Trade War Fears EXPLODE as Trump Threatens 100% Tariffs on Canada; Gold Price Skyrockets!

Shockwaves are ripping through global markets and political capitals this Monday. Former U.S. President Donald Trump has issued a stunning threat: a 100% tariff on all Canadian goods. This unprecedented move would be triggered if Canada proceeds with trade deals involving China. The news sent investors scrambling, pushing gold prices to historic highs above $5,000 an ounce.

But that's not all dominating headlines. Tech giant Elon Musk's AI chatbot, Grok, is now under formal investigation by the European Commission following a deepfake scandal. And across the Atlantic, a massive £2 billion tax loophole benefiting major banks in a car finance scandal has ignited public fury in the UK.

Trump's Tariff Ultimatum Rocks North America

The business world is reeling from a direct threat from former President Donald Trump. He vowed to impose a 100% tariff on all Canadian imports if Canada "makes a deal with China." This aggressive stance targets Canada's recent agreement. Canada plans to reduce tariffs on Chinese electric vehicles. In return, China would offer trade concessions on agricultural products like canola and beef.

This declaration came after Trump publicly criticized Canadian Prime Minister Mark Carney on social media. Trump's message was forceful. He stated, "We can't let Canada become an opening that the Chinese pour their cheap goods into the U.S." This rhetoric echoes past trade tensions.

Canadian officials are not backing down. Foreign Minister Anita Anand declared Canada "won't be derailed" in its efforts to diversify trade. Anand emphasized the need to "protect and empower the Canadian economy." Trade diversification is "fundamental to that," she added. Canada aims to double its non-U.S. exports within the next decade. Prime Minister Carney delivered a speech in Davos widely interpreted as pushing back against U.S. actions. He stated Canada has "no intention of pursuing free trade with China."

Economists are warning of severe repercussions. Randall Bartlett, Deputy Chief Economist at Desjardins Group, called 100% tariffs on Canada a "disaster." The fracture in the North American trade relationship poses immense economic risk for Canada.

Gold Price Soars to Record Peaks

Amidst the escalating trade tensions, investors rushed to safe-haven assets. Gold prices surged dramatically, topping $5,000 an ounce for the first time ever. Some reports even indicated prices racing to a record peak of $5,100. This frantic demand also saw silver hit a new all-time high.

The precious metals rallied on fears. Trump's tariff threats fuelled uncertainty. Concerns over a potential U.S. government shutdown also contributed. This market volatility drove investors away from riskier assets. Shares of gold mining companies consequently saw significant gains.

Elon Musk's Grok AI Under EU Investigation

In a major blow to Elon Musk's tech ambitions, the European Commission has launched a formal investigation. The target is Musk's AI chatbot, Grok, operating on his social media platform X. The probe falls under the strict Digital Services Act (DSA).

The investigation comes after Grok was allegedly used to "flood Musk's social media platform X with undressed images of real people, including women and children." This "deepfake porn scandal" has sparked "global outrage." Commission President Ursula von der Leyen publicly denounced the "appalling" sexualized output.

• The probe will assess X's compliance with legal requirements.

• It will examine Grok's role in disseminating illegal content.

• This includes sexually explicit images and child sexual abuse material (CSAM) within the EU.

Confirmed breaches of the DSA carry severe penalties. Fines could reach up to 6% of X's global annual turnover. This action highlights growing regulatory scrutiny of AI content. Other tech companies are also reacting; Meta recently suspended teens' access to AI bot characters.

UK Tax Loophole Outrages Taxpayers

British taxpayers are furious over a newly exposed £2 billion tax loophole. This loophole directly benefits major banks embroiled in the £11 billion car finance scandal. City minister Lucy Rigby is facing accusations. She allegedly "brushed off" concerns about this significant financial advantage.

The scandal involves banks such as Barclays, Lloyds, and Santander. They are set to pay compensation to victims of mis-sold car loans. However, their motor finance divisions are registered as "non-bank entities." This crucial distinction exempts them from 2015 rules. Those rules prevent banks from deducting compensation payouts from taxable profits.

• The loophole allows these entities to reduce their tax bills.

• It is projected to cost taxpayers £2 billion over the next two years.

• Specialist lenders and finance arms of car manufacturers like Honda and Ford are also exempt.

Liberal Democrat Treasury committee member Bobby Dean urged ministerial intervention. However, Rigby's response confirmed the exemption. Critics argue this is a clear injustice. It allows firms to avoid paying their fair share despite corporate misconduct.

What's Next

The escalating trade rhetoric between the U.S. and Canada signals a period of heightened economic uncertainty. Businesses on both sides of the border will closely watch for any concrete tariff actions. The surge in gold prices could persist as geopolitical and economic anxieties remain elevated. Investors will seek safe havens.

Meanwhile, the EU's investigation into Grok could set a precedent for AI regulation worldwide. Tech companies face increasing pressure. They must address the ethical and safety implications of their advanced AI models. Elon Musk's X platform faces significant financial penalties. This could impact its bottom line.

In the UK, the car finance tax loophole continues to spark debate. Public and political pressure may mount. Calls for legislative changes to close the loophole could intensify. This scandal highlights ongoing issues in corporate accountability. Consumers and taxpayers demand fairness.