###POV: PLAUSIBLE MEXICO DE-ESCALATION...........>

US: ###POV: PLAUSIBLE MEXICO DE-ESCALATION SCENARIO: Lying underneath the firmly

risk-off Mexico tariff headlines are the White House's actual demands, per

acting Homeland Security Sec Kevin McAleenan: 

- 1) More vigorous efforts to secure Mexico/Guatemala border; 2) crackdown on

'transnational criminal organisations' that traffic migrants; 3) Mexico to sign

'safe third country' agreement which would mean in effect that Central Americans

travelling across Mexico would not be entitled to asylum hearings in the U.S.

- The key though is that Trump wants to see a reduction in the record flows of

arrivals, which have surged (in May to an est. 109k, 12-Yr high).

- As VOX points out, seasonality (summer heat) means border crossings drop in

Jun-Aug. So Trump could ease off quickly, pointing to a win on immigration.

- Asylum is the biggest sticking point for Mexico. But we could see quick

progress on the first 2 points, as Mexico has acted on them previously.

- We are not out of the woods by any means, as Mexico will be reluctant to show

that tariff threats have succeeded. But there is a plausible scenario where this

particular situation de-escalates quickly. China may be another story, though.