Weird and weirder

Markets did not have a cow today when trading started. That was interesting. Because, as you know, everything is weird.

Last night Trump said Canada may face a withering new tariff of 35% on everything, pus sectoral levies, come August first. Well, so much for that July 21 deadline negotiators have been working on for a new mini-NAFTA. Poof… and just days after Ottawa caved on the Digital Services Tax when the orange guy threw his last fit.

So were we snookered? Like Trump’s press sweetie said, did Canada ‘cave to the President of the United States’, and get nothing but extra tariffs in return?

Dunno. But Mr. Market is counting on more TACO trade with Trump’s dissing of Canada and a score of other countries. The betting is his new deadline will come and go, or be paused, amended or ended. A Chinese government official said days ago that 47 changes his mind as often as his shoes. Seems about right. (By the way, those guys now have a lux EV that charges in five minutes. Suck that, Elon.)

There’s more.

The number of properties for sale in the GTA should hit 33,000 today or tomorrow. The long-term (17 years) average is just over 18,000. So, this is unprecedented. There’s a 5.5 month supply of resale houses, which compares with seven days in 2021.

The historic situation is linked to Tariff Man, of course, since everybody is expecting a recession. That saps consumer confidence, makes folks worry about household finances, and kicks realtors and retailers where it hurts. The guy selling me an area rug at Alexanian’s yesterday said the last two months had him and his wife wondering about survival. “Nobody is daring to buy even a carpet,” he said.

Bu wait. Look at the latest jobs stats in Canada. There were 83,100 new hires when economists had expected (almost) none. Yes, a whack of those were part-time positions, but it was enough to push the jobless rate for to just below 7% (in the US it’s 4%). Private sector jobs accounted for about half, and ten thousand more people were hired in in manufacturing. Wages increased just over 3% – so ahead of official inflation.

Whazzit mean?

Tariffs have not hit us yet in any meaningful, large, national fashion. “Given the uncertainty hanging over the Canadian economy, many (including us) will be skeptical of this report,” say the economists at BMO.

“Even so, it appears that the economy is hanging in there for now, pending the result of ongoing trade negotiations. Barring a sharp decline in underlying inflation in next week’s June CPI report (which looks unlikely), the strength in today’s jobs data and the recently heightened uncertainty on the trade front likely keep the BoC on the sidelines when it meets later this month.”

So, no rate drop at the end of July, the bank says. That means the next possible decline would not be until September 17th. And Dog only knows what kind of weirdness we’ll be living through then.

Meanwhile, the orange guy seems to be closing in on the Fed boss, Jerome Powell.

As reported days ago, the president has called him stupid and a numbskull. Trump now demands an unprecedented 3% drop in interest rates, which would torch the bond market, ignite equities, fuel inflation, suck off global capital and tatter the Fed’s reputation. Our CB would be thrust into an untenable position. Dropping rates like that would send housing ballistic. Resisting would swell the loonie and tank an economy also facing tariffs.

Well, Trump now says Powell is spending too much on a reno of his HQ, and it borders on criminality. Since a president can only remove a Fed chair for ‘cause’ we all know why this is happening. Mr. Market is nervous.

Oh, and speaking of having cows, the US wants us to dismantle the supply management system that keeps our farmers viable, and rely on American production for our food.

Hooves up!

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Source: https://www.greaterfool.ca/2025/07/11/weird-and-weirder/