Trump threatened Mexico and Canada with swingeing, 25 per cent tariffs unless they devoted more resources to controlling the flood of fentanyl crossing their borders into the US. That triggered a massive share sell-off and a precipitous collapse in stock prices. Both countries agreed to shore up their border controls. Trump called off the tariffs.
By the end of the trading day, share prices were about where they had been when traders were sipping their morning coffees (Starbucks shares up 3 per cent). Kevin Hassett, the estimable head of Trump’s Council of Economic Advisers, had it right when he warned that his boss’s move was not the start of a trade war, but a war on drugs.
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