There is somewhat of a coherent message coming out of the White House today and it’s something like:

Short-to-medium term pain for long-term gain.

That’s a dangerous game to play because recessions are often more about confidence than anything else. Once spending and investment slow, the darkening mood can snowball.

Markets are worried about tariffs today but Trump is likely to talk about fentanyl as that is also a consistent White House message.

However geopolitics are also a risk. One rumor that’s doing the rounds is that Trump will announce tonight that the US is leaving NATO. That wouldn’t be a total shock but it would certainly add to the sense of instability everywhere.

The S&P 500 is now down 1.4% to a session low.

Meanwhile, Trump is also tweeting on Canadian banks, saying “Canada doesn’t allow American Banks to do business in Canada, but their banks flood the American Market. Oh, that seems fair to me, doesn’t it?”

This isn’t true as the Canadian Bankers Association highlighted last month:

“There are 16 U.S. based bank subsidiaries and branches with around C$113 billion in assets currently operating in Canada,” the Canadian Bankers Association said in a statement Monday.

“These banks specialize in a range of financial services, including corporate and commercial lending, treasury services, credit card products, investment banking and mortgage financing. They serve not only customers with cross-border business activities, but also Canada’s domestic retail market.”

This article was written by Adam Button at www.forexlive.com.