my take on tariffs
2 responses | 0 likes
Started by bear - May 6, 2018, 4:23 p.m.

just a few random thoughts on an example...

if america were to impose a tariff on shoes coming in from china.  depending on how high the tariff is,... it would mean that there are more factory jobs for americans who want to make shoes,  but also shoes would cost more for the consumer.  so producers would benefit,  but consumers would be hurt.

if there is no tariff,  then consumers benefit,  but producers would be hurt by the low cost competition.  

this is true whether we are talking about shoes or cars,  whether china or mexico.  

so which is more important,... having factory jobs available to make shoes in america,  or having cheap shoes for consumers to buy?  

i could charge more for my honey if there is not so much cheap honey coming in from 3rd world countries.  

do you want better paying jobs and higher prices?  or lower paying jobs and cheaper prices?  

my main gripe is when the system is not balanced.  if we charge 2,500 per car for cars coming in from europe,  but europe charges 10,000 for cars coming from america,... that needs to be more even and balanced.  

the current problem,... is trumps tariff talk like a poker bluff that is just meant to sway the opponent in our favor?  or will it end up hurting our position economically ?  i am not sure yet which way it will go.  

By metmike - May 6, 2018, 9:57 p.m.
Like Reply


Tons of uncertainty on the tariffs.

On the beans for instance, China is buying more of their beans from South America to try to punish the US.........but they are punishing themselves because we live in a global economy.

The big increase in SA beans from China is pushing SA bean prices higher. So when SA bean prices go higher, it increases demand from the rest of the world for the cheaper US beans.

China is by far the biggest buyer of beans but they can't set the price. By purchasing more expensive beans from SA to spite the US and its backfiring on them. 

By bear - May 7, 2018, 11:40 a.m.
Like Reply

of course if china buys from SA, that does not change total supply,  or total demand for beans.   so it should not have a substantial effect on price.  maybe only a blip,  but no big trend change.