Canada's trade surplus with the US becomes a huge deficit if we sell no Heavy Oil to the US. We currently sell it at a discounted price to refiners in the US who turn a nice profit on their operations. This has a direct impact on gas prices for millions of Americans. There is no rational case for a trade war with Canada.
Trump understood that AI is the key driver of innovation also for his projects. https://www.forexlive.com/news/cbs-...-sector-investment-in-ai-infrasture-20250121/ "CBS is reporting that Pres. Trump is settling out billions of dollars in a private sector investment focused on building AI infrastructure. THe president will the speaking to it at 4 PM ET. OpenAI, Softbank and Oracle are planning a joint ventrue called Stargate" "Trump is set to announce billions of dollars in private sector investment to build artificial intelligence infrastructure in the United States -CBS" "Trump to announce OpenAI, Softbank and Oracle AI investments - CBS." =>VENI, VIDI, VICE Translating the latin words to: Trump came to be US President, he saw what it is needed including AI technology and he will win therefore the battles to make America first again. Why it bothers me if I am not US American ? Because all my money is to 100% invested in the US and I am fully dependent on its growth.
It's more complex than that, from what I have learned. The US has to export dollars if it wants to maintain being the world reserve currency. (which it likely doesn't want to do anymore) This means it needs to keep importing stuff. If they don't export dollars, the world moves away from USD. This also means that less and less outsiders are buying US debt, which is already the case, and then the Fed has to monetize this debt. This now crashes USD and the US is broke. Other countries like Mexico and Asia have a much lower standard of living, so they will cope, but the US citizens will not accept this. All of this also needs to happen while the US slowly builds up production itself, which will be highly inflationary for the first few years. So yes, these heavy tariffs do hurt the other countries, but the US will be deeply hurt as well, and if all the other countries decide to ditch the USD for good, the US has no more bargaining power. In my opinion, Trump is only making threats so that he can negotiate a better deal, but if those countries decided to just ditch Trump and the US, its game over for the US.