The trade and economy mega-thread (5 Viewers)

[superchuck500]

Is there a trade deal with China? Is it really a deal or just a pull-back to status quo ante? Is Trump advancing US interests in this well-executed trade battle plan or was this poorly conceived from the start . . . and harmful?

I think the jury's still out, but I haven't seen that the Chinese are offering much in compromise - and it's not even clear if there's going to be an agreement. But it's clear they are working on something and I'm sure Trump will sell it as the greatest trade deal ever. The proof will be in the details.

 

[LA 2 L.A.]

What a huge forking clown this guy is

Trump is a tyrant, so he doesn't want the world to see that tyrants can be defeated and held accountable. He's not doing it to save Bolsonaro. Trump's doing to save himself.

 

[LA 2 L.A.]

Wannabe gangster. He thinks he’s in the Mafia, basically.

Trump is cosplaying la cosa nostra.

 

[Optimus Prime]

Trump threatens a 35% tariff on Canadian goods, and other nations will be charged up to 20% | CNN Business

President Donald Trump late Thursday threatened a 35% tariff on goods imported from Canada, a dramatic escalation in an on-again, off-again trade war with America’s northern neighbor and one of its most important trading partners.

www.cnn.com

 

[Dragon]

Trump threatens a 35% tariff on Canadian goods, and other nations will be charged up to 20% | CNN Business

President Donald Trump late Thursday threatened a 35% tariff on goods imported from Canada, a dramatic escalation in an on-again, off-again trade war with America’s northern neighbor and one of its most important trading partners.

www.cnn.com

Why does CNN and other mainstream media keep using the term "other nations/country" will be charged x %" That is deliberately misleading.

They should write the truth - "US importers will be charged x % when buying goods from "x" country"

 

[LA 2 L.A.]

Why does CNN and other mainstream media keep using the term "other nations/country" will be charged x %" That is deliberately misleading.

They should write the truth - "US importers will be charged x % when buying goods from "x" country"

...and US importers will pass that cost directly to the consumer. A 35% tariff on goods from Canada ends up basically being a 35% sales tax for anyone in the US who buys Canadian goods.

 

[TampaJoe]

...and US importers will pass that cost directly to the consumer. A 35% tariff on goods from Canada ends up basically being a 35% sales tax for anyone in the US who buys Canadian goods.

Businesses will attempt to pass along any increase in costs to their customers. That includes wages and taxes. That doesn’t mean they will be successful in doing so.

 

[LA 2 L.A.]

Businesses will attempt to pass along any increase in costs to their customers. That includes wages and taxes. That doesn’t mean they will be successful in doing so.

You're joking right? Importers always past the costs of tariffs onto customers. If you think any business is going to take a 35% hit to their profit margin, then you're either fooling yourself or trying to fool everyone else.

You say you don't like and support Trump, but you keep making weak excuses for why what Trump is doing is not so bad. It's bad. Look into the history of tariff wars. They make things more expensive for the people who can least afford higher prices.

 

[efil4]

That doesn’t mean they will be successful in doing so.

Oh they will succeed in passing it along.

What you mean is will they succeed in selling the goods/products at a higher cost.

So, now tell us what happens when a company HAS to either eat costs on products/goods sold, or is not having much success in selling products at a higher price.

 

[TampaJoe]

You're joking right? Importers always past the costs of tariffs onto customers. If you think any business is going to take a 35% hit to their profit margin, then you're either fooling yourself or trying to fool everyone else.

You say you don't like and support Trump, but you keep making weak excuses for why what Trump is doing is not so bad. It's bad. Look into the history of tariff wars. They make things more expensive for the people who can least afford higher prices.

You are hyper sensitive. I didn’t defend anything. I simply agreed with the premise that businesses do everything they can to protect their profit margins. Simple concept. Simple statement. Same for any business. It isn’t limited to importers.

 

[TampaJoe]

Oh they will succeed in passing it along.

What you mean is will they succeed in selling the goods/products at a higher cost.

So, now tell us what happens when a company HAS to either eat costs on products/goods sold, or is not having much success in selling products at a higher price.

In such a case, most businesses will attempt to offset those increased costs in other ways. In many cases, they will look for ways to reduce their costs in other areas. Examples: reduction in force, eliminating travel, eliminating overtime, cutting benefits, wages and bonuses, deferring planned projects, etc.

 

[LA 2 L.A.]

You are hyper sensitive.

That's not true in the least, mon ami.

I didn’t defend anything. I simply agreed with the premise that businesses do everything they can to protect their profit margins. Simple concept. Simple statement. Same for any business. It isn’t limited to importers.

You ended your original post by saying, "that doesn’t mean they will be successful in doing so," as if there's a chance they won't pass to cost off to consumers.

Businesses pass on the costs to consumers to maintain their profit margin. They doing by either raising the per unit cost or crapping out the quality of the product.

 

[LA 2 L.A.]

In such a case, most businesses will attempt to offset those increased costs in other ways. In many cases, they will look for ways to reduce their costs in other areas. Examples: reduction in force, eliminating travel, eliminating overtime, cutting benefits, wages and bonuses, deferring planned projects, etc.

All of those are passing the costs on to consumers, even if it's not the person directly buying their product.

 

[TampaJoe]

That's not true in the least, mon ami.


You ended your original post by saying, "that doesn’t mean they will be successful in doing so," as if there's a chance they won't pass to cost off to consumers.

Businesses pass on the costs to consumers to maintain their profit margin. They doing by either raising the per unit cost or crapping out the quality of the product.

Whether they succeed in passing those increases along is up to the consumer. It depends on the product and how flexible the demand is for that product and what their competitors do.

If you import products that are also manufactured in the US or are imported from other countries not subject to the tariff, you may find it difficult to raise your prices. Being able to pass those costs along isn’t a given. You can raise prices. That doesn’t mean the consumer will buy the product at the higher price. Depends on the product.

 

[TampaJoe]

All of those are passing the costs on to consumers, even if it's not the person directly buying their product.

if I don’t buy the product, I am not a consumer of that product.

 

[efil4]

In such a case, most businesses will attempt to offset those increased costs in other ways. In many cases, they will look for ways to reduce their costs in other areas. Examples: reduction in force, eliminating travel, eliminating overtime, cutting benefits, wages and bonuses, deferring planned projects, etc.

Precisely.

and is that good for the economy? Shedding workforce, cutting benefits, cutting wages and bonuses, halting capital projects etc.

Yet this current administration is telling the US that it will actually do the OPPOSITE.

Now, is that factual? of course not. Its a lie. Anyone with a lick of business sense will tell you this.

The ones that tell you the opposite are lying to conform.

 

[efil4]

Whether they succeed in passing those increases along is up to the consumer. It depends on the product and how flexible the demand is for that product and what their competitors do.

If you import products that are also manufactured in the US or are imported from other countries not subject to the tariff, you may find it difficult to raise your prices. Being able to pass those costs along isn’t a given. You can raise prices. That doesn’t mean the consumer will buy the product at the higher price. Depends on the product.

if no one is buying your product, you are effectively out of business.

If i sell widgets that no one wants, am i really selling widgets? Shoot, am i still in "business"?

Conversely, if you switch to the higher cost US made widget to avoid tariff, and still no buys, same results. You are effectively out of business.

 

[TampaJoe]

Precisely.

and is that good for the economy? Shedding workforce, cutting benefits, cutting wages and bonuses, halting capital projects etc.

Yet this current administration is telling the US that it will actually do the OPPOSITE.

Now, is that factual? of course not. Its a lie. Anyone with a lick of business sense will tell you this.

The ones that tell you the opposite are lying to conform.

I am not a fan of tariffs. That would not be my go to strategy.

We have seen segments of our manufacturing base move overseas. In some cases this presents the US with long term strategic risks from a business and economic perspective as well as a national security perspective. That risk is a problem that needs to be addressed.

So the question is how we address that problem with as little disruption as possible. If we can mitigate the risk, that is a win in the long run. I would prefer using tax policy and regulatory policy to encourage manufacturing in the US. Tariffs would be my last resort.

Businesses routinely contract and expand over time. It is part of the natural business cycle.

 

[TampaJoe]

if no one is buying your product, you are effectively out of business.

If i sell widgets that no one wants, am i really selling widgets? Shoot, am i still in "business"?

Conversely, if you switch to the higher cost US made widget to avoid tariff, and still no buys, same results. You are effectively out of business.

I think we are saying the same thing. You can attempt to pass along a price increase to the consumer. That in no way means the consumer will be willing to buy your product at the higher price.