This article was originally published by Michael Snyder at The Economic Collapse Blog. 

I can hardly believe how rapidly economic events are moving now.  The global trade war that has just erupted is going to be immensely painful.  If you doubt this, just read all the way to the end of this article. There is a reason why the Dow Jones Industrial Average has fallen by more than 1,300 points over the past two days.  The top minds on Wall Street clearly understand what is coming.

China, Canada, Mexico, and the EU could avert disaster by negotiating with President Trump, but they are all choosing not to do so.  Everyone is digging in for a long fight, and the result is going to be absolutely disastrous.  Of course all of this is happening at a time when it appears that a recession has already begun.  We are in far more trouble than most people realize, and the months ahead are likely to be quite excruciating.

Shortly after Trump officially imposed high tariffs on goods coming from China, Canada and Mexico, the Chinese and the Canadians announced new tariffs of their own…

Canada and China swiftly announced retaliatory tariffs against the U.S. on Tuesday, shortly after long-threatened levies by the Trump administration on those countries and Mexico took effect.

President Donald Trump’s new 25% tariffs on imports from Mexico and Canada were imposed at 12:01 a.m. ET, along with a doubling of duties on some Chinese goods to 20%.

The Canadian economy is going to be thrown into a major downturn by these tariffs, but Canadian Prime Minister Justin Trudeau has foolishly decided that this is a battle that his nation needs to fight…

Canadian Prime Minister Justin Trudeau announced Tuesday retaliatory tariffs on U.S. imports to Canada after the U.S. imposed levies of its own. He said a 25% duty on CA$30 billion worth of U.S. goods would take effect immediately, adding that another CA$125 billion in products would be hit with the same tariff in three weeks.

During remarks to the press, Trudeau publicly stated that what Trump has chosen to do is “dumb”…

“We should be working together to ensure even greater prosperity for North Americans in a very uncertain and challenging world,” he said. “Now, it’s not in my habit to agree with the Wall Street Journal, but Donald, they point out that even though you’re a very smart guy, this is a very dumb thing to do.”

“Today the United States launched a trade war against Canada, their closest partner and ally, their closest friend. At the same time, they’re talking about working positively with Russia, appeasing Vladimir Putin, a lying murderous dictator. Make that make sense,” said Trudeau. “We two friends fighting is exactly what our opponents around the world want to see.”

Of course Trump was going to see what Trudeau said, and he responded by threatening to raise tariffs on Canadian products even higher…

Please explain to Governor Trudeau, of Canada, that when he puts on a Retaliatory Tariff on the U.S., our Reciprocal Tariff will immediately increase by a like amount!

Canada is our largest trade partner, and there will be severe consequences on both sides of the border.

One Canadian official is warning that this trade war will result in “recessions, job losses and economic disaster”…

“Today’s reckless decision by the U.S. administration is forcing Canada and the U.S. toward recessions, job losses and economic disaster,” Canadian Chamber of Commerce CEO Candace Laing said in a statement.

I wish that I could tell you that she is wrong.

But I can’t.

Mexico is our second largest trade partner, and Mexican President Claudia Sheinbaum has announced that Mexico will impose retaliatory tariffs by the start of next week…

Sheinbaum said she will announce retaliatory tariffs this weekend.

“We have decided to respond with tariff and non-tariff measures that I will announce on Sunday,” Sheinbaum said.

I can’t even begin to describe how much pain this trade war is going to cause for the Mexican economy.

Trade with the United States is one of the central pillars of their entire economic system.

China is our third largest trade partner, and they are imposing retaliatory tariffs on us too…

China announced Tuesday it would impose additional tariffs of up to 15% on some U.S. goods from March 10 and restrict exports to 15 U.S. companies.

The retaliatory measures from China’s Ministry of Finance and Ministry of Commerce came just as additional U.S. tariffs took effect on Chinese goods.

The additional Chinese tariffs largely cover U.S. agricultural goods, including corn and soybeans, which will be subject to new duties of 15% and 10%, respectively, according to the finance ministry’s website.

Throughout human history, trade wars have often preceded shooting wars.

Ominously, the Chinese are pledging to fight “to the bitter end”…

In Beijing, Foreign Ministry spokesman Lin Jian said that if the U.S. “persists in waging a tariff war, a trade war, or any other kind of war, the Chinese side will fight them to the bitter end.”

Those are unusually strong words for the Chinese.

Usually they are much more restrained.

I think that they understand what is at stake.

We really could be heading into a global economic nightmare.

In fact, a senior official at the International Chamber of Commerce is claiming that we could soon be looking at “a downward spiral that puts us in 1930s trade-war territory”…

The world economy could face a crash similar to the Great Depression of the 1930s unless the U.S. rows back on its plans to impose steep tariffs on imports, a senior official at the International Chamber of Commerce warned.

“Our deep concern is that this could be the start of a downward spiral that puts us in 1930s trade-war territory,” said Andrew Wilson, deputy secretary-general of the ICC, which promotes global business and trade.

I don’t think that most Americans understand what we could potentially be facing.

According to CNBC, “a third of vehicle production in North America could be cut by next week”…

Roughly a third of vehicle production in North America could be cut by next week as a result of President Donald Trump’s 25% tariffs on Mexico and Canada, as automakers attempt to mitigate increased costs and buyers hold off on purchasing new cars and trucks.

That lost production would equate to roughly 20,000 units per day, according to a new analysis from prominent data and forecasting firm S&P Global Mobility.

That would be absolutely devastating to the auto industry.

And we are being told that the tariffs that are being imposed could add “as much as $12,200” to the cost of a new vehicle…

The 25% tariffs on goods from Canada and Mexico, as well as an additional 10% tariff on imports from China, could drive up car costs by as much as $12,200 for some models, according to a report from Anderson Economic Group (AEG), a Michigan-based economic consultancy.

The broad-based tariffs are likely to fuel higher costs on multiple types of vehicles, including SUVs, small cars and electric vehicles, according to AEG’s analysis. Higher sticker prices would hit the auto market even as the typical car now costs close to a near-record high of $50,000, and would likely add more financial strain on inflation-weary consumers.

If you need to purchase a vehicle, I would recommend doing it sooner rather than later.

Food prices are about to go up dramatically as well…

If looking at your grocery total makes you feel like your eyes are bulging out not unlike a cartoon, I have some bad news for you: Those same groceries are about to get a lot more expensive and fast. No, I’m not just talking about eggs, either, but rather pretty much every aisle of the grocery store. Why is that? Well, starting on March 4, 2025, imported products coming from Mexico and Canada will incur a 25% tariff, according to President Trump’s newest directives.

If that sounds alarming, that’s because it is. After all, Canada and Mexico are the largest suppliers of agricultural goods to the U.S. Scan your own pantry (and fridge) shelves, and you’ll likely notice no less than a few dozen different items our neighbors produce. In fact, 77% of our fresh produce comes from Mexico and 34% of our fresh meat comes from Canada, all of which (and more) will mostly likely soon come along with what will feel like a 25% surcharge. So while the immediate impact of the tariffs is still unknown (the brunt of the effects will fall on Mexico and Canada), experts say consumers should anticipate that grocery prices to rise in response.

Most U.S. households are already struggling to make ends meet thanks to how high food prices have risen.

The Wall Street Journal is telling us that even low price store brands are feeling the pain of reduced sales as consumers pull back on spending…

First, shoppers squeezed by inflation began ditching name-brand snacks and drinks in favor of lower-price store brands. But now, with costs for coffee, eggs and other basic grocery items surging, consumers are cutting out many cheaper items as well. That has TreeHouse Foods, one of the country’s largest manufacturers of private brands, feeling the pinch.

The maker of cookies, crackers, coffee and other goods for retailers such as Walmart, Whole Foods, Trader Joe’s and Target, gained ground in recent quarters as inflation pushed shoppers into cheaper food options. With sales growth now slowing significantly, TreeHouse is working to protect its margins by slashing costs and fine-tuning its list of products, anticipating that shoppers will remain stretched, at least for now.

Now food prices are likely to go significantly higher, and that is bad news for all of us.

Unfortunately, this could be the trigger that sends stock prices tumbling.

The stock price gains that we witnessed after Trump was elected are being wiped out, and the Dow fell another 670 points on Tuesday…

The Dow Jones Industrial Average tumbled for a second day as President Donald Trump’s tariffs left investors fearful of potential shockwaves for the economy.

The blue-chip average dropped 670.25 points, or 1.55%, building on Monday’s plunge of nearly 650 points. The Dow ended the session at 42,520.99. The S&P 500 dropped 1.22% and closed at 5,778.15 after notching its worst day of the year in the prior session. The Nasdaq Composite lost 0.35% and finished at 18,285.16.

So what is the bottom line to all of this?

The bottom line is that the severe economic problems that we have been experiencing are about to greatly accelerate.

We were clearly warned that global chaos would soon erupt, and that is precisely what has happened.

Ultimately, what we are witnessing shouldn’t be a surprise to anybody.

But at this point the vast majority of the population is still asleep, and that is extremely unfortunate.

Michael’s blockbuster entitled “Why” is available in paperback and for the Kindle on Amazon.com, and you can subscribe to his Substack newsletter at michaeltsnyder.substack.com.

About the Author: Michael Snyder’s new book entitled “Why” is available in paperback and for the Kindle on Amazon.com. He has also written eight other books that are available on Amazon.com including “Chaos”, “End Times”, “7 Year Apocalypse”, “Lost Prophecies Of The Future Of America”, “The Beginning Of The End”, and “Living A Life That Really Matters”.  When you purchase any of Michael’s books, you help to support the work that he is doing.  You can also get his articles by email as soon as he publishes them by subscribing to his Substack newsletter.  Michael has published thousands of articles on The Economic Collapse Blog, End Of The American Dream and The Most Important News, and he always freely and happily allows others to republish those articles on their own websites.  These are such troubled times, and people need hope.  John 3:16 tells us about the hope that God has given us through Jesus Christ: “For God so loved the world, that he gave his only begotten Son, that whosoever believeth in him should not perish, but have everlasting life.”  If you have not already done so, we strongly urge you to invite Jesus Christ to be your Lord and Savior today.