Tariffs and Potential Inflation

[brymoore]

Okay. However, when Janet Yellin, a former "free trade" advocate reverses gears, wrong, wrong, and wrong are interesting comments w/o alternative opinions shared.
"It is not the critic who counts: not the man who points out how the strong man stumbles or where the doer of deeds could have done better...."

An internet forum poster or those - both Democrat and Republicans (a rarity now days) in agreement for combating China's undercutting of American production.

I agree, prices will rise though those "prices" that rise are due to cheap labor borne goods that directly undercut our American goods. China's interest in their labor market is production many times over the employee. America's interest holds protections for our laborers. It costs more. We've accustomed ourselves to the labor of those in China for the prices we pay for their goods.

I would rather pay more for American goods via inflated values due to tariff to raise the foreign goods price and keep America competing with imports. We continue to let China undermine our American production because we like cheap Chinese products.

What has been achieved in the last 8 years of tariffs?

Nothing except price inflation for American citizens.

 

[Sytes]

What has been achieved in the last 8 years of tariffs?

Nothing except price inflation for American citizens.

Inflation is inevitable, though I respect your opinion.
As mentioned a hundred or two posts earlier - what was the price of a Cadillac in 1950? the price now?

 

[Forkyfinder]

What has been achieved in the last 8 years of tariffs?

Nothing except price inflation for American citizens.

China's economy feels it, for one thing.

We can either fight later with warheads and bullets or with trade tariffs and sanctions now.

 

[brymoore]

China's economy feels it, for one thing.

We can either fight later with warheads and bullets or with trade tariffs and sanctions now.

Or we don’t fight at all.

The best way to win against China is capitalism.

 

[Forkyfinder]

Or we don’t fight at all.

The best way to win against China is capitalism.

In principle I agree with you. I think the evidence that we needed to push for more equal and fair trade practices have really shown through in my lifetime - being born in the early 90s. China doesn't at all play fair and it will be very hard to compete against rampant intellectual property theft, slave labor, and currency manipulation.

They have a long term strategy. A 100 year marathon...

 

[brymoore]

In principle I agree with you. I think the evidence that we needed to push for more equal and fair trade practices have really shown through in my lifetime - being born in the early 90s. China doesn't at all play fair and it will be very hard to compete against rampant intellectual property theft, slave labor, and currency manipulation.

They have a long term strategy. A 100 year marathon...

Or we introduce free market capitalism today.

China isn’t going to nuke its biggest customer.

 

[brymoore]

Inflation is inevitable, though I respect your opinion.
As mentioned a hundred or two posts earlier - what was the price of a Cadillac in 1950? the price now?

2-3% inflation is inevitable. Food prices are up 26% since the original tariffs. This is extraordinary inflation, not inevitable inflation.

 

[Forkyfinder]

Or we introduce free market capitalism today.

China isn’t going to nuke its biggest customer.

No. They aren't.

They'd make us wholly reliant wait till the chips are starked and then start negotiating with credible threats we can't fend off.

 

[homers]

imho, tariffs can be used strategically with benefits to the US. Prices may go up in the short run, but this will also allow new companies to enter the market and compete, bring prices back down over time.
Also supports American workers and new job opportunities.
National security. Supply chain disruptions during COVID showed how dependent the US is for many items, including medications, electronic components,etc.

 

[Bonasababy]

Hot of the Press--FYI Best Buy is HQ'd in my state:

“There are very, very small margins in this industry, which means the vast majority of that tariff will probably be passed on to the consumer as a price increase,” Best Buy CEO Corie Barry said Tuesday. “These are goods that people need, and higher prices are not helpful.”
Barry said about 60% of Best Buy’s inventory, by cost, is imported from China or relies on Chinese parts; Mexico is the second largest exporter of Best Buy’s products.

The added pressure comes at a time Best Buy can least afford it.

The company saw comparable sales drop 2.9% this fall, and revenue of $9.4 billion also missed estimates. Best Buy lowered its financial outlook for the rest of the year.
As a result, the company’s shares were down 7% in midday trading.

Wedbush analyst Seth Basham ranked Best Buy as facing the highest risk of damage from new tariffs among all retailers

​

“Electronics costs would increase materially,” Basham wrote. “Best Buy did a good job navigating prior rounds of Chinese tariffs — suffering moderate gross margin pressure and a slowdown in comps in 2019 — but the level of proposed tariffs and more precarious financial position of consumers makes the company more vulnerable this time.”

 

[SAJ-99]

Did y'all figure this out yet? My perusal of the thread seems to lead me to believe the HT poster consensus is doing nothing is not effective, and doing anything at all is also equally ineffective and naive….so the best course of action is to do nothing, support nothing, and bitch endlessly about it. I might have missed something though.

I do know in my industry (cabinetry for residential construction) when the tariffs hit the Chinese manufacturers in 2018 it made things a hell of a lot better for US based manufacturers of the products we sell. And those products are made with a significant amount of environmental oversight and regulation that the commie Chinese do not abide by. In that instance tariffs seemed to work damn good to me.

Saw the chart below in WSJ and it reminded me your post. I wonder if they are almost two different industries. I have done two remodels and used local manufacturers both times. That local source allows for more custom build. I wonder if the chart below is mostly big-box stuff? Clearly the first set of tariffs helped reduce the China -made stuff, but it was quickly replaced by sources from other countries. The total output simply coincides with the housing market.

 

[Sytes]

Ahhh, welcome back.

 

[FREAK]

We don't need Nu-wav ovens, ab rollers, air fryers, harbor freight crap, and a lot more.

Can we leave the air fryers out of it?! Couldn't read on after this line by schmalts..

 

[BigHornRam]

Hot of the Press--FYI Best Buy is HQ'd in my state:

“There are very, very small margins in this industry, which means the vast majority of that tariff will probably be passed on to the consumer as a price increase,” Best Buy CEO Corie Barry said Tuesday. “These are goods that people need, and higher prices are not helpful.”
Barry said about 60% of Best Buy’s inventory, by cost, is imported from China or relies on Chinese parts; Mexico is the second largest exporter of Best Buy’s products.

The added pressure comes at a time Best Buy can least afford it.

The company saw comparable sales drop 2.9% this fall, and revenue of $9.4 billion also missed estimates. Best Buy lowered its financial outlook for the rest of the year.
As a result, the company’s shares were down 7% in midday trading.

Wedbush analyst Seth Basham ranked Best Buy as facing the highest risk of damage from new tariffs among all retailers

​

“Electronics costs would increase materially,” Basham wrote. “Best Buy did a good job navigating prior rounds of Chinese tariffs — suffering moderate gross margin pressure and a slowdown in comps in 2019 — but the level of proposed tariffs and more precarious financial position of consumers makes the company more vulnerable this time.”

Good time to start up a new non-profit named "save the geek squad".