The trade war should end ASAP, it doesn’t help. Americans don’t want a trade war, Trump was influenced by bad guy
U.S. Steel plans to lay off hundreds of workers in Michigan
The lay-offs call into question claims President Donald Trump has made about the resurgence of the domestic steel industry. Last week in Pennsylvania, Trump said his 25% tariff on foreign imports has turned a “dead” business into a “thriving” enterprise.
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We’ve been over this. Those who invested in higher efficiency tech are booming, since they can produce at a lower cost. Those that didn’t are being crushed.
Trump should have offered tax credits to these steel companies to modernize instead of tariffs.
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Efficiency and productivity gains are the only way to increase the standard of living too. The best way to do that is encourage capital investment. People arguing for other solutions don’t understand basic economics.
Tariffs don’t work. Larry Kudlow knows it. Hopefully Trump will listen to him.
I don’t think anyone wants Tariffs long-term. They are to create leverage for a better trade deal. There’s a 0% chance China was going to give up their huge advantage. They already blocked entire US industries and had more tariffs at higher rates on US goods. There’s no way they’d go to free trade just by us asking. That gets lost in the discussion about it.
People pretend or assume there was free trade between the US and China before the recent tariffs. That couldn’t be more incorrect.
Which efficient steel producer? Nucor? It’s doing so great its stock tanked 20% in the last 12mo. Sure, it’s doing better than US steel, which sank 60%.
Tariffs is a terrible and blunt tool to bring changes to trade relations. It also hurts us a lot. You may argue it hurts the Chinese more. But why not use some other strategy that doesn’t hurt us as much?
I already posted info from multiple sources. I doubt posting it again will make a difference, so there’s no point in doing it again.
Home Depot had their earnings call. They expect the impact of tariffs to drop from 2% of revenue to 1% next year due to suppliers moving stuff outside of China. Manufacturing is leaving China that quickly. Manufacturing doesn’t need to come to the US for the US to win. It just needs to leave China.
I doubt manufacturers will leave a factory in China to build for the rest of the world and make product for the US outside of China. They’ll move their whole manufacturing capacity outside of China.
Manufacturers have different factories for different markets. Apple builds iPhones in India just for the Indian market.
How about European firms? They are not affected by American tariffs and thus have an advantage over American firms because they can import from China for less. And I bet the Chinese government and factories will give them lots of incentives to make sure they stay. Anyway with less competition from American firms for Chinese labor and factory capacity they already have a good deal. A lot of Chinese imports are intermediate goods that don’t sell directly to end consumers but used as parts and ingredients. That means other countries’ firms will have an edge over American firms.
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iPhone has bigger scale than any product in the world. It’s made in India to avoid tariffs. That’s the only reason it’s built there. Local market manufacturing only makes sense for items that are very expensive to transport, or there are heavy tariffs to import.
The US is about 20% of China’s exports. Most of what the US imports are finished goods which blows up your whole European company having an advantage buying components argument. That argument only works for products that are high enough volume to require multiple factories. iPhone sales were tens of millions a year and still made in a single factory. The entire Mac laptop lineup is built in a single factory. Companies won’t split production with a factory in China and outside China. They’ll move the whole operation outside of China.
Win as in get benefit? Some how I get the feeling win means punitive action, regardless of whether US has any benefit. Thought the goal is to get a good trade deal or increase jobs (sound odds since is in full employment) in USA. So, win should be any help towards this goal.
The tariff applies only to imported finished goods. So shifting the assembling of finished goods to another nation would bypass the tariff. From the little I know, China doesn’t make much from assembling, the real benefit is these assembling factories spawn components factories and jobs for the poor countryside folks (are there still many of those?). China is moving up the food chain too, and such assembling factories are gradually leaving China before the tariff war. Tariff war is acting like a catalyst that speed up the process and indirectly forcing China to speed up the transformation to consumption economic model. Hence, tariff creates temporary short-term pain but helps China achieves its transformation faster. That is, I can’t see how the tariff strategy can create the situation where US would eventually get a “better” trade deal.
If win means containing China, tariff has a limited short-term effect. Long term, it won’t stop the ascendancy to superpower.
Win as in force China to accept free trade.
China is the assembly factory for the world. They assemble most of the electronics in your house. They assemble almost every single Apple product.
The consumer based economy is the path to massive debt. It doesn’t work without debt expansion.
Some economists believe that the US manufacturing sector is either entering a recession, or is already in one.
https://www.cnn.com/2019/08/22/investing/premarket-stocks-trading/index.html
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Um, where is their data? The headline says one thing, but the article provides zero support for the headline.
“In Europe, manufacturing output fell for the seventh month in a row. In Germany, the manufacturing PMI hit a two-month high but still indicated that the sector is contracting.”
Maybe they are confused about the difference between the US and Germany?
Here’s actual data.
The trade war is having a small impact. It’s interesting because manufacturing jobs are still growing at a good rate. This could stop that portion of job growth.
I’d love to see how much the Boeing 737 max grounding hurts the numbers given the value per plane, and the fact they can’t sell them.
It also appears part of it is from companies lowering inventory levels. That makes it difficult to tell if it’s a new trend or a one-time for inventory level adjustment.
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I support the goal of rebalancing the trade relations especially with regard to IP, but Trump’s strategies and tactics are just awful. His tariffs are getting less and less support. To win any war you need the American public’s support. This morning’s childish tic-for-tat and twitter meltdown is uncalled for and counterproductive.
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The self-professed “chosen one” has announced new tariffs:
edit: oh I see @harriet already posted.
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