Trump's Tariff Plan Threatens USMCA, Market Stability

President-elect Donald Trump plans to impose significant tariffs on imports from Mexico, Canada, and China, with 25% tariffs on Mexican and Canadian goods and 10% on Chinese imports, aiming to curb illegal immigration and drug flow. These tariffs could disrupt the North American trade pact and lead to higher consumer prices, affecting sectors such as the auto industry and electronics. Critics warn of potential inflation and reduced consumer spending power, while supporters argue tariffs could benefit U.S. manufacturing jobs and federal revenue. Trump's strategy involves using the International Emergency Economic Powers Act, allowing him to act without Congressional approval. The proposed tariffs are already impacting market dynamics, with investors adjusting portfolios to mitigate risks associated with potential trade disruptions. The overall economic impact remains uncertain, with potential for retaliatory tariffs from affected countries and pressure on industries with intricate supply chains.