Tariffs Update: Updated Rates & Canada's Response

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Hi Friends,

Today, I want to talk about tariffs. We have talked about tariffs before on the “Why Tariffs will destroy the US Economy”. We mentioned what President Trump’s plans were and how we are affected. But today, I would like to update you on the new tariff situation. Hope you enjoy today’s article.

On March 4th, tariffs went into effect. The tariffs are as follows: 25% on goods for Canada and Mexico & 10% on Chinese goods getting imported to the US. This 10% given to China is on top of the 10% tariff that had already been placed on China. This means that China has a total of a 20% tariff on all their goods imported into the United States.

The effects on the economy are already being shown. This is because these tariffs are likely to upset the suppliers of these goods in the US, possibly leading to a halt in trade. This could pose a significant problem, as the US imports a considerable amount of goods each day. If that doesn’t occur, these countries may simply increase their prices by 10-25%, depending on the nation.

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Canada has decided to take the tariffs seriously and tax the US right back. They imposed a 25% tariff on US imports. President Trump was mad as soon as he heard this was happening. He threatened to hike the tariffs “a like amount”. The tariffs are likely to reflect on prices. The prices will be 25% higher for these goods.

If President Trump continues to raise tariffs and apply them to new countries, we could have certain products not available in the US anymore. Mexico, Canada, & China all produce important goods that lots of Americans use. If we lose them because other countries do not want to trade with us anymore.

There is a question going around: Why is Trump doing this? Tariffs raise prices, break alliances, and can ultimately cause trade wars. The first reason is that Trump blamed both Canada and Mexico for the flow of immigrants and illicit drugs into the U.S. He plans to continue the tariffs against Canada and Mexico until he feels satisfied with the results. Trump described the tariffs as an international emergency and a crisis that needs to be alleviated.

The second reason Trump continues in his quest for tariffs is to collect revenue. The US government is currently in debt to the tune of approximately $40 trillion, and the debt problem is urgent. See the article named “The US Debt Problem” by Friday Finance. It shows how debt is affecting America and how urgent of a problem it is.

Trump might withdraw the tariffs because he might receive some pushback for doing so from other countries and even citizens of the United States. Whether these tariffs will resolve Trump’s problem is up for debate. This strategy is a temporary strategy to try to collect revenue and resolve problems. This is most likely a little test and probably won’t last more than a few months. But, at this point, anything can happen.

Well, even though Trump has had reasons to put tariffs on Canada & Mexico, I have not yet stated the reason for putting a high tariff on China. His reasons for putting a tariff on China are because China had failed to take action to stem the flow of opioid production, and China says it wasn’t their fault, but Trump thinks so. This could cause major conflict between China & The US in the long run.

Anyway, thank you so much for reading this edition of Friday Finance. I am excited to announce that the Friday Finance shop has launched, check it out with the button below. We are very excited about this new shop, it already has three premium products! Well, we hope you enjoyed this week’s article and we will see you next week.

Jacob Gans

Friday Finance