Let's talk about Trump driving China and Canada together.... - Belle of the Ranch

[TexasTowelie]

Well, howdy there Internet people. It's Belle again. So, today we're going to talk about Trump's tariffs driving Canada and China together and nuclear-powered electric vehicles.

I guess I should start with the big news. Carney beat Trump. There's really no other way to say that. This one deal is just the first step, but the momentum has shifted and Trump is kind of out of juice. Trump's tariff policy did what the experts said, drove longtime allies closer to adversarial nations.

As we talked about a few days ago, Canadian Prime Minister Mark Carney went to China. As we suggested, he came home with trade agreements. Trump's erratic trade policy created uncertainty. Markets hate uncertainty. Speaking of China, Carney said, "Our relationship has progressed in recent months with China. It is more predictable, and you see results coming from that.”

Predictable is the opposite of uncertainty. Markets like predictability. Trump is trying to downplay the massive backfire that just occurred, "Well, it's okay. That's what he should be doing and it's a good thing for him to sign a trade deal. If you can get a deal with China, you should do that.

Let's be clear, Trump's tariffs were meant to strongarm Canada on the economy. The problem is that Canada put a world-renowned economist in the prime minister's slot. Trump was simply outmatched. Carney has pursued other economic partners while Trump continues to alienate ours.

Trump's trade war in Asia may be unwinnable. China has no reason to work with the US because they're gaining influence and we're losing it. My guess is they'll start stringing him along the way Russia does.

So, what's in the deal? The headline stuff is important. There's reduction on tariffs for Chinese electric vehicles coming into Canada, which will probably lead to Chinese investment in Canada. Then there's reductions on tariffs for Canadian agriculture products heading into China. Imagine a country's leader trying to get better market access for farmers? I'm sure American farmers would love to have Carney as their president right now.

Beyond the headline parts of the deal, there's something else. China and Canada will work together on oil and gas. Oh, and natural uranium. That's going to matter a lot as many countries, including the US, restart nuclear power operations.

Senator Brian Schatz of Hawaii said, "We just got absolutely rolled in this Canada China deal. A stark foreign policy failure with domestic economic consequences." The most basic principle in politics and geopolitics is loyalty to friends. And we weren't just disloyal, we were hostile. So here we are.

Now, here's the other part, and it's the part that people who supported Trump's tariffs refused to allow themselves to grasp. Canada now has an economic interest to support Chinese foreign policy a little bit more. As Trump pushes our European allies away over some nationalist fever dream involving Greenland while saying he was worried about Chinese influence, one of our closest allies is stepping out of line with US trade policy and in line with China's. The world order that kept the US and the US economy at the top is cracking. Our economic Humpty Dumpty didn't fall. He was pushed from the White House roof.

Anyway, it's just a thought. Y'all have a good day.