Tariff Man at it Again
US futures are down substantially in response to Trump’s latest Tweet. Trump will set a tariff of 5% effective June 10, rising to 25% by October.
The Wall Street Journal reports Trump Threatens Tariffs on Mexican Imports in Response to Migrant Surge
The trade action comes as the Trump administration is seeking congressional ratification of a trade pact among the U.S., Mexico and Canada, to replace the North American Free Trade Agreement. The three countries’ leaders signed the deal, known as the USMCA, last year.
In a statement released by the White House, Mr. Trump said he would invoke the authorities of the International Emergency Economic Powers Act to impose a 5% tariff on all goods imported from Mexico starting June 10, and increase the tariff gradually, hitting 25% on Oct. 1.
Mexico is the U.S.’s third-largest trading partner, with goods imports of $346.5 billion in 2018, according to the Office of the U.S. Trade Representative.
“If the illegal migration crisis is alleviated through effective actions taken by Mexico, to be determined in our sole discretion and judgment, the Tariffs will be removed,” Mr. Trump said. He also said that Mexican companies could avoid the tariffs by relocating to the U.S.
If this dispute is not resolved immediately, recession starts today.
Imagine what would happen to the US if Mexico said screw you and halted all traffic to the US. Mexico is the US’s third largest trading partner. Repercussions would be enormous.
I do not know how Mexico will respond, nor does anybody else, but this is madness.
This is not how one treats allies and major trading partners.
Trump wants Mexico to spend money to stop illegal immigration to the US.
What is Trump doing to help?
Does Mexico have the money?
Excuse me for pointing out that Trump had an offer, last year, from the Senate Minority leader for over $20 billion to build a wall. Why did Trump turn that offer down?
Also, excuse me for asking: Why doesn’t Trump mandate hiring checks in the US?
Finally, excuse me for pointing out that Republicans were in complete control of the Executive and Legislative branches and wasted two full years over Obamacare instead of dealing with immigration.
Mirror Mirror On the Wall
Good Lord President Trump, please look in the mirror.
This economy is headed over the cliff. It’s not all Trump’s fault. Indeed, place most of the blame on the Fed.
However, Trump just gave recession a great big push.
Mike “Mish” Shedlock