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  • Trump takes a new shot at Canada, threatens to end NAFTA if Congress intervenes

    From cnbc.com

    President Donald Trump on Saturday issued a new threat to terminate the North American Free Trade Agreement altogether, warning Congress not to intervene in tough negotiations that may or may not include Canada in a new accord. Trade talks between the United States and Canada will kick off again Wednesday, after the two sides ended Friday's tense negotiations without a deal. The talks were thrown into doubt after the president reportedly made an off-the-record comment that was published, suggesting he wouldn't give Canada any leeway. In a series of posts on Twitter, Trump took an uncompromising stance with the U.S.'s ... (full story)

Hey Trudeau that's what you get when you try to play hardball with Trump. You are a going to be sorry now. The USA can do without Canada but Canada CAN NOT do without the US market.

This is what is going to unfold....you read it here first....

1. Canada will get all bent out of shape and cry foul
2. The Canadian PM, Justin Trudeau will publicaly say, "We will not cower to the US demands of a 'madman'"
3. Trump will END NAFTA and sign a deal with Mexico that puts Canada in the cold (no pun intended)
4. Trump will put HUGE tariff's on Canadian goods
5. Canada will play the part of the victim
6. Silently many Canadian companies will decide it is 'cheaper' to move to the US to do business
7. Canada will slip into a recession due to the Trump tariff's
8. Canada will sign a new "NAFTA 2.0" in 2019 AFTER over 30 companies have relocated to the US

This will take about 6 months to play out. In the meanwhile BUY USD/CAD

SELL CAD
...because you never know - until you do!
  •  Guest
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You forgot cheap CAD will push business from US to Canada not the other way around.
The story here is not Canada but the US. Congress is responsible for commercial treaties with other nations. It has given authority to Trump to negotiate a trilateral deal. If Congress abandons its responsibility under threat from the President then the US no longer has a president, it has an emperor. This coming week could well mark a turning point in American history.
  •  Guest
  • | IP XXX.XX.65.157
All these insightful comments </sarcasm> ignore some facts.

On 1 December 2018 Mexico swears in their new president, Mr. Obrador. To say that he despises Trump is putting it mild. Once he is sworn in there will be no agreements with Trump. Be a statesmen Mr. Obrador is remaining silent until he is sworn in.

Canada has great trade relations with China, all of Asia, and the EU. Canada has existing agreements such as the Trans Pacific Partnership and the Comprehensive Economic and Trade Agreement. Canada's raw materials are easily sold around the globe.

In June 2018 the U.S. imported 321 Million barrels of oil; of which over 136 Million barrels came from Canada, far more then all the OPEC countries combined. Canada is by far the largest supplier of oil to the U.S.

Canada has the U.S. over a barrel (pun intended). So Mr. Trudeau, slap a 50% export tax on oil to the U.S.; end the negotiations with Trump; create a combine with other world countries and demonstrate what a combine can do to the U.S. economy. The one thing Americans cannot stand is hardship, they will fold at the idea of $200 for a tank of gas and $50 for a hamburger.
long term - no change
short term- lots of presidential talk which is unpresidented
Trump is living in a dream that US can grow alone in isolation. He needs good economic growth but low interest rate and weak dollar. He wants cheap export and costly import. What US is now today, it is not made by American alone, it is made by all the talents coming from all over the world. There is difference between powerful and respectful. US is no more respectful under Trump. Russia is also powerful they have enough military and nuclear arsenal. once respect is over US is finished.
Quoting bdwight1
The story here is not Canada but the US. Congress is responsible for commercial treaties with other nations. It has given authority to Trump to negotiate a trilateral deal. If Congress abandons its responsibility under threat from the President then the US no longer has a president, it has an emperor. This coming week could well mark a turning point in American history.
Uh No! NAFTA has always since its inception has been under the discretion of the President. Any renegotiated trade agreement within the trilateral treaty, needs congressional approval. If they reject the current terms, then the President of US has the Authority to either renegotiate or disband the treaty altogether and negotiate a bi-lateral deal. Which in this case if the latter plays out then the agreement would revert back to 1974 rules.

"The Trade Agreements Act of 1974 and then the 1988 Canada-US Free Trade Agreement followed by NAFTA (which is not a US Law at all, but connect to GATT, which was folded into the WTO) and contains articles 2203 & 2205 in Chapter 22, that nobody ever pays any attention to as it is “procedural”. After the US Canada 1988 Law, Mexico wanted to join in and we eventually got NAFTA (some of it bases on the 1988 Law). Reagan couldn’t finish it, so HW Bush picked it up and basically complete most of it, but couldn’t finish before Clinton came to power – Clinton/Leftists added Environmental articles and Labor articles and came up with the Congressional Action — which was NOT a “Treaty” authorization, just an Implementation Law … THAT’s IMPORTANT to Remember.

Congress passed H.R. 3450, the North American Free Trade Agreement Implementation Act in 1993 – https://www.congress.gov/bill/103rd-congress/house-bill/3450/text?q=%7B%22search%22%3A%5B%22nafta%22%5D%7D

Congress did not ratify the NAFTA text; it ratified H.R. 3450. That’s what matters domestically. If President Trump terminates NAFTA under Article 2205, he would not, by that action, change a word in the implementing legislation. Because invoking Article 2205 would have no effect on H.R. 3450, and because the implementing legislation says nothing about congressional assent.

Now we are up to the Bipartisan Comprehensive Trade Promotion and Accountability Act of 2015 (TPA) ….. this is the one (ignoring all previous Trade Laws/Agreements) that the Leftist CongressCritters are referring to when they say “we must vote” and Canada is counting on because the believe that the US House will be controlled by the Left after Nov 2018. When you hear the term “fast track” concerning NAFTA ….. this is what they are talking about.
https://digitalcommons.ilr.cornell.edu/key_workplace/1425/

It is because of this 2015 Law that Lighthiker sent the Notification to Congress that they were going to begin negotiations in 2017.(required by law) and the notification of the 90 days (also required by Law) – The Congressional Research Service also issued a report when this all began –
https://fas.org/sgp/crs/misc/R43491.pdf …..

and it’s worth a read, but I don’t think they actually looked into the previous Laws much (or at all) or the NAFTA agreement. The CRS essentially responds to Congressional Questions about Laws/Programs from CongressCritters – it’s a matter of asking the right question.

Here is the Issue – it clear (at least to me) that Lighthizer is absolutely on top of this and following all pieces of all Laws and understands what they mean (after he left he Government, he spent 30 years as a TOP International Trade Lawyer and he actually wrote some of the NAFTA stuff in the beginning) — Another tremendous pick by Donald Trump!!!

As soon as the Leftist Media works out that NAFTA is dead and the TeamCanada gets nothing — the internet will be full of “Trump can’t do this” ….. you can also bet that NONE of the reporters or Media will have a clue about the Laws, even the CongressCritters are clueless about the Laws.
Quoting Guest
All these insightful comments </sarcasm> ignore some facts. On 1 December 2018 Mexico swears in their new president, Mr. Obrador. To say that he despises Trump is putting it mild. Once he is sworn in there will be no agreements with Trump. Be a statesmen Mr. Obrador is remaining silent until he is sworn in. Canada has great trade relations with China, all of Asia, and the EU. Canada has existing agreements such as the Trans Pacific Partnership and the Comprehensive Economic and Trade Agreement. Canada's raw materials are easily sold around...

Speaking of ignoring facts, you do well in misrepresenting them altogether.

On 1 December 2018 Mexico swears in their new president, Mr. Obrador. To say that he despises Trump is putting it mild. Once he is sworn in there will be no agreements with Trump.

First of it was Obrador who agreed to the current US Mexico bi-lateral agreement. The heart of the matter was the cost of labor for the Mexican worker, something Obrador ran on.
Mexico, via President-elect Lopez-Obrador, wants to establish heavy industry to expand the Mexican economy and create a real manufacturing industrial base. AMLO sees energy resource development as financial collateral toward achieving more actual heavy manufacturing investment in Mexico. Guess what? He’s right.
Conversely, and showcasing an entirely different set of economic priorities, Canada has slowly removed its heavy industry at the behest of liberal environmental policy and shows no signs of wanting to reestablish that sector.
Without a heavy manufacturing industrial base, Canada needs to retain their import of component parts (made from heavy manufacturing) and simply assemble those parts in Canada. The U.S. and China are their main suppliers for Canadian component goods. A limited industrial base precludes Canada from agreeing to any rules of origin that could essentially limit their economy.

Canada has great trade relations with China, all of Asia, and the EU. Canada has existing agreements such as the Trans Pacific Partnership and the Comprehensive Economic and Trade Agreement. Canada's raw materials are easily sold around the globe.

Canada does not have a trade deal with the EU currently and most of their industry is heavily dependent on Oil. In comparison, to the US, is no where near in comparison able to survive a trade war with the US. US population is 300+Mill, Canada Population is 33+Mil so simple math and economics is suggestive that Canada with their preference of ideological semantics rather than pragmatism is simply saying they are pretty much screwed!

In June 2018 the U.S. imported 321 Million barrels of oil; of which over 136 Million barrels came from Canada, far more then all the OPEC countries combined. Canada is by far the largest supplier of oil to the U.S

True, but this is separate issue than durable goods being imported into the US, and any disruption of OIL being sold into the US Canadian economy would be shooting themselves in the foot. Also not to mention that the "Trans Mountain Pipeline Deal was struck down, is a huge loss for Trudeau which further weakens his position!

Canada has the U.S. over a barrel (pun intended). So Mr. Trudeau, slap a 50% export tax on oil to the U.S.; end the negotiations with Trump; create a combine with other world countries and demonstrate what a combine can do to the U.S. economy. The one thing Americans cannot stand is hardship, they will fold at the idea of $200 for a tank of gas and $50 for a hamburger.

This has got to be the dumbest thing I ever heard! You can't impose an export tax and artificially raise the price of a world commodity that is already set by market prices. This would be a violation of WTO rules and would be struck down faster than you can say lightning! The only country that can impose a tax is the country in which the goods are being imported into. So no Canada does not have the US over a barrel and has no leverage what so ever when it comes to NAFTA. The issue is content origination specifically as it relates to the Auto industry. Canada is practically owned by China, and Chinese goods particularly auto parts have been making their way into the US markets without paying a dime in tariffs. This is something Trudeau knows all too well and is not willing to compromise on because he does his bidding at the behest of China.

"To form a trade relationship with the U.S., based on the same manufacturing priorities applied to the U.S-Mexico deal, Canada would have to fundamentally reverse decades of trade and internal economic/regulatory policy; -OR- Canada would have to limit their Asian purchases and use the U.S. and/or Mexico as the source of their component part origination. This is basic industrial economics.

Again, if you take the U.S-Mexico agreement away from any review of a U.S-Canada agreement, what you discover is that in a bilateral discussion of trade between the U.S. and Canada; the hungry Canadian already eats 2/3rds of the pizza (current terms).

Any move to make the pizza (trade relationship) more equitable in a bilateral deal (50/50) means Canada will have to give up some pie. Canada doesn’t have any current internal economic policy they are willing to give up.
Canada wants to retain their lumber and aeronautics subsidies; they want to retain their protectionist dairy tariffs; they want to retain their barriers keeping their banking and telecommunications sectors protected from external competition; and they want to keep the current manufacturing and assembly processes for durable goods without the pesky industrial/environmental challenges from creating the components of those goods.

This is what Justin Trudeau and Chrystia Freeland call “protecting Canadian workers, and protecting Canadian values”. ~Sundance CTH Sept, 1st 2018

Remember the US has heavily subsidized the Canadian economy for well over the past 30+ years and thus has taken advantage of the US and it is now going to come to an end. The reality is Trudeau is not making decisions that is in the best interest of the Canadian worker, he is making decisions based on political ideology, which is why he will not only lose in the end, but he is also screwing over the Canadian worker at the same time!

Canada's own publication also sees the writing on the wall!

Globe and Mail….Canada is screwed

The fantasy has now been shattered that Canada can secure something as good or better than the deal it already has. Bullied by Mr. Trump and betrayed by Mexico, Canadian negotiators faced a grim ultimatum this week – cave to a series of hardline U.S. demands or get hit with steep tariffs on autos that could plunge much of the country into recession.

This uncomfortable spot was clearly not Plan A for Justin Trudeau’s Liberal government, which had initially hoped it might be able to get away with a relatively painless “modernization” of the 24-year-old trade agreement.
Ottawa is suddenly facing heat on the home front for getting Canada into this mess. Critics say the crisis would have been avoidable if the government had played its cards better in the nearly two years since Mr. Trump’s surprise election win.

Perhaps the government could have shown more willingness to compromise early on, making it clear it would offer concessions, particularly in the highly protected dairy sector. Or it could have pushed for a quick bilateral deal with the United States last year, giving Mr. Trump an early trade “win” and leaving Mexico to fend for itself. And once the die was cast for a full renegotiation of NAFTA with all three partners, Ottawa could have done a better job of managing relations with both the outgoing and incoming governments in Mexico. Finally, the Canadian team should have been more restrained in criticizing the Trump administration, epitomized by Foreign Minister Chrystia Freeland’s withering denunciation in June of the President’s trade and foreign policy in a speech delivered just blocks from the White House.

https://www.theglobeandmail.com/busi...tion-on-nafta/
Quoting amarranjan
Trump is living in a dream that US can grow alone in isolation. He needs good economic growth but low interest rate and weak dollar. He wants cheap export and costly import. What US is now today, it is not made by American alone, it is made by all the talents coming from all over the world. There is difference between powerful and respectful. US is no more respectful under Trump. Russia is also powerful they have enough military and nuclear arsenal. once respect is over US is finished.
Tell me how the US is living in isolation? The US is making deals with many countries since Trump has taken office. People like you who make such arguments are not properly informed on the economics playing out, but only parroting MSM talking points.

This is about economics, not about Military might or making war, so leave that nonsense out of this discussion.
Quoting Guest
You forgot cheap CAD will push business from US to Canada not the other way around.
You are correct! Especially the automotive sector.
Quoting fxsport
Hey Trudeau that's what you get when you try to play hardball with Trump. You are a going to be sorry now. The USA can do without Canada but Canada CAN NOT do without the US market. This is what is going to unfold....you read it here first.... 1. Canada will get all bent out of shape and cry foul 2. The Canadian PM, Justin Trudeau will publicaly say, "We will not cower to the US demands of a 'madman'" 3. Trump will END NAFTA and sign a deal with Mexico that puts Canada in the cold (no pun intended) 4. Trump will put HUGE tariff's on Canadian...

You are spot on!

Mexico is a done deal and can not be changed! This right before a midterm, congress has nothing and will not come to the aide of Canada by siding with Multi-nationals, the crux of why increased Mexican Labor cost was a brilliant move by Lighthizer! Win win for everyone! Good luck Trudeau! Been nice knowing ya! Not!
😂😂😂😂😂😂😂😂😂😂😂😂😂

Or ..... to be more Wourld Wide Weby correct ....

LOL!
Quoting DrManhatten
{quote} Tell me how the US is living in isolation? The US is making deals with many countries since Trump has taken office. People like you who make such arguments are not properly informed on the economics playing out, but only parroting MSM talking points. This is about economics, not about Military might or making war, so leave that nonsense out of this discussion.
Odd. CETA is in place and comparable to NAFTA. As for Canada being subsidised by the US, the truth is something else - as the US subsidises 73% of it's own milk production, for example.
Quoting fxsport
Hey Trudeau that's what you get when you try to play hardball with Trump. You are a going to be sorry now. The USA can do without Canada but Canada CAN NOT do without the US market. This is what is going to unfold....you read it here first.... 1. Canada will get all bent out of shape and cry foul 2. The Canadian PM, Justin Trudeau will publicaly say, "We will not cower to the US demands of a 'madman'" 3. Trump will END NAFTA and sign a deal with Mexico that puts Canada in the cold (no pun intended) 4. Trump will put HUGE tariff's on Canadian...
One problem.

All of that is completely moot when Trump gets impeached.
Quoting raklian
{quote} One problem. All of that is completely moot when Trump gets impeached.
Trump isn't going anywhere lol. Not now, not after November, not anytime before 2020.....probably not until the end of his second term.
Quoting Guest
All these insightful comments </sarcasm> ignore some facts. On 1 December 2018 Mexico swears in their new president, Mr. Obrador. To say that he despises Trump is putting it mild. Once he is sworn in there will be no agreements with Trump. Be a statesmen Mr. Obrador is remaining silent until he is sworn in. Canada has great trade relations with China, all of Asia, and the EU. Canada has existing agreements such as the Trans Pacific Partnership and the Comprehensive Economic and Trade Agreement. Canada's raw materials are easily sold around...
https://oilprice.com/Energy/Crude-Oil/US-Outstrips-Saudis-In-Largest-Recoverable-Oil-Reserves.html

I dont think US has an oil problem
Quoting raklian
{quote} One problem. All of that is completely moot when Trump gets impeached.
Once again stop drinking the MSM flavor-aid. There is NOTHING that constitutes anything worthy of impeachment of a sitting US President. Any legal scholar/expert will verify that, however the MSM delights in their impeachment fantasy.

2. The Democrats will NOT regain control of the House of Representatives in November. How do I know this? To quote James Carvell, "It's all about the economy stupid..." When push comes to shove Americans will vote their pocketbooks over ideology 99% of the time.

3. If you remove the PERSON Trump from the equation and just look at the economic policies and rollback of government regulations than over 75% of American approve. With regard to the immigration policy that is currently advocated there is video of current Democrats calling for building a wall.
...because you never know - until you do!
Quoting amarranjan
Trump is living in a dream that US can grow alone in isolation. He needs good economic growth but low interest rate and weak dollar. He wants cheap export and costly import. What US is now today, it is not made by American alone, it is made by all the talents coming from all over the world. There is difference between powerful and respectful. US is no more respectful under Trump. Russia is also powerful they have enough military and nuclear arsenal. once respect is over US is finished.
What isolation are you talking about? The US is about to sign a Free Trade Agreement with Mexico and announced trade regulations with the EU last month.

The US has trade agreements in place with Japan and we are attempting to get China to come to the table as well.

Trump would be more than willing to put an agreement in place with the UK but until they break free from the yoke of the EU that probably won't occur. In addition Trump has signed deals in Saudia Arabia and had more talks with Russia than the past US Administration.

As for "respect" frankly Trump doesn't care. There is a cliche in the business world, "Money talks and BS walks" The US will no longer throw money around the world, especially to countries that don't show their gratitude for it, ie., Palestinians. Trade agreements will have to be redone to be "fair". No longer will the US turn the other cheek and allow smaller countries to take advantage of the US.
...because you never know - until you do!
Quoting Guest
You forgot cheap CAD will push business from US to Canada not the other way around.
Yes, BUT
1. Higher US tariff's will negate the currency differential
2. US has lower corporate tax rates than Canada
3. US has lower energy costs for manufacturing companies and better infrastructure
4. US has a better business climate than a socialist Canada has.
...because you never know - until you do!
  •  Guest
  • | IP XXX.XX.66.166
Quoting lasty
{quote} https://oilprice.com/Energy/Crude-Oil/US-Outstrips-Saudis-In-Largest-Recoverable-Oil-Reserves.html I dont think US has an oil problem
No matter the size of the reserves, the U.S. does have a problem getting the oil out of the ground and out to market. The Permian basin does not have pipeline capacity to get the crude to the Gulf, looking at 2019 at the earliest for some new pipes to come online and even then it will be well short of what is needed. Pipelines are enormously expensive and are typically 20 year investments. There is risk in tying up capital for 20 years when the underlying commodity will run through several boom and bust cycles during that time.

The other issue in the Permian is the amount of salt water that has to get pumped up with the fracked oil. Currently 4 barrels of saline get pumped up for every barrel of crude. Since the water has a high salt content as well as contaminants it cannot be simply dumped on the ground.

Then there is the whole methane issue with millions of dollars of NG being flared off since there are no pipelines for the the gas.

Yes, lots of reserves; in theory,
  •  Guest
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Quoting DrManhatten
{quote}
You can't impose an export tax and artificially raise the price of a world commodity that is already set by market prices. This would be a violation of WTO rules and would be struck down faster than you can say lightning! The only country that can impose a tax is the country in which the goods are being imported into.
And yet, this very day, WTO member Argentina did precisely that with its agricultural exports. They already have export taxes in place, and today, raised some of them.

There is nothing in the WTO that bans export taxes. Many discussion papers and talk, but not a single regulation.

If you make your posts longer you may appear authoritative, but you are still wrong in fact.
Quoting Lamplighter
{quote} Odd. CETA is in place and comparable to NAFTA. As for Canada being subsidised by the US, the truth is something else - as the US subsidises 73% of it's own milk production, for example.
CETA is not the same, and that is Trudeau's problem, he thinks he can impose EU policy on the US market as part of this deal and it will never fly. Things like Gender, Global warming, Carbon tax BS.

Yes the US does subsidize their dairy market, only because Canada imposes such 270% tariffs on US dairy products and Dairy farmers are having a hard time with costs when such barriers are erected from Canada. Funny how that works, Canada gets to complain about US tariffs yet they say nothing when they having been doing the same making money hand over fist well before this agreement was up for renegotiating. There is a good reason why there is a 70 billion trade deficit with Canada, and it didn't get that way because Canada is a diverse economy!

Also the US does heavily subsidize the Canadian economy due to the volume of trade that goes south of the boarder vs what goes North in the form of US goods and the the amount of money that has to be paid in Canadian costs for having access to their market. Softwood Lumber, Automotive, Aeronautical?

Lastly this is more to do with Chinese content that Canada is insistent on that the US accept as part of the new NAFTA deal, and there is no way Trump and his team will go for that, which is why there will be no deal in the end. Trudeau can die on his ideological sword for all I care, the writing has already been on the wall for quite some time and that is exactly what he will do! There is no saving face for him, his political life depends on it!

Even a Smart Canadian knows this as well!

Inserted Video
Quoting Guest
{quote} And yet, this very day, WTO member Argentina did precisely that with its agricultural exports. They already have export taxes in place, and today, raised some of them. There is nothing in the WTO that bans export taxes. Many discussion papers and talk, but not a single regulation. If you make your posts longer you may appear authoritative, but you are still wrong in fact.
We are talking about Oil. A commodity that is dictated by world markets. Seems to me you are the one that should check your facts and learn basic economics.

Furthermore going back to your original premise of Canada having the US over a Barrel, that is a statement that is typical for someone who lives in a fantasy world! Nice try!
Quoting Guest
{quote} No matter the size of the reserves, the U.S. does have a problem getting the oil out of the ground and out to market. The Permian basin does not have pipeline capacity to get the crude to the Gulf, looking at 2019 at the earliest for some new pipes to come online and even then it will be well short of what is needed. Pipelines are enormously expensive and are typically 20 year investments. There is risk in tying up capital for 20 years when the underlying commodity will run through several boom and bust cycles during that time. The other...

They don't get all their oil out of the Permian basin! Alot is being produced in other places such as Alaska, North Dakota, offshore etc. US is on pace to being energy independent so really its a moot point because most of what your saying is speculative in nature and nothing has happened yet. Who knows? Maybe a deal can be struck, but I am not counting on it. That being said if the latter happens, and Trudeau decides to play politics instead of doing whats is right, Canada, particularly Canadian workers will suffer more that the US and that would be a shame!
Quoting Guest
{quote} No matter the size of the reserves, the U.S. does have a problem getting the oil out of the ground and out to market. The Permian basin does not have pipeline capacity to get the crude to the Gulf, looking at 2019 at the earliest for some new pipes to come online and even then it will be well short of what is needed. Pipelines are enormously expensive and are typically 20 year investments. There is risk in tying up capital for 20 years when the underlying commodity will run through several boom and bust cycles during that time. The other...
I guess you haven't heard about trains and tanker oil cars have you?

As for the fraking and saline content that is CURRENTLY a problem but unlike other countries the USA will find a solution VERY quickly.
...because you never know - until you do!
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  • Posted: Sep 1, 2018 2:50pm
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    Category: High Impact Breaking News
    Comments: 27  /  Views: 7,124