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Good morning, I'm Nathan Hager and I'm Karen Moscow. Here are the stories we're following today.
Karen, we are seeing a sharp sell off in stocks around the world with President Trump set to follow through on his threat of tariffs against America's closest trading partners. On Saturday, the President announced twenty five percent duties on products from Canada and Mexico and ten percent on China, starting just after midnight tonight. Trump admits American consumers might take a hit.
We may have short term so a little pain, and people understand that.
But long term, the United States has been.
Ripped off by virtually every country in the world. We have deficits with almost every country, not every country, but allmost.
And Republican lawmakers are signaling they support the president's efforts. Senator Lindsey Graham had this reaction on Fox News Sunday.
If you want tariffs to go away, Mexico and China, stop poising Americans, stop sending ventanyl into America to kill Americans. If you want to have a better relationship Mexico with the United States, do your report on the other side.
Of the border, but Democratic Senator Mark Warner says tariffs amount to what he calls a Donald Trump Super Bowl tax less than a week before the big game. Remember, Donald Trump got hired trying to lower grow saying he was going to lower grocery prices.
Right two weeks in, He's doing something that's going to do the absolute opposite.
Senator Warner spoke to CBS as Margaret Brennan on Face the Nation and you can hear both Face the Nation and Fox News Sunday every Sunday on Bloomberg Radio.
Well, Nathan Trump says he will have separate calls this morning with Canadian Prime Minister Justin Trudeau as well as with the Mexican leadership. The Canadian leader has already pledged twenty five percent retaliatory tariffs on one hundred and seven billion dollars worth of US goods. Trudeau says Trump's action now risks job losses and price rises for Americans.
If President Trump wants to usher in a new golden age for the United States, the better path is to partner with Canada, not to punish US.
Canadian Prime Minister Justin Trude do other Canadian officials announce their own measures. David Eby, the Premiere of British Columbia, directed the provincially owned liquor distributor to remove some alcohol brands made in Republican Led States from the shelves of retail stores and to cease further purchases.
Well, as you mentioned, Karen, the PAESO is dropping to its lowest level in almost three years. Mexican President Claudia Shanebaum says she'll set out her response to US tariffs later today. She says she hopes a resolution can be found quickly.
That's a bit anise Nibo sovereignty is not negotiable to this end. Yesterday, in my statement, I proposed to President Trump, though we establish a working group, it is not with the imposition of tariffs that the problems are resolved, but speaking and dialoguing as we did.
Mexican President Claudia Shanebaum spoke there through an interpreter. President Trump has said he may escalate US tariffs further response to any retaliations.
Well Nathan China's reaction to Trump's tariffs, which come in the middle of Lunar New Year holiday celebrations, has been more muted. The country's Commerce Ministry issued a statement expressing strong dissatisfaction and vowing corresponding countermeasures, without elaborating. Our Chief North Asia correspondent Stephen Engels says China's reaction could yet ramp up.
This is going to be a protracted process, So Beijing has to process exactly what's going to be the end result of tariffs.
Is it going to go up to sixty percent?
It's ten percent right now, and there's going to be an economic impact to that. And I think right now, especially as they're coming out of the long Lunar New Year holiday, kind of crafting their message obviously, and.
Mutz Bloomberg Steven Angel reporting from Hong Kong.
And after announced those duties on China, Mexico, and Canada, Karen, President Trump also ramped up threats to the European Union, citing that block's large surplus with the US.
It will definitely happen with the European Union, I can tell you that, because they've really taken advantage of us, and you know, we have over three hundred billion dollar deficit. They don't take our cars, they don't take our.
Farm products, they take almost nothing. Can we take everything from them?
Millions of cars tremendous amounts of food and farm product.
President Trump's remarks came after an EU spokesperson said that the BLOCK would respond firmly to any trading partner that unfairly or arbitrarily imposes tariffs on EU goods.
Well, Nathan, President Trump's tariffs against Canada and Mexico may result in consumers paying more for cars, and we get that angle up the tariff story with Bloomberg's John Tucker and John how much are we talking about here?
Well, Karen Research from automotive consultant Alex Partners says the tariffs will add sixty billion dollars in cost to the auto industry, a lot of which likely to be passed on to consumers. Wolf Research analysts, so the average price of a new car may climb by about three thousand dollars. The duties would immediately hit almost a quarter of this sixteen million vehicles that are sold in the US every year,
as well as the parts and components that go into them. Now, car components can make their way back and forth across US borders as many as eight times during the production of the car. Automakers in Mexico they've been preparing by preemptively importing both more components and vehicles that could ease the blow in the first few weeks. But Flavio Volpi, he's the president of Canada's Automotive Parts Manufacturers Association, predicts his words now the auto sector is going to shut
down within a week. This morning, shares of GM down seven percent, Stalantes is off almost six percent, and Ford is down four percent. John Tucker, Bloomberg Radio.
John, thanks now the latest on another hot button issue for President Trump, Panama. It's now promising free passage for US warships through the Panama Canal and also says it will withdraw from China's Belton Road initiative, making Panama the first Latin American country to do so. The concessions came after a Secretary of State Marco Rubio visited Panama over the weekend.
Over time, it's the relationship had its ups and downs, and today it's one of our strongest economic partners, certainly in the hemisphere, and an important catalyst for so much trade and commerce that happens in the United States that effects and impacts so many people both going out and coming in.
And that was Secretary of State Marco Rubio speaking over the weekend.
The US built the Panama Canal at the start of the twentieth century and seated it back in nineteen ninety nine under a treaty signed by President Jimmy Carter in nineteen seventy seven.
Nathan, we're also learning more about Elon Musk's plans for government efficiency. He's sketching out plans for aggressive cuts that include wiping out the US Agency for International Development. Much said he has the President's blessing to end the US Agency for International Development and fold what's left into the State Department. The Tesla CEO says this move from his Doze initiative should instill confidence in the Treasury market.
Well, let's check the markets once again, Karen raf. Stocks are falling.
The dollar is rallying after President Trump and post tariffs on Canada, Mexico, and China. The dollars up to its highest level in more than two years. Checking it against the euro right now, the euros at one point zero two three seven, down one point two percent, the Mexican peso down two percent, while the Canadian dollar is weaker against the US dollar by about one percent.
Futures are sliding.
The S and P futures down one point six percent, Down futures one point four percent lower, and Nasdaq futures on the decline by one point eight percent. Oil is rallying nine x, crudes up two and a half percent seventy four dollars thirty two cents a barrel, and Bitcoin is falling as well, down one point eight percent at about ninety five thy three hundred dollars.
Well Nathan Earnings will also be in focus this week, as two more members of the Magnificent Seven or pourt quarterly results, and Bloomberg's Tom Busby has a preview.
Google parent Alphabet out with earnings is Tuesday. It's expected to see revenue grow double digits thanks to ad sales on its Google Search Engine, growth in its services and cloud computing, and advancements in its generative AI capabilities. Also expending its way moow robotaxi business to more cities. On Thursday, we hear from Amazon. It's expected to benefit from a burst of consumer spending ahead of the holidays and a head of tariffs imposed by the Trump White House. Also
solid revenue from its Amazon Web Services cloud division. I'm Tom buzzby Bloomberg Radio.
Time no offer look at some of the other stories making news in New York and around the world, and for that we're joined by Bloomberg's Michael Barr Michael.
Good Morning, Good morning, Karen. Authorities say they have recovered the remains of fifty five of the sixty seven people killed in last week's plane crash in the nation's capital. John Donnelly of the Washington DC Fire and Ems Department says they are committed to the dignified recovery of remains as they prepare to lift wreckage from the Potomac River as early as this morning. Don Lee also says he has spoken with the families and kept them informed of
the timeline and the operations as they work. They are a strong group of families that are focused on getting their the ones back and I think that's the appropriate place to be at this point. Officials in Philadelphia have now located the black box of the medical flight that crashed in a crowded city neighborhood Friday night. All six people on the plane were killed, and one person on the ground also died. At least twenty two people now
reported injured, including three in critical condition. Mayor Jael Parker says federal, state, and local investigators have been working around the clock at the scene.
This remains an ongoing investigation.
The situation is fluid and it is active.
The plane was on its way to Missouri and was only in the air for a short time before it crashed. Beyonce finally won air Grammy that has eluded her g one Album of the Year, the sixty seventh Grammy Awards last night, for the Country music song cow Boy Carter.
I just feel very full and very honored. It's been many, many years.
To see of CBS Recording, Academy, Global News twenty four hours a day and whenever you want it with Bloomberg News Now Michael Barr, and this is Bloomberg Karen.
All right, Michael Barr, thank you any time now for the Bloomberg Scores update. Brought to you by Tri State Outy. Here's John stash Hour, John, good morning.
Good morning. Carry the NBA trade dadline now until Thursday. But what a weekend it was. Saturday night brought the stunning blockbuster Luca Donci to the Lakers, Anthony Davis to Dallas last night, not to that level, but the Aaron Fox and Zach Lamine, good players who've been All Stars, and Fox was moved from Sacramento to San Antonio. Lavine goes from Chicago to Sacramento. I mean, while Donsi released a statement and said he thought he'd spent his entire
career in Dallas every one day. Last season, Doncis averaged thirty four points a game, nine rebounds in ten assisted. He led the Maps to the NBA Finals. So why trade him? The Dallas Genteral manager is Nico Harrison.
You know, there's some unique things about his his contray that we had to pay attention to. You know, there's there's other teams that were flowing up. You know that he was going to have he was gonna be able to decide to make his own decision at some point and whether he wants to be here or not, whether we want a super maxim or not, or whether he
wants to opt out. So I think we had to take all that into consideration and feel like we got out in front of what could have been in tromoltuous summer.
Alongside MAV's owner Mark Cuban no longer the majority owner, he was not involved in the decision the trade Donson Jet the Garden Rangers three goals in the third period beat Vegas for to two. The Islanders seven game winning street came to an end at Florida six to three. The Devils and Buffalo fell behind early three nothing lost four to three for the third.
Time in the last four years.
Rory McElroy's first term of the year of victory his first ever win at pebble Bee finished twenty one hunder a par one by two over Shane Lowry. They both had holes in one in the opening round. Former Baseball Commissioner Fay Vincent has passed away at eighty six. John stesha that I want Bloomberg Sports karnon Nathan Coast to Coast on Bloomberg Radio nationwide, on Serious Exam and around the world on Bloomberg dot Com and the Bloomberg Business app.
This is Bloomberg Daybreak.
Good morning, I'm Nathan Hager.
President Donald Trump's promise of tariffs on America's closest trading partners is rippling through markets. After announcing twenty five percent duties on Canada and Mexico and ten percent on China, the President says the European Union is next.
They don't take our cars, they don't take our farm products.
They take almost nothing. Can we take everything?
From their?
President spoke to reporters outside Washington last night, joining us this morning from the nation's capital, Terry Haynes, the founder of Pangaea Policy. As we watch stocks sell off and the dollar rally this morning, Terry, should the market have seen this coming?
Good morning?
Hi, Good morning, Nathan, And yes, I think they should have. Markets have spent the last few months talking themselves into a GRADUALI history even you know this isn't happening. It's all negotiation stance, And yes it is negotiation, but it's negotiation based not from a trade war perspective, but I think from an overall conflict perspective, a broader geopolitical context, among others.
So what is the chance, then, Terry, that the President actually does follow through on these He announced they're going to kick in just after midnight tonight. At the same time he's saying that he will have discussions with Canada and Mexico today.
I think the markets should assume that some tariffs are coming. I think the size and shape are still very much up in the air, and markets are going to have to get used to volatility here. Frankly, in the realm of political decision making. You know, my instinct, and it is only instinct, is that it's not at all beyond the question that the tariffs go in as announced. It's also not beyond the question that they go in with
some lowered modifications. You can look one way you can look at this is Trump testing the markets on reaction, and he's also tested politically the reaction of our border partners to do specific things to actually improve the border and stop the flow of fentanyl.
Is this a test on fellow Republicans as well?
It is to some extent, yes, but I think it's in so far they've been supportive. But what you got to remember over the last decade, and it's been a decade since since tariff policy became part of geopolitical policy in the United States, is that Congress has supported the means in which the how Trump imposes these tariffs, whether it was Trump one, whether it was Biden then now whether it's Trump too. You know, Congress supports the how. There will be some dissent on the when or why.
That's rooted as much in the partisan politics as anything else, but there's not going to be any serious move to try to stop Trump from doing any of these things.
Do you think there are any further concessions that Canada or Mexico could make after the concessions that they've say that they have made before the President announced these duties over the weekend.
My unsolicited advice to those countries is very simple is that you get as you get as specific. If they want to stop the tariffs, you get as specific, and to talk about how well and how much you can partner as possible. If Trump realizes, I think, unlike the first that he's going to need support from his his border partners and and very much wants those things.
And in just thirty seconds, is this about partnerships?
Is this about the fentanyl and immigration flows or is this more about the trade deficits.
I think it's about both. But at root, you know, the Trump always says that his top priority is securing the border, and I think you have to take the border strategy both seriously and literally as part of the broader geopolitical strategy and the broader economic strategy which are out there, which exists, even if they're being ignored by markets. Today.
This is Bloomberg Daybreak, your morning podcast on the stories making news from Wall Street to Washington and beyond.
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And I'm Nathan Hager.
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