Oh Sh*t. Now what?

“Can you put a flag up?’

So I did. On the front fence with black zip ties. And Dorothy was happy to see an extra red maple leaf festooned on a street with copious visitors from Ohio. NY, Michigan and other border states where Mark Carney is about to do to them what Donald Trump just did to us.

More a drama queen than we’re used to, the PM said on the weekend that we are ‘at war’ with America after, ‘they attacked us’. All true, of course. But thus far our guy has been the only world leader refusing to bend over, bow, supplicate, grovel and submit to the Grifter King.

It that calculated, manly courage? Or is he nuts?

Carney did what the majority of us wanted. He held. He walked. Now we have new, absurd 50% tariffs on Manitoba honey, Ontario cheese and Quebec-made dog muzzles (a total of $28 billion, adding in 497 other categories). We’re told a third of small businesses that export will lose half their revenues. For nothing. Sad.

This morning Trump – who has vowed in the past to break us economically – kept it up.

Economists at RBC claim this is serious, not fatal. “The size of the tariffs is likely not large enough to derail Canada’s economic growth backdrop,” they said a weekend statement. “The Canadian value added content of newly tariffed U.S. imports adds up to ~0.4% of Canadian GDP and jobs. More than 80% of exports would remain duty free under CUSMA exemptions. Still, the measures mark a re-intensification of U.S. tariff threats/measures, and concentrated specifically on Canada.”

Yeah. More is likely coming. Canada, and Carney, are in the crosshairs. After Labour Day we will tariff US stuff in retaliation. Consumer prices and business losses will grow on both sides of the border. The fate of our NA trade deal is looking grim. Until the Trump presidency ends in early 2029, we’ll be living next to an untamed, undisciplined, untrustworthy beast.

Okay, now what?

There will be some job losses, most pronounced in Ontario, BC and Quebec. Business investment will probably fade since nobody can predict anything any more with Trump in office. Carney said the US signs deals in pencil. He was too kind. It’s with crayons.

Economists see more inflation coming as import prices rise, but our economy will be taking a hit at the same time. So interest rates stay where they are – unless all this tips the country into recession (then they fall). The slowly-rustling-to-life real estate market could grow comatose again as people fret over their job security and the wisdom of walking into new piles of debt.

The loonie will be under pressure as the new tariffs suck off some of our export volume and structural demand for Canadian dollars. If the economy sours enough to force the CB to trim rates, the currency will reflect that, especially if the Fed is raising rates to deal with America’s war inflation (and the impact of seriously dumb tariffs).

Bay Street could feel it, too. As you know, the TSX has handed investors a stellar 30% return over the past twelve months and our big banks have been shooting the lights out. The new American tariffs are bearish for the manufacturing and industrials sectors, as well as consumer discretionary and retail companies.

If you’ve thought about buying a Wolf stove, Sub-Zero fridge or a Generac, just fuhgeddaboudit. In fact, almost no major home appliances are made in Canada any more. Perhaps that will now change.

Economically, it’s possible Canada might see stagflation – higher prices amid a slower economy. But, equally, Trump might abandon his tariffs or see them struck down by the courts. So it’s uncertainty that will impact investors for weeks or months to come. And, as you know, our advice has always been the same – never, ever sell into a storm. Stay invested. Stay calm.

But wait. Could we have avoided an attack on our dollar, business investment, markets and jobs by just, you know, giving in, rolling over and being ravaged by an 80-year-old fiscal predator?

Maybe. But at a cost.

The White House wanted to tell us who we could trade with. To take French off your Cheerios box. To bring your milk in from Wisconsin. And to tax us the same ldevel as the grovellers in the UK or Vietnam. Trump does not care about Canada or Canadians, Ukraine, Taiwan, Cubans or sending life-saving vaccines to brown people.

This is a corrupt, inept administration that has disrupted the global economic order, alienated allies and soiled its own flag. In the face of this, Canada has retained integrity, currency and sovereignty. Our guy did the right thing. Now we pay for it.

Carney is the new Zapata. That Mexican revolutionary fought the country’s overlords on behalf of the peasants, arguing a life without freedom or agency is a life not worth having.

It is better to die on your feet, he said, than to live on your knees.

About the picture: “Meet Sully, our family’s latest addition, and what a welcomed addition,” writes Craig in London. “He’s a King Charles Cavalier that is 12 weeks old this week and this tiny runt is such a loving soul that’s full of energy and playfulness. Love your column Garth – thanks for the informative financial sharing, and never lose the humour. More importantly, thanks for the subtle reminder that we’re so fortunate to be Canadians.”

To be in touch or send a picture of your beast, email to ‘[email protected]’.

Source: https://www.greaterfool.ca/2026/08/23/oh-sht-now-what/