The Globe and Mail reports in its Thursday edition that if a trade war erupts, we can expect a noxious combination of a worse economy and higher inflation. The Globe's Rob Carrick writes that U.S. tariffs would likely push our dollar lower, which makes imports from the U.S. more expensive. As well, if we slap tariffs on those imports, they become even pricier for consumers. You could face higher grocery costs while your workplace leverage weakens, risking raises and layoffs. Recent comments from Magna International's chief executive officer, indicate some automotive firms are mulling moving production to dodge tariffs. A KPMG survey revealed nearly half of Canadian businesses plan to shift more investment and operations to the U.S. A trade war would up costs and uncertainty for Americans, but Canada would feel it more. January home sales data shows a 2.9 per cent year-over-year rise, but sales slowed at month-end due to tariff threats. Prices rose by 1.1 per cent, resulting in a 0.8 per cent decline after adjusting for inflation. To prepare for a trade war Mr. Carrick says build cash savings where possible, be cautious about new debt obligations and prepare for your investments to bounce around in the near term.