Posted on 03/04/2025 8:16:38 AM PST by lasereye
So perhaps the best thing we can do here is to give you some context on how big a deal the imposition of tariffs here would be.
The key thing to remember is that North America has been, in effect, a free trade zone for decades. Goods move back and forth across the borders so frequently that the number of crossings is almost incalculable.
Consider an example highlighted by the Wall Street Journal recently. It pointed out that a piston - a component of a car component, might cross the border, back and forth between Canada and the US and Mexico, six times before it actually reaches a customer.
Right now, it doesn't incur any fees on each of those crossings; tariffs change that picture and completely change the economics of making stuff.
Now, there are some deeper long-term discussions that could be had about the merits of making a car in one place versus another, but in the short run, the implication of these tariffs will be inflation. That's almost inescapable.
If it suddenly costs 25% more to bring a piston across from Canada into the US then imagine extrapolating that into every single component making that journey each day: it means the price of many goods goes up.
How many? That's hard to say, but consider that between them, Canada, Mexico and China account for around 40% of all US imports.
They account for almost 60% of energy imports. So while the objective of these tariffs might be (we still don't really have a clear picture since various different administration figures give various different explanations) to rebuild American manufacturing, it takes years to get factories built. In the intervening period, tariffs spell higher costs for American consumers.
And the upshot of those higher costs is lower economic activity.
(Excerpt) Read more at news.sky.com ...
The underlying evil in this country has gone under ground they set up trip wires along the way Im sure Trump and his team know this and work accordingly
Plummet. Plummeting. Interesting choice of words. How much of a decrease in an index constitutes a plummet?
“a piston - a component of a car component, might cross the border, back and forth between Canada and the US and Mexico, six times before it actually reaches a customer.”
That’s the stupidest thing I’ve read today. Who would tolerate such gross economic inefficiency?
I think they are talking about where the piston is put into something that is not the finished product. I could see where it crosses four times. A possible scenario would be:
1) The piston is made in Canada.
2) It gets shipped to a factory in Mexico where the engine is built.
3) The engine is shipped to Canada where the auto is built.
4) The auto gets shipped to a car dealer in the US.
The practice has been for auto parts makers to be located near the product they go into. So the piston company would have a factory near the engine manufacturer. In that case the piston would only have three border crossings. But they probably can't put up a factory near every customer.
I can't think of how it could go across borders six times. If they mean the piston crosses borders six times without ever going into a partly finished product, that sounds ridiculous.
The American Revolutionary War took seven years to win against an enemy that fought out in the open.
Our fight against Deep State won’t be any easier.
Folks better be prepared for that.
Summer soldiers and the sunshine patriots will not defeat Deep State.
S&P is 12.5% higher than one year ago. It has suddenly plummeted 1.48% in the last week. It doesn’t look like a stock market crash just yet. I suppose that if you go from merely plummeting you might get in to plunging territory.
You must not follow the stock market.
U.S. stocks saw losses mount on Tuesday as President Donald Trump’s tariffs on key trade partners took effect and prompted retaliatory measures, triggering a global trade war and escalating fears of the national economy cracking.
The Dow Jones Industrial Average dropped 716 points, or 1.7%, building on Monday’s plunge of nearly 650 points. The S&P 500 shed 1.5%.
The Nasdaq Composite lost 1.9%. That put the tech-heavy index on track to close in correction territory, which is when it falls 10% from a recent high.
This week’s sell-off pushed the S&P 500 into the red for 2025 and the Dow near flat on the year. Because investors hoped that a last-minute deal could be reached to sidestep the full taxes on Mexico and Canada, losses steepened in Monday’s session after Trump confirmed the long-awaited levies were coming. Paired with soft economic data released recently, the tariffs have given market participants further reason for worry about the health of the U.S. economy.
With Tuesday’s losses, the S&P 500 now trades below where it finished on Election Day in November, when voters headed to the polls to return Trump to office.
Exactly. Phantoms everywhere. Artificial highs. We need to get back to reality or everything will implode for good.
I don’t see any connection with fighting the Deep State.
Every day that the factory doesn't start getting built is another day on those years that the factory doesn't come online.
President Trump's end goal is to return manufacturing to the United States. It took decades to lost it; waiting a few years to get it back is necessary.
-PJ
slowing the economy down a bit will actually help reign in inflation.
The key thing to remember is that North America has been, in effect, a free trade zone for decades. Goods move back and forth across the borders so frequently that the number of crossings is almost incalculable
And the Canadians and Mexicans put their own tariffs on our stuff as they have the past few years.
Where has Ed Conway been?
The entire world has been in a recession since “The Arab Spring” invations started.
Seems like that's the opposite idea of what Trump ran on. If the objective is slowing the economy we could have elected Harris. In fact the economy was already slowing.
Fighting inflation by raising prices sounds like the kind of lunatic idea we expect from Democrats.
I’ll call the whambulance for you.
I call them "Free Traitors™".
The new tariffs were a lot smaller in his first term. Also the effect of Trump's deregulation and tax cuts more than offset the tariffs. Hopefully that will prove to be true this time.
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