T-day is upon us and the 25% tariffs on Mexico and Canada with an additional 10% on China have just gone live. Retaliation is set to be swift as Canada looks at imposing restrictions of C$30 billion on US products which will be extended after three weeks, Mexico will announce its own package later as China lines up the agricultural trade with the US for a 10-15% counter-tariff.
In a brilliant book, ‘Sapiens’, the author, Yuval Noah Harari, defines culture as the instinctive ability of strangers to cooperate effectively. Cultures, due to their internal dynamics and because of their man-made nature, constantly undergo changes and they are tempted to become the dominant force over other cultures
Markets are feeling a corrective shock to a complacent idea that all the bluster emanating from the White House have been transactional feints. Yesterday’s reduction in tolerance on allowing negotiations appears to have been triggered by the current administration’s border analysis showing little change in the illegal flows of fentanyl entering the United States.
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