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Photo: Chip Somodevilla/Getty Images

The market did not take Trump's Mexico tweet well.

Our thought bubble, via Axios' Felix Salmon: Strategically, it makes zero sense for the U.S. to enter a two-front trade war, engaging Mexico even as the confrontation with China is reaching a boiling point. China and Mexico are 2 of America's 3 largest trading partners. To start trade wars with both of them is a declaration of isolationism not seen since 1945.

By the numbers:

  • The Mexican peso fell almost 2% against the dollar to its lowest value since early March.
  • Yields on the 2-year U.S. Treasury note dropped below 2% for the first time since February 2018, and to the lowest since September 2017 on the benchmark 10-year note.
  • S&P 500 futures were lower by 1.2%, London's FTSE 100 fell more than 1%.
  • Chinese shares were slightly lower, falling by around 0.2%. Germany's DAX was off by more than 1.5%.
  • Shares of Ford lost 4% in pre-market trade. GM dropped more than 5%.

Be smart: "Imposing these tariffs is in principle, not allowed under the free trade agreement currently in place between Mexico and the United States or under WTO general frameworks," wrote Tania Escobedo, strategist at RBC Capital Markets.

  • "It is likely, however, that Trump will claim the measure is a matter of national security, referring to the International Emergency Economic Powers Act (IEEPA)."

Go deeper: Trump's Mexico tariffs could decimate the auto industry

Go deeper

Biden taps Brian Deese to lead National Economic Council

Brian Deese (L) in 2015 with special envoy for climate change Todd Stern (C) and Secretary of State John Kerry (R). Photo: Mandel Ngan/AFP via Getty Images

President-elect Joe Biden announced Thursday that he has selected Brian Deese, a former Obama climate aide and head of sustainable investing at BlackRock, to serve as director of the National Economic Council.

Why it matters: The influential position does not require Senate confirmation, but Deese's time working for BlackRock, the world's largest asset manager and an investor in fossil fuels, has made him a target of criticism from progressives.

Felix Salmon, author of Capital
27 mins ago - Economy & Business

The places regulation does not reach

Illustration: Aïda Amer/Axios

Financial regulation is not exactly simple anywhere in the world. But one country stands out for the sheer amount of complexity and confusion in its regulatory regime — the U.S.

Why it matters: Important companies fall through the cracks, largely unregulated, while others contend with a vast array of regulatory bodies, none of which are remotely predictable.

1 hour ago - Economy & Business

Boeing gets huge 737 Max order from Ryanair, boosting hope for quick rebound

Ryanair low cost airline Boeing 737-800 aircraft as seen over the runway. Photo by Nik Oiko/SOPA Images/LightRocket via Getty Images

Dublin-based Ryanair said it would add 75 more planes to an existing order for Boeing's 737 Max airplanes, a giant vote of confidence as Boeing seeks to revive sales of its best-selling plane after a 20-month safety ban following two fatal crashes.

The big picture: Ryanair's big order, on the heels of breakthrough vaccine news, is also a promising sign that the devastated airline industry might recover from the global pandemic sooner than expected.