Tariffs?

[TagliatelliMonster]

Plenty of countries use them to their benefit. If they were that bad, no country would use them. Maybe you should know how they work in that way.

They can be beneficial if they are used for justifiable economic reasons. Trumpty Trump is trying to use them as a weapon instead. And he's not even doing that correctly as his plan is the equivalent of trying to shoot someone with the gun pointing at your own foot instead of the person in front of you.

 

[TagliatelliMonster]

It would give great incentive to start producing domestically instead of relying on foreign imports.

More naivity.

1. if domestic production needs to still start up, this will take time and meanwhile you'll be paying

2. if there are domestic products (now or in the future), they'll charge a premium also, since they will be able to afford higher profit margins and still remain competitive with the artificially inflated prices of the imported competition.

Either way, price will go up.

People don't seem to understand this.
If you have product A and B at similar price range, and A is forcibly inflated (for whatever reason), B is going to rise in price also, because... why the hell not?
If A and B both cost 10 bucks and A suddenly goes to 15 bucks, then B can comfortably go to 13-14 bucks and still be the better choice for consumers.

What, you think B will not do this? The manufacturer of B doesn't like making more money?

All I see is a return of manufacturing back to the States like it used to be when America was doing pretty good on that front.

Yeah.... there's a reason also why manufacturing went outside of the states. Hint: the reason is economic.
Domestic manufacturing will also result in higher prices for consumers due to larger operational costs.
That, and off course the issue I mentioned earlier: if competitor prices are inflated (for whatever reason, in this case because of additional sales taxes), then the other prices will go up also and still remain competitive, because why the hell not?

 

[TagliatelliMonster]

Maybe it will happen. Who knows?

Every person with some basic knowledge on how pricing and economy works, knows.

Time will tell, as well as other issues. Since Republicans control the House and the Senate, we'll see what happens.

It doesn't matter who controls what.
Additional sales tax will lead to higher prices. Basic logic.
Next to that, there will be ripple effects which will lead to higher prices of many other products which aren't even directly subject to the additional sales tax.

 

[TagliatelliMonster]

Judging from his Tweet (or whatever) he doesn't seem to know the first thing about "these matters."

And the scary thing about that, is that the billionaires he tends to surround himself with either don't know the first thing about it either, or they are too afraid to tell him.

Another option, off course, is that they all know very well what they are doing, including Trumpty Trump, and are simply planning a massive money grabbing scheme by the example of Russian Oligarchs. If you are on the "inside" and know what's coming and own businesses.... you can actually make a boatload of money by riding the back of inflation. All at the expense of consumers and workers, off course. They get into massive debt and meanwhile the billionaires at the top are raking in monster profits and interests.

There are many ways by which this can be done. It's like insider trading.


An obvious and easy to understand example is for instance when you own a chain of retail stores in say, clothing.
Knowing that in 2 months a 60% tariff is coming to chinese goods... You could buy a massive amount of chinese clothes at pre-tariff prices and stack warehouse after warehouse with it. Say the stock is worth 1 billion in retail price. Then the 60% tariffs hit. Now you do a price correction on that stock and its value suddenly becomes 1.6 billion. You just magicked 600 million dollars of value out of nowhere. And that's just the small scale stuff.

You can do the exact same with shares of companies etc. Oligarchs were / are experts at such things. During times of heavy inflation (which they knew was coming), they for example would delay paying salaries of workers. Sometimes for several months. Meanwhile, inflation was ongoing. The money they didn't spend on salaries was then invested strategically which was earning them interest. Meanwhile, the workers were getting into debt. Then when they finally paid the salaries, that money was worth a lot less then it would have been if paid on time. Essentially, this means that the oligarchs ended up paying them less (in proportion) to what they normally would have. And meanwhile, they used that money to earn more money through insider trading.

It's quite diabolical.


And to be honest.... when I look at Trumpty Trump, Musk, and the other billionaires in their circle........... I can't just shake the feeling that they are planning to do the exact same thing.

 

[Kathryn]

Every person with some basic knowledge on how pricing and economy works, knows.


It doesn't matter who controls what.
Additional sales tax will lead to higher prices. Basic logic.
Next to that, there will be ripple effects which will lead to higher prices of many other products which aren't even directly subject to the additional sales tax.

So you say. And it does matter who controls what because nothing should get voted down. Meanwhile, neither you nor I have much control over things like tariffs so that's where my "let's see what happens" thing comes in.

 

[Heyo]

Meanwhile, neither you nor I have much control over things like tariffs so that's where my "let's see what happens" thing comes in.

I'd be pretty disappointed if Trump doesn't fulfil his promise to ruin the US.

 

[F1fan]

What many don't seem to understand is that there is only so much money in the middle class to spend. If a tv breaks, well they can go buy a new one at 25% higher cost, or perhaps try to find a used one. A family might be able to justify $300, but $400 is a turn off. There's only so much money out there to spend, and having low prices has been an incentive to buy things. If they get more expensive and less affordable it will turn off many buyers.

But let's say the tariffs are in place and consumers keep buying beyond their means, meaning using credit cards more and more to replace broken items. 1. It will end up costing Americans more, in the added tariff cost which is a tax, and the added interest on the borrowed money. 2. If the economy suffers and people need to rely on credit more and more there could be a boom for banks, but more stress on the consumer, and a greater probablity of defaults. There's already reporting of rising credit card defaults, as well as mortgage defaults, as many were on the bubble when the pandemic inflation and insurance increases hit. With insurance companies hitting consumers with higher premiums, and cities having to raise property taxes to cover costs, another financial crisis may be on the horizon.

Let's note that cities have had to increase property taxes because with federal budget uts there's fewer grants given to states and cities. With Trump's tax cuts the effort to reduce the deficit will again mean cutting grants, Social Security, medicaid, and food stamps. The stress on the average household is going to go up and up and up with these Trump policies that seem designed to help the wealthy. The rich are going to benefit exceptionally well in the next four years and the middle class and poor will have to find ways to cover increasing costs to living. Does @Twilight Hue have any advice for us? Maybe he can share his tips for survival.

 

[TagliatelliMonster]

So you say.

So logic says.
Say that I am a manufacturer.
I produce a product that I sell at 10 bucks a pop and it costs me 3 bucks to make.
Of that 3 bucks, 2 bucks is spend on imported goods from china.

Tariffs are put in place and that 2 bucks now turns into 5 bucks. So now the production cost is 6 bucks.
To maintain the same profits, I will now have to sell the product at 13 bucks.

Say my competitor also sold at 10.
He doesn't import from china, so his production cost remains the same. But he smells an opportunity.
He starts selling at 12 and is still competitive.

What, you think companies will not raise their prices and just take the losses of the extra production / import costs?

Meanwhile, neither you nor I have much control over things like tariffs so that's where my "let's see what happens" thing comes in.

As individuals, we don't. But as a populace, we do.
We live in democracies, after all.

 

[Kathryn]

So logic says.
Say that I am a manufacturer.
I produce a product that I sell at 10 bucks a pop and it costs me 3 bucks to make.
Of that 3 bucks, 2 bucks is spend on imported goods from china.

Tariffs are put in place and that 2 bucks now turns into 5 bucks. So now the production cost is 6 bucks.
To maintain the same profits, I will now have to sell the product at 13 bucks.

Say my competitor also sold at 10.
He doesn't import from china, so his production cost remains the same. But he smells an opportunity.
He starts selling at 12 and is still competitive.

What, you think companies will not raise their prices and just take the losses of the extra production / import costs?


As individuals, we don't. But as a populace, we do.
We live in democracies, after all.

The US is actually a democratic republic.

https://www.npr.org/2022/09/10/1122089076/is-america-a-democracy-or-a-republic-yes-it-is

 

[Revoltingest]

Your prediction is logged and noted Nostradamus.

Your posts dismiss addressing Trump's promises & their consequences.
But sometimes his promises are brought to fruition, eg, taking away
the right to abortion.
Did you expect that things will be better under Trump than Harris?

 

[Copernicus]

So logic says.
Say that I am a manufacturer.
I produce a product that I sell at 10 bucks a pop and it costs me 3 bucks to make.
Of that 3 bucks, 2 bucks is spend on imported goods from china.

Tariffs are put in place and that 2 bucks now turns into 5 bucks. So now the production cost is 6 bucks.
To maintain the same profits, I will now have to sell the product at 13 bucks.

Say my competitor also sold at 10.
He doesn't import from china, so his production cost remains the same. But he smells an opportunity.
He starts selling at 12 and is still competitive.

What, you think companies will not raise their prices and just take the losses of the extra production / import costs?


As individuals, we don't. But as a populace, we do.
We live in democracies, after all.

So you say. And it does matter who controls what because nothing should get voted down. Meanwhile, neither you nor I have much control over things like tariffs so that's where my "let's see what happens" thing comes in.

We've already seen what destructive tariffs have done in the past. See:

What Is the Smoot-Hawley Tariff Act? History, Effect and Reaction​

And that was with tariffs imposed at 20%. Trump is proposing far worse. The problem for US manufacturers is that they absolutely must import certain components that come from countries that Trump is about to engage in a trade war with. Those countries will not sit back and take it when their exporters suddenly lose lucrative sales to the US, and they will retaliate. Mexico has already said explicitly that it will do so. US businesses depend on a lot of imports from other countries.

 

[TagliatelliMonster]

The US is actually a democratic republic.

https://www.npr.org/2022/09/10/1122089076/is-america-a-democracy-or-a-republic-yes-it-is

Or how to nitpick on the most irrelevant part of the post.

 

[SkepticThinker]

The US is actually a democratic republic.

https://www.npr.org/2022/09/10/1122089076/is-america-a-democracy-or-a-republic-yes-it-is

Which is a form of democracy.

Democracy or Republic: What's the difference?

A case can be made for either

www.merriam-webster.com