TL;DR
The US is slapping tariffs on goods from Mexico and Canada, and it’s probably going to make everything more expensive and trigger economic instability, just like it did with China. Get ready for another round of trade wars and higher prices.
Story
“The Tariff Cycle is Back.” Oh boy, here we go again. I’ve seen this movie before, and it doesn’t end well. It reminds me of a playground bully grabbing everyone’s lunch money. Only this time, the bully is the US, and the lunch money is, well, everyone’s money. 25% tariffs on goods from Mexico and Canada? Seriously? It’s like deciding to punch your neighbors in the face for no good reason.
Remember that time we tried this with China? How did that work out for us? Higher prices for everything, businesses scrambling, and a whole lot of economic uncertainty. Now we’re picking fights with our closest trading partners, who also happen to be our neighbors. Genius.
So, let’s break it down for the five-year-olds (and the politicians who seem to think like them). Tariffs are like extra taxes on things we buy from other countries. So, that avocado for your toast? More expensive. The car parts your dad needs to fix the family van? Also more expensive. And who ends up paying for it? We do. It’s like going to the store and realizing everything suddenly costs 25% more. Except it’s worse than that. It makes it harder for us to sell our stuff too. Because if Mexico and Canada have to pay more for our things, they might just buy from someone else, someone who doesn’t treat them like a piggy bank.
Someone on social media said, “Priced in. SPY to $700 Feb 1.” Honey, if you think this is priced in, I have a bridge to sell you. The market doesn’t just magically absorb bad decisions without a hiccup. This could trigger a cascade of retaliatory tariffs, trade wars, and economic instability.
Oh, and someone else mentioned inflation? You better believe this will make inflation worse. Remember when eggs were expensive? Buckwheat up, buttercup, it’s going to be a bumpy ride.
Advice
If this news makes you nervous, you’re not alone. Now might be a good time to review your budget, look for ways to cut expenses, and maybe consider diversifying your investments. Just in case things get bumpy.
Source
https://www.reddit.com/r/wallstreetbets/comments/1i66uoo/the_tariff_cycle_is_back/