Posted originally on CTH on March 22, 2025 | Sundance

While repeating his claim that Canada can easily replace their trade relationship with the USA by seeking larger trade relationship with other countries, specifically the EU, current interim Prime Minister Mark Carney repeats that no contact will be attempted or accepted by the Canadian government until President Donald Trump shows him respect.

This doesn’t portend favorably for U.S-Canada relations; which, to be fair, they would argue have been destroyed by President Donald Trump questioning their sovereignty.  However, here’s the kicker, what Canadians don’t seem to realize is that questioning their sovereignty is simply a strategy by President Trump to eliminate the one-sided trade relationship with Canada.

It is funny to me that Canada just can’t figure this out.

As long as Canada refuses to engage with President Trump due to a perceived lack of respect, President Donald Trump will continue to enhance his disrespect of Canada, because the absence of engagement assists his ‘total trade reset’ objective.  President Trump wants to ¹show, perhaps prove to the Canadian people, how dependent they are on their USA relationship; vis-a-vis they are already not a sovereign, economically independent nation.  WATCH:

¹Somewhere around 80% of Canadians have no concept of how their economy is functioning {GO DEEP}. Most Canadians seem to think they have some form of capitalistic system in operation and tweeking the knobs will fix things; it won’t.

So, from an American political perspective, specifically from the perspective of President Trump – as noted in all of his repeated remarks about the upcoming Canadian election, having Mark Carney carry out his policies and watching the system therein collapse, might break the borg-mindset.  It will be massively painful for Canadians when their currency hits around 0.25¢ to the US dollar.  However, that currency collapse will ¹more than eliminate any Trump tariff impact.

REPEAT – This is all predictable.

Here’s how it will happen. CAD = Canadian Dollar, USD = U.S Dollar

President Trump hits Canada with an approximately 50% tariff.  Let’s say an import widget from Canada costs the purchaser/importer $100 CAD + 50% tariff, now $150 CAD.

$1 CAD = 0.70¢ USD

Without U.S. tariff, it costs $70 USD to purchase the $100 CAD widget.

With the U.S tariff it would take $105 USD to purchase $150 Canadian widget

However, due to economic policy, Canada’s dependence on the USA market and the tariff battle, the Canadian currency drops around 30%.  $1 CAD now equals 0.50¢ USD

With currency drop it now costs $50 USD to purchase the original $100 Canadian widget.  $75 USD with tariff.

BEFORE: $70 USD without U.S. tariff, or AFTER: $75 USD with 50% U.S. tariff.  A net change of $5.

But wait, back to Mark Carney’s plan.  As stated in his tariff policy, the prime minister will take income from the Canadian side of the tariff equation (countervailing duties) to subsidize the impacted export sector.  Just like China and the EU did in ’17, ’18 and ’19, the Canadian government plans to offset the difference to the U.S. consumer by subsidizing the exporter with import tariff income.  All of this is done to retain access to USA consumers.

The final outcome, the U.S. purchaser is back to the original price of $70, only now that same outcome is evident with an invisible $50 tariff.

This is what China tried to do. This is what the EU tried to do.  This is what Canada is now planning to do to retain access to the U.S. market while they look for alternatives.

But wait, it gets better….

….. As the Canadian financial sector evaluates the likely drop in the CAD currency, they seek safe harbor investment to retain the value of their money.  The reciprocal tariffs are hitting every currency. The Canadian finance sector purchases dollar and dollar-backed assets to retain their value.  This approach increases the value of the U.S dollar.

Do you really think President Trump gives a hoot about PM Carney’s feelings?   Quite frankly, Trump would not want to be bothered by Canada while he is working on a much, much bigger geopolitical economic dynamic.

Go back and reference the renegotiation of the NAFTA for reference.  Trump didn’t care if Canada (Trudeau/Freeland) agreed or did not agree with the USMCA. Trump was quite willing, heck he was hoping, to just deal with Canada on a bilateral trade system.