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Financial Experts Warn: Americans WILL Pay The Cost Of A Trade War

Mac Slavo
July 18th, 2018
SHTFplan.com
Comments (27)
Read by 2,118 people

With most of the media in a tailspin over the tensions between the United States and China because of a trade war, many are missing the bigger picture.  Financial experts have been sounding the alarms, but no one appears to want to hear that it isn’t possible to win a trade war.

Everyone loses when you use goods as ammunition in an economic war and the idea that the United States can win a trade war is pure foolishness, according to Seeking Alpha Tariffs are a form of taxation that ultimately is paid not by the exporter, but by the U.S. consumer. If you want to see who the real victims of tariffs are, go look in the mirror.  Of course, that isn’t something those residing in the U.S. want to hear but it is nonetheless necessary to be aware of this fact. Sadly, most analysis of the trade situation does not reflect this hard truth and most have no idea just how hard their wallet could be hit. 

As China and Europe get dragged into a tit-for-tat battle, more and more consumer goods are likely to be targeted, making the effects of tariffs felt much more in the pocketbooks of Americans. We may soon find that the impact of tariffs on our economy will take away many of the benefits of the fiscal stimulus that was passed in last year’s tax bill. 

The other glaring concern is that both leaders involved in and leading two powerhouses down a path of economic war don’t seem willing to end it anytime soon. With neither the Chinese president nor U.S. president Donald Trump about to blink, this tariff battle could ultimately turn into something much bigger and worse than we imagine. For the time being, Seeking Alpha doesn’t see any way for the U.S. is going to back themselves off of the trade cliff of their own making.

This is unfortunate because while the focus on China and automobiles is no accident in the administration’s drive to reduce the trade deficit, the effect will be felt across all sectors of the economy.  Take, for example, the Uber driver who needs to buy a new car.  Because the cost of that car has increased and the tariff has been passed onto the Uber driver, there are two options: the driver can make less money overall, or pass that cost onto customers in the form of higher prices for services. It really isn’t all that difficult to see that the end user will pay for the tariffs which will get passed on.  Expecting China to pay the tariffs is like expecting the rich to allow their money to be voted away. It just doesn’t work that way.

Using tariffs as a policy tool is a game that no one can win. Tariffs on imports from China are not a tax on Chinese citizens, they are a tax on Americans. (So are tariffs on imports from Canada, Mexico, and Europe). Yes, China will export less so it will hurt them too, but the cost of it is being born by citizens in the United States and the cost is a lot larger than the tariffs being threatened on $250 billion of imports from China.

One thing is certain—wars are not fought without cost, and Americans will bear their share of the cost in fighting this war. –Seeking Alpha

The bottom line? No one wins a trade war.

 

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Author: Mac Slavo
Views: Read by 2,118 people
Date: July 18th, 2018
Website: www.SHTFplan.com

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27 Comments...

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  1. Anonymous says:

    We should go back to the gold standard to solve the balance of trade and balance of payments deficit (ever increasing debt to those nations we have a deficit with).

    They send us a trillion dollars in goods and we pay them off with 500 billion in goods and 500 billion in gold bullion to keep the accumulated trade deficit (debt) at zero.

    Problem solved, everything comes out even.

  2. Off topic:

    Today is the anniversary of Nelson Mandela. Mandela was an avowed Communist, racist murderer. No wonder idiots across the USA worship him.

    _

    • The Deplorable Braveheart says:

      B, may Nelson Mandela burn in hell forever.

    • durangokidd says:

      Considering that APARTHEID discriminated against South African Blacks in their own homeland making them less than citizens and more like slaves; with the full approval of the USA I might add, it is little wonder that Mandela looked to Communism for equality ….. and the funds necessary for liberation.

      Mandela was an attorney, and at his essence, Mandela was a FREEDOM FIGHTER in the true sense of the word,seeking equality. I would hope that others here would understand that.

      The enemy of my enemy is my friendif he is fighting my foe. 🙂

  3. Heartless says:

    I tend towards an isolationist viewpoint. I would like to see our nation be self-sufficient for all necessary products, foodstuffs, utilities, education, medical needs, transportation, military needs and anything else I’ve left out. As for our ‘toys’…. come on folks, we can make our own. The only exceptions to the above would be raw materials we do NOT have here in our 50 (+ territories) states. Most of what we are embarking on a trade war in terms of goods are things we could, should and would make for ourselves.

    • Archivist says:

      The US can mine all the minerals and metals used in industry, except for chromium. That comes from Africa. We already produce more food than we can eat. There are unused factory buildings all over the country. With modern methods, those factories can be remodeled to produce whatever we need efficiently.

      Of course the American consumer will have to pay for all of this ultimately, as we pay for everything anyway.

      If they would do it, the government could eliminate income taxes and finance everything through tariffs like they used to do before the income tax.

      We can win a trade war.

      I’d be willing to pay more to get better quality American-made goods. Very little good quality merchandise is available in my town any more. I’m tall, so I can’t even buy clothes at all here. It’s sad that almost the only thing I can buy here is food.

    • Norrak says:

      This is what I’ve been saying for years now, since 1992. Money should be invested in bringing back manufacturing to the USA. We can produce everything we need. I’ve already stopped buying anything made in China years ago, it can be done by everyone if you will do it. Won’t need any tariffs, just simply stop buying Chinese goods. China and other countries need our foodstuffs. They can’t raise enough for their high numbers of citizens. They will be begging us for our products and technologies, that is if our treasonous politicians will stop screwing the American people over. I won’t buy anything from China even if I have to tie rags on my feet for shoes.

  4. True Grit says:

    You forgot to mention the cost Americans have already paid in the ongoing trade war with China.
    56 million manufacturing jobs lost!
    90 million out of the work force!
    Millions of homeless in cities all across the country!
    Nah, We tried it your way. We lost! You can cite all the Pedigreed Parrots you want to get your desired sentiment on “Trade War” I say we start fighting back!!
    M.A.G.A. God Bless You President Trump!!

    • 2018 Is Now says:

      Federal Reserve took down the economy long before Trump.

    • Maranatha says:

      We’ve been fighting the globalists since Nixon went to China and flooded the country with slave labor goods.

      The only viable option is isolationism. They cannot feed the world like we can PLUS we have the weapons. What we lack are new soldiers as 75% of Millennials can’t pass basic training. Ultimately this means we cannot maintain our bases with personnel and to do so would mean a LARGE rise in pay. It’s basic economics when you lack the personnel, you pay more in wages to attract them.

      Believe it or not, an average Millenial boy is equal in strength to a girl. I am serious. They did a study of grip strength and Millenial boys (I refuse to call them men) were weaker than their fathers and the girls were equal to their mothers. And in comparison to each other, the Millenials across the sexes were identical!

  5. Nonsense..the so called experts never saw the crash in 09, or the housing bubble, or the decline of bitcoin.
    China, has built whole cities that are vacant. Their banking system is fraught with deceptive books. They had a steel or aluminum scam.They depend on us buying substandard products, we all know who sells them.
    Enough of this… We need to rebuild our manufacturing base and become self sufficient vs increasing our deficit with China… buying teash….

  6. Asshat says:

    Being a consumer is a losing battle for the individual. You buy a product use it then it breaks and you go out and buy another one. The engineers and designers of products work to make this cycle happen faster to keep their $ wheel turning. They even make their products in compatible with other manufacturers of the same product so you have to go back to them. They rig the prices so it’s not worth trying to save a buck when you will have to go way out of your way to. Yes your going to consume but you don’t have to be a slave to it if you live simple. Trade war isn’t gonna affect me cus I don’t rely on consumer shit as it is now and I can do with much less going forward.

  7. Feckless Sweat says:

    WARNING: There is no such thing as a financial expert…..

  8. Anonymous says:

    For years now China has subsidized some of their certain industries to be able to drive the same American industries out of business. Either we fight back or kiss our industries good bye. China does not play fair and never will unless Trump forces them to.

  9. Traitor Hator says:

    Seems their are a lot of players in this game. The domestic enemy is a big one. One we seem to always disregard?

  10. Traitor Hator says:

    Paying the cost , will go up, But the Tares burn in the end, A hard won tribulation? Bring it on.

  11. TharSheBlows says:

    The US manugacturing base has be Raped, pillaged and sold off ti china along with ppatent blueprints and machine ne tooling. Its been that massive sucking sound if Trade imbalance since the 1980’s. What did you expect with free open trade and NAFTA.

    TRUMP is just trying to restore some balance and the elite profit margins just got squeezed and they are whining like baby tantrums. Spano em hard Trump. Demand in the US will create manufacturing jobs and we will again produce products here. Good for America, lets start willing again. MAGA!!

  12. Freeholder1776 says:

    We in the US have been losing a trade war for decades. Unfair tariffs on our exports by China and most other countries saw to that. Idiots who won’t take the time to buy American whenever they can helped push the cart over the cliff. The result was manufacturing jobs fled overseas, our plants closed and unemployment skyrocketed.

    Imposing tariffs to balance that inequity may hurt consumers here short term, but if American made goods end up priced the same as foreign made goods more Americans will buy them and that will lead to more good paying jobs as companies come back to the US.

    Long term we will win the trade war. If for no other reason than we can feed ourselves and be energy independent.

  13. the blame-e says:

    Nobody ever wins a trade war. That’s not to say that we have not been in dire need of one. For a very, very long time the US has borne an unfair burden in almost every trade and treaty agreement out there.

    The shipping companies are getting creamed. Hanjin Shipping went belly-up a while ago mainly due the Crash of ’08 and the (continued and lingering), death of the American Middle Class. Maersk Shipping is in deep financial trouble; the company may capsize any day.

    Look at NATO. The US cannot even get its deadbeat allies to even cough up a measly 2-percent towards carrying their fair share of the cost to protect themselves from a third World War.

    I am tired of my country getting screwed over and over and over again. As far as the trade wars go I say “bring it.” As far as nullifying unfair treaty agreements I say “bring it.”

  14. When an appliance breaks down, we are all forced to decide on repairing of replacing the appliance. I’m convinced that appliance makers have been trying to make it impossible to repair their appliances. If you’re like me and try to squeeze more years out of your appliances, you’re going to find it difficult. The tariffs are on appliance parts as well on the appliances, assuming you can get them.

  15. Phoenix says:

    um, if I’m not mistaken, the asian cars come from Japan (honda, toyota) and korea (hyundai, kia)… What the hell has China got to do with cars? Parts are built in mexico (reman calipers, for example) and taiwan (mopar parts). I think the author needs to do some more research in order to state the correct facts.

    • durangokidd says:

      China puts a major tariff on American cars and car parts produced in the USA and shipped to China, giving local Chinese manufacturers a BIG advantage.

      Honda and toyota produce their cars in the USA, for sale in the USA. Honda even produces itys executive jet in the USA. Only $4.5 million.

      Buy two !!! 🙂

  16. runna muck says:

    we see how long your trade war lasted about 5 days

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