On Tuesday, President Donald Trump followed through on his promises to impose tariffs on Canada and Mexico, a decision that has sent shockwaves through the financial markets and raised alarms over a potential global trade war. The tariffs, set at a staggering 25%, come on the heels of previous tariffs on Chinese goods and are ostensibly aimed at curbing the flow of fentanyl into the United States. According to Andrew Wilson, deputy secretary-general of the International Chamber of Commerce, this aggressive move could lead to economic repercussions akin to those witnessed during the Great Depression of the 1930s. The immediate impact on the stock market was severe, with the Dow Jones Industrial Average plunging by around 670 points, or 1.55%, by the end of trading. The broader S&P 500 and Nasdaq Composite also suffered declines of 1.22% and 0.35% respectively. This represented a significant market downturn, suggesting heightened investor anxiety over Trump’s tariffs becoming a reality rather than mere negotiating tactics. As the VIX, Wall Street’s fear gauge, surged to its highest levels for the year, the sentiment among traders shifted, indicating that even previously optimistic outlooks were giving way to fear. Global markets followed suit, with indices in Europe and Asia also taking hits, reflecting the broad selloff in response to Trump’s decision. Seeking to retaliate, both Canada and Mexico announced intentions to impose their own tariffs on American goods, with Canadian Prime Minister Justin Trudeau expressing vehement opposition to the US tariffs. This tit-for-tat tariff scenario has created a situation ripe for a protracted trade war, which could further unravel economic stability and undermine consumer confidence in the US, already wavering under inflationary pressures. As tariffs on essential goods loom, American consumers may find themselves facing increased prices just as they attempt to manage their household expenses amid rising inflation rates and an uncertain economic outlook. In this context, Trump is due to address Congress later, a speech that will likely be scrutinized as markets await guidance on his administration’s direction regarding trade policies. The impending economic forecasts project potential contractions, which spell trouble not just for stock values but for the everyday lives of American citizens. This continuing saga of tariffs and trade relations raises critical questions about the effectiveness of such measures in achieving their intended goals without inflicting unnecessary harm on the economy.