The White Home has confirmed imposition of tariffs on Canada, Mexico, and China tomorrow (Feb 1). Why are tariffs on Canada and Mexico totally different than (some) different tariffs? Contemplate this graph courtesy of Bloomberg by way of Torsten Slok:
I can’t see how manufacturing to home companies will be achieved in a single day, so presumably within the quick run, companies will run down their inventories of stockpiled components (perhaps why items imports have been so excessive in December). However over the span of a pair months, that backstop will fail…
Wall Avenue response, as summarized by the VIX.
Canada has signaled retaliation of some kind.
*Apologies to Barry McGuire.
