Just how bad will Trump tariff reignite inflation?

Discussion in 'Economics' started by schizo, Dec 12, 2024.

  1. schizo

    schizo

    If we're talking politics, then yeah I see no problem with all this BS. But economically speaking, I have no idea how you can reconcile high tariffs and numerous tax cuts (especially at the corporate level) and still maintain "fiscal responsibility".
     
    #101     Dec 18, 2024
    sridhga likes this.
  2. sridhga

    sridhga


    Unfortunately, this thread has attracted politically charged debaters in a strongly polarized nation during an election season. A simple reading of the basic economics book, " Economics in One Lesson" by Henry Hazlitt has all the answers for the questions posed on this thread. But rational thought will be fought with abusive language here by members who have no clue of the economic repercussions of the proposals made by the incoming administration. However, not all proposals are really bad.
     
    Last edited: Dec 18, 2024
    #102     Dec 18, 2024
    schizo likes this.
  3. SunTrader

    SunTrader

    (AXIOS)

    1 big thing: Tariffs crush profits
    By Emily Peck

    [​IMG]
    Illustration: Aïda Amer/Axios


    One reason CEOs are so keen on becoming Donald Trump's new besties: The incoming president could make their profits go poof.

    Why it matters: The president-elect's proposed tariffs are so high they could entirely wipe out the annual profits of some large companies, per an analysis from consulting firm PWC.

    • Of course, companies won't sit idly by and let that happen — those costs will likely be passed along to American consumers.
    Catch up fast: Trump said last month on Truth Social he'd put 25% tariffs on all goods coming from Canada and Mexico — the two largest U.S. trading partners — as soon as he takes office.

    • That's on top of tariffs of 60% or more on goods from China, and 10% to 20% tariffs on imports from the rest of the world.
    Zoom out: These measures could increase the amount of money businesses pay in tariffs by more than 400%, per a data analysis that PWC conducts for clients using company-specific data from U.S. Customs.

    Zoom in: The modeling looks at worst-case scenarios. When Trump says all goods will be tariffed, companies take that seriously, says Chris Desmond, a PWC principal for customs and international trade.

    Behind the scenes, the Trump team is telling corporate consultants that there's no budging the president-elect on his tariff stance, the Wall Street Journal reported.

    PWC's model finds tariff increases are often larger than an importer's annual profits across a range of industries including autos, retailers, communications equipment-makers, and companies that import fruits and vegetables.

    • That's leading companies to question if they can change their supply chain strategies to adjust or pass costs to consumers, Desmond says.
    Reality check: It's certainly possible some firms that import goods may absorb these costs and accept lower profit margins, but many have already said they will pass the increased costs through.

    Flashback: Not only do companies pass through tariff costs to consumers, sometimes they take the opportunity to raise prices on other goods, too.

    • After the 2018 tariffs on washing machines hit, the price of dryers — which weren't tariffed — went up too, per research published in the American Economic Review in 2020.
    The bottom line: Lots of uncertainty out there, but it's a safe bet that companies won't just sit by and let their profits disappear.
     
    #103     Dec 18, 2024
  4. Picaso

    Picaso

    Easy, they'll cut foodstamps and privatize VA care :D
     
    #104     Dec 18, 2024
    schizo likes this.
  5. schizo

    schizo

    I wouldn't be surprised. What's even more funny is many of those food stamp recipients voted for Trump.
     
    #105     Dec 18, 2024
    Picaso likes this.
  6. SunTrader

    SunTrader

    Can you say trump, trump, trump ..... dump, dump, dump?

    Tariffs and slash and burn to trade deals are a good thing huh?

    And no its not The Fed, they are very distant secondary issue.
     
    Last edited: Dec 18, 2024
    #106     Dec 18, 2024
    NoahA likes this.
  7. SunTrader

    SunTrader

     
    #107     Dec 26, 2024
  8. 2rosy

    2rosy

    we can cut subsidies to counter the tariffs
     
    #108     Dec 26, 2024
  9. mervyn

    mervyn

    only job number matters now, core inflation wills stay in the foreseeable future. the rate market is pushing fed to cut or force the orange man to push the fed.
     
    #109     Dec 26, 2024
  10. SunTrader

    SunTrader

    Huh?

    Cut subsidies to U.S. companies ... to make them even less competitive?
     
    #110     Dec 26, 2024
    schizo likes this.