There were already plenty of potential disasters on deck like Ukraine, Inflation and interest rates just to mention a few. I certainly didn't expect "trade wars" to be initiated so soon with our next door neighbors who are now justifiably angry despite having taken advantage for years of far more liberal trade policies by previous administrations.
But who the hell picks a fight with Canadians for crying out loud??
We do, apparently, and this type of policy is only just starting.
We're looking at a seismic shift in the US's relationship with the world, via Arnaud Bertrand:
1) The US is dismantling its foreign interference apparatuses (like USAID )
2) Marco Rubio stating that we're now in a multipolar world with "multi-great powers in different parts of the planet" and that "the postwar global order is not just obsolete; it is now a weapon being used against us."
3) The tariffs on supposed "allies" like Mexico, Canada or the EU: This is the US effectively saying "our attempt at running the world is over, to each his own, we're now just another great power, not the 'indispensable nation'." It looks "dumb" (as the WSJ just wrote) if you are still mentally in the old paradigm but it's always a mistake to think that what the US (or any country) does is dumb.
I have come to the conclusion that Trump already sees the weaknesses in US trade relationships and is implementing a "controlled demolition" of America's global trade position which is already eroding quickly.
Here is an interesting take:
“WE WILL WIN!”
Trump’s trade war isn’t strategy, it’s a Darwin Award-worthy blunder disguised as tough talk. His latest move? Slapping 25% tariffs on Mexico and Canada, blaming them for America’s fentanyl crisis and migrant woes, as if pointing fingers fixes problems. Spoiler: It doesn’t.
But here’s the predictable plot twist, Mexico and Canada aren’t rolling over.
• Mexican President Claudia Sheinbaum fired back, calling for “non-tariff means” to defend Mexico. Translation? Economic precision strikes and alliances that’ll leave Washington scrambling.
• Canada’s ‘lame-duck’ Trudeau and believe us, we’re no fans of this clown, just hit the U.S. with $155 billion in retaliatory tariffs. Congrats, Donald. You just slapped your own base in the face.
And while Trump pounds his chest, Quebec Premier François Legault warns this tariff war could last years.
Guess who pays the price?
• American consumers, drowning in inflation.
• U.S. industries, suffocating under supply chain chaos.
• Trump’s political base, watching their cost of living torched by their own “hero.”
Let’s be clear: Trudeau is a puppet and political lightweight, but even he stumbled into the right move here.
This isn’t about defending Trudeau, it’s about calling out Trump’s economic illiteracy.
• Alienate your largest trading partner? Check.
• Trigger inflation at home? Check.
• Hand global markets to China and Russia on a silver platter? Triple check.
This isn’t 4D chess.
This is a toddler flipping the board because he’s losing.
Trump’s tariffs won’t curb fentanyl. They won’t bring back jobs. But they will accelerate America’s decline, one self-inflicted wound at a time.
“WE WILL WIN!” is a eulogy for an empire too arrogant to realize it’s bleeding out."
These moves will impact our daily lives almost immediately making products and services we all use regularly more expensive and/or unavailable. This is happening while most American consumers who are the life's blood of our domestic economy are being squeezed by stagflationary forces which are inflating prices and stagnating incomes.
"According to data tracked by the U.S. Federal Reserve Bank of St. Louis, the average city price of a dozen Grade A large eggs has risen by more than 182 percent between January 2021 and December 2024. The price of ground beef per pound is up by 41 percent, fresh whole chicken by nearly 30 percent, whole fortified fresh milk per gallon by 18 percent, and white pan bread per pound by almost 24 percent."
"Most Americans cannot afford a $1,000 emergency expense, with inflation and high interest rates affecting their ability to save adequately, according to a recent survey by consumer services company Bankrate."
"Acknowledging the existence of a multipolar world and choosing to operate within it rather than trying to maintain an increasingly costly global hegemony couldn't be delayed much further. It looks messy but it is probably better than maintaining the fiction of American primacy until it eventually collapses under its own weight."
Meanwhile market players are all wondering what that smell is:
To my dear readers: There's so much going on right now I almost can't absorb it all much less try to make any sense of it. Between work, personal life and writing this weekly blog there's less time to focus on details or to do deeper dives into the ramifications of new policy on small business owners. The summary however is that things will be changing fast and hard. There will be little time for adjustments and there will be as many opportunities as there will be challenges.
Here are some of the links I saw last week which I though were interesting:
"Core services are about 65% of consumer spending and include housing costs, insurance of all kinds, health care, education, subscriptions, transportation, broadband, personal care services, financial services, food services & accommodation, etc."
"Everything has gone up," said Norma Rivera, a working single mother of two, during an interview at the Food For Others food pantry in Fairfax, Virginia, adding, "Fifty dollars is nothing" in the grocery store, she said."
"Trump had threatened to levy those tariffs if the nations did not do more to help secure US borders from the inflow of undocumented migrants and illegal drugs. Markets, business and political leaders had been watching closely to see if Trump would follow through on a tariff threat. -Bloomberg"
This made me laugh out loud:
