Canadian Prime Minister Mark Carney is delivering speeches, holding press conferences and trying to justify his position following the collapse of negotiations between the USA and Canada.  Meanwhile, President Trump and his trade team are intentionally quiet.

In all high-stakes negotiations, deals and financial issues, the apex predators always know you make your point clearly and without reservation, you establish your terms and then you don’t say anything.  Total silence.  The first person to break the silence is the losing hand.  Once your terms are established you stay quiet and then let the other party talk, talk, and talk themselves to yes.  Silence is the power.

Mark Carney is telling everyone his position and trying to justify what has taken place.  Mark Carney is in a very weak position on both structure and substance of the issues. [I wrote a lengthy explanation HERE]

Within this segment Carney tries to explain what the USA requests were that Canada would not agree to.  He notes the U.S. wanted strict control over Canada’s free trade agreements (FTAs) with other countries.  What Carney fails to note is that this exists already, right now in the USMCA [Article 32:10 of the USMCA].  The U.S. has termination rights to both Canada and Mexico FTAs with other countries.  This is an example of Carney gaslighting Canadians.

In reality, Canada wants unlimited and unrestricted access to the U.S. market as if they were a 51st state.  However, Canada will not permit unlimited and unrestricted access to their market for U.S. companies.  This, Carney says, compromises the sovereignty of Canada. WATCH:

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I was confident the discussions would collapse because the Canadian position is based on lies, fraud and political denial.  Canada is playing politics hoping to retain their one-sided benefits and outlast President Trump into the midterm election.  Trump, however, has already executed the tariffs and the only thing remaining for him and Greer to do is trigger the six-month USMCA withdrawal. [Details Here]

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Moments ago, Canadian Prime Minister Mark Carney delivered the news via his X account.  Discussions between the U.S and Canada have collapsed. All trade representatives are called back home.  The 50% U.S. tariffs against Canada are now in effect.  A trade war begins.

First, read the statement from Prime Minister Mark Carney, with the understanding that Carney is making the first statement because the news is exceptionally bad for Canada.  Worse than bad.

[SOURCE]

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This video from the Promethean Action PAC wraps in a few background details that most readers and followers of the U.S-Canada trade relationship will likely find interesting.

Susan Kokinda argues the dispute is larger than USMCA negotiations, portraying Canada as an “outlaw” that enables transshipment “smuggling,” fails to enforce forced-labor bans, and facilitates “snow-washing” through weak corporate transparency and money laundering documented in British Columbia’s Cullen Commission.

She contrasts U.S. Energy Secretary Chris Wright’s pro-development case for oil and gas as civilizational progress with Canadian Minister Mélanie Joly’s Chatham House speech promoting “geo-industrialization” and a Mark Carney-aligned “middle powers” strategy against U.S. and China “hegemons.” Kokinda highlights a House of Commons petition led by Green Party leader Elizabeth May to declare U.S. Ambassador Pete Hoekstra persona non grata, and notes Joly’s outreach to U.S. lawmakers and cities during the trade fight.  WATCH:

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Earlier today following a meeting in Washington, D.C., between Canada-U.S. Trade Minister Dominic LeBlanc and United States Trade Representative Jamieson Greer, both representatives delivered remarks to reporters.  There are no details provided, however, within his remarks, Greer says he is confident that a deal has been reached as they work to finalize the details.

USTR Greer notes the significant trade barriers between the U.S. and Canada appear to have been resolved. However, the devil is going to be in the details.  Greer noted they are putting together the documentation that will allow him to brief President Trump and congress on the proposals.  “While we certainly have eliminated some of the irritants we have had over the past several years, we are also taking a strong foot forward,” Greer remarked. WATCH:  

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Given the antagonistic nature of Canada and their dependency on retaining an assembly economy with access to the U.S. market, it will be interesting to see what non-tariff barrier positions the Canadian government is willing to put forth.

There is a lot of optimism in media surrounding the tariff pause and the remarks that have followed; but I would caution interested parties to be aware of the scale of the divide between the two sides.

President Trump’s remarks from today about the Canada-U.S. trade position are below.

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President Trump has paused the 50% tariffs set to go into effect against Canada at midnight.

According to media reports, after the Canadian trade delegation failed to come to a negotiated settlement on key USMCA terms, Prime Minister Mark Carney called President Trump earlier today to discuss the tariffs that were scheduled to begin tomorrow.

President Trump has announced a pause via Truth Social:

[SOURCE]

I’m curious to see how this works out.  Apparently, there’s something about the Keystone XL Pipeline in a deal.

UPDATE:

Congratulations Mr. President. The deal will include comprehensive market access for all American goods, economic security commitments, digital trade alignment, and many important provisions that will continue to protect our market and American workers, along with our Canadian… https://t.co/YSQ4rNmKAv

— United States Trade Representative (@USTradeRep) August 19, 2026

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The White House Office of Trade and Manufacturing released an extensive report this week identifying the major nations who enable China to transship goods into the U.S market in an effort to avoid tariffs.  [REPORT HERE]

Within the report several nations and regions are identified as being used by Chinese manufacturers to avoid U.S. customs and duty enforcement mechanisms.  However, both Canada and Mexico are cited as primary enablers of the process.

[SOURCE HERE]

The issue strikes at the heart of the problem identified long ago with the NAFTA agreement, and the problem only worsens when the USMCA provisions on country of origin are not enforced.

When you remove oil and lumber, the majority of Canada’s manufactured exports to the USA contain Chinese component parts and this has been the source of much friction in the current trade negotiations.  The manufacturing supply chain within all free trade agreements only works when the source of component goods is accurately recorded.

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This would seem like a no-brainer, but multiple nations are so dependent on abusing the de minimis process the multinationals actually sued the United States for eliminating the $800 de minimis tariff exception.

On August 29, 2025, the U.S. government eliminated the de minimis threshold for all countries via Executive Order 14324, making the rule apply regardless of origin.  {SEE HERE} Chinese companies like Shein and Temu are subject to paying import taxes to ship cheap products into the USA.

Truth Social – BIG WIN today at the U.S. Court of International Trade on one of the most DESPICABLE loopholes in American Trade Policy — The so-called “de minimis” exemption.
 
For years, Foreign Shippers could send packages worth up to $800 into our Country, DUTY FREE, NO TARIFF, far less scrutiny. It became a giant loophole for TARIFF Cheats — and a Pipeline exploited by Fentanyl Traffickers, Counterfeiters, and other Criminals shipping dangerous and illegal products into America. The numbers were staggering. In 2024 alone, de minimis cost America an estimated 10.8 BILLION DOLLRS in foregone TARIFF Revenue, and an astonishing share of narcotics and counterfeit seizures came through the de minimis channel. So, we CLOSED IT. With the stroke of my mighty pen — NO AUTOPEN!!! — we ended this ridiculous giveaway, and made Foreign Goods play by the rules. The Importers sued. Today, THEY LOST. The Court ruled that the President had the Legal Authority to rescind this so-called “privilege.”
 
America is now SAFER, our Workers are better protected, and BILLIONS in TARIFF Revenue that used to slip through this loophole can instead help pay for our Great Military, Tax Relief, NO TAX ON TIPS, and NO TAX ON SOCIAL SECURITY. AMERICA FIRST TRADE — AND AMERICA FIRST LAW ENFORCEMENT!

~ President Donald J Trump

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The Canadian trade officials continue to misread the room.  Threatening the Trump administration with something the Trump administration benefits from, is not exactly the best trade strategy.

In the background the DOJ has just arrested a woman for her part in a trafficking operation, smuggling Indian illegal aliens into the USA through Canada {citation}.  Simultaneously, a petition within Canada to remove U.S. Ambassador to Canada, Pete Hoekstra, is gaining support because Hoekstra is focused on American best interests and not looking out for the best interests of Canadians {citation}.

On the economic front, Canadian trade minister Dominic LeBlanc met with U.S. Trade Representative Jamieson Greer for the third time in three weeks. However, it’s Canada’s Chief Trade Negotiator Janice Charette, who also participated in discussions, making headlines with threats.

Janice Charette is telling the Canadian public that formal trade discussions with the USA will end if President Trump and USTR Jamieson Greer trigger the 50% tariffs against Canadian goods which are scheduled to begin on August 19th.

President Trump and USTR Greer announced last month the U.S. would begin 50% tariffs on a range of Canadian products. the tariffs are intended as reciprocal action for Canada’s counter-tariffs on U.S. automobiles and steel, as well as decisions by Canadian provinces to boycott American alcohol. {CITATION} According to USTR Greer the tariffs will affect approximately $20 billion in Canadian imports, representing around 5.2% of the $383 billion in goods the United States imported from Canada in 2025. USMCA covered products would not be exempt from the tariff.

Ms. Charette is reported to have made it clear if the U.S. goes through with the tariffs, the Canadians will pull out of USMCA discussions and walk away from renegotiating the trilateral trade agreement.

This is apparently the threat from Canada.  However, when contrast against the intent to eliminate the multilateral trade agreement, the threat carries terms completely acceptable to the Trump administration.

CANADA – Canada’s lead trade negotiator with the U.S. Janice Charette has warned her American counterparts that if the White House imposes new 50 per cent tariffs on Aug. 19, it could put further trade talks at risk.

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Treasury Secretary Scott Bessent gets it.  When asked about the Strait of Hormuz, Bessent notes that yes, things will likely never return to the way they were before; however, there is a distinction that must be applied.

Even if Iran completely acquiesced to all of the most stringent terms and conditions requested by President Trump, they will never again recapture the position they held with the Strait of Hormuz as a chokepoint.

Capital markets respond to risk in the medium and long term; risks are always mitigated.  With the Strait now identified as a strategic risk, the emphasis will be on forever neutralizing that risk and avoiding the issue in the future.  As a consequence, Iran’s strongest point of leverage is disappearing now and will continue to disappear.  WATCH (prompted):

As further explained by James Thorne on X: “By repeatedly signaling its willingness to disrupt the Strait of Hormuz, Tehran hasn’t strengthened its hand, it has accelerated the market’s exit. Capital does not tolerate chokepoints; it routes around them.

Saudi Arabia is expanding its East-West pipeline. The UAE has already built out Fujairah as a bypass. Iraq is revisiting overland export corridors. Every marginal dollar now flows toward redundancy, not reliance. What was once a geopolitical lever is being engineered into irrelevance. Bessent gets it: markets don’t absorb coercion; they arbitrage it away.

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What we can take away from the Institute for Supply Management (ISM) index on manufacturing [Data Here]: overall, the U.S. manufacturing sector is continuing to expand significantly.  The current index of 55.6 percent in July is 2.3 percentage points above the June figure and the highest reading since May 2022 (55.9 percent), when we were trying to recover from the COVID-19 shutdowns and supply chain problems.

PMI – The overall economy continued in expansion for the 21st month in a row. (A Manufacturing PMI^® above 47.5 percent, over a period of time, generally indicates an expansion of the overall economy.) The New Orders Index expanded for the seventh consecutive month after four straight readings in contraction, registering 56.7 percent, up 0.7 percentage point compared to June’s figure of 56 percent.

The July reading of the Production Index (58.5 percent) is 6.3 percentage points higher than the 52.2 percent recorded in June and the highest figure since November 2021 (60.5 percent). The Prices Index remained in expansion (or ‘increasing’ territory), registering 71.1 percent, a 1.9-percentage point decrease from June’s reading of 73 percent. The Backlog of Orders Index registered 55 percent, up 4.5 percentage points compared to the 50.5 percent recorded in June.

The Employment Index reading of 52.8 percent is up 3.1 percentage points from June’s figure of 49.7 percent, putting the index in expansion territory for the first time in 33 months.” (source)

All that data and a couple of bucks will buy you a cup of coffee, but here’s what it means in common speak.

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