US Tariff War

robbieh said:
The US essentially saying we're not importing stuff would logically affect non US stock markets negatively as in the companies that comprise them will see sales down.

The Dow will be less affected.

But in real life the US will suffer from product scarcity which means a price hike and ultimately worse off consumers.

Meanwhile elsewhere there will be a glut of unsold products which should lead to price drops.

This is the short term. After a while China et al will cut back on production. Resulting in unemployment.

Whilst the US will have to increase theirs. So they'll have to reverse their immigration policy. Also increased production will require increased investment which may not be on the cards if the US has isolated itself.

The non US economies will have to organise more trade amongst themselves.

All this takes time.
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Imagine a new sovereign country, say one with just a few penguin farmers. Call it New Guano. They discover a new element, unobtainium. New Guano is the only supplier. Companies in the USA need unobtainium. They buy it from New Guano. New Guano now has a trade surplus with the USA. Trump slaps on a tariff on New Guano exports. Whatever the US companies are doing with unobtainium, they could now probably do it somewhere other than the USA, without import tariffs.

For a more mind-blowing look at Trump's deficit formula, try BBC's More or Less. Apparently the epsilon and phi bits of the formula are usually used, with variable values, in calculating the elasticity effect of tariffs in particular cases. But the Trump team applied values across the board of 4 and 0.25... 4 x 0.25 = 1. They complicated the formula by multiplying the sum by 1!

www.bbc.co.uk

BBC Radio 4 - More or Less, The mistake in Trump’s tariff formula

Also, counting bobbies, freezing tax and electrocuting redheads
www.bbc.co.uk www.bbc.co.uk
 
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Vic said:
Imagine a new sovereign country, say one with just a few penguin farmers. Call it New Guano. They discover a new element, unobtainium. New Guano is the only supplier. Companies in the USA need unobtainium. They buy it from New Guano. New Guano now has a trade deficit with the USA. Trump slaps on a tariff on New Guano exports. Whatever the US companies are doing with unobtainium, they could now probably do it somewhere other than the USA, without import tariffs.

For a more mind-blowing look at Trump's deficit formula, try BBC's More or Less. Apparently the epsilon and phi bits of the formula are usually used, with variable values, in calculating the elasticity effect of tariffs in particular cases. But the Trump team applied values across the board of 4 and 0.25... 4 x 0.25 = 1. They complicated the formula by multiplying the sum by 1!

www.bbc.co.uk

BBC Radio 4 - More or Less, The mistake in Trump’s tariff formula

Also, counting bobbies, freezing tax and electrocuting redheads
www.bbc.co.uk www.bbc.co.uk
Click to expand...

Ha, I'd wondered what the Greek version had added in to have no effect!
 
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Vic said:
Imagine a new sovereign country, say one with just a few penguin farmers. Call it New Guano. They discover a new element, unobtainium. New Guano is the only supplier. Companies in the USA need unobtainium. They buy it from New Guano. New Guano now has a trade deficit with the USA. Trump slaps on a tariff on New Guano exports. Whatever the US companies are doing with unobtainium, they could now probably do it somewhere other than the USA, without import tariffs.

For a more mind-blowing look at Trump's deficit formula, try BBC's More or Less. Apparently the epsilon and phi bits of the formula are usually used, with variable values, in calculating the elasticity effect of tariffs in particular cases. But the Trump team applied values across the board of 4 and 0.25... 4 x 0.25 = 1. They complicated the formula by multiplying the sum by 1!

www.bbc.co.uk

BBC Radio 4 - More or Less, The mistake in Trump’s tariff formula

Also, counting bobbies, freezing tax and electrocuting redheads
www.bbc.co.uk www.bbc.co.uk
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Thanks for that. Interesting.

Does this mean they'll import less, thus reducing the trade deficit, and the outside world will have less money to reinvest in US stocks, treasuries thus the overall situation hardly changes.
 
bluethrunthru said:
win after win after win

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Here is another example. One of my customers imports hundreds of containers a month from China to the US. Duty on one container would be around $9k. Now it will be $312k - more than the value of the goods. Completely unsustainable.
 
vincent said:
Here is another example. One of my customers imports hundreds of containers a month from China to the US. Duty on one container would be around $9k. Now it will be $312k - more than the value of the goods. Completely unsustainable.
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The world should just stand by and watch it all explode - Trump will be in hiding in Israel by the end of the year
 
vincent said:
Here is another example. One of my customers imports hundreds of containers a month from China to the US. Duty on one container would be around $9k. Now it will be $312k - more than the value of the goods. Completely unsustainable.
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Of course it is
As a youtuber said in his blog last week, 60% of goods sold in Wallmart are of Chinese origin
Where are they going to source those items now, as they're nearly all going to be produced abroad, so will already be more expensive plus a tariff

It took China 40 years to become the industrial behemoth it is.
How long will it take before the US can compete!
 
dickie davies said:
Of course it is
As a youtuber said in his blog last week, 60% of goods sold in Wallmart are of Chinese origin
Where are they going to source those items now, as they're nearly all going to be produced abroad, so will already be more expensive plus a tariff

It took China 40 years to become the industrial behemoth it is.
How long will it take before the US can compete!
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it will never compete - US citizens will never do the 9 - 9 - 6 required and even if they did they would not have the income to buy the cheap shit they would be being worked to death to produce - this whole game play is a massive land, property and money grab by the extremely wealthy supported by sycophants who I can only assume think they are on some sort of promise in return for support all of which is to be played out on the backs of the American people.
 
Dubai Blue said:
It's almost as though the whole thing hasn't been thought through properly ;)

Does Trump even realise that most American consumer goods companies are making their stuff outside the country?
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He is trying to force companies/consumers to buy domestic products or force companies to bring manufacturing back to the US. Even if companies start to do this (some are already making changes due to Covid), it can take years to change their manufacturing footprint.
 
dickie davies said:
Of course it is
As a youtuber said in his blog last week, 60% of goods sold in Wallmart are of Chinese origin
Where are they going to source those items now, as they're nearly all going to be produced abroad, so will already be more expensive plus a tariff

It took China 40 years to become the industrial behemoth it is.
How long will it take before the US can compete!
Click to expand...
What this does all do is force us to face our (the collective West) own economic model which is essentially to have decentish workers rights and minimum wages, then to buy our consumer goods cheaply from the far east where workers are treated like shit resulting in no manufacturing jobs for our own workers who are now sat on benefits on their sofas ordering Chinese tat off eBay.
I'm not sure that's sustainable, or what the answer is tbh.
 
Dubai Blue said:
It's almost as though the whole thing hasn't been thought through properly ;)

Does Trump even realise that most American consumer goods companies are making their stuff outside the country?
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It's time Melania went through his XXXXXXL wardrobe and left the things out that are not made in the US and see his reaction to the 100s of bin bags awaiting him.
 
According to chatgpt, the countries with the largest per capita trade deficit are the US followed by the UK.
Maybe we should be putting tariffs on all our imports!
 
Mazzarelli's Swiss Cheese said:
What this does all do is force us to face our (the collective West) own economic model which is essentially to have decentish workers rights and minimum wages, then to buy our consumer goods cheaply from the far east where workers are treated like shit resulting in no manufacturing jobs for our own workers who are now sat on benefits on their sofas ordering Chinese tat off eBay.
I'm not sure that's sustainable, or what the answer is tbh.
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It has been sustainable for decades, why make your own products when it can be made for far cheaper elsewhere? that's how the world works and how globally most countries have prospered.
Obviously, workers rights should be tackled more and countries should be punished unless they change there ways on this.
 
vincent said:
He is trying to force companies/consumers to buy domestic products or force companies to bring manufacturing back to the US. Even if companies start to do this (some are already making changes due to Covid), it can take years to change their manufacturing footprint.
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I understand his "logic" but they don't ever seem to focus on the American companies that are actually doing this; their public ire is always aimed at the nasty foreigners. Maybe they should have started closer to home!

That said, there isn't a parallel universe where a company like Nike, for example, can bring its manufacturing capacity back to the U.S. (no matter how long it takes). By trying to force it, he's putting all the relatively high-paid white collar Nike jobs that are already based in the country at risk.
 
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