Trump's tariffs roil U.S. markets. And that's the reaction that matters
Trump's tariffs roil U.S. markets. And that's the reaction that matters
What is Alexander Panetta's problem with Canada? Is he an American or a fifth columnist of snark. CBC might want to consider someone capable of writing analysis without trashing Canada.
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Those factors will likely pack more punch in Washington than the $155 billion in counter-tariffs threatened by Canada. To put this number in perspective, it's a fraction of what American stock markets have lost this week.
That's a pretty dumb take when you consider that a major cause of those losses is the market factoring in the cost of Canadian retaliatory tariffs.
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I think you're maybe misunderstanding the direction of the tarrifs costs?
The tarrifs cost American importers regardless of our counter tarrifs. For an example, the article pointed to, Target which
said it expected to raise prices within days, specifically mentioning Mexican strawberries, bananas and avocados
Doesn't matter what counter tarrifs Mexico puts in place, produce from Mexico will be more expensive in America. Counter tarrifs just make things more expensive in our own country and hopefully dissuade people from buying them.
The markets aren't roiling because of reduced access to Canadian markets, it's that the stuff in their own products (like say, car parts made in Canada) overnight became 25% more expensive. (I would also be surprised if we tarrifed much in our shared industries like auto production as it'll be hard enough to keep those factories here without making them even more expensive.)
That's not to say what we do is irrelevant, we should absolutely boycott and do whatever we can to make the markets worse but it's good to do so with clear eyes.
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No I'm well aware of how tariffs work. The thing is, given how tightly coupled our economies are, nearly all major US manufacturing is heavily dependent on Canadian exports. Our auto industry alone has a single vehicle traversing the border multiple times. When we impose a counter-tariff, that hurts US industry considerably. Couple this, with the lost good will between the US and it's biggest trading partner by far, and you've got a a massive devaluation of US stock prices due to diversification and boycotts alone.
In other words, the dude's not wrong that the market hit is massive, he's just got blinders on around the cause.
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Automobiles are a great example! Yes, those parts cross the border multiple times and that's exactly why they are excluded from counter tarrifs!
You can check for yourself:
It is also why trump just exempted automobile parts, his tarrifs hit them, ours basically didn't. (I think we have tires because we finish those as a whole part and the production chain is a bit different for those.) The overwhelming majority of the effect on American auto stocks is because of self imposed costs to American businesses.
We're not aiming our tarrifs at things that will target our own factories. Look through the list and let me know what you think looks like a production input that would get refined here and then sent back.
Edit: For more evidence, you might look at today's stock rally after trump announced delaying auto tarrifs. You'll note Canada made no mention of lifting any of our counter-tarrifs and it'd be weird to assume there'd be a massive change in boycotts or diversification off a one month tarrifs reprieve in one sector.
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