- In today’s CEO Daily: Diane Brady talks to CEOs about Trump’s upending of U.S. trade policy.
- The big story: Trump’s global trade war is tanking markets worldwide.
- The markets: It’s a bloodbath out there.
- Analyst notes from Claudia Sahm, JP Morgan, Goldman Sachs.
- Plus: All the news and watercooler chat from Fortune.
Good morning. I am thinking about the pain that is about to be imposed on our neighbors and ourselves because of the steep tariffs that will come into effect tomorrow. Trump signed executive orders this weekend, imposing a 10% tariff on China and a 25% tariff on all imports from Canada and Mexico, with levies of 10% on Canada’s energy resources.
Over the past month, I’ve been asking C-suite leaders what they think of the new Trump administration’s stance on key issues. There’s a largely positive reaction to regulation and taxes, differing views on immigration and geopolitics, and a uniformly negative stance on tariffs. China is a complicated case, given accusations of dumping, IP infringement and other issues. But I could not find a single leader who supports imposing high tariffs on Canada and Mexico. Not one.
It’s easy to understand why. Tariffs are taxes that will be paid by American consumers and businesses. They will disrupt finely calibrated supply chains honed through two generations of free trade. The auto pact goes back even further; about 40% of the GM’s North American production is outside the U.S. Every country will see lower GDP and higher inflation as a result. They’re cruel and destructive to our largest trading partners. They also punish people who have nothing to do with the flow of immigrants and drugs across the border. The only drug trade I associate with Canada is the flow of Americans heading north to buy cheap prescription drugs.
Jay Timmons, CEO of the National Association of Manufacturers, points out that one-third of critical U.S. manufacturing inputs now come from Canada or Mexico, “rather than from competitors that often engage in unfair trade practices.” Even UAW President Shawn Fain said the auto union does “not support using factory workers as pawns in a fight over immigration or drug policy.” And partners are already retaliating as Ontario and other provinces have started pulling U.S. alcohol from store shelves. Expect more moves to follow.
Nobody wins in this trade war. But, as one Canadian CEO told me last week, “short of moving production south of the border, there’s nothing we can do about it.”
More news below.
Contact CEO Daily via Diane Brady, diane.brady@fortune.com, LinkedIn.
Top News
Trump’s tariffs are tanking markets globally. Stocks in China, Japan, Europe and the UK all fell sharply this morning as investors realized that President Trump’s war on trade is really happening. Worst hit was was Japan, where the Nikkei 225 fell 2.7%.
“The Dumbest Trade War in History.” The editorial board of the Wall Street Journal published an extraordinary and brutal critique of Trump’s trade policies. Trump responded on Truth Social by saying: “Anybody that’s against Tariffs, including the Fake News Wall Street Journal, and Hedge Funds, is only against them because these people or entities are controlled by China, or other foreign or domestic companies.” Reality check: The Journal is not controlled by China.
The EU vowed to respond to the U.S.’s new taxes on trade. Europe does more trade with the U.S. than any single country — meaning that things are likely to get worse before they get better.
Life in the U.S. is about to get more expensive. Prices for autos, gasoline, vegetables, fruit, beverages, liquor, beef, and construction lumber are likely to start going up as the cost of tariffs is borne by American consumers. Reminder: Trump promised to lower inflation, not raise it.
Elon Musk vows to end USAID. Musk gained access to the Treasury’s payment systems and has begun purging top officials. First on the chopping block: USAID, which funds foreign aid. “USAID was a viper’s nest of radical-left marxists who hate America,” Musk said.
Rubio repeats Panama Canal threats. We’re getting a clearer picture of what, exactly, Trump’s problem with Panama is. The company that contracted with Panama to run the canal is based in Hong Kong (ie China). Trump believes U.S. ships are charged more than others, and this breaks a treaty which requires the canal be operated in a neutral way. But the contract expires in a year or so anyway and Panama has vowed not to use a Chinese company again.
From Fortune
Activist investor warns of crypto bubble
Activist investor Elliott Management is warning investors that President Donald Trump’s support of cryptocurrency may have helped create a crypto bubble due for an “inevitable collapse.” The bubble “could wreak havoc in ways we cannot yet anticipate” and weaken the U.S. dollar, Elliott Management wrote in a letter to investors first reviewed by the Financial Times. Fortune
Jensen Huang: Get an AI tutor
Nvidia CEO Jensen Huang suggested that everyone “get yourself an AI tutor right away” during a new video interview with journalist Cleo Abram. “I have a personal tutor with me all the time,” Huang said, and singled out ChatGPT and Grok as particularly effective AI models. Fortune
Dell shuts off remote work
Dell CEO Michael Dell announced the end of remote work for all employees close to an office on March 3rd, according to a memo obtained by Business Insider. “Nothing is faster than the speed of human interaction,” Dell wrote. Fortune
The markets
- It’s going to be very rough out there today. S&P 500 futures are down 1.4%. … Nasdaq futures are down 1.5%. … Bitcoin is back down to $95,000 after topping out at around $106,000. … the VIX — the “fear index” which gauges volatility in the markets — popped up 24% already.
From the analysts
- JP Morgan on global inflation: “Tariffs could lift global inflation this year, but inflation performance during 1H25 will be largely determined by current business cycle dynamics. … we push back against the “immaculate” view held by most central bankers that (absent a tariff threat) inflation has a strong gravitational pull lower.” Nora Szentivanyi and Bruce Kasman estimate inflation will be 3% again this year.
- Goldman Sachs on oil: “The inclusion of Canada oil in a 25% tariff on Canada and Mexico would likely initially raise gasoline prices in the US Midwest, and eventually weigh on crude prices globally (via weaker demand) and especially in Canada where producers have limited export options,” per Daan Struyven.
- Claudia Sahm on the Fed: “The Fed’s meeting yesterday lived up to expectations: boring. Boring is fine. … Unless something changes with unemployment, we should expect the Fed’s pause to last several months—even if the inflation data are good,” she wrote.
- Wedbush on Alphabet: “While digital advertising demand remains strong for both Search and YouTube, we think it will be difficult for Alphabet to materially outperform expectations for advertising growth in the near-term, given recent FX headwinds and more challenging comps in 4Q and through 2025. Instead, we highlight ongoing strength in Cloud segment growth and the potential for more aggressive cost-cutting under the company's new CFO,” per Scott Devitt and team.
Around the Watercooler
Major players in the anti-DEI movement: Here’s who’s attacking Goldman Sachs, Pfizer, IBM, and other Fortune 500 companies by Lila MacLellan
Jeff Bezos and Elon Musk might be ‘best friends,’ and now Amazon reportedly plans to buy ads on X by Stuart Dyos
Visa is partnering with X to launch ‘X Money,’ Elon Musk’s rival to Venmo by Danny Bakst
CEO Daily was compiled by Joey Abrams and Jim Edwards.
