In partnership with

Editor’s note: the podcast is back! We generate a full conversation between two AIs covering the day’s most interesting stories. Subscribe on Spotify and Apple to get notifications when a new episode drops.

You can always read previous updates on thebrrr.com.

TheBRRR’s Thoughts 

GM.

President Trump sent crypto screaming higher on Sunday morning with the following post on Truth Social, reiterating his desire for a crypto strategic reserve:

Bitcoin pumped from $84K to $93K while Solana teleported from $140 to $180 over a 12 hour window.

The euphoria did not last long.

The president then proclaimed on Monday that the previously-announced-then-delayed tariffs on Mexico and Canada would go into effect on Tuesday (today) because neither country had done enough to slow drug trafficking into the US.

The tariffs sent all risk assets plummeting lower.

By the end of trading on Monday night, the moves in crypto fully retraced and prices are now below where they were over the weekend, before Trump’s initial post.

We’ll see how the price action plays out ahead of Friday’s “Crypto Summit” at the White House, where further details on the proposal are set to be revealed.

Let’s get one thing straight: it’s preposterous for the US government to buy SOL, XRP, and Cardano, as they’re more akin to startup equity than they are to strategic commodities.

I think Trump is advocating for their inclusion merely for leverage - he’ll walk it back and “compromise”. We’ll end up with a bitcoin-only reserve.

One other note on macro before we dive into the major news stories today.

Interest rate markets have started to price in additional cuts this year.

As recently as a week ago, the odds of interest rates remaining unchanged after the May meeting were 77% but have fallen to 51% this morning.

We expect the trend to continue as weak data continues to come in.

Trade Wars Erupt: Markets Bracing for Impact

Synopsis

The U.S. has officially imposed 25% tariffs on Canada and Mexico today (with Canadian energy taxed at 10%) and an additional 10% levy on China, triggering swift retaliation. Canada hit back with 25% tariffs on $155 billion worth of U.S. goods, while China raised tariffs by 10-15% on key American agricultural exports and suspended U.S. lumber imports.

The Details

• U.S. Tariffs:

  • 25% on all imports from Canada & Mexico, excluding Canadian energy (10%).

  • 10% tariff increase on Chinese goods, raising the average effective tariff rate on China to 34%.

  • The U.S. aims to pressure allies like Canada and Mexico into matching higher tariffs on China.

• Retaliation from Canada & China:

  • Canada: Immediate 25% tariffs on $30 billion of U.S. exports (bourbon, orange juice), with $125 billion more in three weeks.

  • China's Customs suspended U.S. lumber imports and revoked soybean import qualifications for three major U.S. firms.

  • MOFCOM (China’s commerce ministry) urged the U.S. to withdraw “unreasonable” tariffs, but China’s reaction remains measured.

• U.S. Growth Impact:

  • Atlanta Fed GDPNow plunged to -2.8%, indicating a potential recessionary signal.

  • U.S. manufacturing is already feeling the pinch—ISM Manufacturing report had 20 mentions of tariffs, compared to just 4 in January.

Why It Matters

• Inflation Risk: Higher tariffs will raise consumer prices, hitting American pockets at a fragile economic moment.

• U.S. Dollar Weakness: The muted FX reaction suggests traders don’t believe these tariffs will be permanent. Goldman warns that tariffs alone won’t drive USD strength—focus is shifting to AI trade, European fiscal policy, and potential U.S. recession fears.

China’s 2025 Stimulus Plan: Cautious Start, Bigger Moves Ahead?

Synopsis

China is set to unveil its 2025 economic roadmap at the Two Sessions this week, with a 5% GDP growth target, a 2% inflation goal, and a record-high deficit of 4% of GDP. While Beijing is preparing fiscal expansion to counter deflation and U.S. trade tensions, there’s discrepancy over how aggressive the initial stimulus will be.

The Details

• GDP & Inflation Targets: 5% growth target, despite UBS forecasting real growth closer to 4%. CPI target cut to 2%, the lowest in 20+ years, acknowledging deflation risks.

• Fiscal Expansion Debate:

  • SCMP’s take: 2T yuan ($275B) in special bonds, limited near-term stimulus, focus on debt control.

  • Bloomberg’s take: Up to 12T yuan in fiscal expansion, including 4T yuan in local government special bonds and broader deficit financing.

• Trade War Fallout: Trump’s tariffs threaten China’s export growth, forcing Beijing to shift focus to domestic demand.

• Sector Focus:

  • Boosting consumption via pension hikes, social insurance, and consumer trade-in programs.

  • Property market stabilization, but no direct bailouts

  • Tech & AI investment remains a priority as China pushes for supply chain self-sufficiency.

Why It Matters

• Short-term caution, long-term stimulus? Beijing may hold back on aggressive stimulus initially but could scale up later if trade tensions worsen or deflation deepens.

• Market implications: If SCMP’s cautious approach holds, expect continued weak sentiment in China-exposed assets. If Bloomberg’s larger fiscal injection materializes, expect a mid-year rally in Chinese equities, infrastructure, and commodities.

Looking for unbiased, fact-based news? Join 1440 today.

Join over 4 million Americans who start their day with 1440 – your daily digest for unbiased, fact-centric news. From politics to sports, we cover it all by analyzing over 100 sources. Our concise, 5-minute read lands in your inbox each morning at no cost. Experience news without the noise; let 1440 help you make up your own mind. Sign up now and invite your friends and family to be part of the informed.

Subscribe to 1440 today.

Got feedback? Follow the writer on Twitter @frank_locascio and send a message.

The BRRR is meant for informational purposes only. It is not investment advice. Please consult with your investment, tax, or legal advisor before making any investment decisions.