Skip to comments.US tariffs on China jump
Posted on 05/09/2019 10:09:09 PM PDT by BeauBo
The Trump administration is hiking duties on $200 billion worth of Chinese products to 25% from 10%... Industries and businesses affected by the tariff hike will not feel the effect right away: it will apply to goods exported after May 10, according to the Office of the U.S. Trade Representative. It will not affect products already in transit to the United States. Trump has prepared to put even more pressure on China as he pushes for an agreement. The president has threatened to slap 25% tariffs on $325 billion in Chinese goods that remain untaxed.
(Excerpt) Read more at cnbc.com ...
This is the year. The conditions have been carefully set.
Have your popcorn ready to watch.
“It will hurt farmers.”
I agree that agricultural products are a top category for Chinese retaliation, but two things:
1. The total amount eaten should stay around the same. If the Chinese buy wheat from someone else this season, the customer who was going to buy that wheat before will have to get it from somewhere else. Commodity products are easier to substitute. So it is unlikely to be a one to one hit on US producers.
2. The Trump Administration and Congress already have a bailout ready for farmers, if they get caught in the trade war changes. Last I heard it was like $19 billion.
Stock market will take a dump today. But this will hurt China more than the US. I’ve read that due to tariffs more than a few industries have relocated their factories to other countries.
Wrong...... all they can do is sell the bonds
Does anyone know what specific products from China will be hit with this increase?
I am having trouble finding out what exactly will be affected.
There is nothing China sends us that doesn’t have an alternative supplier: clothing, junk, appliances, etc. There are a host of countries producing the same things and very cheaply. When the market is that elastic, then there’s really not that great a risk.
There is nothing we sell to China that cannot be sold to another buyer or cannot be changed. Soybeans, for example, are bought each year at X amount. There is still a market for X amount, and if China gets theirs from Argentina instead of the US, then whoever used to buy the Argentina beans will be looking for beans.
Besides that, with beans down anyway, that’s an incentive to produce more corn, wheat, barley, oats, etc.
We are not over any kind of barrel.
And as the president says, he can buy the excess from our farmers with the tariff money he’s getting from China and ship the stuff off to starving nations. Who pays? China pays. Trump is a very smart man.
“Ive read that due to tariffs more than a few industries have relocated their factories to other countries.”
10% tariffs are a painful warning, but 25% really makes most manufacturing businesses have to move.
During the last round, $50 billion worth of volume got hit with the 25% rate. This time its $200 billion. So the real relocation of business out of China should speed up
The next round is reported to be $325 billion, if imposed - basically all remaining communist Chinese imports. That next round would also be bigger, because unlike this big round, tariffs would not be going from 10% to 25%, they would be going from near 0% straight to 25%.
The bottom line is that if the USA is intent on making manufacturers who sell to the USA move their production out of China, we can simply set the tariff rate to overcome any manipulation that the communists might try to provide. 25% should do the trick, but 50% or 100% tariffs are not rare in the world - just rare in the USA.
So the capability is obviously there to force the move, and businesses just have to assess the seriousness of the intent. Everybody’s assessment of that seriousness just went way up today.
“I hope that does not happen again. Then again, I dont need to access my 401k until about 2023. So should be recovered by then, provided we dont elect another 0bama.”
Not to pile on, but if we’ve learned ANYTHING from those miserable 8 YEARS of 0bama, it’s that diversity in your investments will save your butt.
Always live BELOW your means from the minute you start working for others or yourself. 401K with employer match (free money!), and an IRA & Precious Metals. Paid-for Land. Paid for house. Paid for vehicles. No debt. Have the mindset that it’s a GAME and YOU are going to win it!
Pretty much nothing but another world-wide Depression can harm you...and even THEN you’ll have all of the above, while others fail. Then, you buy up THEIR stuff on the cheap, LOL! (My Grandpa did that during the Depression, while he worked three jobs and raised his family and supported his busted FIL.)
When the markets tanked in 2008, all the Libs I worked with at the time never ONCE blamed 0bama and his STUPID @ss-backwards, Hate-America policies. Not. Once!
Some of them are still complaining about all the $ they lost, but they STILL can’t see the Forest for President Trump. MAGA! :)
“Does anyone know what specific products from China will be hit with this increase?”
Cellphones ($45 billion) and laptops ($39 billion) are the big billpayers; and also PC monitors, networking gear, toys, gaming consoles, meat, fish, and other items.
China only imports about $100 billion in US products, and has already raised tariffs on basically all of it already, in the earlier rounds. Some of those US imports are components that go into Chinese exports, so they would be shooting themselves in the foot by raising tariffs on them. They are basically out of ammo to return fire in kind.
How does only $200B tank the market? Fake contrived "reaction".
Here is how they will be delivered.
The supply should increase domestically. This will allow for us to pay less for food. This is a good thing. Corporate farmers (like ADM) keep the prices artificially high by shipping our excess out of the market to maximize profits.
I like the Trump strategy of using the excess to support the market for this situation.
"....agricultural products from our Great Farmers, in larger amounts than China ever did, and ship it to poor & starving countries in the form of humanitarian assistance. In the meantime we will continue to negotiate with China in the hopes that they do not again try to redo deal!!"
China State Funds Prop Up Stocks: https://www.bloomberg.com/news/articles/2019-05-10/china-state-funds-prop-up-stocks-after-hit-from-u-s-tariffs?srnd=new-economy-forum
Shanghai Composite Index sees huge intraday swing on Friday
Shares had opened higher, then tumbled on news of tariff hike
State Banks jumped in, the Shanghai Composite closed up 3.1%.
They will also do things like threaten, or make examples out of, people who sell when the State officials tell them not to.
Their resources available to manipulate their markets (and currency) are not unlimited, but we are not yet close to their breaking point.
LOVE OUR PRESIDENT!
... and if they retaliate, we can just go back to the way it used to be and make things HERE.
Imagine! A world without cheap Chinese shit (which is EVERYTHING they make!).
Unfortunately, they will likely just wait out Trump knowing that at least half our government is on China’s side.
Excellent call, President Trump!
Meat would be mostly pork, and the door should be slammed shut there anyway. Quarantine. (The “pig plague” can be carried by pork products, so, if uncooked or poorly cooked scraps are discarded and fed to hogs, the disease is spread.)
Soybean / feed farmers are going to take a hit regardless, if 200 million Chinese hogs die from disease, in short order, and more in other parts of Asia / the world.
If PC monitors are on that list, I’d guess TV’s might be, too? Some are dual purpose, anyway.
That is an underestimation of the adversary. Much like what was sometimes assumed long after Japan turned the quality tables on us. Some Chinese products are excellent: I have direct industrial experience with some. They are the distinct minority of products, but growing.
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