Ok but the prices spiked when the initial tariffs were introduced. And they haven't gone down at least we haven't seen any reduction. And we were just told to expect a price increase again the first of the year as usual. All I know is my costs jumped considerably when the tariffs started and they certainly haven't gone down.
Tariff Wars
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Seasoned Oak
Minister of Fire
Its an old game these countries play subsidize your companies and devalue your currency to drive the competition out of business, it worked with solar,steel even aircraft, then the market is yours alone. Always short term pain associated with correcting that,so most politicians just ignored it in the past. China knows weve never had the stomach for that,and all the whining from the public which is why they have been playing us for so long. Plus they could care less what the public thinks in a communist country.
World economies are not strong right now. I am concerned that the new Oct. and Dec. tariffs may end up starting a global recession. Trade wars help no one in the long run. In Ireland, food and drink make up 2/3d of their exports. We are not immune if a major recession snowballs in Europe.
Jan Pijpelink
Minister of Fire
I recently read that Singapore is facing a major recession (like the one they had in 1997/1998 which was the cause of me losing my job there) because the most important trade partner, China, cannot pay for the goods made in Singapore, due to the high tariffs China has to pay for the US made products and high US import duties for China made products. This is a global mess and will get a lot worse before it gets better. I will be in Singapore next month and will ask my business partners there about the situation. I was in Korea 2 weeks ago and heard similar stories. Scary.
It only takes one domino to fall and set off a larger chain of events. The US economy is not that strong right now either and this time it's corporate debt that is creating the bubble.
Wow, sounds like we are all doomed. I'm sure your solution to the China "issue" is much more enlightened. Can I ask what it is?
The manufacturing regulations you regularly propose on US manufacturers would be much more damaging to the US economy than slapping a few tariffs on imports.
I also take issue with doing so much business with a communist country that suppresses free speech and is big on censorship, but that is just me. I know others feel differently.
Seasoned Oak
Minister of Fire
By most standards the US economy is booming. We are now the worlds top petroleum producer. Most other indicators inching up. Low inflation ,healthy job creation ,good GDP growth .But it depends which study you read ,there are as many different opinions on this as climate change. https://www.usatoday.com/story/mone...2019-strengths-jobs-low-inflation/2417937002/
Sawset
Minister of Fire
A pricing scenario, one that was eluded to in one of the first links I sent - a what if, but I think relevant:
Stove weighs 500lb
80% of that is iron, remainder glass, bricks, fasteners, leaves 400lb
Steel price - $.40/lb = $160
Steel tarriff 25%
Steel price now - $.50/lb = $200
$3000 stove increased to $3040
Assuming all imported steels, from china, and all of it has tarriff applied:
How much talk of price increases is coming from:
1) pent up desire to pass along costs that they haven't been able to be due to constraints beyond the sellers control, ie market conditions.
2) how much is due to epa mandate
3) how much is actual material pricing
Stove weighs 500lb
80% of that is iron, remainder glass, bricks, fasteners, leaves 400lb
Steel price - $.40/lb = $160
Steel tarriff 25%
Steel price now - $.50/lb = $200
$3000 stove increased to $3040
Assuming all imported steels, from china, and all of it has tarriff applied:
How much talk of price increases is coming from:
1) pent up desire to pass along costs that they haven't been able to be due to constraints beyond the sellers control, ie market conditions.
2) how much is due to epa mandate
3) how much is actual material pricing
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semipro
Minister of Fire
I'm just hoping the pain we feel in the U.S., whether real or perceived, results in some changes with respect to leveling the economic playing field and increased respect for intellectual property rights in China. I believe the latter will ultimately result in more economic benefit to the U.S. We're being robbed blind on that front.
Jan Pijpelink
Minister of Fire
Jan Pijpelink
Minister of Fire
The company I work at (100% employee owned) has China among the emerging countries. We export a lot to China (scientific equipment), we are not happy either.
Seasoned Oak
Minister of Fire
Its hard for these countries to accept equal terms ,zero tariffs both ways and a level playing field since they have been exploiting us for so long, but what ever it takes because Robots and AI are just around the corner and we will need to retain all the jobs we can to deal with that alone.
We've been top oil producer for a while now. Manufacturing is down, durable goods orders are down, transportation is down. These are frequent headwinds. And we have an inverted yield curve warning of recession. Consumer spending is doing most of the work right now and if that slumps there will be a downturn.
Jan Pijpelink
Minister of Fire
Define "top oil producer". I know we have a lot of oil from the shale drilling. As a petroleum chemist, I am not a fan of shale drilling.
I was in India in August. A company called Reliance (the 7th largest petrochemical company in the world) has a 2 million barrel per day refinery in Jamnagar. They are currently constructing another 2 million barrel per day refinery and both will be connected to a 4 million barrel plant. Consider the largest US refinery is Motiva with 625, 000 barrels per day.
Also good to know that the same Reliance owned 70% of the Marcella shale project in PA (Chevron owned 30%). Reliance sold their stake late last year. Based on the daily insight information I get, Saudi Arabia is still #1.
I was in India in August. A company called Reliance (the 7th largest petrochemical company in the world) has a 2 million barrel per day refinery in Jamnagar. They are currently constructing another 2 million barrel per day refinery and both will be connected to a 4 million barrel plant. Consider the largest US refinery is Motiva with 625, 000 barrels per day.
Also good to know that the same Reliance owned 70% of the Marcella shale project in PA (Chevron owned 30%). Reliance sold their stake late last year. Based on the daily insight information I get, Saudi Arabia is still #1.
SpaceBus
Minister of Fire
I don't understand why you keep saying other nations are exploiting the US. Walmart and all the other junk stores in the US switched production to China. China has been exploited for their slave labor for decades, before that it was immigrant workers in the US from abroad, and before that it was native peoples of North America. Consumers here are exploited for their money, but hardly for resources. India, China, Taiwan, and many other Asian countries have suffered greatly from western greed. Phones, laptops, and most other consumer goods and electronics are made in Asia, that's exploitation. The Mekong River is blue from dye for Levi's jeans, that's exploitation
Can somebody explain to me how an inverted yield curve warns of recession? I hear the bubble heads on tv reporting it, but dont see how it warns of a recession.
Sawset
Minister of Fire
Z33
Burning Hunk
An inverted yield curve does not cause a recession. It is an indicator of a potential recession.
When the yield curve inverts, short term bonds yield more than long term bonds certerus parabum.
This basically signifies investors are wary of further capital investments and there for buy bonds for the safety.
As demand for these Long term bonds increase their yield decreases below that of the short term bonds causing an inversion of the yield curve.
Long story it's a sign of capital Investment flight. No capital Investment =declining returns.
This is a terrible over simplification with many missing nuances but this is hearthnot an economist forum.
When the yield curve inverts, short term bonds yield more than long term bonds certerus parabum.
This basically signifies investors are wary of further capital investments and there for buy bonds for the safety.
As demand for these Long term bonds increase their yield decreases below that of the short term bonds causing an inversion of the yield curve.
Long story it's a sign of capital Investment flight. No capital Investment =declining returns.
This is a terrible over simplification with many missing nuances but this is hearthnot an economist forum.
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Seasoned Oak
Minister of Fire
China has been charging us 25 % tariffs and up for decades. we have been charging them 3% . Until now no made a serious effort to get a better deal, it was easier to let them keep exploiting us. Japan and South Korea have been dumping millions of cars here for decades while doing everything possible to keep our products out by making them too expensive there.(tariffs, needless inspections ect) Many other countries have tariffs as high as 100% . Ours mostly3% . So thats why. Im not going back 300 yrs to the indians or 100 yrs to the chinese laborors to set trade policy today. Its sad that you have such poor view of your own country ,but you have a lot of company lately. As far as walmart ,yes they are making big bucks taking advantage of our lopsided trade relationship with china. If that improves walmart may have to source mechandise elsewhere or possibly right here.
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True, but many spit out what the TV tells them without looking further into the data.
My oversimplification goes like this:
Price goes up an down with demand on a bond.
Assuming an equal rate (payment) on them, you want the lowest price, which would give you the highest yield.
The talking heads could make the information easier to understand by just stating that more people want bonds and that is driving the price up/yield down.
So, why is there all this demand? What are the yields offered in other parts of the world?
Z33
Burning Hunk
Yields in Europe and most of the rest of the developed world are negative. That's a good portion of what's driving demand for American bonds.
Would you rather have a US 30 year treasury yielding 2.1% or a 30 year Euro zone bond yielding -0.3
Even if the US bond doesn't beat inflation it beats paying a bank to keep your money.
SpaceBus
Minister of Fire
What happens when suddenly you can't pay slave wages to make consumer goods? If you think $1,000 for a cell phone is expensive, just wait until you have to pay someone more than $3/day to make them. You simultaneously want the economy to be like it was in the early 60's, wages to stay the same, but goods to also stay the same. It's just not going to happen. You are absolutely right, I dog on this country a lot, but It's my right. I'm absolutely lucky to be born here, and as a token of my appreciation I joined the army with no intention of getting out. I learned a lot more about my country than I thought I knew. Who cares if Chinese people have to pay a ton of money for American cars? It has nothing to do with giving American companies, which are really global companies, a bad deal. Americans benefits from low tariffs on incoming goods, especially when very little is actually made here. Perhaps the point of the tariffs is to ease Americans into paying what goods should actually cost rather than just increase the prices over night.
I do try to buy American made goods and use US based services whenever my budget will allow. Most of what we eat is grown or raised locally, I shop at small businesses, and do my best to never give my money to large companies whenever possible. I don't hate America or anything, I just hate what our government does to third world countries. Intentionally or not our government causes a great deal of destabilization and mayhem with their constant meddling in global affairs. I'm not saying our government is the only one, just the worst offender. We all want to cry about other nations getting caught meddling in our elections, but several dictators across the world were installed directly by the CIA and other arms of the US government. Most of the time it's not even a secret. Also look at 9/11, regardless if they did it or not, our government gave the Taliban weapons and training, greatly increasing the reach and power of a tiny band of warlords and freedom fighters. THIS IS STILL A PROBLEM TODAY, 30+ YEARS LATER, THANKS CIA!
Seasoned Oak
Minister of Fire
YEA i know its a mess, but its our mess, and its up to us to clean it up. Since this thread is about tariffs ill stick to that. Just because we let it slide for so long it seems that some think we have no right to mess with it. If we do in fact get the trade thing right in most cases, i think it l will bode well for us going forward cuz otherwise we wont have much of an economy left just selling each other foreign made goods. Im for no tariffs either way ,that would be a huge improvement and much closer to that level playing field!
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