs not cease, we are in active and ongoing discussions with provinces and territories to pursue several non-tariff measures.
Other Canadian politicians are reacting with outrage to Trump’s imposition of tariffs. Ontario Premier Doug Ford warned, “If they want to try to annihilate Ontario, I will do everything — including cut off their energy with a smile on my face.” He continued, “They rely on our energy, they need to feel the pain. They want to come at us hard, we’re going to come back twice as hard.”
Premier Ford added that Michigan auto plants would likely shut down within a week and that he would halt nickel shipments and cross-border transmission of electricity from Ontario to the U.S. “I’m going after absolutely everything,” Ford said.
In contrast to Canada, Mexico’s President Claudia Sheinbaum had taken a cautious approach, continuing to make a strong case against tariffs and even endeavoring to prove her country is doing everything possible to allay Trump’s asserted concerns. As the Associated Press reported, last week Mexico turned over 29 drug cartel figures to the U.S. and dismantled over 100 drug labs of the Sinaloa Cartel. But these efforts were brushed aside by Trump as insufficient, signaling that he had never been very serious about tying fentanyl to tariffs.
In response to Trump’s renewed tariff threat, President Sheinbaum cautioned, “It’s very important that the people know that we have made a very important effort of coordination, of collaboration, but it depends on the United States,” Sheinbaum said. “We have to respond to this decision.” An announcement of retaliatory measures by Mexico is expected later this week.
China responded to Trump’s hike in tariffs with a measured response, announcing a 15 percent new tariff on U.S. chicken, wheat, corn and cotton products and a 10 percent tariff on sorghum, soybeans, pork, beef, fruits, vegetables, dairy and fish products. “The Chinese people have never believed in coercion or intimidation, nor do we succumb to bullying and hegemonic tactics,” Chinese Foreign Ministry spokesperson Lin Jian said at a regular briefing in Beijing on Tuesday.
The last time China responded to Trump’s tariffs, farmers across the Midwest were hit badly enough that they needed a $28 billion bailout from the federal government. Trump appears to understand that there will be pain in the form of Chinese retaliation. He tweeted that U.S. farmers need to “start making a lot of agricultural product to be sold INSIDE of the United States” and further warned that there will be more tariffs on external farm products coming in a month.
He ended with, ”Have fun!” Because he just doesn’t care.
**Tariffs are the new unwelcome disaster
The tariffs come at a particularly dicey time for the U.S. economy. They could easily deal a further blow to consumer confidence, which already saw a sharp decline last month. Moreover, a sharp uptick in inflation could cause the Federal Reserve to hold the line on cutting interest rates, meaning less money in the pockets of home borrowers and less investment and expansion by companies faced with higher borrowing costs.
Tariffs will add weight to an alarming projection by the Atlanta Federal Reserve that we are headed from what was 3 percent growth to a 2.8 percent contraction this quarter. There is already generalized uncertainty and anxiety over the Trump administration’s policies. These include hundreds of thousands of across-the-board federal job cuts, the loss of critical research funding from the NIH, a threatened gutting of Medicaid and food assistance programs, the possibility of payment disruptions from Social Security, and a looming possibility of a federal shutdown in just over a week should Congressional House Republicans fail to agree upon a continuing resolution to fund the government. That’s just to name a few.
The technical economic term for all of this is a “sh** show.” And Trump’s tariffs only deepen the economic cliff we may soon hurtle into.
* * *
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[Rideback]

Trump's tariff's went into place Tues at 12:01 am. Canada and China both imposed retaliatory tariffs immediately with Trudeau saying there would be a 2nd phase in 21 days.

https://www.cnn.com/2025/03/04/economy/ ... index.html

[mister_coffee]

I have heard contradicting reports of when or even if the tariffs are going into effect. Confusion is part of the abuse.

Trump seems to be trying to walk back at least some of the mass DOGE firings of probationary employees. I don't know how that works or what that could even mean. Again confusion is part of it.

[PAL]

From what I have heard and read, I thought they went into effect yesterday. Then this is just a game of psychological warfare on the American people. It is typical #47.

[mister_coffee]

There seems to be an assumption that the farmers who grow, say, soybeans for export can either sell them to Americans or that they can stop growing soybeans and plant avocado trees and sell avocados.

What farmers grow and who they sell to is planned out years in advance and there isn't a lot of flexibility in that system. A big change on a short time scale (like these tariffs) disrupts that system. What that means is lots of farmers going bankrupt. Oh well, most of 'em voted for exactly this and I hope they enjoy the consequences of their actions.

Apparently the tariffs don't go into effect until April 2nd so I suspect in the end that this was just another way to psychologically torture everyone he can and keep himself at the center of attention. And that will probably work until it all blows up and then nobody will even care who the President of the United States is this week.

[mister_coffee]

When he starts telling us to kill sparrows I'd run for the hills...

https://journals.sagepub.com/doi/pdf/10 ... e%20killed.

[PAL]

This is what #47 voters wanted, isn't it? They were so afraid of communism and look what they got.
And they most assuredly will blame the Dems.
https://www.msn.com/en-us/money/other/r ... 694&ei=152

[Rideback]

Hadn't thought of that, Trump may not have either, but that's a pretty good definition
https://www.investopedia.com/terms/c/co ... 20services.

[mister_coffee]

Is it just me or is Trump trying to implement some kind of command economy here? We know those don't work, And obviously for an economy as large and complex as the US economy a command economy policy will fail rapidly and spectacularly.

For all Republicans are so down on communism this centrally "planned" approach sounds pretty damned communistic to me.

[Rideback]

https://thinc.blog/2025/03/04/canada-th ... -supplies/

Canada threatens US electricity supply

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https://statuskuo.substack.com/p/trumps ... irect=true

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"People need to understand there may be temporary pain. Prices may go up. The stock market may crash. Russia might overturn Ukraine. Long dormant diseases may re emerge. People will die. But it's all for a good purpose and that purpose is, um...

making america great again

[Rideback]

https://www.nbcnews.com/business/market ... rcna194681

[Rideback]

Wall Street Journal Tues am:
"WSJ: dumbest move ever. "We’ve courted Mr. Trump’s ire by calling the Mexico and Canada levies the “dumbest” in history, and we may have understated the point. Mr. Trump is whacking friends, not adversaries. His taxes will hit every cross-border transaction, and the North American vehicle market is so interconnected that some cars cross a border as many as eight times as they’re assembled.
Mr. Trump also objected when we reported an analysis by the Anderson Economic Group that the 25% tariff will raise the cost of a full-sized SUV assembled in North America by $9,000 and a pickup truck by $8,000. Is this how the new Republican Party plans on helping working-class voters?"