Under the Trump regime, Mexico's 'counter-tariffs', China's 'currency war', Musk's 'alliance cracks'
Mexico announced 'self-tariff retaliation' to the early hard-line conservatism of the Trump regime, China responded with a 'currency war', and Elon Musk, who had built an alliance system during the election, is experiencing difficulties in the alliance as he is pushing for the appointment of the last FBI director after being frustrated with 'personnel intervention' one after another.
On the 26th, Mexican President Claudia Sheinbaum said in response to US President-elect Trump's threat to impose a 25% import tariff on Mexican products if the flow of drugs and immigrants across the border was not stopped, "Drugs are an American problem" and "Mexico is in trouble due to US arms trafficking", and "Mexico can retaliate with its own tariffs." “There are American automakers with plants on both sides of the border,” President Sheinbaum said of Mexico’s own retaliatory tariffs, the AP reported on the 26th, adding, “If one tariff comes after another, then another tariff comes after another, and ultimately we are putting ordinary businesses at risk.” President Sheinbaum continued, “Mexico is suffering from the influx of weapons smuggled from the United States,” and said, “The flow of drugs is a problem for the public health and consumption of their own society,” and that it is an American problem.
President Sheinbaum criticized the U.S.’s arms spending in particular, saying, “The money from weapons sales should be used locally to solve the immigration problem,” and, “If a certain percentage of the money that the U.S. spends on war was spent on peace and development, it would solve the root causes of immigration.”
AP reported, “Sheinbaum, who took office on October 1, is a staunch leftist ideologue trained in the radical student protest movement and seems unwilling to appease or placate Trump,” and, “Sheinbaum’s firm response suggests that Trump is facing a much different Mexican president than he did during his first term.”
“We are a great country, so we negotiate as equals, and there is no subordination here,” a presidential spokesman told AP. “I think we will reach an agreement.”
The New York Times analyzed China’s response to Trump’s tariff attacks. “China has a powerful tool to respond to new tariff threats on Chinese products,” he said on the 26th. “This could trigger a currency war, which would be extremely dangerous for China and the United States.”
Letting China’s currency, the yuan, lose value against the dollar is a tried-and-true solution to tariffs, and China used this strategy in response to tariffs imposed in 2018 and 2019 during the first Trump term.
With strong yuan controls supporting the Chinese system, a cheaper yuan would make it less expensive for overseas buyers to purchase Chinese exports, thereby mitigating the damage that Trump’s tariffs would do to China’s competitiveness.
The New York Times said, “A cheaper yuan could partially or completely offset the impact of the 10% additional tariffs on Chinese products that President Trump said he would order on his first day in office,” and “A strategic devaluation of China’s currency, which is tightly controlled by the Chinese central bank, could allow China to strengthen its powerful export machinery.”
China's total exports have already surged nearly 12% in the first nine months of this year compared to last year, and China is preparing to expand supply for additional profits by expanding lending to build new factories by banks.
On the other hand, China's strategy of allowing the currency to depreciate, coupled with its strategy of targeting US Treasury bonds, could put the Chinese economy at risk.
If the yuan suddenly weakens, Chinese companies and Chinese intervention funds could try to withdraw funds overseas instead of investing, and the Chinese government's strategic response seems to be the key.
The New York Times reported on the 26th that cracks are appearing in the powerful conservative power alliance between Trump and Mask.
Musk suffered a bitter defeat in the strong recommendation of the failed attorney general candidate, and then Musk's recommendation was pushed out in the recommendation of the Treasury secretary, and the cabinet was formed by the de-Musk camp.
The New York Times said, “Billionaire Elon Musk has used his social media platform X to advocate for President-elect Donald Trump’s Cabinet picks and promote his preferred candidates, championing choices seen as agents of change who could help rebuild the U.S. government. But in several high-profile cases, Musk has been limited to supporting those who have lost their roles or have fallen out of consideration,” suggesting “the early limits of the influence of a big Republican donor, even as he has emerged as one of Trump’s most potent allies.” Reuters said of the picks, “Musk, who has 260 million followers, posted or reposted more than 70 times between Election Day, Nov. 7, and Nov. 20,” and “Musk has used it in many cases to draw attention to some of Trump’s most controversial picks, including former Democratic congresswoman Tulsi Gabbard, a former U.S. intelligence director, and environmental activist Robert F. Kennedy Jr. to lead the nation’s top health agency.” Musk showed a great support strategy in the initial nomination battle for the attorney general who fell from grace.
The New York Times reported that “Musk was most enthusiastic in rallying support for former House of Representatives member Matt Gates, whom former President Trump had initially nominated for attorney general,” and that “in the days after Gates was nominated for attorney general on November 13, Musk posted 37 times about Gates and his wife Ginger, mostly positively, and far more than he posted about any of Trump’s other appointments.”
Reuters reported that “Musk’s political posts on X were far more numerous than those he used to promote his three businesses,” and that “he frequently mocked libertarians and posted about government waste and Trump’s new panel on government efficiency, which the president-elect had asked Musk and entrepreneur Vivek Ramaswamy to co-chair.” The Trump transition team said Musk’s close proximity to Trump “provoked some hand-wringing and frustration from the transition team, which was not used to having the president around so much,” two sources close to Trump’s staff told the Times.
Musk had supported Sen. Rick Scott, R-Texas, for Senate president since early November, but Trump decided not to weigh in, and Scott ultimately lost to Sen. John Thune.
A source close to Musk told the Times that he was impressed by Musk’s willingness to stick with Trump even after being “shut down” by the president-elect, adding that “it’s very rare for billionaires to do that, and they usually walk away when they don’t get what they want.”
The final test of Musk’s influence came after the election, when he posted six times in support of Trump loyalist Cathy Patel running the FBI. Patel, who served on the National Security Council (NSC) during Trump’s first term, has pledged to pursue politicians and journalists perceived as Trump’s enemies.
Musk’s X post clearly declared that he sees Patel as the best choice for change and reform.
On the 14th, Musk posted a clip of Patel saying that the FBI headquarters would be closed and reopened as a “deep state museum” on the first day of the new Trump administration, captioning it “Make him FBI director” with a “100%” emoji.
Axios reported on the 25th, citing sources, that “if President-elect Trump chooses Patel as FBI director, it could be difficult to get Senate confirmation, so he could be given the position of FBI deputy director or a position related to investigations within the Justice Department,” indicating a “possible downfall.”
In his book “Gangsters in Government: The Deep State, Truth, and the Battle for Our Democracy” last year, Patel singled out the FBI as a target for reform. The New York Times reported on the 24th, “President-elect Trump has yet to sign a memorandum of understanding with the General Services Administration (GSA), which allows him to collect unlimited funds from anonymous donors for the hiring of staff, travel expenses, and office expenses related to the transition of power.” The Times added, “Trump is the first president-elect to avoid signing an agreement with the GSA. If he signs this agreement, the transition team will receive $7.2 million in federal funds, but donations from individuals are limited to $5,000 per person, and there is an obligation to disclose donors, so the Trump transition team has avoided this and has not disclosed its fundraising target, donors, or where the funds were used.”
The transition team of ‘Trump Vance 2025 Acquisition Corp. (INC.)’ is designated as a ‘dark money nonprofit organization’, so it is not required to disclose the identity of its donors to the IRS, but unlike campaign donations, ‘foreign donations’ can be made anonymously.
The New York Times pointed out that this behavior by President-elect Trump’s side is raising concerns among ethics experts. Anyone who wants to look good in the Trump second administration can donate directly to the president-elect without their name or potential conflicts with the government being disclosed, and unlike campaign donations, foreigners can also donate. The New York Times reported that “President-elect Trump has not signed a memorandum of understanding with the GSA or a contract with the Department of Justice, leaving the FBI, which is part of the Justice Department, without the existing ‘security background check’ system for the next administration’s nominees,” and that “the Trump transition team is known to be excluding the FBI and using private companies to vet candidates,” foreshadowing the FBI’s cessation of function.