“This Is A Black Swan Event”: Markets Turmoil As Trump Unleashes Tariffs On Mexico “Until Illegal Immigration Stops”

Update 2: some borderline apocalyptic observations from Bloomberg markets live managing editor, Mark Cudmore who writes the following:

This Mexico tariff news is far worse than even the initial market reaction makes it out to be. The timing is almost immediate. Chaos for both companies and bureaucrats. No time for anyone to prepare or make contingencies. The only way the S&P 500 doesn’t sink massively today is if Trump rows back on this. The U.S. imported almost $350b worth of goods from Mexico in 2018.

What makes it even worse again, if possible, is that so many traders were hoping Trump would soon take a more conciliatory trade zone because U.S. stocks have weakened.

This is a black swan event for markets and people aren’t even registering. Maybe traders are all hoping there’s some mistake or that this won’t be implemented.

* * *

Update 1: it’s going from bad to worse, with the White House warning that it will hike Mexico tariffs to 25% by October 1, if the border crisis persists, as Trump is activating a scorched earth approach whereby he will “punish” any offshore nation that he believes is transgressing, by imposing tariffs.

Meanwhile, moments after Trump’s shock tweet, the Mexican deputy foreign minister Seade said that if President’s threat to impose tariffs is carried out, “it would be disastrous”, and Mexico would “respond strongly”, adding that “we will not remain with out arms folded” before the tariff deadline “to see if it is serious.”

* * *

Following an earlier leaked story from the Wall Street Journal, President Trump has confirmed that he will impose tariffs on Mexico until the illegal immigration problems at the southern US border are fixed.

Amid negotations and escalations in the process of moving USMCA through Congress, Trump has decided to go after one on America’s closest trade partners: “On June 10th, the United States will impose a 5% Tariff on all goods coming into our Country from Mexico, until such time as illegal migrants coming through Mexico, and into our Country, STOP. The Tariff will gradually increase until the Illegal Immigration problem is remedied, at which time the Tariffs will be removed. Details from the White House to follow.”


The reaction in markets was swift. Futures slumped…

And the peso plunged…

And Treasury yields tumbled, with 5Y back below 2.00%…

Collapsing the curve into further inversion (3m10Y now -19.7bps)…

So it appears ‘Tariff Man’ is true to his word – imposing arbitrary tariffs on anyone and everyone until he gets what he wants to Make America Great Again.

via zerohedge


  1. You would think Mexico would be a little more conciliatory about stopping illegal immigrants from entering the US instead of making threats toward the US it would be of their interest to stop illegals from entering their Southern Boarder instead of encouraging them. Sounds like 88all Mexico wants to do is hurt itself and the US the country it does the most trading with.

  2. Tariffs for Mexico? Yup, cheaper for them to park their military on that border of theirs and end the South American flush of every SA country’s trash to the US. They do not want these people so they are laughing as they send em here for the dim wits to use. Glad Trump finally spelled it out to the countries who take loads of money from us that are making fools of us at the same time.

    Stop them at that border since here in the US the dim wits stop every attempt to end the hordes their donors have encouraged for the votes and cheap underclass of labor usually under the table. And we as voters need to vote out the floaters in the cesspool of DC.

    Sick of the dim wits making this country look like crap, the are POS as a party and now resemble a lunatic asylum. The people who vote for them are brain dead and do not give a damn about this country or they cannot connect the dots to see the truth of the fundamental destruction agenda Bozo started. DNC is destroying the constitution, our laws, our country in their vendetta because Hillary lost even though they rigged the primary as their DNC chair stated and the general as well. They just did not count on the patriots out voting their fraud. And they cannot accept the results since it definitely stopped their NWO plan.

  3. Tariff-Man as a cartoon. See how the media is mainly used as a propaganda tool. As a soldier in Afghanistan we were taught to try and win the hearts and minds. We did this with food, candy, goats, sometimes money or buy their stolen shit. We didn’t win a damn thing and most were natural born enemies of the US anyway. Propaganda is a short term solution to obtaining the near term results. It’s not for long term. The media wants to turn Trump into a villain over tariffs. They will use this terminology until Americans realize the candy has run out. Then we’ll maybe finally figure out if we are treated equal as they themselves then we stand a chance to stabilize regions. If your a supposed American, what is wrong with dollar for dollar trade with China, Mehico, Canada? Now those investors in China market and Mehico are crying because they liked that lopsided treatment. They liked making three times as much in a foreign market, they don’t want fair trade. So, if Bill and Hillary were in when these new trade agreements went in to affect, why you worried now. Because the rich in America don’t want Trump. He’s hurting them but to get the liars to admit they made good money from the Latinos but I thought Trump was only for the rich.

  4. This is sorrrrrrrrry. But no matter what President Trump does (that is actually what America needs), the MSM and all the brainwashed-into-socialism college grads of the last few years, are gonna find fault with it. In many cases, this is just because the masses of younger Americans HAVE been misinformed. But God help us if their votes prevail in 2020! Sadly, they’ll live to see what a horrid mistake they made — but it’ll be too late for all the freedom-loving Americans. May Trump prevail in 2020, dear Lord!

    The sad fact is that the tidal wave of “invaders” through our southern border is costing far, far, far, far more than what these rich folks are losing in the markets. They should have put their money into something that actually helps their country, not in something that helps destroy it!

  5. Oh, and by the way, let’s put the blame for the markets falling squarely where it belongs: on the shoulders of the mule-headed and self-centered Demo(n)crats who just totally ignored the crisis we’re in, even denying that there is a crisis, and stoutly refused to do their job in Congress by voting to give our President the funds he needed to fix things without tariffs!!!!!!!!!

    Wake up, you who are drinking the Leftist Kool-Aid!

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