The roiling markets mean a recession looms, and blame rests with the U.S.-China tariff war, Brexit, fears by some Wall Street players that Bernie Sanders will win in 2020, and, ironically, fears by others that Donald Trump will win again.
Last week, Trump blinked and gave China a four-month reprieve from additional tariffs to calm markets. He also moved to calm down concerns that China may intervene in Hong Kong’s protests. Even he understands that a Tiananmen Square crackdown by China would rock the world in financial terms. A no-deal Brexit, supported by Trump, will cause major dislocation throughout the European Union. And, if the U.S. falls into recession, Canada will fall harder due to our higher consumer debt, federal deficits and unemployment levels. Mortgages, credit card debts and other expenses have increased to the point that the average Canadian now has over $1.81 in debts for every $1 in disposable income, well above $1.09 in the U.S.
Sanders is not an unreasonable speculation. Public opinion veers left and American voters take huge risks — Obama and Trump for instance. Sanders is also the best Democrat to beat Trump. He is an articulate and tough New York street fighter, uniquely capable of destroying Trump in a head-to-head contest.
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