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Careful citing CATO. Those ivory tower ticklers have a penchant for contradicting themselves. And I’ve yet to meet a libertarian that ever wants to do the dirty work no economy can function without. Ask the bears😏
@patrick Boyle IF YOU ONLY READ ONE COMMENT READ THIS ONE! IF ITS ONLY THE LAST PART THATS FINE!!! YOUR LIFE MIGHT BE SAVED OVER IT!!! Im rather sure that the wright brothers had their first flight back in 1908. (somewhere around then) So, commercial airlines had little to do with the German's. However, if you want to blame the German's with giving humanity the desire or need to blow up the world to save the world. Well... They are still apologizing as well as not wanting to talk about it to this day. We will see where Russia leads us. I bet it will be a lot less where China leads us! I can only assume North korea will be an appetizer and Iran will be a dessert. This is all under the assumption "WE" are still the good guys and "WE" still win the war! Where as the United States is supposed to protect capitalism in today's era we do a damn good job in destroying it! We allow corruption, monopolies, and prevent open markets, even penalize other countries when they disagree with us. Yes, Russia is being penalized for war... however, if Russia was trying to make alliances with CUBA AND MEXICO would we allow it? My friends if you watch art (movies, tv, books, actual art) you will realize that life imitates art and is likely indication of the future. We are possibly already headed towards WW3. The type were nukes land across the world and then robots help humanity rebuild. The following years humans give robots the ability to defend them better so as not to be another nuclear mistake. This will be what leads to the "Terminator incident". Something similar to AI singularity and the robots rebelling on humanity. Humanity faces the great wall. Called many things but the fact is to much debris in our outer atmosphere would trap us in earth not allowing us to leave. This may seem like no big deal at first but our survival depends on us leaving earth. Nuclear weapons, robots, singularity, energy dependency, and even the decline in population are all huge problems coming up for those of us under 40. Yall thought the great depression was bad? (well those who had grandparents who told them about it.) The stories yall were only told or saw on tv! What is about to come will haunt your nightmares because you will be living it and dreaming it! Imagine no work, no job, no where to live, no place to get food because no one has money for the food so no one is making or growing the food. Those who have the food or money are hording it! during world war 2 People went to Germany to buy blocks of houses and apartments with the spare change they had. (less than 100$ US) Lot more money back then. Well countries are already experimenting with Euthanasia. How long till they come for the SICK, DYING, ELDERLY, DISABLED, OR A SPECIFIC RELIGION, POLITICAL PARTY, OR YOU!!!! STOP EUTHANASIA AT ALL COST!!! ITS A START DOWN A ROAD WHERE THE GOVERNMENT DECIDES WHO LIVES AND WHO DIES!!!!
@PatrickBoyle Please do a YT- vid over Euthanasia! I see this as a slippery slope! I dont want to tell my doctors anything nor do I want to be in any countries where this is legal! Im currently trying to find an escape but I dont like my options. Please help! Think 1920-1930's Germany - 1930's Japan ( Experiment 436 group I believe it was maybe incorrect on their name but they did the Japanese did the research on people in some cases more horrifying than the German's did.)
Ofcourse they will work if you want more home grown production, here are my thoughts: 0. Are 10% Tariffs enough ? No, an outright ban on China is the best way to go. 1,. Would it stop China? No. China cant be stopped at this point even if you bottleneck them by affecting their exports. They will double down their exports to EU. 2. Should EU too apply these tariffs? Absolutely a global ban is the only way this works. Similar to how Iran is eating and dumping bricks due to lack of exports. 3. What else can be done to stop china and get US lead back in AI and other technologies that it is loosing? Low regulation on AI and More H1B Visas but only for the top talent specifically from china. 4. What can EU do to participate in this ? Well the same and poach best talent and pose tariffs and encourage home grow production, increase manufacturing give more manufacturing loans and isolate China like Iran. A third Industrialisation wave is imminent, and one must use AI to do that, because china will do it with its aging population. 5. What monetary actions can be taken? Reduce spending on useless stuff and reduce , leakage and reduce debt. Stop printing more money and utilize debt and tariffs as a mechanism to pay for re-industrialisation of US and EU. 6. How about shifting manufacturing base to India or sourcing products from there ? They simply dont have the manufacturing capacity , even they source products from china and thny export to US/EU. It is useless with its aging middle age population.
I don't know if Patrick is an aspiring rap artist but he is a Prof. of Finance at King's College London and has had a successful career in finance before that and if you care to post your credentials here in a verifiable manner we can all draw our own conclusions as to whether or not we should take anything you have to say seriously. Quit trying to sound smart just put up you CV in a verifiable way or crawl back under your rock.
During Trump’s first term, he put a tariff on steel. Prices went up by 25%…. it has been seven years and steel manufacturing has actually decreased in the US… but prices remain high
When W Bush did Steel tariffs he saved about 8,000 Steel jobs and cost the US over 200,000 manufacturing jobs. Another brain genius move from the GOP. For a group who thinks they are good for business, they are absolutely lost when it comes to the economy.
To be fair in the case of steel that has more to do with how U.S. steel mills never sought to update into electric arc furnaces and such. The company U.S. Steel is only actually 10% steel production today, mostly it's oil exploitation. There is only one U.S. company 'Nucor' which developed electric arc furnaces further into being able to produce sheet steel. Now the tariff is responsible for the jump in price because Nucor has no reason to undercut itself when it can't even meet demand so when Chinese steel prices went up so did Nucor's.
@@Cragified Both the Biden and former Trump admin and future Trump admin are blocking a major, acquisition deal that's favorable to steel workers on Japan's national steel company, a company that is the 3rd largest steel manufacturer globally. Steel is on tough times and neither economic orthodoxy or whatever Trumpenomics might be called has and will do anything to rectify.
@@Cragifiedsame thing will happen with electric cars. Pound for pound the Chinese cars are innovative and competitive with American electric cars. Trying to draw a protectionist stance around car manufacturers and protect American producers from failing on their products will mean that the auto industry will die a slow drawn out death.
Replacing income taxes with tariffs is basically raising taxes on the poor while lowering taxes on the rich. It's just a variation of raising sales taxes.
@@toomanyaccounts I think that income taxes should be replaced with tariffs *and a progressive sales tax* - a higher sales tax rate on more expensive goods, such as luxury items.
@@toomanyaccounts lol you tried to fact check and ended up agreeing with them. Tariffs themselves are a regressive tax. So if your government collects taxes primarily from tariffs, and those tariffs are paid by the consumer, it means the poor will be paying the largest percentage of their income to the government, because they spend the largest percentage of their income on imported goods. It’s like a tax on gasoline.
Tariffs will increase costs of finished goods and components used throughout US manufacturing. This will be an immediate and huge hike in inflation. To fight inflation the Fed will have to hike interest rates which will be wonderful for the billionaires but possibly take away the middle class. Inflation is so high that consumers are literally taking debt for basic life necessities. Collapse has indeed begun..
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You guys all remember when the Republicans vigorously opposed protectionism and promoted free trade? Because an awful lot of people seem to be suffering mass amnesia about all that.
yeah that is the point. free trade when I have the upperhand, tariffs when i dont. lol. it'll be hella funny to witness the mental gymnastics of some westerners to rationalise all they are gonna do in the following 50 years 😅
Democratic presidents forced Japan to open trade in 1854. The British did similar things. In our time African countries are still pressured to import goods.
Pre-Great Depression 1920's Republicans were staunch protectionists using tariffs. Right up to, you guessed it, the Great Depression. Then Hoover just let the market correct itself while sitting on his hands. How else did you end up with FDR for four terms? Betcha after Trump you'll get Democratic administrations after the second disastrous Trump term.
@@FLASK904 easy to find something newer but you are right that Reagan and Bush were free trade. Under the Eisenhower, Kennedy, Johnson and Nixon administrations, increasing numbers of Voluntary Export Restraint agreements were also secured with Japan, South Korea, Taiwan, Hong Kong and European countries to avert the application of trade barriers by the US. Products subjected to quotas included textiles, plywood, sewing machines, flatware, tuna, woodscrews, steel, steel and iron products, glass, footwear, and electronics.
Tariffs are like scalpels. It needs to be focused and exact. Universal tariffs on everything imported from a few countries is like welding a hammer where a scalpel is required.
I hope whatever you're smoking is good. How big do your hands look? Tariffs are a part of overall geopolitics, and is a tool for negotiation. This comments section is full of uneducated 'geniuses' telling us 'how it is' without realizing that foreign nations have tariffs on US products right now.
@@pistonburner6448 "There is nuance to tariffs that is absent in this decision" "Actually there is no nuance here because tariffs exist" Do you not know how specific and complex tariff schedules are? No one does blanket tariffs for good reason. Pay attention.
A blanket tarriff can be useful when 1. The trading partner is in breach of the trade agreement (aka not complying with remain in canada/mexico) 2. The dispute resolution policy of the trade deal creates a liability for the retaliation 3. There is a demonstrable damage claim for the non compliance ( 150 billion/year) 4. Compliance request is associated to the breach ( closing border/taking deported who were let thru)
Tariffs only conceivably work when you have local manufacturing to compete with foreign manufacturers. We decided long ago to get rid of manufacturing so that we could pump more money into shareholder accounts, which would then be used to build retirement communities in Florida (where there's too much water) and Arizona (where there's definitely not enough water).
@@lenerdenator still won't work. All that still does is pass off the cost onto the consumer.... While subsidizing low productivity. Not to mention it opens up the US dollar to be replaced as a reserve currency
@@ashishpatel350 I thought republicans dislike welfare, as it turns out they just hated the poor hence why they dislike social welfare but more open to the idea of corporate welfare. Trump subsidized farming corporations for over 20 billions USD due to his disastrous tariff policy.
Once tariffs have been in place for a while, and consumers have become used to them, this resets the market price for those products at a higher level. Removing or reducing tariffs doesn't lead to lower consumer prices, importers and retailers will simply put the reduced tariff into their own pockets as higher profits. Retailers don't exist to do favours for consumers. They will charge as much as the market will bear
The way Donald Trump uses tariffs is to encourage and make viable the manufacture of the goods under tariff, in America. So Americans get more jobs and the economy booms...then people have more money to spend, even if they want to spend it on imported goods. Capiche?
@@markanthony3275 That's not how it works. For example, the steel and aluminium import tariffs Trump imposed before, in his first term, didn't create that many more jobs in those protected industries, it just forced prices up. That then passed on those costs to other industries, such as the auto-industry many of whom chose to move manufacturing out of the USA. putting American workers out of jobs. If US manufacturers require the cost of imports to be artificially inflated to be viable, that shows that they're fundamentally uncompetitive.
@@MrBrendanrex The cost increases in the auto industry came from union wage demands, ...people that traditionally vote democrat, so I don't think you could include that in your analysis. And do you recall what Trump did to the big three who wanted to move to Mexico for cheap labour? He signed an executive order that if they move there, they must pay Mexican workers the same wages as Detroit workers. Now he threatened John Deere for trying the same thing. Tariffs on metals were not responsible for higher costs or prices downstream, there were many other variables, like the unionized costs I mentioned.
If you have a chinese vehicle that costs 25k , and GM car that costs 40k, 100% tariff would mean that GM can increase the price by say 5k, since that chinese EV now costs 50k.
Don't forget the 20k Tesla that Enron Musk keeps promising but failing to deliver, unless you count the price of a Cybertruck after owning it for 3 days.
US cars are unnecessarily large, become more like tanks every day. So that you have to buy "more car" for the ability to drive alone to the supermarket. Maybe there are more problems here then just cheap labor in china and tariffs won't fix that.
What do U think GM cars are made out of? Montana bulsa wood? 🤣 All the parts are imported...it's only assembled in America. They would have to raise their price to 65k to cover the tariffs also....thus making the Chinese car still cheaper lol
"We shouldn't take Trump's proposal seriously because it just wouldn't work." Man, if only we lived in a world where that would ever even slow him down.
Trump raises tariffs on other countries that depend on American dollars to survive and they try to pass the tariffs onto us and then we can make our own things cheaper so America starts making stuff at home again and those foreign countries loose our business and money.
The U.S. has new leaders with different ideas, even within the same party, often. International companies with infrastructure worldwide don't want to scrap all that and build up in the U.S. for what could be 1-4 year conditions. Countries with more long-term, unified parties of leadership could much more effectively use tariffs in this way.
This is what I don’t get. Everything was pinned on Harris, even policies she didn’t believe in, as inevitable and catastrophic, but when it comes to Trump’s very real policies he outlined in detail you’re treated as crazy for thinking he might actually administer them.
@@mishaf19 maybe if she gave an interview she could have dispelled that notion? Harris was a terrible candidate, I mean Biden was a terrible candidate and he still won the primary while she was defeated almost immediately. You don't know ANYBODY that voted for Harris. I don't know anybody that voted for Harris. You know people that voted against trump but not for Harris. Nobody liked her they just hated Trump. That's what makes her so God awful, like it or not the presidency is part personality, popularity contest and Trump actually has personality and actually has people who voted FOR him. People who showed up to vote who otherwise would not have bothered if another candidate was on the ballot. Harris only had one argument, I'm not Trump. Well 350 million people aren't trump in America. How about you give a reason to vote for you
Tariffs can also make completely independent and domestically produced goods more expensive This happens because the competing product becomes more expensive due to the tariff, allowing domestic manufacturers to increase their prices without losing their competitive edge in the market this happened in the 80s with cars: Japan faced tariffs and export restrictions on its cars, but as a side effect, us-produced cars also became more expensive. While this increased profits for US car companies, since us-consumers had to pay more, it barely resulted in more job creation. The intended strengthening of domestic companies had only a minor impact beyond raising their revenues at the expense of US customers
your pretty far off base with that assessment about Japaneses auto's and its impact on the US ecconomy.. The Japan Automobile Manufacturers Association U.S. office (JAMA USA) has released its annual contributions update, including data from Rutgers University Economics Professor Thomas J. Prusa, PhD. The contributions update shows that Japanese-brand automakers have continued to invest in American manufacturing and have cumulatively invested more than $60.4 billion since first starting production in 1982. In the coming years, this number also will include announced investments in both electrified vehicles and battery manufacturing facilities as they come online. The update also highlights how Japanese-brand automakers directly employ more than 107,000 U.S workers and have continued to invest in areas beyond the manufacturing floor. To date, Japanese-brand automakers have 50 vehicles designed and/or developed throughout 43 R&D/design centers across the country. In addition to JAMA’s annual contributions data, Dr. Prusa’s employment study shows that in 2022, Japanese-brand automobile direct employment supported 499,000 intermediate jobs and 399,000 additional “spin-off” jobs. Combined with the 1,300,000 individuals directly and indirectly employed by the Japanese-brand automakers’ dealership network, Dr. Prusa’s study concludes that Japanese-brand automakers now support more than 2.29 million U.S. jobs. The study also highlights the $197 billion in employee compensation across Japanese-brand automakers’ manufacturing and supporting operations and new vehicle dealers’ employment.
@johntowers1213 The most likely reaction to high tariffs would be to shift production/investment behind the tariff wall to access the protected market - that is what Japanese auto manufacturers did starting in the 1980s. However, Trump is proposing 25% tariffs on all manufacturing sector imports from all countries. Not all foreign manufacturers will have sufficient US sales to justify moving production behind the tariff wall; thus will not invest or export to the US. If there are US domestic producers (alternate suppliers) for these lost importers, they can either choose to increase production, increase prices or both - which strategy do you think they will choose? And what will be the impact on the consumer and the economy.
That is why Fed chief Janet Yellen asked China to stop making stuff earlier this year. You can spot overconsumption easily as you will see a proliferation of self-storage facilities - often in repurposed factories that shut down.
A striking example is that you could raise tariffs on bananas to the point that greenhouse bananas grown in Michigan could compete, but boy would they be expensive.
The funny thing is that the supposed lack of manufacturing in US is partially a myth. The overall production by industry in US has never stopped growing (excluding temporary set backs during recession, covid etc.), it's in fact the biggest in the history. So for example the real output of US industry 50 years ago was actually half of what it is now. Of course, individual industries and companies have various history, steel manufacturing dropped massively in the 80s, but other sectors grew. The problem is that American people are buying more and more and more every year since WW2. And so the import grows and grows. So, it's really not about bringing the industry back, it's still there. Although of course the productivity has increased massively over the years, which means fewer and fewer people employed while output grows.
@@jankoodziej877 Thats the point. Tariffs would take money from poor and middle class so they buy less. This will decrease imbalance but I am not sure 90% will be happy about this.
@@jankoodziej877I can make stuff using the company owned machine that would have required at least five blokes back in 1950. The job has not necessarily moved anywhere, no one has taken it. Steel industry both hit an end of a boom, people getting wealthier are not going to buy a third or fourth car. And the process was already growing more efficient. Recycled steel was being more widely used.
I probably won't be the first to express this - but first an anecdote: Until 2016, the US was working on the Trans-Pacific Partnership (TPP) to curtail China's influence across the Pacific Rim countries (low-end Whirlpool washing machines built in Vietnam instead of importing Haier washing machines from China, etc.). It was a way for the US to secure lower cost manufacturing without a trade war. By exiting, Trump gave all 12 of those countries away to China. _I actually lost my job in 2017 (working on a secure cloud infrastructure for the TPP) when Trump exited the agreement and I never caught up in salary (based on inflation) since._ Anyway, I think on paper, across the board tariffs will work BUT ... underneath all the rhetoric about bringing back jobs, is the simple fact that, in order to subsidise Trumps extension of his tax cuts for the top
OH - BTW, if Trump raises tariffs on goods imported from other countries by >20% while increasing Chinas by only 10% (consumers are already experiencing up to 40% tariffs on Chinese imported goods, so...), might it not actually help make China more competitive against their other Asian neighbors - just a thought.
All you said is true. Trump has shown Asia that US is not a reliable ally, if even. So far only Japan and South Korea are still beholden, and that's only because of relic of WW2.
Once the USA had walked away from the TPP, the other partners signed an agreement lickity-split. Copywrite and access to health systems were major stumbling points. No one was willing to let the USA destroy their health systems for marginal trade gains. And no one cares about Mickey Mouse.
Every time I think about this I can't help but wonder about just how much tariffs are beneficial for the owners of domestic manufacturing. Basically tariffs remove competition. Perhaps if we had some laws about "fair" profit that would cap the "difference in price over cost", this would work out, but we don't and we know that price gouging is a thing along with planned obsolescence and cost cutting corner cutting. So, i see tariffs as a big big win for the wealthy as it reduces competition which in turn reduces accountability. I don't know if this take is right... It's probably not, but it's what I wonder about.
The point of protectionism is to insulate domestic industries from foreign competition, it benefits the wealthy by design. You have to keep in mind that free trade and competition being good for the economy as an idea isn’t much older than America as an independent country.
I think you got a good point there. Tarriffs have a purpose; but they need to be implemented smartly and with foresight. Something that seems to be completely missing from Trumps supposed plans.
From the moral standpoint, we should tariff foreign countries that have less strict regulations (whether labor or environmental) to make sure they can't cut out existing domestic production. Very fine balance, though...
@@skillfulfighter23 Too long didnt read put 25% of oil/natural ressource imports from colombia under tariffs because they didnt randomly allow american military planes into their air space.
It's all the same nationalist bravado. He has to frame himself as "winning" even though in reality he has absolutely no power over anything except messing up the US.
You legitimately believe people will choose to pay 100% more on a product built in China 🇨🇳 instead of the same or similar product domestically built or from a non-tariff country? You really believe that? If you believe that to be true. Then not a single US Automaker would still be in business.
One thing the tariffs cannot do is bring back manufacturing jobs, because offshoring has never been the primary driver of the reduction in manufacturing jobs. That has always been automation. The manufacturing jobs just aren't coming back.
Despite the automation of production, it still has a positive effect on the economy, as it increases tax revenues and affects sectors associated with servicing automated production.
I can't remember what it's called, but it is generally good for our economy to produce more of a certain thing for as cheap as possible rather than produce less of a product to produce another product which we can technically produce for less than another country. The real problem is that we have no safety net for people that lose their jobs. It shouldn't be about bringing jobs back home, but by assisting people that lost their jobs to live while providing them means to get another job.
If that was the case we should see a large increase in productivity as automation takes root. We haven't seen this. Technology has indeed changed the nature of some jobs (e.g. undeground coal mining has been entirely replaced with mountaintop removal mining), but hasn't impacted the number of workers needed as the gains from automation have been gradual and are effectively lagging behind the growth in global demand. So off-shoring has really been the major driver. Yet you are actually right. Re-shoring is impossible, because the economies that lost those jobs restructured and created different jobs that were mostly better. If those jobs came back they would have to compete for labour in a very unfavourable way and they would end up with inexperienced and unproductive workers and managers, which means they would quickly become zombie industries that are only supported by the presence of tariffs or subsidies. Automation would in fact be a great way to address that problem, but it can't, because it doesn't exist. Yet.
That was true for the biggest part of industrial history, but it peaked already, as cheap labor can replace automation far more efficiently now. Automation is an investment and costs you can just undercut by doing it with cheap little hands on a table in an unregulated environment without any power or infrastructure. Automation nowadays needs power, knowledge, technology, and infrastructure. Due to the rules of the current market that it must be made as cheap as possible, you will not automate until labor costs are as high or higher than going for automation. We are just in that bracket, and now they all scramble for the cheapest solution while mitigating the fallout of nonexistent automation or manufacturing jobs. It’s a hellhole.
I think its important to note that trump tarrifs led to a loss if 150k jobs and us having to spend over 20 billion dollars bailing out our farming industry
unfortunately the dark reality of that experience is farmers learned they will get their money without having to employ farm workers or even do any farming
What are the 3 expenses that have gone up the most over the last 20 years? 1) Healthcare 2) College 3) Housing Now name 3 industries that are just about impossible to import. This idea that you can make the economy stronger by bringing back manufacturing jobs is the claim that you can pay for expensive stuff by selling cheap stuff. Of course it can't work.
Manufacturing jobs would be a nice option instead of going to college, taking on huge loans and hoping you'll land a job in the industry (and actually like that profession), so yes, bringing back manufacturing can help with education costs. Housing is also concentrated heavily in big cities where the jobs currently are, manufacturing jobs outside city would revive dying areas where housing is cheap.
@@bigmacfinland4343 Nobody is going to work in a factory for Chinese-level wages after spending $45K on a degree. This is not negotiable, economic development is a one way street. The US is a service economy, it can't simply go backwards.
@@PlatinumAltariaWhy can't it 'go back?' If we make more stuff then there will be more stuff to go around, and I don't see how an insurance claim adjustor or SEO engineer actually contribute to the wealth of the nation anywhere near as much as a guy putting screws into toasters? Yes, economies move forward, now-a-days most assembly is done by automation, but that doesn't mean we don't need people to build and operate the automation. It just means we can make more stuff per person working in a factory. Housing is a great example, the actual materials that a house costs are not that expensive, if there were more people qualified to build houses, they would build houses in spite of the large contractors who want to turn a huge profit. The idea that factory workers don't make much is not only untrue (I have an engineering degree yet working as a tech makes me more money), but unreasonable. Why would factory workers make "chinese level pay"?
@@bigmacfinland4343 "Would be nice" is a thoughtful sentiment that's never backed up by math. In 2023, the average manufacturing job in China paid $15,130. Who in the US considers that their dream job? I understand there are sections of the rust belt that need help. But they have to move forward. Remote work in a services economy has a lot more potential than fighting over low value positions.
When I was an economics student in the 80s I wrote a paper on tariffs in the Australian Auto Industry. The conclusion was that every job in Automotive manufacturing was costing Australia $186,000. The benefit for the government was support in 4 key federal seats. The effect of removal of tariffs was an increase in employment of 3 times the number of direct auto manufacturing jobs lost.
All of that never addressed the amount of government stimulus paid to the auto manufacturers. That is an inflation caused by your Kinseyian economic nonsense. Just print print ect. Recession is a natural occurrence in a real economy to clean up zombie companies and ridiculous govt regs. That cannot happen in this central bank Kinseyian demand economic plans. Zombies = amc stock and meta Inc.
That can’t be right , the jobs at the car factories have gone to other countries , they are not coming back to Australia , how can you say that this is an improvement? Tariffs are necessary for developing economies as Australia has always been , progress was slow but had the policy of protectionism been maintained Australia would be in a better position, with a strong manufacturing sector , albeit subsidised.
In 1772 Americans revolt against 2% tarrif on tea. 2024, Americans elected President who promised to impose 100% tariffs on everything 🤔 Am I missing something?
In 1772 the average American would work at a farm or factory and provide a good living for his family. And not have to worry about ming working in the prc for a tenth of his wage, flooding the market with cheap disposable goods.
For billionaires a burger costing $10 instead of $5 isn’t a problem but it is for most families. Production in the US isn't even possible for a lot of goods. China sits on 80% of rare earth metals needed for high tec stuff like chip manufacturing, batteries etc. Tariffs can be a working instrument if used surgically with caution. Something tells me Trump won't use much of caution in anything..
But we don't, that's the we have almost no lithium and I'm not a million percent certain we have enough rare earth metals in general to keep the kind of industry American consumers demand running in the least.@@RiversJ
@@lightunicorn1371 Yes you do, that isn't something up for debate, you just don't want to mine it yourself because most rare earths are mixed with radioactive ores like thorium which China doesn't mind and is stockpiling for future use in thorium power plants they're developing since the US has slept on those for fifty years despite originally developing it. You rather wanted cheaper nuclear weapons and since that time dishonest environmentalists funded by oil corpos make it legally impossible.
@@lightunicorn1371North America is one of the most resource rich locations on the planet..it could if it wanted be almost entirely self sufficient in most if not all key elements, but understandably would rather some other nation dug up their country instead ... you should check out the Geological survey database to see what the nation is actually sitting on...
It's not that China is the only country that has Rare Earths, it's the only country that will mine and process them at reasonable prices. Why? Because most of the Rare Earths are chemically similar and require horribly toxic, polluting processes to get the required purity levels. Have a guess how they make that work. Some years back, China floated a ban on exports and the immediate response in America was that some old, mothballed mines started to look at re-opening. Because if the price goes up a lot, those barriers to production disappear. China realised it was a bad idea and retracted their position.
Tariffs *can* work if the country is self-sufficient. However, we have passed the point of no return in regards to globalization. The United States completely lacks the ability to isolate and maintain its quality of life nor is its populace willing to sacrifice "for the greater good."
Ohhh.. you are so mistaken... All it takes are the resources. Russia is rather proving the point now, and the U.S. is probably more adequately situated. Petro-sufficient. Iron-sufficient, Food-sufficient, And ultimately lithium sufficient...
The greater good would be what is best for the world no? Not just one country in particular. And when people can barely afford groceries, that often means getting the cheapest products you can wherever you can get them and selling others the products you make that are a good deal. Obviously international trade where it is unnecessary is polluting the planet unnecessarily as well, but creating car factories in every country of the world just so every country could have cars would be redundant and highly inefficient. If countries just isolated as you say, most western countries wouldn't even have computers probably due to a lack certain resources required. Before large scale international if a country couldn't produce or grow it themselves, they just had to go without. A global economy gives everything to everyone at the best possible price. As for food, a lot of wealthy northern countries wouldn't even be able to feed themselves if they couldn't import food, unless they wanted to live on old potatoes and carrots etc. There is just too much good about the global economy to write it off for a few of the bad things about it.
You left out the part that the US is in fact the global core of globilization. The largescale economic and society benefits of that are unquestionable. Not only is it the core of globilization, it is the originator of it in the modern economic system. However, the US has failed to reckon with the problems of that, pushing it off for decades for the benefit of quarterly shareholder statements and two/four year election cycles (and the attending grift & fundraising that goes with that). Instead of using the government as a tool to ensure the benefits of having the US as the economic core of a global system be available to the public (see higher tax rates in the 50s and 60s) it paid Peter to Rob Paul and allowed income inequality to grow and let the haves become increasingly the have-alls to the point where they've bought the system wholesale and are in their tiny little greed is good money-addled brainpans, along with the cultish Southern Christian fundamentalists hooked on the abhorrent and utterly heretical "prosperity gospels" and dominance as their stormtroopers, think the best they can do is retvrn the US to some mythical 19th century of isolation and robber baron AI robot paradise and they're using a charismatic fake racist billionaire mob-connected TV reality star who couldn't make money running a damn casino as their figurehead. Anyway, good luck out there.
To restart manufacturing you need labor. The current unemployment rate is fairly low. You also need the right kind of labor pool. Even if the US decided to restart more manufacturing we would have a hard time convincing people trained as lawyers, accountants, or business to work the lines. President Trumps immigration policies will also eliminate a traditional source of manufacturing labor.
U3 is useless as a policy making tool. They only count people who are drawing benefits. A better measure of surplus labor is the percentage of people who are out of the job market entirely, which is at historic highs. The problem we're having is low skilled and unskilled labor pays so little, if you're stuck on the lower rungs of the job ladder you're better off not working and instead collecting benefits. We need to raise wages for those jobs, and the best way to do that is to sharply curtail immigration as well as instituting tariffs to encourage low end manufacturing.
I have heard elsewhere that lots of the jobs that people do have are multiple jobs (Each person having seversal), unreliable temporary contractor work, zero hours contracts with no guarantee of hours or schedule and just unsatifying lowly paid work. I don't think we;d be talking about lawyers, accountants or MBAs.
@@RobertLutece909 Your argument on the accuracy of U3 doesn't make any sense and you're highly unlikely to raise wages for low-skilled jobs that way without sharply increasing the opportunity cost (wages) for higher-skilled jobs in the process. That is the problem with curtailing immigration and instituting tarriffs. The combination is likely to trigger runaway inflation and a major recession while making the US economic position *worse* in the long run.
Bro, the US has millions of minimum wage starbucks barristas and Chipotle employees. These people aren't married to their jobs and will go into manufacturing if better opportunities arise. That's not even counting the millions of liberal arts majors that graduate every year. Don't worry, the manpower is there. That and, you know, infinite amounts of people at the borders who would gladly work in factoried for a chance at a green card.
Thank you for stepping into the, “noise-scape,” and offering an unbiased, practical breakdown of the issues at hand. It is really hard for a lay person like me to get a grip on the basics when all, “analyses,” seem to be coming from extreme positions, necessarily inserting their political biases first and foremost, whether opposing or supporting the introduction of a new tariff policy. As you make clear, all countries have a dog in this fight, so to speak. So a good understanding of the unvarnished facts are essential. Much appreciated.
When Capitalism included a huge number of small businesses, then increased prices went in part to pay more to staff, given that small business knew their employees and customers well, so it was in the interest of business owners to re-invest in the business. Move to globalism, and the staff are now just replaceable numbers making it easy for CEO's to make decisions that are not in the interest of employees 😢
Unfortunately you'd be almost entirely missing the real story which is how Trump is using tariff threats as a geopolitical stick. Not only is that what he is doing before he's even back in office, it appears to be working. It's easy to sit back and express well-known economic principals to push a point about tariffs not being directly beneficial for an economy. It's also purposely obtuse, at least in this particular case. And yes, while they're almost certainly directly bad for the US economy they're *worse* for the economy he's waving the stick at. Patrick touches on this a bit, but not enough IMHO.
If the US want to bring Canadians, Mexicans, Europeans and Chinese together so they can have advantageous trade deals excluding the US, tariffs are a great way to make this happen.
None of these political entities is capable of coming together on anything meaningful, one main reason for it being that their politicians are in cahoots with US oligarchies. So at least on this front there's no such competition risk.
@@vbrotherita Uh, Canada gets along great with the EU, and we have no issues trading with Mexico. In a way you're right there's no new risk of competition, since we're already trading with them just fine.
As a German i want to use this oportunity to thank President Trump for ensuring that our American competitors will become overprised and crappy, thus leaving the rest of world markets to us.
The fact that there isn’t a massive investment in industrial skills that go along with the tariffs doom them to failure. Even if they could somehow find the people there just isn’t enough skills to actually man the factories. Coupled with demographic headwinds and proposed mass deportations there is no way we could keep the same GDP with these tariffs.
Also there's no factories. In fact I have not heard him utter one word about subsidizing any manufacturing. No one in their right mind is going to start a factory making a product for domestic sale only, that could once again be cheaper from China in 4 years.
@@criticalevent Forget 4 years, what if the Chinese and the EU say "F you Mr Trump" and subsidise their exports in targeted areas? I mean really undercut American manufacturing where it hurts. WTO will get their knickers in a twist for rule breaking, but maybe only if the US ever bothers to pay its outstanding dues to the WTO that is. Right now they don't have the bandwidth.
@@criticalevent They are more likely to move their companies to one of the many other countries with cheap labor anyways. In fact, some experts predicted this long before the tariff discussions began, as labor costs in China have been rising already. The declining birth rate, the expansion of education, and the general rise in prosperity across the population are major factors here. the goverment doesn´t like that and will try to do something about that, but we will see.
It actually clarified a lot of things when you said that Trump views a trade deficit as losing. These tariffs are like "taking your ball and going home" except youve actually been renting the ball and borrowing money to make your 'ball payments', and at this point you owe more money than the ball itself is worth 😂
Easy solutionfrom my perspective as German: German trade surplus is the mirror image of Germanys lack of capital investment, instead of building up stuff in Germany, whch would require more imports, German businesses invest abroad, e.g. in USA. Simply ban capital investment in the US by foreign investors, and the trade will balance because others won't shove capital into USA that is what funds the US trade deficit.
What are you talking about? It's not the tariffs, it's the THREAT of tariffs , made by a person like Trump who everyone in the world knows, doesn't back down. The threat is already working, and Trump ain't even in office yet! Biden, couldn't accomplish in four years what Trump did with a few sentences.
Tariffs will just be an invisible tax on the consumer to subsidize inefficient manufacturing. Most manufacturing jobs are lost to automation, not to foreign competitors. A better policy would be to retrain workers to build and run those automated factories so workers earn higher paying jobs.
Retrain workers???? Get real. That will never happen. Some of our ex-factory workers are never going to learn anything beyond a 12th grade education. Their jobs are outsourced or replaced by a robot. The workers get to work at Walmart or full time Uber gig workers. That middle class job is gone forever. I don't have a solution to the automation problem, but pretending that these hillbilly factory workers can be retrained is nonsense.
Shouldn't automation creating unemployment and thus major profit margins for CEOs lead to... you know, taxes on the rich in favor of social programs to the people whose labour made them rich? Why retrain 50 year old factory workers who are too busy dealing with backpain and voting for the very party that wants to cut their social security to learn how to become full stack web developers in a gig economy. But what the fuck do I know?
Accepting the basic premise that the tariffs will protect and encourage increased manufacturing within the US that still at the very least will also lead to those businesses increasing their prices because they can control the market. Additionally, you must accept that other countries are going to apply tariffs of their own and they will most likely effect the wider manufacturing industry because of the reliance on raw materials from those countries. In certain and limited circumstances having tariffs are a perfect measure but they are not a fix all and using them in such a way will cause greater problems. The issue is that those problems aren't likely to show as quickly as the benefits from new manufacturing jobs that are likely to be created. The "X" factor is that Trump wants to be loved and in four years he will leave not caring what happens after that !!
"...you must accept that other countries are going to apply tariffs of their own." I guess doing precisely what Trump expects China, Canada and Mexico to do in order to avoid tariffs is out of the question?
@@sprague49 To a certain extent I would say yes because firstly the US are responsible for their own borders not Mexico and Canada who can only secure their side. Also, when it comes to China the reality is that they are good at what they do and produce things people want regardless of the subsidies those companies receive. I would absolutely agree that China overproduce and that is something the world needs to get a focus on but consumers also want the best quality and US companies aren't offering it. I don't just single out the US, other countries in the so-called "global north" are as guilty of having created the Chinese manufacturing powerhouse and you have to have comparable alternatives to really challenge in what is now a world market !!
TRUMP will never leave the totaly corrupt supreme court 6 republicans made him king!! the tarriffs will be selective!!! he will get all the bribes and access to build trump towers everywhere!! the tarriffs will not create any jobs except for his personal army!!! he will make every single rule going forward weather it is legal under our constition or not he is king now!! get ready for the very bad depression in every single sector! it will be just like the breakup of the USSR! ELON IS IN THE LEAD NOW! but we will wait and see untill trump goes after him! trump will be loved by the people he makes rich and that isnt you!!! GOD HELP US ALL! but most of all dont give up and give in to the dictator!! or become russians who go about life and being proud about being angry and miserable but do nothing to help themselves! you never ever see a smileing russian!! yes the US is corrupt as hell now but trump is 100x worse!! the SEC and FFA will be the first places that will be gutted by trump not the IRS! the IRS will be the bagmen for trump!
Yes and no. If he puts on tariff, while reducing income tax, he is effectively boosting the income of people to offset partial impact of tariff. At the same time, a lot of interim goods indeed coming from China, but raw materials are coming from Australia. In this case, instead of left US firms completely helpless, it is likely to incentivize these firms to produce these interim goods by their own. Also, US has a competitive market, look at the basic retail stores, Costco, Walmart, aldi, they undercutting each other in costs to provide goods to unserved customers. The competitive nature of US market is likely work out a solution to reduce the price at the end. And tariff is unlikely to placed at once, it is gonna take times, and he got 4 years or even more (depending on successor) to do the job. It will offset a lot of problems.
@@darksmith7318 The baseline logic of what you are saying I can't argue with but reality is much more complicated and won't benefit anyone really in the long-term. It will simply create wider and more defined divisions across the world !!
Man, you’re really a good speaker. Idk if you’re reading a script but I imagine myself messing up the transition from saying Japan in one sentence, and starting the next sentence with Janan Ganesh.. around 11:24. Random thing i noticed
That's assuming they'll be able to make the connection between his actions and any resulting negative consequences. Don't be surprised if they somehow scapegoat democrats or the "deep state"
I work with mostly red voters. I made it very clear to them I don't like Trump for policy reasons such as this. They literally have no idea what a tariff is.
Short answer is "no". Long answer is "hell no". Higher prices means less demand since people's money only goes so far with higher prices. That means on the retail end things will get bad. Whats the point of manufacturing all this stuff in the US if only the 1% can afford to buy things? You have massive inequality in the US and you want to introduce tariffs to make things even more expensive for the people who live pay check to pay check??? You're going to have massive surplus of stock if you introduce tariffs and force everything to be made in the US. What about exporting those excess goods? Well, everyone is going to slap tariffs on the US in retaliation meaning that importing from the US, with its high valued currency, will be too expensive. So you're going to have all these manufacturers making things and no one can afford to buy them domestically or internationally.
As always, a lot of detail. But could you elaborate on how a floating pen will be able to compete under tariffs whilst also combatting a pencil that concedes to gravity at 1/1000th of the price?
since gravity is proportional to cubed distance, the tariffs on it are also cubed. This way pencil's weight will increase as x^3, massively outrunning its linear price increase. And floating pen's non-existent weight will still be 0.
@@Hexanitrobenzene Oops, you are right, inverse squared distance. I dont remember if i was drunk or what when i typed that... still that silly argument somewhat holds
I think Milton Friedman in his time didn't expect that there would ever be a country with such a gigantic manufacturing capacity that it can overwhelm US demand capacity and sustain that for decades.
fair. But also the answer to that if you are somewhat smart, is to give better trade conditions to everyone else than china, as to shift capital investment in production in those other countries, e.g. other asian countries, african countries, south american countries, that would have even cheaper labor than China anyways. China has been given favorable treatment by USA since Nixon/Kissinger opened up to China, the situation is a product of US government policy, just not the one Trump thinks.
Here's the thing about the Trump Tariffs that I don't get: If I want to buy a widget, let's say an external hard drive, I can get a good one made in China for $50. Assuming that the US could produce one (it can't) while offering me a variety of companies to choose from (the free market and all that), it would cost $100. So the tariff has to be close to 100% before I'm going to buy the American one. And how many years will it be before I can buy that American hard drive for twice the price? I'm all for raising the price of junk so that people consumer less, but there's fundamental flaws with tariffs.
Trump, who want bankrupt with a casino, thinks he is a great dealmaker. It's all just bluffing. Which you can do for a long time, when you're the potus for 4 years and you're using other people's money.
There's nuance here that he didn't get into. The tariff applies historically to the portion that was produced in the country. So if parts of the hard drive assembly, let's say they're the expensive parts are made in Taiwan or Japan and the whole thing is assembled inexpensively in China the actual cost increase will be small. If it's $100 hard drive (production costs, not retail including markup) and $60 of that was made in a country not subject to tariffs. The tariff is only going to hit on the $40 from the assembly and packaging in China.
The sole purpose of tarrifs is to make foreign goods more expensive than domestic goods. Otherwise, there's no point. If a hard drive from China costs 50$ and a hard drive from the US costs 100; If tariffs make the hard drive from China cost 120, the consumer will buy from the US, and China loses a sale. If tariffs make the Chinese hard drive 60, that's the worst of both worlds. The consumer buys from China, pays more for no reason, and China doesn't feel the effect at all.
@@HelixsoulX The US will look elsewhere first. If it costs $50 from China, $60 from Vietnam, and $100 from the US, and the US slaps a 100% Tariff on China to bring prices in line with American producers, the consumer will switch to Vietnam and eat the 20% higher cost.
Really informative for those of us who have a lot to learn about the consequences of international trade, and about international situations in general! Thank you for the info!
Short answer: no. Long answer: this will be one of the most disastrous economic policies since the heady days of Liz Truss. One can only hope that Trump's second tenure is as short as Truss's.
I think the Biden sanctions on Russia and China as well as tarriffs predated this upcoming failure. It showed that it was possible to function and survive even with the US waging economic war and it's emboldened BRICS and many other countries. The search to how survive sanctions has led to a non dollar using paradigm that has grown ALL because of US sanctions. Even US allies like France and Saudi are trading in non US currency and many are bypassing a currency that is highly politicized and which can be used against a country. The sanctions is the greatest economic disaster in decades. Just look at Germany deindustrialization and rest of Europe. They wanted to ruin Russia but they ruined themselves.
Short answer: no Long answer: Only works if everyone's blind to the concept of a tariff, which was not the case for that tea party in Boston long ago Edit: This party I'm referring to is a loose time frame when people actually knew what they were voting for instead of the vibe era we've been in for 100 years. I know the difference between a tax imposed by a foreign country (the party) and a tariff (tax companies pay to the country as soon as they import from another country). Good day, y'all!
A concerted global tariff on China (EU, US, ROW) could seriously dent the dragon. It depends what you mean by work. Stupidity is ignoring the redistributive impacts of free trade on the marginal (not average) voter. The "elites" have definitely gained disproportionately due to Chinese subsidies but a democracy doesn't choose its leaders based on what "the elites" want (not anymore, apparently)
10:45 This is not just about the retail/residential sector. A massive number of commercial and Industrial products or raw materials that are sold business to business are coming from China.
@@thomas316You're really not getting it here. The point is that your average person isn't going to absorb those costs directly or maybe at all. The US manufacturers are going to stick to importing lower cost items like raw materials and then doing the manufacturing work here. China was doing this the other way around with their aluminum dumping into the US. They were casting these shaped ingots calling them semi-finished product and getting around the raw material import restrictions into the US.
Exactly. I made this point in a reply to a post the other day. This isn't just a tax on a TV set made in China. It's a tax on many parts that go into making a Harley-Davidson. It's a tax on some of the parts used to build "American" made agricultural equipment used to sow and harvest American crops. It's a on one fifth of the components that go into building a Ford, Chevrolet or Chrysler.
@@davidbrayshaw3529What this is going to do is stratify production. The cheap stamped steel part might still be made in China. The expensive aluminum casting or the electric motor are going to be made domestically
Neat pen. I’ve been looking for something unique to write with for awhile. Thanks for heads up and the code. Got the notebook too but we will see about the quality on that when I get it.
The FIRST effect of tariffs is going to be even higher prices in America than we have now. This may or may not set off more inflation, but it at least complicates what the Fed is successfully doing . In the long run, it could force countries like China to balance their trade policies, but in the long run we are all dead (as Keynes said). Also, America will be in trouble if foreign exporters have to re-patriate their capital because Americans simply don't save enough money to fund our domestic investment (or they have it tied in non-productive real estate). Basically, even if this pays off in the long run, the short run will be utter chaos.
"This may or may not set off more inflation" = blanket tariffs will DEFINATELY set off inflation given the sheer scale, variety and essential nature of the products being imported. "complicates what the Fed is successfully doing" = Completely undercuts the work of years in one day. In fact the wheels went into motion the minute Trump opened his mouth after the election. "even if this pays off in the long run" = How did it go last time America decided to go native and blow up the world economy back in 1930? Well it plunged the world into a recession which ended in a world war. Blanket tariffs are as dumb as it gets.
My tiny hope is that, the threat of 25% tariff is enough to force countries to sit on negotiation table and make out new deals, a form of negotiation tactic. Otherwise, fasten your seatbelt. These upcoming 4 yrs gonna be wild.
US consumers will pay more for imported goods from China - US made goods will take advantage and rise in price. Had an argiment about somebody who said he is going to be okay since he only buys US made tyres just after I explained to him that there are no rubber trees in the US.
Tyres are made from synthetic rubber. The common car tire is made synthetically from acryonitrile-butadiene-styrene polymer. The feestock for this comes from crude oil/natural gas. .
@@gagamba9198 Sumitomo closed a tire plant in Tonawanda New York - the problem was it was old, and it was not viable to be upgraded. There is a P&L for each plant - if they don't make enough money then there is no justification for continuing operations once the plant has aged out and requires capex.
Interestingly, tariffs were one of the lesser known contributing factors causing the civil war “tariffs were one of several significant economic factors that contributed to tensions leading to the Civil War, though they weren't as central as slavery. The main tariff disputes centered around the Tariff of 1828 (known as the "Tariff of Abominations") and subsequent tariff policies. The North, which was more industrialized, generally supported high tariffs to protect their manufacturing from foreign competition. The South, which was primarily agricultural and relied heavily on cotton exports, opposed high tariffs for two main reasons: 1. They made imported goods more expensive, and the South relied heavily on European imports 2. High U.S. tariffs led European nations to impose retaliatory tariffs, hurting Southern cotton exports The conflict came to a head during the Nullification Crisis of 1832-33, when South Carolina declared federal tariffs unconstitutional and threatened to secede. While this specific crisis was resolved through compromise, it highlighted the deep economic divisions between North and South and established a precedent for state resistance to federal authority that would later resurface. However, it's crucial to understand that while tariffs contributed to regional tensions, they were one part of a broader economic divide that was fundamentally rooted in the institution of slavery. The tariff disputes reflected deeper conflicts between the industrial North and the slave-based agricultural economy of the South.”
From an industry bloke perspective, I don't like things to be swingy and volatile. Sometimes consumers have the illusion that we are flexible. We are not. Constant rumours of new rules changes, rules changes because the president has a mood, rules that can get funky exceptions because the right lobbyist praised the president are all hard to work around when your world moves in six-month long cycles or more.
One of the greatest criticisms from the british industry towards brexit was that they had no idea how the trade regulations between the UK and EU would look like which gave them no time or even an idea how to prepare for them.
@@schwarzflammenkaiser2347 I still think Leave could have functioned if not for at least three different Leave factions all blabbing that their particular version was the true one. They kept pushing this debate into the future until time ran out.
Discussions about tariffs and how they affect the global market, always confuses me, but I always need to thank Patty B when he drops a video. I guess I’ll take what I can get since the newest rap album isn’t ready yet.
that is the real question. There is already not a lack of money in the US. It is the country with the biggest GDP by far. Its that all that money is accumulated at some rich people and tariffs wont change that.
@@_Dibbler_That's why I think you have just entered a tiny fraction of real labour debate. What is the value of a working class American. Who is supposed to buy all this stuff. How many cartels can the USA afford.
2 things: 1. on Tariffs for only important, advanced industries 2. on understanding our situation with China Tariffs should only be used for very niche scenarios in conjunction with subsidies for industries of national importance to the country. To be completely honest, I don't really think we want Americans to do basic manufacturing jobs, we should want Americans to do more advanced, higher output jobs that make leverage of the country's extreme wealth and resources. Now that's made extremely difficult with a wealth gap and awful education system, but I don't think our goal is to manufacture everything in the US, but to manufacture the things important to us and manufacture them well and truly competitively. Trump doesn't seem to believe in friendshoring which is a damn shame, because to me if other countries want to specialize in something and make it better than us, then we should welcome that and be happy with it. If we want to use tariffs and subsidies, it should only be for important advanced technologies like semiconductors. Anything simple we can just friend shore it to a poorer country, those aren't the jobs we should want anyways. In the same way. China is, unfortunately, the new cold war enemy of the United States. Many people talk about how the Cold War, while all-encompassing ended up being a war of economics. I believe this is very much the same. The Chinese government has for a long time made it their goal to economically and technologically displace America's position as the #1 country. If America wants to defend its position, it has to use the same weapons as China (ie economic tools like subsidies and tariffs) These weapons, much like military weapons, only serve to hurt and do not help the free market. But we are at conflict, and I think it's a mistake to view whether or not to use tariffs purely through an economic lens, because this is a geopolitical conflict. This is not just about what will improve the American life, but to prevent it from being overtaken by China. Everyone will lose here, it's just about if we can lose less. To be clear: I think it is extremely tragic that Washington and Beijing feel that they need to compete like, but this is the reality we live in. Beijing and Washington fear of each other and it shows
The fear comes exclusively from the American end. The US behaves appallingly with them and has for a while now. Trump is just the totally unacceptable face of the US, a dumb as rock twat.
I think him imposing unilateral tariffs on countries like Canada will result in in tit for tat tariffs back (just as it did during his first presidency), and hurt both countries. While Canada does have an issue with migrants slipping over to the us (helped by very lax laws dealing with illegal immigration in the USA), we have huge problems with drugs and firearms being smuggled the other way.
Migrants aren't an issue at all - it's actually harder to get into Canada then it is to the US, so it doesn't make much sense to use Canada as a point of entry. There are far more migrants coming into Canada from the United States. Trump is using the tariff threat to force Canada to enact policies that he favors, and it's working.
Canada mostly belongs to China, so I see how Trump got confused. I'd like to see a full customs union with Canada and Mexico. Tarriff China with us, eh.
Congress has to enact those tariffs. The most Trump can do is 10% for 150 days. Anything more goes through Congress. Tariffs are used as a negotiation tactic.
A tariff is a tax on American consumer, as you well know. It has always been clear that the US could cut itself off from the world economy by raising the cost of imports along with the barriers to US exports that will be put up in response. It is basically a concession that the US cannot compete globally. Such an isolated economy can work, but will result in a lower standard of living for Americans.
I didn't get how US manufacturing would become competitive (at the end.) Tariffs make imports of raw materials and components more expensive. And competing with artificially higher imported prices might make domestic industry more competitive domestically, but they still are more expensive than other manufacturers internationally.
My Prediction: Inflation is going to get worse, there will be a serious labor shortage, companies will outsource jobs more, government assistance programs’ budget will decrease, benefits allowances will lower and some programs might even disappear.
Due to decisions that prioritize short-term political gains over long-term economic stability, the US government has chosen to deliberately ignore their historically brainless Smoot-Hawley Tariff policy, which caused the great depression and demonstrated how protectionist measures can backfire. Rather than adapting or competing effectively, the U.S. is essentially saying, "If we can't win, we'll disrupt the game" - imposing trade barriers that harm both economies but are framed as protecting American interests. Notably, these tariffs imposed by Trump and continued by Biden haven't even achieved their supposed goal: U.S. trade deficits haven't significantly shrunk, and the economic impact has been largely negative for both nations. The US government is essentially throwing an economic tantrum with China, similar to the UK government approach to Brexit with the EU. By imposing massive tariffs, the U.S. government is responding to its own paranoia and perceived economic threats from China, particularly around trade practices and technological competition, similar to the Cold War with Russia. Trump is just another idiot proving that politicians are good at only two things: causing wars and unemployment. His economic policies, particularly his tariff strategies, demonstrate a fundamental misunderstanding of international trade dynamics. Imposing tariffs on products a country cannot produce effectively is economically self-destructive, raising consumer prices, potentially triggering trade wars, and harming domestic economic interests.
Always nice to read something from a person that has educated themselves in economic theory and history. Well said. Too bad most people in the US praise ignorance and stupidity.
not directly related to the topics but your comment regarding trade surplus countries subsidizing domestic industries ( directly and indirectly) and squeezing capital investment from trade deficit countries by using restriction to surplus countries market as a bargaining chip really resonate with my country Indonesia lol, the rapid growth of Indonesia's minerals downstreaming industries at the cost of environmental protection, the massive spending in Infrastructures during Jokowi's administration, and Indonesia's currency and labour policy and it does contribute to the continuous Indonesia's trade surplus for the past 4 years
This is the clearest exposition of international trade theory and practice that I have ever come across. Well done! An additional point: the US can afford to play a game of chicken with the ROW only because of the scale of its domestic economy; accordingly, it could arguably survive indefinitely as a closed entity.
New to the channel, appreciate the “Sponsored Content” title during the Hoverpen statement. It’s a level of honest disclosure that I don’t recall ever having seen on YT before. Now to buy one :)
With Trump, the issue of tariffs cannot be discussed in an isolated fashion. He has also said he wants control over interest rates and will be implementing a massive deportation program that will include American-born citizens. People who voted for him did so largely on the basis of the cost of living (which they stupidly assign blame for to the administration instead of Corporate America). Yet, in combination, these three economic measures will produce a huge inflation surge, making everyday goods, especially food, much more expensive as well as scarce. Trump is convinced that tariffs will spur more job growth in the States. However, economically speaking, from companies' point of view, it makes no sense. Even if the goods they make overseas and import into the country cost them the same amount as making them here, production costs are not the only costs to consider. The company would have to build factories here - no small cost, especially considering the greatly increased cost of building materials, even if it only entails the makeover of an existing structure.
The point of tarrifs are to protect industry not to collect money. It's not that confusing. If i charge you more to sell in my store you will charge more for the goods. It could work out if the good are artificial inflated but at some point it just raises costs and the government ends up with more money. The increase in price goes to the consumer not the businesses. If the goal was to protect home based industries it would lower the cost of home based goods compared to others but we barely do that in the USA and aren't hearing towards making those goods.
I think the first question is... What do you mean by work? What is Trump trying to do? This all looks like misdireciton to me. There is a huge amount of uproard about this. There does not seem to be any about purging the senior leadership in the military so that the military will follow illegal orders without question. There does not seem to be any uproard about the plans to purge the federal civil service of people who will try to hold the Trump administration to the rules. Those are the biggest issues right now. Since the press and whatever this is get money by more views and personalities get more views than ideas and policy, this is a great way to distract the nation while our country is stolen from us.
It's actually not about mining it because gallium and germanium are actually biproducts of zinc and aluminum. The problem is that they aren't economically viable at current prices, and are harmful to the environment. Still, it will increase the prices by a lot.
@@ColdRunnerGWN The United States does not have the capability currently to refine rare earth elements as they exported the pollution and energy use to China decades ago. This is not something you can do quickly and the United States will be at a big disadvantage until that can be figured out.
@@michaelstanley5215 - I totally agree. I was just pointing out it wasn't about finding the deposits, but about production. Oddly enough, Canada actually has a rare earth strategy, so the proposed tariffs are just making things harder for the US.
This might sound naive, but maybe just consume less? The median pay gap between EU and US workers seems to be around 2x in favour of US. Fuel prices (input cost to all) in US are around 2x lower that EU. Where does all that pay go?
Can you check if you're looking at gross pay? You want to see how much less can be consumed you need to look at discretionary pay, which is pay after everything you need to pay for, like the minimum amount you'd need to spend on rent, food, and healthcare. In the US those expenses taken out from disposable income to determine discretionary income tend to be very high. Fuel may be cheaper, but a much higher proportion of the population pays for car loans, car maintenance, and car insurance, and those tend to be higher per vehicle because supporting cheaper modes of transportation are declared "an attack on cars." There's also generally less competition between companies, as Americans generally oppose pro-competition policies. As an example, the attempts at market manipulation that got Walmart booted out of Germany are things they're been doing here for decades.
Trump clearly hasn't read Adam Smith's Wealth of Nations.... 🤦 In short: different nations have different resources and more or less of different stuff and all nations get wealthier by trading with each other (vs going it alone).
Im glad Big Macs are not imported from China. Maybe the Sunday machine is. but its been broken since 2021... my washing machine, they just dropped about 11 percent.. funny that it coincided with the expiration of the first tarrif
Yes tariffs cause immediate price changes proportional to the tax, but it changes the incentive structure. Over time, American businesses will find it more profitable to build factories and be productive instead of just being a reseller. America consumes a lot more than it produces. The debt is not monopoly money, it's real debt! Oh no America will collapse if it can't rely on cheap Chinese slave labor! Listen to yourself.
The 'drugs' mandate tells you all you need to know about his tariffs. the majority of drugs are brought in by american citizens at legal ports of entry, and americans already complain loudly if you increase border checks on them, so there isn't anything either country can actually DO about this. but it makes great theater to his supporters. His tariffs are all about meeting the emotional needs of a certain block of the population, which they will do quite well. And since they are feeling good, that shapes how they view the economy and their own situation, so it will be a victory independent of the economic realities.
The consequence, as always, will be seen much later anyway. Probably Trump will long be dead when the US is hit by the full repercussions of his actions and the next governments have to deal with it.
Playing economic chicken with your 3 largest trading partners is a very high risk game when there is a large and growing federal debt overhanging the U.S. economy. Inflation is still smoldering, would not take too much of wind to blow it back to life.
The only way the debt will go down is if we stop the handouts, particularly social security and Medicare (50% of spending). We are overspending by 15-25%, the economy isn't going to grow enough to swallow the deficit, tariffs or not.
Stop the handouts, you sink the economy, raise taxes, you sink the economy, cut taxes you blow up the already large federal debt driving up interest rates and starving the market of credit, blowing up the economy.. The question is, how close is the U.S. to a debt spiral? Any rocking of the boat at this time could capsize it.
@@chazzbranigaan9354 While those are big budgets, you should also look at how income is generated a federal and state level. The whole world is becoming a tax heaven for big corpo. If they were taxed more the extra income could be used to reduce the debt and even invest in useful stuff. But as it stands right now, big corpo pay less taxes in total than the regular people.
@samsonsoturian6013 He can unilaterally implement tariffs without Congress. That may be enough damage done even before the Republican congress can cut revenue and further increase the deficit.
yeah we seen that last time especially the farmers however Brasil and Europe loved it they made a fortune on the loss of business American farmers suffered I met an Australian in Hong Kong and he loved Trump because of the Tariff war China turned to other Countries to buy their meat and produce and he picked up a large contract selling grain because of the 2018 Tariffs
@@samsonsoturian6013 - The answer is yes and no. He isn't supposed to be able to, but he is going to invoke the national security, which allows him to do it. He did this with steel tariffs his last term.
Tariffs will increase costs of finished goods and components used throughout US manufacturing. This will be an immediate and huge hike in inflation. To fight inflation the Fed will have to hike interest rates which will be wonderful for the billionaires but possibly take away the middle class. Inflation is so high that consumers are literally taking debt for basic life necessities. Collapse has indeed begun..
A collapse has began!!! Rich people know this.... they are hedging... through hedge funds. It costs them about 6% a year to do this. Those that aren't rich are not hedge and are at great risk in the bubble of all bubbles with the debt at all time highs. The increasing prices have impacted my plan to retire at 62, The stock market's volatility, coupled with a reduced income, is making me anxious about having enough for retirement.
I feel your pain mate, as a fellow retiree, I'd suggest you look into passive index fund investing and learn some more. For me, I had my share of ups and downs when I first started looking for a consistent passive income so I hired an expert advisor for aid, and following her advice, I poured $110k in value stocks and digital assets, Up to 400k so far and pretty sure I'm ready for whatever comes.
Annette Christine Conte is the advisr I use and im just putting this out here because you asked. You can Just search the name. You’d find necessary details to work with to set up an appointment.
Enjoy 10% OFF on all Hoverpens and free shipping to most countries with code PATRICK:
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Careful citing CATO. Those ivory tower ticklers have a penchant for contradicting themselves. And I’ve yet to meet a libertarian that ever wants to do the dirty work no economy can function without. Ask the bears😏
Man you have a lot of haters in the comments, I think you misread your audience, or a rear occasion you are just wrong.
@patrick Boyle IF YOU ONLY READ ONE COMMENT READ THIS ONE! IF ITS ONLY THE LAST PART THATS FINE!!! YOUR LIFE MIGHT BE SAVED OVER IT!!!
Im rather sure that the wright brothers had their first flight back in 1908. (somewhere around then) So, commercial airlines had little to do with the German's. However, if you want to blame the German's with giving humanity the desire or need to blow up the world to save the world. Well... They are still apologizing as well as not wanting to talk about it to this day.
We will see where Russia leads us. I bet it will be a lot less where China leads us! I can only assume North korea will be an appetizer and Iran will be a dessert.
This is all under the assumption "WE" are still the good guys and "WE" still win the war!
Where as the United States is supposed to protect capitalism in today's era we do a damn good job in destroying it! We allow corruption, monopolies, and prevent open markets, even penalize other countries when they disagree with us. Yes, Russia is being penalized for war... however, if Russia was trying to make alliances with CUBA AND MEXICO would we allow it?
My friends if you watch art (movies, tv, books, actual art) you will realize that life imitates art and is likely indication of the future. We are possibly already headed towards WW3. The type were nukes land across the world and then robots help humanity rebuild. The following years humans give robots the ability to defend them better so as not to be another nuclear mistake. This will be what leads to the "Terminator incident". Something similar to AI singularity and the robots rebelling on humanity.
Humanity faces the great wall. Called many things but the fact is to much debris in our outer atmosphere would trap us in earth not allowing us to leave. This may seem like no big deal at first but our survival depends on us leaving earth. Nuclear weapons, robots, singularity, energy dependency, and even the decline in population are all huge problems coming up for those of us under 40. Yall thought the great depression was bad? (well those who had grandparents who told them about it.) The stories yall were only told or saw on tv! What is about to come will haunt your nightmares because you will be living it and dreaming it!
Imagine no work, no job, no where to live, no place to get food because no one has money for the food so no one is making or growing the food. Those who have the food or money are hording it!
during world war 2 People went to Germany to buy blocks of houses and apartments with the spare change they had. (less than 100$ US) Lot more money back then. Well countries are already experimenting with Euthanasia. How long till they come for the SICK, DYING, ELDERLY, DISABLED, OR A SPECIFIC RELIGION, POLITICAL PARTY, OR YOU!!!!
STOP EUTHANASIA AT ALL COST!!! ITS A START DOWN A ROAD WHERE THE GOVERNMENT DECIDES WHO LIVES AND WHO DIES!!!!
@PatrickBoyle Please do a YT- vid over Euthanasia! I see this as a slippery slope! I dont want to tell my doctors anything nor do I want to be in any countries where this is legal! Im currently trying to find an escape but I dont like my options. Please help!
Think 1920-1930's Germany - 1930's Japan ( Experiment 436 group I believe it was maybe incorrect on their name but they did the Japanese did the research on people in some cases more horrifying than the German's did.)
Ofcourse they will work if you want more home grown production, here are my thoughts:
0. Are 10% Tariffs enough ?
No, an outright ban on China is the best way to go.
1,. Would it stop China?
No. China cant be stopped at this point even if you bottleneck them by affecting their exports. They will double down their exports to EU.
2. Should EU too apply these tariffs?
Absolutely a global ban is the only way this works. Similar to how Iran is eating and dumping bricks due to lack of exports.
3. What else can be done to stop china and get US lead back in AI and other technologies that it is loosing?
Low regulation on AI and More H1B Visas but only for the top talent specifically from china.
4. What can EU do to participate in this ?
Well the same and poach best talent and pose tariffs and encourage home grow production, increase manufacturing give more manufacturing loans and isolate China like Iran. A third Industrialisation wave is imminent, and one must use AI to do that, because china will do it with its aging population.
5. What monetary actions can be taken?
Reduce spending on useless stuff and reduce , leakage and reduce debt. Stop printing more money and utilize debt and tariffs as a mechanism to pay for re-industrialisation of US and EU.
6. How about shifting manufacturing base to India or sourcing products from there ?
They simply dont have the manufacturing capacity , even they source products from china and thny export to US/EU. It is useless with its aging middle age population.
Is a sad commentary on today's world that an aspiring rap artist like Patrick has to make videos on economics to make a living.
He's an alien
I blame Spotify.
I don't know if Patrick is an aspiring rap artist but he is a Prof. of Finance at King's College London and has had a successful career in finance before that and if you care to post your credentials here in a verifiable manner we can all draw our own conclusions as to whether or not we should take anything you have to say seriously. Quit trying to sound smart just put up you CV in a verifiable way or crawl back under your rock.
Patrick was my Top Artist in 2024 in my Wrapped
and slinging pens of all things...
During Trump’s first term, he put a tariff on steel. Prices went up by 25%…. it has been seven years and steel manufacturing has actually decreased in the US… but prices remain high
When W Bush did Steel tariffs he saved about 8,000 Steel jobs and cost the US over 200,000 manufacturing jobs. Another brain genius move from the GOP. For a group who thinks they are good for business, they are absolutely lost when it comes to the economy.
To be fair in the case of steel that has more to do with how U.S. steel mills never sought to update into electric arc furnaces and such. The company U.S. Steel is only actually 10% steel production today, mostly it's oil exploitation. There is only one U.S. company 'Nucor' which developed electric arc furnaces further into being able to produce sheet steel. Now the tariff is responsible for the jump in price because Nucor has no reason to undercut itself when it can't even meet demand so when Chinese steel prices went up so did Nucor's.
@@Cragified Both the Biden and former Trump admin and future Trump admin are blocking a major, acquisition deal that's favorable to steel workers on Japan's national steel company, a company that is the 3rd largest steel manufacturer globally.
Steel is on tough times and neither economic orthodoxy or whatever Trumpenomics might be called has and will do anything to rectify.
@@Cragifiedsame thing will happen with electric cars. Pound for pound the Chinese cars are innovative and competitive with American electric cars. Trying to draw a protectionist stance around car manufacturers and protect American producers from failing on their products will mean that the auto industry will die a slow drawn out death.
@@Cragified You import oil, aluminum and electricity from Canada do you believe that will become cheaper with trade war?
Replacing income taxes with tariffs is basically raising taxes on the poor while lowering taxes on the rich. It's just a variation of raising sales taxes.
false. tariffs used to produce most of the tax revenue and the poor weren't paying any additional tax. it was the rich.
@@toomanyaccounts I think that income taxes should be replaced with tariffs *and a progressive sales tax* - a higher sales tax rate on more expensive goods, such as luxury items.
@@toomanyaccounts lol you tried to fact check and ended up agreeing with them. Tariffs themselves are a regressive tax. So if your government collects taxes primarily from tariffs, and those tariffs are paid by the consumer, it means the poor will be paying the largest percentage of their income to the government, because they spend the largest percentage of their income on imported goods. It’s like a tax on gasoline.
We'll call it a happy coincidence - Trump
@@magnetospin Flat-rate consumption taxes are always regressive.
Tariffs will increase costs of finished goods and components used throughout US manufacturing. This will be an immediate and huge hike in inflation. To fight inflation the Fed will have to hike interest rates which will be wonderful for the billionaires but possibly take away the middle class. Inflation is so high that consumers are literally taking debt for basic life necessities. Collapse has indeed begun..
The U.S. economy relies on ongoing credit and debt generation for sustenance. The Federal Reserve is expected to increase the money supply, leading to further debt accumulation for the average American. So how exactly can we guard against the coming financial reset Like what are really the best strategies to make our portfolio recession proof against the incoming financial reset? I'm very worried about my $310k stock portfolio.
Accurate asset allocation is crucial with an Experts guidance. I have 850k in equity, 75 cash earning 5.25 interest, 685k in roth ira, 120k in 401k, Gold and silver bars. age is 48. My advisr helped me realign my portfolio to my risk tolerance and it boomed shortly.
Can you share details of your advisor? I want to invest my increased cash flow in stocks and alternative assets to achieve financial goals.
Annette Marie Holt is the licensed advisor I use and i'm just putting this out here because you asked. You can Just search the name. You’d find necessary details to work with to set up an appointment.
Thank you for the lead. I searched her up, and I have sent her an email. I hope she gets back to me soon.
You guys all remember when the Republicans vigorously opposed protectionism and promoted free trade?
Because an awful lot of people seem to be suffering mass amnesia about all that.
yeah that is the point. free trade when I have the upperhand, tariffs when i dont. lol. it'll be hella funny to witness the mental gymnastics of some westerners to rationalise all they are gonna do in the following 50 years 😅
Democratic presidents forced Japan to open trade in 1854. The British did similar things.
In our time African countries are still pressured to import goods.
Pre-Great Depression 1920's Republicans were staunch protectionists using tariffs. Right up to, you guessed it, the Great Depression. Then Hoover just let the market correct itself while sitting on his hands. How else did you end up with FDR for four terms? Betcha after Trump you'll get Democratic administrations after the second disastrous Trump term.
@@zadarthule I think OP was talking about the 1990s dude, not the 1890s...
@@FLASK904 easy to find something newer but you are right that Reagan and Bush were free trade.
Under the Eisenhower, Kennedy, Johnson and Nixon administrations, increasing numbers of Voluntary Export Restraint agreements were also secured with Japan, South Korea, Taiwan, Hong Kong and European countries to avert the application of trade barriers by the US. Products subjected to quotas included textiles, plywood, sewing machines, flatware, tuna, woodscrews, steel, steel and iron products, glass, footwear, and electronics.
Tariffs are like scalpels. It needs to be focused and exact. Universal tariffs on everything imported from a few countries is like welding a hammer where a scalpel is required.
I appreciate your non cut and dry perspective
I hope whatever you're smoking is good. How big do your hands look?
Tariffs are a part of overall geopolitics, and is a tool for negotiation. This comments section is full of uneducated 'geniuses' telling us 'how it is' without realizing that foreign nations have tariffs on US products right now.
Scapel "cut" and dry.
I get it now! 😄
@@pistonburner6448 "There is nuance to tariffs that is absent in this decision"
"Actually there is no nuance here because tariffs exist"
Do you not know how specific and complex tariff schedules are? No one does blanket tariffs for good reason. Pay attention.
A blanket tarriff can be useful when
1. The trading partner is in breach of the trade agreement (aka not complying with remain in canada/mexico)
2. The dispute resolution policy of the trade deal creates a liability for the retaliation
3. There is a demonstrable damage claim for the non compliance ( 150 billion/year)
4. Compliance request is associated to the breach ( closing border/taking deported who were let thru)
Tariffs only conceivably work when you have local manufacturing to compete with foreign manufacturers.
We decided long ago to get rid of manufacturing so that we could pump more money into shareholder accounts, which would then be used to build retirement communities in Florida (where there's too much water) and Arizona (where there's definitely not enough water).
Deport alligators to Arizona I say
@@lenerdenator still won't work. All that still does is pass off the cost onto the consumer.... While subsidizing low productivity.
Not to mention it opens up the US dollar to be replaced as a reserve currency
@@ashishpatel350 I thought republicans dislike welfare, as it turns out they just hated the poor hence why they dislike social welfare but more open to the idea of corporate welfare. Trump subsidized farming corporations for over 20 billions USD due to his disastrous tariff policy.
The "We" who decided is the big multinationals not the average consumer who loses out in the end.
*competitive, not that u just have local.
Once tariffs have been in place for a while, and consumers have become used to them, this resets the market price for those products at a higher level. Removing or reducing tariffs doesn't lead to lower consumer prices, importers and retailers will simply put the reduced tariff into their own pockets as higher profits. Retailers don't exist to do favours for consumers. They will charge as much as the market will bear
The way Donald Trump uses tariffs is to encourage and make viable the manufacture of the goods under tariff, in America. So Americans get more jobs and the economy booms...then people have more money to spend, even if they want to spend it on imported goods. Capiche?
@@markanthony3275 That's not how it works. For example, the steel and aluminium import tariffs Trump imposed before, in his first term, didn't create that many more jobs in those protected industries, it just forced prices up. That then passed on those costs to other industries, such as the auto-industry many of whom chose to move manufacturing out of the USA. putting American workers out of jobs. If US manufacturers require the cost of imports to be artificially inflated to be viable, that shows that they're fundamentally uncompetitive.
@@MrBrendanrex The cost increases in the auto industry came from union wage demands, ...people that traditionally vote democrat, so I don't think you could include that in your analysis. And do you recall what Trump did to the big three who wanted to move to Mexico for cheap labour? He signed an executive order that if they move there, they must pay Mexican workers the same wages as Detroit workers. Now he threatened John Deere for trying the same thing. Tariffs on metals were not responsible for higher costs or prices downstream, there were many other variables, like the unionized costs I mentioned.
@@MrBrendanrexhilarious seeing the "logic" of the Magats 🤣😂🤣😂
- i do not understand economics
If you have a chinese vehicle that costs 25k , and GM car that costs 40k, 100% tariff would mean that GM can increase the price by say 5k, since that chinese EV now costs 50k.
Bold of you to assume that the GM wouldn't double their prices too
And GM will raider it by 7,5k because they know for 2,5k extra anyone will pick us made over china made
Don't forget the 20k Tesla that Enron Musk keeps promising but failing to deliver, unless you count the price of a Cybertruck after owning it for 3 days.
US cars are unnecessarily large, become more like tanks every day. So that you have to buy "more car" for the ability to drive alone to the supermarket. Maybe there are more problems here then just cheap labor in china and tariffs won't fix that.
What do U think GM cars are made out of? Montana bulsa wood? 🤣 All the parts are imported...it's only assembled in America. They would have to raise their price to 65k to cover the tariffs also....thus making the Chinese car still cheaper lol
"We shouldn't take Trump's proposal seriously because it just wouldn't work."
Man, if only we lived in a world where that would ever even slow him down.
Trump raises tariffs on other countries that depend on American dollars to survive and they try to pass the tariffs onto us and then we can make our own things cheaper so America starts making stuff at home again and those foreign countries loose our business and money.
The U.S. has new leaders with different ideas, even within the same party, often.
International companies with infrastructure worldwide don't want to scrap all that and build up in the U.S. for what could be 1-4 year conditions.
Countries with more long-term, unified parties of leadership could much more effectively use tariffs in this way.
This is what I don’t get. Everything was pinned on Harris, even policies she didn’t believe in, as inevitable and catastrophic, but when it comes to Trump’s very real policies he outlined in detail you’re treated as crazy for thinking he might actually administer them.
@@mishaf19 maybe if she gave an interview she could have dispelled that notion?
Harris was a terrible candidate, I mean Biden was a terrible candidate and he still won the primary while she was defeated almost immediately.
You don't know ANYBODY that voted for Harris. I don't know anybody that voted for Harris.
You know people that voted against trump but not for Harris. Nobody liked her they just hated Trump.
That's what makes her so God awful, like it or not the presidency is part personality, popularity contest and Trump actually has personality and actually has people who voted FOR him. People who showed up to vote who otherwise would not have bothered if another candidate was on the ballot.
Harris only had one argument, I'm not Trump. Well 350 million people aren't trump in America. How about you give a reason to vote for you
@@mishaf19Because, as Patrick is pointing out here, they are nearly certain to be ineffectual.
The last time Americans put massive tariffs on goods and deported large amounts of immigrants it led to the Great Depression
Tariffs can also make completely independent and domestically produced goods more expensive
This happens because the competing product becomes more expensive due to the tariff, allowing domestic manufacturers to increase their prices without losing their competitive edge in the market
this happened in the 80s with cars: Japan faced tariffs and export restrictions on its cars, but as a side effect, us-produced cars also became more expensive. While this increased profits for US car companies, since us-consumers had to pay more, it barely resulted in more job creation. The intended strengthening of domestic companies had only a minor impact beyond raising their revenues at the expense of US customers
your pretty far off base with that assessment about Japaneses auto's and its impact on the US ecconomy..
The Japan Automobile Manufacturers Association U.S. office (JAMA USA) has released its annual contributions update, including data from Rutgers University Economics Professor Thomas J. Prusa, PhD.
The contributions update shows that Japanese-brand automakers have continued to invest in American manufacturing and have cumulatively invested more than $60.4 billion since first starting production in 1982. In the coming years, this number also will include announced investments in both electrified vehicles and battery manufacturing facilities as they come online. The update also highlights how Japanese-brand automakers directly employ more than 107,000 U.S workers and have continued to invest in areas beyond the manufacturing floor. To date, Japanese-brand automakers have 50 vehicles designed and/or developed throughout 43 R&D/design centers across the country.
In addition to JAMA’s annual contributions data, Dr. Prusa’s employment study shows that in 2022, Japanese-brand automobile direct employment supported 499,000 intermediate jobs and 399,000 additional “spin-off” jobs. Combined with the 1,300,000 individuals directly and indirectly employed by the Japanese-brand automakers’ dealership network, Dr. Prusa’s study concludes that Japanese-brand automakers now support more than 2.29 million U.S. jobs. The study also highlights the $197 billion in employee compensation across Japanese-brand automakers’ manufacturing and supporting operations and new vehicle dealers’ employment.
America doesn't really make anything anymore.
@johntowers1213 The most likely reaction to high tariffs would be to shift production/investment behind the tariff wall to access the protected market - that is what Japanese auto manufacturers did starting in the 1980s. However, Trump is proposing 25% tariffs on all manufacturing sector imports from all countries. Not all foreign manufacturers will have sufficient US sales to justify moving production behind the tariff wall; thus will not invest or export to the US. If there are US domestic producers (alternate suppliers) for these lost importers, they can either choose to increase production, increase prices or both - which strategy do you think they will choose? And what will be the impact on the consumer and the economy.
I love that no one even seems to consider the issue with the US trade deficite might be their massive overconsumption.
And bad consumer debt. Average American is fugged with how much they borrow.
well said. Well not that it is the only factor, but definitely one big factor.
That is why Fed chief Janet Yellen asked China to stop making stuff earlier this year. You can spot overconsumption easily as you will see a proliferation of self-storage facilities - often in repurposed factories that shut down.
Our garbage dumps are getting full.
Meanwhile Patrick: Buy this floating pen!!
A striking example is that you could raise tariffs on bananas to the point that greenhouse bananas grown in Michigan could compete, but boy would they be expensive.
that whole theory is just bananas
are there any historical examples of tariffs regenerating a manufacturing sector that's been dead for 50+ years?
This has to be trolling, bros looking for historical examples 😂
The funny thing is that the supposed lack of manufacturing in US is partially a myth. The overall production by industry in US has never stopped growing (excluding temporary set backs during recession, covid etc.), it's in fact the biggest in the history.
So for example the real output of US industry 50 years ago was actually half of what it is now.
Of course, individual industries and companies have various history, steel manufacturing dropped massively in the 80s, but other sectors grew.
The problem is that American people are buying more and more and more every year since WW2. And so the import grows and grows.
So, it's really not about bringing the industry back, it's still there. Although of course the productivity has increased massively over the years, which means fewer and fewer people employed while output grows.
@@jankoodziej877 Thats the point. Tariffs would take money from poor and middle class so they buy less. This will decrease imbalance but I am not sure 90% will be happy about this.
@@jankoodziej877I can make stuff using the company owned machine that would have required at least five blokes back in 1950.
The job has not necessarily moved anywhere, no one has taken it.
Steel industry both hit an end of a boom, people getting wealthier are not going to buy a third or fourth car. And the process was already growing more efficient. Recycled steel was being more widely used.
@@КонстантинПономаренко-я7яThis was not an issue in historical mercantilism. Mercantilism was not about the wealth of the subjects.
I probably won't be the first to express this - but first an anecdote: Until 2016, the US was working on the Trans-Pacific Partnership (TPP) to curtail China's influence across the Pacific Rim countries (low-end Whirlpool washing machines built in Vietnam instead of importing Haier washing machines from China, etc.). It was a way for the US to secure lower cost manufacturing without a trade war. By exiting, Trump gave all 12 of those countries away to China. _I actually lost my job in 2017 (working on a secure cloud infrastructure for the TPP) when Trump exited the agreement and I never caught up in salary (based on inflation) since._ Anyway, I think on paper, across the board tariffs will work BUT ... underneath all the rhetoric about bringing back jobs, is the simple fact that, in order to subsidise Trumps extension of his tax cuts for the top
OH - BTW, if Trump raises tariffs on goods imported from other countries by >20% while increasing Chinas by only 10% (consumers are already experiencing up to 40% tariffs on Chinese imported goods, so...), might it not actually help make China more competitive against their other Asian neighbors - just a thought.
All you said is true. Trump has shown Asia that US is not a reliable ally, if even. So far only Japan and South Korea are still beholden, and that's only because of relic of WW2.
If by "tariffs will probably work" you mean everyone will be poorer you are correct. If you mean everyone will do better you are demonstrably wrong.
Once the USA had walked away from the TPP, the other partners signed an agreement lickity-split. Copywrite and access to health systems were major stumbling points. No one was willing to let the USA destroy their health systems for marginal trade gains. And no one cares about Mickey Mouse.
That's the plan, always was.
Every time I think about this I can't help but wonder about just how much tariffs are beneficial for the owners of domestic manufacturing. Basically tariffs remove competition. Perhaps if we had some laws about "fair" profit that would cap the "difference in price over cost", this would work out, but we don't and we know that price gouging is a thing along with planned obsolescence and cost cutting corner cutting. So, i see tariffs as a big big win for the wealthy as it reduces competition which in turn reduces accountability. I don't know if this take is right... It's probably not, but it's what I wonder about.
The point of protectionism is to insulate domestic industries from foreign competition, it benefits the wealthy by design. You have to keep in mind that free trade and competition being good for the economy as an idea isn’t much older than America as an independent country.
Plus, domestic manufacturers are effectively allowed to make their shit almost as expensive as the imported and tariffed shit.
I think you got a good point there. Tarriffs have a purpose; but they need to be implemented smartly and with foresight. Something that seems to be completely missing from Trumps supposed plans.
From the moral standpoint, we should tariff foreign countries that have less strict regulations (whether labor or environmental) to make sure they can't cut out existing domestic production.
Very fine balance, though...
@@skillfulfighter23 Too long didnt read put 25% of oil/natural ressource imports from colombia under tariffs because they didnt randomly allow american military planes into their air space.
Why Trump claiming China will pay for the tariffs reminds me of his first term when he said Mexico will pay for the wall?
It's all the same nationalist bravado. He has to frame himself as "winning" even though in reality he has absolutely no power over anything except messing up the US.
You legitimately believe people will choose to pay 100% more on a product built in China 🇨🇳 instead of the same or similar product domestically built or from a non-tariff country?
You really believe that?
If you believe that to be true. Then not a single US Automaker would still be in business.
@@RosoneandWatsonwe don't already have the manufacturing jobs here to fill the need for those goods.
@@TheModdedwarfare3 People like him are morons.
He really doesn't understand what he's talking about. A function of low intelligence.
Chapters, Patrick! Chapters!!!!!
Listen to the whole thing in one go, Kyle! It ain’t difficult.
That would be good.. I'm only here to get the latest rap news.. not really interested in the financial stuff..
Are you you saying you don't want a hoverpen?
CHAPTERS ARE FOR PUSSIES!!!
attention span, Kyle, attention span!!!
One thing the tariffs cannot do is bring back manufacturing jobs, because offshoring has never been the primary driver of the reduction in manufacturing jobs. That has always been automation. The manufacturing jobs just aren't coming back.
Despite the automation of production, it still has a positive effect on the economy, as it increases tax revenues and affects sectors associated with servicing automated production.
I can't remember what it's called, but it is generally good for our economy to produce more of a certain thing for as cheap as possible rather than produce less of a product to produce another product which we can technically produce for less than another country. The real problem is that we have no safety net for people that lose their jobs. It shouldn't be about bringing jobs back home, but by assisting people that lost their jobs to live while providing them means to get another job.
If that was the case we should see a large increase in productivity as automation takes root. We haven't seen this. Technology has indeed changed the nature of some jobs (e.g. undeground coal mining has been entirely replaced with mountaintop removal mining), but hasn't impacted the number of workers needed as the gains from automation have been gradual and are effectively lagging behind the growth in global demand. So off-shoring has really been the major driver. Yet you are actually right. Re-shoring is impossible, because the economies that lost those jobs restructured and created different jobs that were mostly better. If those jobs came back they would have to compete for labour in a very unfavourable way and they would end up with inexperienced and unproductive workers and managers, which means they would quickly become zombie industries that are only supported by the presence of tariffs or subsidies. Automation would in fact be a great way to address that problem, but it can't, because it doesn't exist. Yet.
That was true for the biggest part of industrial history, but it peaked already, as cheap labor can replace automation far more efficiently now. Automation is an investment and costs you can just undercut by doing it with cheap little hands on a table in an unregulated environment without any power or infrastructure.
Automation nowadays needs power, knowledge, technology, and infrastructure. Due to the rules of the current market that it must be made as cheap as possible, you will not automate until labor costs are as high or higher than going for automation.
We are just in that bracket, and now they all scramble for the cheapest solution while mitigating the fallout of nonexistent automation or manufacturing jobs. It’s a hellhole.
I think its important to note that trump tarrifs led to a loss if 150k jobs and us having to spend over 20 billion dollars bailing out our farming industry
Wasnt it like 50bln$?
Yes the Iowa soy bean disaster - they thought China will take it like a puppy.
Its great that trump is expediting the process of US downfall
unfortunately the dark reality of that experience is farmers learned they will get their money without having to employ farm workers or even do any farming
@@rwlurk Also construction and farming depend on the low paid illegal immigrants - deport and pay the price at the checkout.
What are the 3 expenses that have gone up the most over the last 20 years?
1) Healthcare
2) College
3) Housing
Now name 3 industries that are just about impossible to import.
This idea that you can make the economy stronger by bringing back manufacturing jobs is the claim that you can pay for expensive stuff by selling cheap stuff. Of course it can't work.
Manufacturing jobs would be a nice option instead of going to college, taking on huge loans and hoping you'll land a job in the industry (and actually like that profession), so yes, bringing back manufacturing can help with education costs. Housing is also concentrated heavily in big cities where the jobs currently are, manufacturing jobs outside city would revive dying areas where housing is cheap.
that seems a drastic oversimplification to me
@@bigmacfinland4343 Nobody is going to work in a factory for Chinese-level wages after spending $45K on a degree. This is not negotiable, economic development is a one way street. The US is a service economy, it can't simply go backwards.
@@PlatinumAltariaWhy can't it 'go back?' If we make more stuff then there will be more stuff to go around, and I don't see how an insurance claim adjustor or SEO engineer actually contribute to the wealth of the nation anywhere near as much as a guy putting screws into toasters?
Yes, economies move forward, now-a-days most assembly is done by automation, but that doesn't mean we don't need people to build and operate the automation. It just means we can make more stuff per person working in a factory.
Housing is a great example, the actual materials that a house costs are not that expensive, if there were more people qualified to build houses, they would build houses in spite of the large contractors who want to turn a huge profit.
The idea that factory workers don't make much is not only untrue (I have an engineering degree yet working as a tech makes me more money), but unreasonable. Why would factory workers make "chinese level pay"?
@@bigmacfinland4343 "Would be nice" is a thoughtful sentiment that's never backed up by math. In 2023, the average manufacturing job in China paid $15,130. Who in the US considers that their dream job?
I understand there are sections of the rust belt that need help. But they have to move forward. Remote work in a services economy has a lot more potential than fighting over low value positions.
When I was an economics student in the 80s I wrote a paper on tariffs in the Australian Auto Industry. The conclusion was that every job in Automotive manufacturing was costing Australia $186,000. The benefit for the government was support in 4 key federal seats. The effect of removal of tariffs was an increase in employment of 3 times the number of direct auto manufacturing jobs lost.
All of that never addressed the amount of government stimulus paid to the auto manufacturers.
That is an inflation caused by your Kinseyian economic nonsense.
Just print print ect.
Recession is a natural occurrence in a real economy to clean up zombie companies and ridiculous govt regs.
That cannot happen in this central bank Kinseyian demand economic plans.
Zombies = amc stock and meta Inc.
That can’t be right , the jobs at the car factories have gone to other countries , they are not coming back to Australia , how can you say that this is an improvement? Tariffs are necessary for developing economies as Australia has always been , progress was slow but had the policy of protectionism been maintained Australia would be in a better position, with a strong manufacturing sector , albeit subsidised.
In 1772 Americans revolt against 2% tarrif on tea.
2024, Americans elected President who promised to impose 100% tariffs on everything 🤔
Am I missing something?
Not all Americans voted for slapdick Donnie, but all low compression thinkers did.
@stever5359 not all Americans revolted though
@@karendarrenmclaren true, there were a significant number who were loyal to the king.
In 1772 we revolted because of a 2% tea tax not tariff. It was taxation without representation.
In 1772 the average American would work at a farm or factory and provide a good living for his family. And not have to worry about ming working in the prc for a tenth of his wage, flooding the market with cheap disposable goods.
For billionaires a burger costing $10 instead of $5 isn’t a problem but it is for most families.
Production in the US isn't even possible for a lot of goods. China sits on 80% of rare earth metals needed for high tec stuff like chip manufacturing, batteries etc.
Tariffs can be a working instrument if used surgically with caution. Something tells me Trump won't use much of caution in anything..
You have tons of rare earths in the US, you just don't want to mine them. Don't you dare ask for pity for a self-inflicted problem.
But we don't, that's the we have almost no lithium and I'm not a million percent certain we have enough rare earth metals in general to keep the kind of industry American consumers demand running in the least.@@RiversJ
@@lightunicorn1371 Yes you do, that isn't something up for debate, you just don't want to mine it yourself because most rare earths are mixed with radioactive ores like thorium which China doesn't mind and is stockpiling for future use in thorium power plants they're developing since the US has slept on those for fifty years despite originally developing it. You rather wanted cheaper nuclear weapons and since that time dishonest environmentalists funded by oil corpos make it legally impossible.
@@lightunicorn1371North America is one of the most resource rich locations on the planet..it could if it wanted be almost entirely self sufficient in most if not all key elements, but understandably would rather some other nation dug up their country instead ... you should check out the Geological survey database to see what the nation is actually sitting on...
It's not that China is the only country that has Rare Earths, it's the only country that will mine and process them at reasonable prices. Why? Because most of the Rare Earths are chemically similar and require horribly toxic, polluting processes to get the required purity levels. Have a guess how they make that work. Some years back, China floated a ban on exports and the immediate response in America was that some old, mothballed mines started to look at re-opening. Because if the price goes up a lot, those barriers to production disappear. China realised it was a bad idea and retracted their position.
Tariffs *can* work if the country is self-sufficient. However, we have passed the point of no return in regards to globalization. The United States completely lacks the ability to isolate and maintain its quality of life nor is its populace willing to sacrifice "for the greater good."
Ohhh.. you are so mistaken... All it takes are the resources. Russia is rather proving the point now, and the U.S. is probably more adequately situated. Petro-sufficient. Iron-sufficient, Food-sufficient, And ultimately lithium sufficient...
@@mattfinleylivedude we are not sufficient in any of that. A large portion of our foods is imported because we are in fact bout sufficient.
The greater good would be what is best for the world no? Not just one country in particular. And when people can barely afford groceries, that often means getting the cheapest products you can wherever you can get them and selling others the products you make that are a good deal. Obviously international trade where it is unnecessary is polluting the planet unnecessarily as well, but creating car factories in every country of the world just so every country could have cars would be redundant and highly inefficient. If countries just isolated as you say, most western countries wouldn't even have computers probably due to a lack certain resources required. Before large scale international if a country couldn't produce or grow it themselves, they just had to go without. A global economy gives everything to everyone at the best possible price. As for food, a lot of wealthy northern countries wouldn't even be able to feed themselves if they couldn't import food, unless they wanted to live on old potatoes and carrots etc. There is just too much good about the global economy to write it off for a few of the bad things about it.
@@mattfinleylive I mean who doesn't want to have Russia's economy?! /s
You left out the part that the US is in fact the global core of globilization. The largescale economic and society benefits of that are unquestionable. Not only is it the core of globilization, it is the originator of it in the modern economic system. However, the US has failed to reckon with the problems of that, pushing it off for decades for the benefit of quarterly shareholder statements and two/four year election cycles (and the attending grift & fundraising that goes with that). Instead of using the government as a tool to ensure the benefits of having the US as the economic core of a global system be available to the public (see higher tax rates in the 50s and 60s) it paid Peter to Rob Paul and allowed income inequality to grow and let the haves become increasingly the have-alls to the point where they've bought the system wholesale and are in their tiny little greed is good money-addled brainpans, along with the cultish Southern Christian fundamentalists hooked on the abhorrent and utterly heretical "prosperity gospels" and dominance as their stormtroopers, think the best they can do is retvrn the US to some mythical 19th century of isolation and robber baron AI robot paradise and they're using a charismatic fake racist billionaire mob-connected TV reality star who couldn't make money running a damn casino as their figurehead. Anyway, good luck out there.
To restart manufacturing you need labor. The current unemployment rate is fairly low. You also need the right kind of labor pool.
Even if the US decided to restart more manufacturing we would have a hard time convincing people trained as lawyers, accountants, or business to work the lines.
President Trumps immigration policies will also eliminate a traditional source of manufacturing labor.
*artificially low
U3 is useless as a policy making tool. They only count people who are drawing benefits. A better measure of surplus labor is the percentage of people who are out of the job market entirely, which is at historic highs.
The problem we're having is low skilled and unskilled labor pays so little, if you're stuck on the lower rungs of the job ladder you're better off not working and instead collecting benefits. We need to raise wages for those jobs, and the best way to do that is to sharply curtail immigration as well as instituting tariffs to encourage low end manufacturing.
I have heard elsewhere that lots of the jobs that people do have are multiple jobs (Each person having seversal), unreliable temporary contractor work, zero hours contracts with no guarantee of hours or schedule and just unsatifying lowly paid work. I don't think we;d be talking about lawyers, accountants or MBAs.
@@RobertLutece909 Your argument on the accuracy of U3 doesn't make any sense and you're highly unlikely to raise wages for low-skilled jobs that way without sharply increasing the opportunity cost (wages) for higher-skilled jobs in the process. That is the problem with curtailing immigration and instituting tarriffs. The combination is likely to trigger runaway inflation and a major recession while making the US economic position *worse* in the long run.
Bro, the US has millions of minimum wage starbucks barristas and Chipotle employees. These people aren't married to their jobs and will go into manufacturing if better opportunities arise. That's not even counting the millions of liberal arts majors that graduate every year. Don't worry, the manpower is there. That and, you know, infinite amounts of people at the borders who would gladly work in factoried for a chance at a green card.
Thank you for stepping into the, “noise-scape,” and offering an unbiased, practical breakdown of the issues at hand. It is really hard for a lay person like me to get a grip on the basics when all, “analyses,” seem to be coming from extreme positions, necessarily inserting their political biases first and foremost, whether opposing or supporting the introduction of a new tariff policy.
As you make clear, all countries have a dog in this fight, so to speak. So a good understanding of the unvarnished facts are essential.
Much appreciated.
Inflation: higher prices passed down to consumers so those up the financial chain do not have to pay more.
Inflation is corporate welfare 😮
When Capitalism included a huge number of small businesses, then increased prices went in part to pay more to staff, given that small business knew their employees and customers well, so it was in the interest of business owners to re-invest in the business.
Move to globalism, and the staff are now just replaceable numbers making it easy for CEO's to make decisions that are not in the interest of employees 😢
You could watch hundreds of hours of Fox, CNN, MSNBC etc. and not come across such a clear and unbiased explanation of the economic situation.
And how to you know he is not biased? Because that would be quite the feat for any human.
@terriplays1726 you and me both.
Yes, but why would anyone waste time on those outlets?
@@dereinzigwahreRahl You are right, let’s say he is making an effort to be unbiased.
Unfortunately you'd be almost entirely missing the real story which is how Trump is using tariff threats as a geopolitical stick. Not only is that what he is doing before he's even back in office, it appears to be working. It's easy to sit back and express well-known economic principals to push a point about tariffs not being directly beneficial for an economy. It's also purposely obtuse, at least in this particular case.
And yes, while they're almost certainly directly bad for the US economy they're *worse* for the economy he's waving the stick at. Patrick touches on this a bit, but not enough IMHO.
If the US want to bring Canadians, Mexicans, Europeans and Chinese together so they can have advantageous trade deals excluding the US, tariffs are a great way to make this happen.
Trade with allies and friendly nations.
None of these political entities is capable of coming together on anything meaningful, one main reason for it being that their politicians are in cahoots with US oligarchies. So at least on this front there's no such competition risk.
@@vbrotherita Uh, Canada gets along great with the EU, and we have no issues trading with Mexico. In a way you're right there's no new risk of competition, since we're already trading with them just fine.
@@GamesFromSpace And us Europeans like you Canadians too, it's nice not getting threatened by an ally all the time.
@@vbrotherita A quarter of Canada is owned by Chinese billionaires and they run intelligence ops on our elections. We'd happily cuddle up to China.
As a German i want to use this oportunity to thank President Trump for ensuring that our American competitors will become overprised and crappy, thus leaving the rest of world markets to us.
Like Deutschland can get it's act together on energy 😅😅😅
@Desert_Rogue_Tanker like the "chicken tax" boosted the export of Japanese Pick Up Trucks and SUVs
The fact that there isn’t a massive investment in industrial skills that go along with the tariffs doom them to failure. Even if they could somehow find the people there just isn’t enough skills to actually man the factories. Coupled with demographic headwinds and proposed mass deportations there is no way we could keep the same GDP with these tariffs.
Also there's no factories. In fact I have not heard him utter one word about subsidizing any manufacturing. No one in their right mind is going to start a factory making a product for domestic sale only, that could once again be cheaper from China in 4 years.
@@criticalevent Forget 4 years, what if the Chinese and the EU say "F you Mr Trump" and subsidise their exports in targeted areas? I mean really undercut American manufacturing where it hurts. WTO will get their knickers in a twist for rule breaking, but maybe only if the US ever bothers to pay its outstanding dues to the WTO that is. Right now they don't have the bandwidth.
👏👏there is no skill gap👏👏 stop disguising a pro-status quo opinion as a anti-status quo opinion
edit: i joined uttp
@@menjolno There's a huge skill gap. China now has decades of experience running mega factories.
@@criticalevent They are more likely to move their companies to one of the many other countries with cheap labor anyways. In fact, some experts predicted this long before the tariff discussions began, as labor costs in China have been rising already. The declining birth rate, the expansion of education, and the general rise in prosperity across the population are major factors here. the goverment doesn´t like that and will try to do something about that, but we will see.
It actually clarified a lot of things when you said that Trump views a trade deficit as losing. These tariffs are like "taking your ball and going home" except youve actually been renting the ball and borrowing money to make your 'ball payments', and at this point you owe more money than the ball itself is worth 😂
Easy solutionfrom my perspective as German:
German trade surplus is the mirror image of Germanys lack of capital investment, instead of building up stuff in Germany, whch would require more imports, German businesses invest abroad, e.g. in USA.
Simply ban capital investment in the US by foreign investors, and the trade will balance because others won't shove capital into USA that is what funds the US trade deficit.
This is like watching a 10 car pileup in slow motion. You know it’s inevitably going to turn to shit, yet no one’s doing anything about it.
When both sides of nitwits use tarriffs there is little chance of common sense.
We just spent 4 years wading through s---t. Where were you exactly?? Thinking Kamala would have somehow been better is ludicrous.
@ Didn’t vote for her, nor did I say she would have been better. But by all means, keep reaching.
@@metatechnologist
Kamala's proposed economy didn't revolve around tossing out tariffs like candy, so yes
What are you talking about? It's not the tariffs, it's the THREAT of tariffs , made by a person like Trump who everyone in the world knows, doesn't back down. The threat is already working, and Trump ain't even in office yet! Biden, couldn't accomplish in four years what Trump did with a few sentences.
Tariffs will just be an invisible tax on the consumer to subsidize inefficient manufacturing. Most manufacturing jobs are lost to automation, not to foreign competitors. A better policy would be to retrain workers to build and run those automated factories so workers earn higher paying jobs.
Only if the tariffs were with the entire world, and not just targeted at a few countries such as China.
Retrain workers???? Get real. That will never happen. Some of our ex-factory workers are never going to learn anything beyond a 12th grade education. Their jobs are outsourced or replaced by a robot. The workers get to work at Walmart or full time Uber gig workers. That middle class job is gone forever. I don't have a solution to the automation problem, but pretending that these hillbilly factory workers can be retrained is nonsense.
All taxes are paid by the consumer. The question is, why do we tax the production of our own citizens and not those of other countries?
@@flashoflight8160 You have a choice but to retrain the population. Otherwise you have a permanent underclass.
Shouldn't automation creating unemployment and thus major profit margins for CEOs lead to... you know, taxes on the rich in favor of social programs to the people whose labour made them rich? Why retrain 50 year old factory workers who are too busy dealing with backpain and voting for the very party that wants to cut their social security to learn how to become full stack web developers in a gig economy. But what the fuck do I know?
Accepting the basic premise that the tariffs will protect and encourage increased manufacturing within the US that still at the very least will also lead to those businesses increasing their prices because they can control the market. Additionally, you must accept that other countries are going to apply tariffs of their own and they will most likely effect the wider manufacturing industry because of the reliance on raw materials from those countries.
In certain and limited circumstances having tariffs are a perfect measure but they are not a fix all and using them in such a way will cause greater problems. The issue is that those problems aren't likely to show as quickly as the benefits from new manufacturing jobs that are likely to be created. The "X" factor is that Trump wants to be loved and in four years he will leave not caring what happens after that !!
"...you must accept that other countries are going to apply tariffs of their own."
I guess doing precisely what Trump expects China, Canada and Mexico to do in order to avoid tariffs is out of the question?
@@sprague49 To a certain extent I would say yes because firstly the US are responsible for their own borders not Mexico and Canada who can only secure their side. Also, when it comes to China the reality is that they are good at what they do and produce things people want regardless of the subsidies those companies receive. I would absolutely agree that China overproduce and that is something the world needs to get a focus on but consumers also want the best quality and US companies aren't offering it. I don't just single out the US, other countries in the so-called "global north" are as guilty of having created the Chinese manufacturing powerhouse and you have to have comparable alternatives to really challenge in what is now a world market !!
TRUMP will never leave the totaly corrupt supreme court 6 republicans made him king!! the tarriffs will be selective!!! he will get all the bribes and access to build trump towers everywhere!! the tarriffs will not create any jobs except for his personal army!!! he will make every single rule going forward weather it is legal under our constition or not he is king now!! get ready for the very bad depression in every single sector! it will be just like the breakup of the USSR! ELON IS IN THE LEAD NOW! but we will wait and see untill trump goes after him! trump will be loved by the people he makes rich and that isnt you!!! GOD HELP US ALL! but most of all dont give up and give in to the dictator!! or become russians who go about life and being proud about being angry and miserable but do nothing to help themselves! you never ever see a smileing russian!! yes the US is corrupt as hell now but trump is 100x worse!! the SEC and FFA will be the first places that will be gutted by trump not the IRS! the IRS will be the bagmen for trump!
Yes and no. If he puts on tariff, while reducing income tax, he is effectively boosting the income of people to offset partial impact of tariff. At the same time, a lot of interim goods indeed coming from China, but raw materials are coming from Australia. In this case, instead of left US firms completely helpless, it is likely to incentivize these firms to produce these interim goods by their own. Also, US has a competitive market, look at the basic retail stores, Costco, Walmart, aldi, they undercutting each other in costs to provide goods to unserved customers. The competitive nature of US market is likely work out a solution to reduce the price at the end. And tariff is unlikely to placed at once, it is gonna take times, and he got 4 years or even more (depending on successor) to do the job. It will offset a lot of problems.
@@darksmith7318 The baseline logic of what you are saying I can't argue with but reality is much more complicated and won't benefit anyone really in the long-term. It will simply create wider and more defined divisions across the world !!
Man, you’re really a good speaker. Idk if you’re reading a script but I imagine myself messing up the transition from saying Japan in one sentence, and starting the next sentence with Janan Ganesh.. around 11:24. Random thing i noticed
I think the only positive effect of trumps second presidency will be that I can tell some people “I told you so”
That's assuming they'll be able to make the connection between his actions and any resulting negative consequences. Don't be surprised if they somehow scapegoat democrats or the "deep state"
I work with mostly red voters. I made it very clear to them I don't like Trump for policy reasons such as this. They literally have no idea what a tariff is.
Kamala is drinking right now
That's better than nothing.
And they'll still blame the dems, somehow.
Because of tariffs, American's ended up with only crappy Harley Davidson motorbikes.
As a Milwaukee-area native, I wanna fight you...but you're right lol
soon, crappy teslas too lol
Harley Davidson moved their production to overseas 😅
Big HD Factory in Mexico, so....
Harleys are crap 1950's crap no matter made in USA, Mexico or elsewhere.@@eriknickerson8786
Short answer is "no". Long answer is "hell no". Higher prices means less demand since people's money only goes so far with higher prices. That means on the retail end things will get bad. Whats the point of manufacturing all this stuff in the US if only the 1% can afford to buy things?
You have massive inequality in the US and you want to introduce tariffs to make things even more expensive for the people who live pay check to pay check???
You're going to have massive surplus of stock if you introduce tariffs and force everything to be made in the US. What about exporting those excess goods? Well, everyone is going to slap tariffs on the US in retaliation meaning that importing from the US, with its high valued currency, will be too expensive.
So you're going to have all these manufacturers making things and no one can afford to buy them domestically or internationally.
As always, a lot of detail. But could you elaborate on how a floating pen will be able to compete under tariffs whilst also combatting a pencil that concedes to gravity at 1/1000th of the price?
😂😂😂😂
everyone knows, gravity trickles down.
since gravity is proportional to cubed distance, the tariffs on it are also cubed. This way pencil's weight will increase as x^3, massively outrunning its linear price increase. And floating pen's non-existent weight will still be 0.
@@mahiainti678
Cubed distance ? Nah, gravity is proportional to mass and inversely proportional to the square of distance.
@@Hexanitrobenzene Oops, you are right, inverse squared distance. I dont remember if i was drunk or what when i typed that... still that silly argument somewhat holds
I think Milton Friedman in his time didn't expect that there would ever be a country with such a gigantic manufacturing capacity that it can overwhelm US demand capacity and sustain that for decades.
fair.
But also the answer to that if you are somewhat smart, is to give better trade conditions to everyone else than china,
as to shift capital investment in production in those other countries, e.g. other asian countries, african countries, south american countries, that would have even cheaper labor than China anyways.
China has been given favorable treatment by USA since Nixon/Kissinger opened up to China, the situation is a product of US government policy, just not the one Trump thinks.
TLDR; No. they are a horrible, dumb idea that caused financial harm last time and none of the reasons why have been addressed.
Here's the thing about the Trump Tariffs that I don't get: If I want to buy a widget, let's say an external hard drive, I can get a good one made in China for $50. Assuming that the US could produce one (it can't) while offering me a variety of companies to choose from (the free market and all that), it would cost $100. So the tariff has to be close to 100% before I'm going to buy the American one. And how many years will it be before I can buy that American hard drive for twice the price? I'm all for raising the price of junk so that people consumer less, but there's fundamental flaws with tariffs.
Trump, who want bankrupt with a casino, thinks he is a great dealmaker. It's all just bluffing. Which you can do for a long time, when you're the potus for 4 years and you're using other people's money.
There's nuance here that he didn't get into. The tariff applies historically to the portion that was produced in the country. So if parts of the hard drive assembly, let's say they're the expensive parts are made in Taiwan or Japan and the whole thing is assembled inexpensively in China the actual cost increase will be small.
If it's $100 hard drive (production costs, not retail including markup) and $60 of that was made in a country not subject to tariffs. The tariff is only going to hit on the $40 from the assembly and packaging in China.
The sole purpose of tarrifs is to make foreign goods more expensive than domestic goods. Otherwise, there's no point.
If a hard drive from China costs 50$ and a hard drive from the US costs 100; If tariffs make the hard drive from China cost 120, the consumer will buy from the US, and China loses a sale. If tariffs make the Chinese hard drive 60, that's the worst of both worlds. The consumer buys from China, pays more for no reason, and China doesn't feel the effect at all.
@@HelixsoulX The US will look elsewhere first. If it costs $50 from China, $60 from Vietnam, and $100 from the US, and the US slaps a 100% Tariff on China to bring prices in line with American producers, the consumer will switch to Vietnam and eat the 20% higher cost.
Raising prices so people consume less is like fucking for virginity.
I have a trade deficit with my local bakery. I pay him more than he pays me. Not sure if I should apply tariffs.
😂🤣😂😂 love it!
Really informative for those of us who have a lot to learn about the consequences of international trade, and about international situations in general! Thank you for the info!
Seriously happy my microwave decided to crap out on me today and not two months from now. ✌️
Oven is superior
But cannot cook chicken in minutes 🤦🤦
get one of those toaster oven things. better than the microwave for like anything except liquids
Microwave < air fryer
Q. Can Trump's Tariffs Work?
A. Yes, just like boomerangs work. They often come back and hit you with a thud.
Boomerang usually never hit you. Thats why people use them
@@JustSomePerson8 People don't actually use them, outside of cartoons.
@@timogul yes they do lol
@@JustSomePerson8 When was the last time you saw someone use a boomerang for a practical purpose?
@@timogul Tuesday
Short answer: no. Long answer: this will be one of the most disastrous economic policies since the heady days of Liz Truss.
One can only hope that Trump's second tenure is as short as Truss's.
Here's hoping for a bad big mac.
I think the Biden sanctions on Russia and China as well as tarriffs predated this upcoming failure. It showed that it was possible to function and survive even with the US waging economic war and it's emboldened BRICS and many other countries. The search to how survive sanctions has led to a non dollar using paradigm that has grown ALL because of US sanctions. Even US allies like France and Saudi are trading in non US currency and many are bypassing a currency that is highly politicized and which can be used against a country.
The sanctions is the greatest economic disaster in decades. Just look at Germany deindustrialization and rest of Europe. They wanted to ruin Russia but they ruined themselves.
these tariffs are going to harm pork markets
Short answer: no
Long answer: Only works if everyone's blind to the concept of a tariff, which was not the case for that tea party in Boston long ago
Edit: This party I'm referring to is a loose time frame when people actually knew what they were voting for instead of the vibe era we've been in for 100 years. I know the difference between a tax imposed by a foreign country (the party) and a tariff (tax companies pay to the country as soon as they import from another country). Good day, y'all!
That wasn't a tariff. That was a boycott. You are welcome to the free middle school history lesson.
America has never grown tea. It wasn't a tariff.
Monkey, shutup
@OceanusHelios a tariff doesn't require that product to be produced domestically
A concerted global tariff on China (EU, US, ROW) could seriously dent the dragon. It depends what you mean by work. Stupidity is ignoring the redistributive impacts of free trade on the marginal (not average) voter. The "elites" have definitely gained disproportionately due to Chinese subsidies but a democracy doesn't choose its leaders based on what "the elites" want (not anymore, apparently)
10:45 This is not just about the retail/residential sector. A massive number of commercial and Industrial products or raw materials that are sold business to business are coming from China.
This is an important point that’s not addressed in the video.
Surely advocates would just say that's even better, "more jobs in commercial and industrial products as well as producing raw materials!" 🤷♂️
@@thomas316You're really not getting it here. The point is that your average person isn't going to absorb those costs directly or maybe at all. The US manufacturers are going to stick to importing lower cost items like raw materials and then doing the manufacturing work here.
China was doing this the other way around with their aluminum dumping into the US. They were casting these shaped ingots calling them semi-finished product and getting around the raw material import restrictions into the US.
Exactly. I made this point in a reply to a post the other day. This isn't just a tax on a TV set made in China. It's a tax on many parts that go into making a Harley-Davidson. It's a tax
on some of the parts used to build "American" made agricultural equipment used to sow and harvest American crops. It's a on one fifth of the components that go into building
a Ford, Chevrolet or Chrysler.
@@davidbrayshaw3529What this is going to do is stratify production. The cheap stamped steel part might still be made in China. The expensive aluminum casting or the electric motor are going to be made domestically
Neat pen. I’ve been looking for something unique to write with for awhile. Thanks for heads up and the code. Got the notebook too but we will see about the quality on that when I get it.
The FIRST effect of tariffs is going to be even higher prices in America than we have now. This may or may not set off more inflation, but it at least complicates what the Fed is successfully doing . In the long run, it could force countries like China to balance their trade policies, but in the long run we are all dead (as Keynes said). Also, America will be in trouble if foreign exporters have to re-patriate their capital because Americans simply don't save enough money to fund our domestic investment (or they have it tied in non-productive real estate). Basically, even if this pays off in the long run, the short run will be utter chaos.
"This may or may not set off more inflation" = blanket tariffs will DEFINATELY set off inflation given the sheer scale, variety and essential nature of the products being imported.
"complicates what the Fed is successfully doing" = Completely undercuts the work of years in one day. In fact the wheels went into motion the minute Trump opened his mouth after the election.
"even if this pays off in the long run" = How did it go last time America decided to go native and blow up the world economy back in 1930? Well it plunged the world into a recession which ended in a world war.
Blanket tariffs are as dumb as it gets.
My tiny hope is that, the threat of 25% tariff is enough to force countries to sit on negotiation table and make out new deals, a form of negotiation tactic. Otherwise, fasten your seatbelt. These upcoming 4 yrs gonna be wild.
US consumers will pay more for imported goods from China - US made goods will take advantage and rise in price.
Had an argiment about somebody who said he is going to be okay since he only buys US made tyres just after I explained to him that there are no rubber trees in the US.
Tyres are made from synthetic rubber. The common car tire is made synthetically from acryonitrile-butadiene-styrene polymer. The feestock for this comes from crude oil/natural gas. .
@@gagamba9198 Sumitomo closed a tire plant in Tonawanda New York - the problem was it was old, and it was not viable to be upgraded.
There is a P&L for each plant - if they don't make enough money then there is no justification for continuing operations once the plant has aged out and requires capex.
Tire rubber isn't made from trees anymore lmao
@@gagamba9198 So the thing we are a net importer of? Gotcha. We export shale sands, which cannot be refined into gasoline.
Interestingly, tariffs were one of the lesser known contributing factors causing the civil war
“tariffs were one of several significant economic factors that contributed to tensions leading to the Civil War, though they weren't as central as slavery. The main tariff disputes centered around the Tariff of 1828 (known as the "Tariff of Abominations") and subsequent tariff policies.
The North, which was more industrialized, generally supported high tariffs to protect their manufacturing from foreign competition. The South, which was primarily agricultural and relied heavily on cotton exports, opposed high tariffs for two main reasons:
1. They made imported goods more expensive, and the South relied heavily on European imports
2. High U.S. tariffs led European nations to impose retaliatory tariffs, hurting Southern cotton exports
The conflict came to a head during the Nullification Crisis of 1832-33, when South Carolina declared federal tariffs unconstitutional and threatened to secede. While this specific crisis was resolved through compromise, it highlighted the deep economic divisions between North and South and established a precedent for state resistance to federal authority that would later resurface.
However, it's crucial to understand that while tariffs contributed to regional tensions, they were one part of a broader economic divide that was fundamentally rooted in the institution of slavery. The tariff disputes reflected deeper conflicts between the industrial North and the slave-based agricultural economy of the South.”
From an industry bloke perspective, I don't like things to be swingy and volatile. Sometimes consumers have the illusion that we are flexible. We are not. Constant rumours of new rules changes, rules changes because the president has a mood, rules that can get funky exceptions because the right lobbyist praised the president are all hard to work around when your world moves in six-month long cycles or more.
One of the greatest criticisms from the british industry towards brexit was that they had no idea how the trade regulations between the UK and EU would look like which gave them no time or even an idea how to prepare for them.
@@schwarzflammenkaiser2347 I still think Leave could have functioned if not for at least three different Leave factions all blabbing that their particular version was the true one. They kept pushing this debate into the future until time ran out.
@@SusCalvin Which was my Point, though not explicitly stated.
@schwarzflammenkaiser2347 I can't tell which Leave could have worked best out of all options.
@@SusCalvin we have to be content to never truly know, only guess.
You are the funniest, yet most serious person I follow
Dear Sir your videos are indeed a higher education in economics and the pulse of USA 🇺🇸 .
We really appreciate your academic, factual approach.
Tariffs are a weird sub-genre of rap
Discussions about tariffs and how they affect the global market, always confuses me, but I always need to thank Patty B when he drops a video. I guess I’ll take what I can get since the newest rap album isn’t ready yet.
Thanks Professor, superbly explained
If the Trump II Administration does succeed in imposing these proposed tariffs on Americans, they will "work"; the real question is, "For whom?"
that is the real question. There is already not a lack of money in the US. It is the country with the biggest GDP by far. Its that all that money is accumulated at some rich people and tariffs wont change that.
@@_Dibbler_That's why I think you have just entered a tiny fraction of real labour debate.
What is the value of a working class American. Who is supposed to buy all this stuff. How many cartels can the USA afford.
2 things:
1. on Tariffs for only important, advanced industries
2. on understanding our situation with China
Tariffs should only be used for very niche scenarios in conjunction with subsidies for industries of national importance to the country. To be completely honest, I don't really think we want Americans to do basic manufacturing jobs, we should want Americans to do more advanced, higher output jobs that make leverage of the country's extreme wealth and resources. Now that's made extremely difficult with a wealth gap and awful education system, but I don't think our goal is to manufacture everything in the US, but to manufacture the things important to us and manufacture them well and truly competitively. Trump doesn't seem to believe in friendshoring which is a damn shame, because to me if other countries want to specialize in something and make it better than us, then we should welcome that and be happy with it.
If we want to use tariffs and subsidies, it should only be for important advanced technologies like semiconductors. Anything simple we can just friend shore it to a poorer country, those aren't the jobs we should want anyways. In the same way.
China is, unfortunately, the new cold war enemy of the United States. Many people talk about how the Cold War, while all-encompassing ended up being a war of economics. I believe this is very much the same. The Chinese government has for a long time made it their goal to economically and technologically displace America's position as the #1 country. If America wants to defend its position, it has to use the same weapons as China (ie economic tools like subsidies and tariffs) These weapons, much like military weapons, only serve to hurt and do not help the free market. But we are at conflict, and I think it's a mistake to view whether or not to use tariffs purely through an economic lens, because this is a geopolitical conflict. This is not just about what will improve the American life, but to prevent it from being overtaken by China.
Everyone will lose here, it's just about if we can lose less.
To be clear: I think it is extremely tragic that Washington and Beijing feel that they need to compete like, but this is the reality we live in. Beijing and Washington fear of each other and it shows
The fear comes exclusively from the American end. The US behaves appallingly with them and has for a while now. Trump is just the totally unacceptable face of the US, a dumb as rock twat.
America has been a bad role model since the mid-70's. It's time for a new super power take over. America doesn't deserve the title.
I think him imposing unilateral tariffs on countries like Canada will result in in tit for tat tariffs back (just as it did during his first presidency), and hurt both countries. While Canada does have an issue with migrants slipping over to the us (helped by very lax laws dealing with illegal immigration in the USA), we have huge problems with drugs and firearms being smuggled the other way.
Migrants aren't an issue at all - it's actually harder to get into Canada then it is to the US, so it doesn't make much sense to use Canada as a point of entry. There are far more migrants coming into Canada from the United States. Trump is using the tariff threat to force Canada to enact policies that he favors, and it's working.
He is going to enact any tariffs on Canada. He likes to talk and see news headlines he doesn't care what happens.
Canada mostly belongs to China, so I see how Trump got confused.
I'd like to see a full customs union with Canada and Mexico. Tarriff China with us, eh.
Congress has to enact those tariffs. The most Trump can do is 10% for 150 days. Anything more goes through Congress. Tariffs are used as a negotiation tactic.
funny how Trudeau caved and flew to Mar a Lago to kneel before Trump .
Would you believe someone who lied 3,000+ during his first term? No.
A tariff is a tax on American consumer, as you well know. It has always been clear that the US could cut itself off from the world economy by raising the cost of imports along with the barriers to US exports that will be put up in response. It is basically a concession that the US cannot compete globally. Such an isolated economy can work, but will result in a lower standard of living for Americans.
I didn't get how US manufacturing would become competitive (at the end.)
Tariffs make imports of raw materials and components more expensive. And competing with artificially higher imported prices might make domestic industry more competitive domestically, but they still are more expensive than other manufacturers internationally.
My Prediction: Inflation is going to get worse, there will be a serious labor shortage, companies will outsource jobs more, government assistance programs’ budget will decrease, benefits allowances will lower and some programs might even disappear.
Due to decisions that prioritize short-term political gains over long-term economic stability, the US government has chosen to deliberately ignore their historically brainless Smoot-Hawley Tariff policy, which caused the great depression and demonstrated how protectionist measures can backfire.
Rather than adapting or competing effectively, the U.S. is essentially saying, "If we can't win, we'll disrupt the game" - imposing trade barriers that harm both economies but are framed as protecting American interests.
Notably, these tariffs imposed by Trump and continued by Biden haven't even achieved their supposed goal: U.S. trade deficits haven't significantly shrunk, and the economic impact has been largely negative for both nations.
The US government is essentially throwing an economic tantrum with China, similar to the UK government approach to Brexit with the EU.
By imposing massive tariffs, the U.S. government is responding to its own paranoia and perceived economic threats from China, particularly around trade practices and technological competition, similar to the Cold War with Russia.
Trump is just another idiot proving that politicians are good at only two things: causing wars and unemployment.
His economic policies, particularly his tariff strategies, demonstrate a fundamental misunderstanding of international trade dynamics.
Imposing tariffs on products a country cannot produce effectively is economically self-destructive, raising consumer prices, potentially triggering trade wars, and harming domestic economic interests.
Always nice to read something from a person that has educated themselves in economic theory and history. Well said. Too bad most people in the US praise ignorance and stupidity.
not directly related to the topics but your comment regarding trade surplus countries subsidizing domestic industries ( directly and indirectly) and squeezing capital investment from trade deficit countries by using restriction to surplus countries market as a bargaining chip really resonate with my country Indonesia lol, the rapid growth of Indonesia's minerals downstreaming industries at the cost of environmental protection, the massive spending in Infrastructures during Jokowi's administration, and Indonesia's currency and labour policy and it does contribute to the continuous Indonesia's trade surplus for the past 4 years
This is the clearest exposition of international trade theory and practice that I have ever come across. Well done! An additional point: the US can afford to play a game of chicken with the ROW only because of the scale of its domestic economy; accordingly, it could arguably survive indefinitely as a closed entity.
Since 22 you guys have imported more food than you exported. Gonna get slim at last .....
Lol
I don't think Americans are about to be content with 'surviving'.
New to the channel, appreciate the “Sponsored Content” title during the Hoverpen statement. It’s a level of honest disclosure that I don’t recall ever having seen on YT before. Now to buy one :)
With Trump, the issue of tariffs cannot be discussed in an isolated fashion. He has also said he wants control over interest rates and will be implementing a massive deportation program that will include American-born citizens. People who voted for him did so largely on the basis of the cost of living (which they stupidly assign blame for to the administration instead of Corporate America). Yet, in combination, these three economic measures will produce a huge inflation surge, making everyday goods, especially food, much more expensive as well as scarce.
Trump is convinced that tariffs will spur more job growth in the States. However, economically speaking, from companies' point of view, it makes no sense. Even if the goods they make overseas and import into the country cost them the same amount as making them here, production costs are not the only costs to consider. The company would have to build factories here - no small cost, especially considering the greatly increased cost of building materials, even if it only entails the makeover of an existing structure.
There are no domestic replacements for car parts that criscross the boarder.
Patrick, thank you, it is so mind-enriching to listen to you!
China can focus on 80% of the world as market while US consumers learn about credit discipline 😂😂😂
The point of tarrifs are to protect industry not to collect money. It's not that confusing. If i charge you more to sell in my store you will charge more for the goods. It could work out if the good are artificial inflated but at some point it just raises costs and the government ends up with more money. The increase in price goes to the consumer not the businesses. If the goal was to protect home based industries it would lower the cost of home based goods compared to others but we barely do that in the USA and aren't hearing towards making those goods.
Thanks Good Reportage ⭐️
Wanna pay $2000 for a locally made toaster? These times are on their way. Woohoo!
My two toasters will be worth $4000
I'm rich!
I think the first question is... What do you mean by work? What is Trump trying to do? This all looks like misdireciton to me. There is a huge amount of uproard about this. There does not seem to be any about purging the senior leadership in the military so that the military will follow illegal orders without question. There does not seem to be any uproard about the plans to purge the federal civil service of people who will try to hold the Trump administration to the rules.
Those are the biggest issues right now.
Since the press and whatever this is get money by more views and personalities get more views than ideas and policy, this is a great way to distract the nation while our country is stolen from us.
Fantastic discussion
Excellent analysis
Thank you Sir
Thank you Patrick
Americans better get their picks and shovels out and start digging for Gallium, Germanium and Antimony
It's actually not about mining it because gallium and germanium are actually biproducts of zinc and aluminum. The problem is that they aren't economically viable at current prices, and are harmful to the environment. Still, it will increase the prices by a lot.
@@ColdRunnerGWN The United States does not have the capability currently to refine rare earth elements as they exported the pollution and energy use to China decades ago. This is not something you can do quickly and the United States will be at a big disadvantage until that can be figured out.
@@ColdRunnerGWN Increase of forty percent in a single day for Antimony.
@@michaelstanley5215 - I totally agree. I was just pointing out it wasn't about finding the deposits, but about production. Oddly enough, Canada actually has a rare earth strategy, so the proposed tariffs are just making things harder for the US.
@@ColdRunnerGWN Check the price of Antimony. See what has happened in the last few days.
Here is my prediction: Sometime after Trumps tariff plan goes terribly wrong he will say "Nobody Knew Global Trade Could Be So Complicated"
Brilliantly ... Explained ... thank you ...
This might sound naive, but maybe just consume less? The median pay gap between EU and US workers seems to be around 2x in favour of US. Fuel prices (input cost to all) in US are around 2x lower that EU. Where does all that pay go?
Buying expensive Trump branded Sneakers, Watches and his new line of Perfume.
@@evulclown😂😆
Can you check if you're looking at gross pay? You want to see how much less can be consumed you need to look at discretionary pay, which is pay after everything you need to pay for, like the minimum amount you'd need to spend on rent, food, and healthcare.
In the US those expenses taken out from disposable income to determine discretionary income tend to be very high. Fuel may be cheaper, but a much higher proportion of the population pays for car loans, car maintenance, and car insurance, and those tend to be higher per vehicle because supporting cheaper modes of transportation are declared "an attack on cars." There's also generally less competition between companies, as Americans generally oppose pro-competition policies. As an example, the attempts at market manipulation that got Walmart booted out of Germany are things they're been doing here for decades.
Please check healthcare, education, and other living expenditures.
I admit, I didn't go too deep with analysis, i just did quick "median pay US" "median pay EU" searches and took the numbers from summary box.
Trump clearly hasn't read Adam Smith's Wealth of Nations.... 🤦
In short: different nations have different resources and more or less of different stuff and all nations get wealthier by trading with each other (vs going it alone).
@@djayjp Trump clearly hasn't read. Period
Trump needs to start with Aristotle and work his way forward.
@haneytr3s I'd start with the ABC, and some nursery rhymes. Baby steps
@@piage84he's a multi millionaire lol
Nor anything else, obviously...
Kudos and thank you. So very informative, as always. Another one hit out of the park.
Im glad Big Macs are not imported from China. Maybe the Sunday machine is. but its been broken since 2021... my washing machine, they just dropped about 11 percent.. funny that it coincided with the expiration of the first tarrif
Yes tariffs cause immediate price changes proportional to the tax, but it changes the incentive structure. Over time, American businesses will find it more profitable to build factories and be productive instead of just being a reseller. America consumes a lot more than it produces. The debt is not monopoly money, it's real debt! Oh no America will collapse if it can't rely on cheap Chinese slave labor! Listen to yourself.
The 'drugs' mandate tells you all you need to know about his tariffs. the majority of drugs are brought in by american citizens at legal ports of entry, and americans already complain loudly if you increase border checks on them, so there isn't anything either country can actually DO about this. but it makes great theater to his supporters. His tariffs are all about meeting the emotional needs of a certain block of the population, which they will do quite well. And since they are feeling good, that shapes how they view the economy and their own situation, so it will be a victory independent of the economic realities.
Love your material when its unbiased
On the positive side, no matter how bad the economy gets, MAGA supporters will always say, strongest economy ever. He's got that in his favour.
The consequence, as always, will be seen much later anyway. Probably Trump will long be dead when the US is hit by the full repercussions of his actions and the next governments have to deal with it.
Majority of people that is
Playing economic chicken with your 3 largest trading partners is a very high risk game when there is a large and growing federal debt overhanging the U.S. economy. Inflation is still smoldering, would not take too much of wind to blow it back to life.
The only way the debt will go down is if we stop the handouts, particularly social security and Medicare (50% of spending). We are overspending by 15-25%, the economy isn't going to grow enough to swallow the deficit, tariffs or not.
Stop the handouts, you sink the economy, raise taxes, you sink the economy, cut taxes you blow up the already large federal debt driving up interest rates and starving the market of credit, blowing up the economy.. The question is, how close is the U.S. to a debt spiral? Any rocking of the boat at this time could capsize it.
@@chazzbranigaan9354 *cough cough* 650+ billion dollars of annual military spending *cough cough*
@@chazzbranigaan9354 While those are big budgets, you should also look at how income is generated a federal and state level.
The whole world is becoming a tax heaven for big corpo.
If they were taxed more the extra income could be used to reduce the debt and even invest in useful stuff. But as it stands right now, big corpo pay less taxes in total than the regular people.
Well done, thankyou for clear headed and balanced commentary.
Crazy that Patrick did a backflip at 14:22
I guess you could consider them a VAT. Importing the product adds 'locational' value.
Placing tariffs on the countries who'd current trade deal he himself negotiated and signed is wild.
Get ready for higher prices and reduced export sales.
He can't unilaterally do a lot and Congress isn't going to approve some of this stuff
@samsonsoturian6013 He can unilaterally implement tariffs without Congress. That may be enough damage done even before the Republican congress can cut revenue and further increase the deficit.
@Videomorgue It's a lot more complicated than that
yeah we seen that last time especially the farmers however Brasil and Europe loved it they made a fortune on the loss of business American farmers suffered I met an Australian in Hong Kong and he loved Trump because of the Tariff war China turned to other Countries to buy their meat and produce and he picked up a large contract selling grain because of the 2018 Tariffs
@@samsonsoturian6013 - The answer is yes and no. He isn't supposed to be able to, but he is going to invoke the national security, which allows him to do it. He did this with steel tariffs his last term.
Tariffs will increase costs of finished goods and components used throughout US manufacturing. This will be an immediate and huge hike in inflation. To fight inflation the Fed will have to hike interest rates which will be wonderful for the billionaires but possibly take away the middle class. Inflation is so high that consumers are literally taking debt for basic life necessities. Collapse has indeed begun..
A collapse has began!!! Rich people know this.... they are hedging... through hedge funds. It costs them about 6% a year to do this. Those that aren't rich are not hedge and are at great risk in the bubble of all bubbles with the debt at all time highs. The increasing prices have impacted my plan to retire at 62, The stock market's volatility, coupled with a reduced income, is making me anxious about having enough for retirement.
I feel your pain mate, as a fellow retiree, I'd suggest you look into passive index fund investing and learn some more. For me, I had my share of ups and downs when I first started looking for a consistent passive income so I hired an expert advisor for aid, and following her advice, I poured $110k in value stocks and digital assets, Up to 400k so far and pretty sure I'm ready for whatever comes.
How can I reach this adviser of yours? because I'm seeking for a more effective investment approach on my savings
Annette Christine Conte is the advisr I use and im just putting this out here because you asked. You can Just search the name. You’d find necessary details to work with to set up an appointment.
Thanks a lot for this recommendation. I just looked her up, and I have sent her an email. I hope she gets back to me soon.