• 15 hours Gold Exodus To Reverse
  • 2 days Wall Street Salaries Soar After Another Solid Year
  • 2 days Ripple Soars, Overtakes Ethereum As 2nd Largest Crytpocurrency
  • 2 days The New King In Cannabis Markets
  • 2 days Emerging Markets Boost Gold Holdings
  • 3 days Is It To Cut And Run On The S&P 500?
  • 3 days Another European Bank Falls To Russia-Linked Money Laundering
  • 3 days Improved Commodity Conditions Fueled Mining Growth In 2017
  • 3 days Is Tesla "Headed For The Graveyard?"
  • 4 days Morgan Stanley Turns Bullish On Gold
  • 4 days How Climate Change Is Impacting Global Hunger
  • 4 days Hacks, Bugs And Exploits: Growing Pains For The $4 Billion Blockchain
  • 4 days Debunking The A.I. Productivity Myth
  • 5 days Coca-Cola Hints At Cannabis Product
  • 5 days Saudi Wealth Fund Pumps $1B Into Tesla Rival
  • 5 days Major Financial Institutions Are Planning Crypto Products
  • 5 days Is A Market Meltdown Looming?
  • 6 days Is A Four-Day Workweek Feasible?
  • 6 days This Millennial Brokerage Is Coming To Tesla’s Rescue
  • 6 days $2.7 Billion In Assets To Be Auctioned Following Anti-Corruption Crackdown
Saudi Wealth Fund Pumps $1B Into Tesla Rival

Saudi Wealth Fund Pumps $1B Into Tesla Rival

Lucid Motors managed to close…

Is A Four-Day Workweek Feasible?

Is A Four-Day Workweek Feasible?

Four-day work weeks have been…

Charles Benavidez

Charles Benavidez

Staff Writer, Safehaven.com

Charles Benavidez is a writer and editor for Safehaven.com. Charles is located in New York City and has over 5 years of experiencing covering financial…

Contact Author

  1. Home
  2. News
  3. Breaking News

Wall Street Rallies After Trump Tariffs Lose Their Bite

Trump

Canada and Mexico will be indefinitely exempt from U.S. steel and aluminum tariffs imposed by Trump late yesterday, and other countries will be able to negotiate exemptions, too—so all the bluster about dangerous tariffs and a looming trade war just faded, as far as the market is concerned.

After the closing bell yesterday, the Dow gained 93 points.

Trump has a tried-and-true MO of raising the stakes on a big issue, and them implementing something much softer. Lobbyists buy it, for a time. Voters buy it, and the stock market buys it, too.

While Elon Musk likened the tariffs to an “Olympic race wearing lead shoes”, at the end of the day, and as further details emerged, what we got was a watered-down version of tariffs that isn’t likely to ruffle nearly as many feathers, outside of Asia—the original target. 

Trump traded lead shoes for a trimmed down pair of steel-toed boots. It’s not Olympian; but neither is it debilitating.

The tariffs will go into effect in 15 days, and this is what you need to know:

Canada is the biggest supplier of steel and aluminum to the United States (no, it’s not China). The U.S. and Mexico are Canada’s top two markets for steel exports, accounting for 97 percent of the total. In 2016, Canada sent 87 percent of its steel to the U.S., and 8 percent to Mexico. Last year, that figure was 84 percent.  

While everyone was wondering why tariffs ended up looking like an attack on Canada instead of China, it emerged that the U.S. administration expressed concerns that Chinese steel and aluminum products were coming into the U.S. through Canada. It was an idea that Canadian Prime Minister Justin Trudeau found unrealistic, at best.

According to Canadian media, citing an unnamed official, Trudeau told Trump that Canadian steel and aluminum workers would be surprised to hear the products they were manufacturing were Chinese. Related: PayPal Gets A Boost From Its Crypto Patent

So Canada won an exclusion, and there may or not be a trade-off.

According to Politico, a senior U.S. official said that Canada (and Mexico, too) will have to negotiate “some agreement to address the threat to U.S. national security caused by their steel and aluminum exports to the United States”.

But Canada and Mexico are also the top destinations for U.S. steel exports. Canada was the largest market for U.S. exports of steel, accounting for 50 percent of the total in 2017. Mexico took in 39 percent of total U.S. steel exported last year.

(Click to enlarge)

Mexico accounted for 9 percent of all U.S. steel imports last year.

(Click to enlarge)

Now, there’s talk of other possible exemptions, and Trump has specifically hinted that Australia will be among them.

“We have a very close relationship with Australia,” Trump said. “We have a trade surplus with Australia. Great country, long-term partner. We’ll be doing something with them. We’ll be doing something with some other countries.”

By Charles Benavidez for Safehaven.com

More Top Reads From Safehaven.com:

Back to homepage

Leave a comment

Leave a comment