If this echoes 1921, 22 the markets will swing wildly. If this echoes 1929 we won’t recover for a decade.
We have nosebleed tops, margin debt, and corporate debt.
Even without the tariffs, we are at risk of the markets crashing as the press would say. In reality, the markets may trade lower as we are no longer a supply-side economy.
This has failed written all over it like a bought and paid college degree when none was earned.
It’s all about the show, like rounding up thousands/millions of brown people, to keep the mob in line. Reality will probably be 180 degrees different, but just keep putting on the show, and the mob will not notice.
Steve
The same experts have found that most importers simply pass the added cost of tariffs on to U.S. consumers by jacking up their prices— rather than going out of their way to replace the affected goods with American-made alternatives, which still tend to be more expensive.
No problem, then the tariffs were obviously ‚not high enough‘. What is the big deal with a little inflation if the future is golden?
Then other countries retaliate with tariffs of their own, risking a global trade war and recession.
Are we going to get there?
On the last go around, TNG said China was the root of all evil, and was urging US businesses to get their supply chains out of that country.
Now, everything is supposedly kissy-face. Is that s Musk paid for?
Steve
If Trump is doing “strategic tariffs”, that could work.
Put a 100% tariff on Chinese automobiles, then offer them a sliding scale on tariffs if they start making autos in the US with US labor.
You give the Chinese manufacturer a 50% exemption on the Chinese content of the vehicle the first year and ratchet that up by 10% per year to encourage the manufacturer to source more car parts in the US. There’s some, non-zero percent formula that would be attractive to a foreign company.
It will be interesting to see how the Mexican-made Chinese EVs that are already being produced are handled.
intercst
I don’t see how they are going to allow us to put Chinese autos on the road when they can’t trust Chinese apps in our pockets - whether they are made here or not.
He is putting it in the future tense. Those 100% tariffs are already in place last I knew.
Oh, but Chinese apps in people’s pockets are fine, according to TNG, if he is given a piece of the company. Congressionally passed laws don’t matter.
Steve
I3 HD SD 2027
I2 HD SR 2024
I1 HD SR 2022
See the future?
Don’t forget that the apps in our pockets are run on Chinese built phones.
There is already a tariff on Chinese EVs. The current 27.5% tariff placed on Chinese vehicles, which significantly increases the price of a BYD car when imported to the US, making it less competitive. There are also tariffs in semiconductors solar panels and a small tariff on Lithium-ion batteries.
So for example, the current long range Han EV with a 27.5% tariff and import/export costs runs about $43,000 if it was sold in the United States. Increasing this tariff to 100% would not change anything.
Heard on NPR about McKinley this morning. Not Mount McKinley but the tariffs of 1893. It was a total disaster for the US economy. Not bad for the robber barons but horrifying otherwise.
My guess is that the end result of all this huffing and puffing will be a diminished role for the US in the global economy.
The US is being seen as an undependable economic partner. Even our allies are actively looking to diversify their export markets away from the US.
I suspect there will be an increase in free trade agreements that do not include the US. Already happening with the EU, who I think are recognizing that the US is too volatile.
Same with Canada who will be emphasizing Asia: Canada’s Indo-Pacific Strategy
Canada is already part of the CPTPP.
If the tariffs on our allies actually happen and trump’s US decides to go it alone, it wouldn’t surprise me if Canada, Mexico, and even the EU decide they are better off making trade agreements with China. I bet China would give favorable terms as this would be one way for China to supplant the US as the global economic leader.
We are I think playing with fire.
TNG withdrew the US from that agreement on the last go around, in 2017.
Steve
He is not intelligent. Don’t hold your breath.
This will be a global Great Depression 2.
Odds…not facts yet.
It won’t be a loss of US power. The rest of the globe will be worse off than the US.
And so goes a lot of the revenue to companies owned by TIG. Maybe we need a poll to guess how many BKs will be filed this time.