As if the American consumer and U.S.-based businesses haven’t taken the tariffs on the chin already, many business groups are warning that more tariffs will only make the problems in the economy much more noticeable. With 78% of Americans living paycheck to paycheck, the consumer cannot really afford more pricing increases.
Companies say they have weathered the increases so far thanks to careful planning, but are running out of room to maneuver at the same time that President Trump has threatened to escalate the fight by placing new tariffs of up to 25% on $300 billion worth of goods, according to a report by the Washington Examiner. Businesses are simply running out of wiggle room now. Business owners say that some of the effects of the tariffs have been mitigated so far through careful planning methods such as shifting to suppliers outside China, building up inventory by purchasing goods ahead of when the tariffs would go into effect, and cutting costs. But now, those same businesses who prepared have reached the limits of what they can do in those areas.
That means this trade war could hit your wallet even harder in the coming months.
Financial Experts Warn: Americans WILL Pay The Cost Of A Trade War
“While we have shifted some imports to manufacturers in other countries over the past year, there simply is not the infrastructure to manufacture the volume and quality of items we require other than China,” said Wade Miquelon, president of Jo-Ann Stores, an Ohio-based fabric chain. “Due to the lack of alternate sources, we have no option but to continue to import items from China.” Which means the tariff tax is going to be levied on the American consumer falling on their backs at a time when the economy is on thin ice and most don’t have the disposable income available to pay for the taxes.
“We will have no choice but to absorb the costs of the tariffs and therefore reduce the profits of our company or pass the costs along to the consumer,” said Jay Foreman, president of Basic Fun!, a Florida-based toy company according to the Washington Examiner. “If we get 10% tariffs, we’ll have to reduce our headcount by 10%. If it’s 25% tariffs, then the headcount is reduced by 25%. The money has to come from somewhere.”
A survey released Wednesday by Tariffs Hurt the Heartland, an ad-hoc coalition of businesses calling for an end to the trade war, found that American businesses and consumers paid a combined $6 billion in tariffs in June 2019, up from $3.5 billion the last year. About 75% of the increase came from the tariffs on Chinese products, which currently cover just $250 billion worth of goods. The next round of tariffs set to go into effect in September will cover $300 billion worth of goods. –Washington Examiner
“While we were lucky enough to get our products removed from the previous list they were put back on in the fourth one, so we are now subject to 10% tariffs in September,” said Win Cramer, the chief executive officer of California-based JLab Audio, a technology company. He said he will have to lay off workers or charge higher prices to compensate.
This is basic economics. The charges will always be passed on to the end-user. But in the U.S., there’s so much partisanship with voters putting on political blinders that they won’t notice the damage until products cost more than their unemployment check allows them to spend.
The White House has disputed that tariffs have a negative effect on the economy. Officials have pointed to the economy remaining strong as proof. “These same groups said the same kinds of things when the tariffs began. We’re just not seeing it,” White House trade policy adviser Peter Navarro told Fox News Sunday. But if the economy is so strong, why was a rate cut needed? Why is the retail sector collapsing before our eyes and why are Americans putting basic necessities like food or rent on their credit cards?
https://www.shtfplan.com/headline-news/nearly-25-of-americans-are-using-debt-to-pay-for-necessities-like-food_05302019
It sure doesn’t look like this economy is booming if one takes the time to simply scratch the surface.
That the White House is attempting to say that the reason things haven’t crumbled just yet is a result of the efforts businesses have put into compensating for the tariffs, said Daniel Ujczo, a trade policy lawyer with the firm Dickinson Wright. “I don’t think they [The White House] fully appreciate why companies were able to swallow the tariffs,” Ujczo said. “At this time last year when the tariffs first started to come on, what did most companies do? The overwhelming majority bought around the tariffs. They bought huge inventories. Those inventories are out and companies are now forced to buy items with tariffs when they have been for the last year.”
Jo-Ann Stores.
Is this one of those positions, which you say is not a real job.
Oh noes. They’ve lost the not-a-real-job. The sky is falling.
“That means this trade war could hit your wallet even harder in the coming months”
LMFAO !!! 🙂
Half of all Americans make less than $36k a year before taxes. Half. These Americans are not going to feel anything. They are already numb from the NWO stripping their 70,000 + factories (yeah these are/were factory workers) while Congress facilitated the invasion of America by 40 million foreign nationals.
Now they work retail or work in warehouses. They spend their income on rent (not likely home owners as they don’t make enough money), groceries, nicotine and alcohol. They don’t buy $1,000 i phones every year.
American importers DID buy large quantities of the Chinese products they sell to American Consumers, front loading their inventory. This is what caused the BLIP in the US Trade Deficit the past few months. In the meantime, these same businesses Wally World) began re-sourcing their products from other countries.
I just bought three white casual shirts from WW last week. They were made in Jordan, whereas these same shirts use to be sourced from China. The NWO will move EXCESS world production from China to South America and the Middle East as I have explained here many times.
The Trade War will trigger a recession, but a recession was WAYYYYYY overdue anyway. Then consumers cut back their purchases, which is a good thing, because they have too much CC debt and they stop buying durable goods. This IS the cycle. It happens every time at the end of the business cycle. Nothing new.
TRUMP timed the Trade War perfectly. 🙂
No mention of the yuan allowed to float lower? It makes a big difference on prices.The Chinese have been manipulating their currency for a long time. But they have actually been manipulating it HIGHER in the past. Now that they let it float free and it falls, you hear the Treasury scream “manipulator”. It should actually be even lower if allowed to fall to it’s real, free market value. But this 5% or so drop in the yuan erases half of the new tariffs put on by the US. This is a big reason why prices remain lower than the tariffs would dictate, as a percentage of total price. When the yuan devalues against the FRN, it makes Chinese exports cheaper to buy in dollars. It negates some of the tariff effect on Chinese exports since the US importer pays less and, even after passing some of the tariff cost on to the US customers, it still doesn’t add up to the full 10% or 25% tariff on the local shelves.
When people say China is “Dumping dollars”, what they are really doing is selling dollar assets to stabilize their currency so it doesn’t go lower. The Treasury has been crying about the Chinese not letting their currency float for years. Now, when they do, they are called manipulators. Up is down, black is white, and dogs lay down with cats.
Well said. If allowed to seek it’s market level the Yuan would likely be somewhere between 12 to 18 Yuan to the USD. But hey, don’t worry !!!
It will get there !!! Can you say “CONFETTI” ??? 🙂
Now now be a good slave and vote for us. See everything’s fine. Now now, be a good slave and make our shit in sweatshops and die. See everything’s fine.
Yeah it’s fine if you’re one of those people that thinks a Lambo is a commuter car…
Tariffs are a tax.
By law this originates in
the House of representatives.
In some cases the house of
representatives has delegated
that power to the president.
Section 232 of the Trade Expansion Act of 1962
It is limited and can be reversed
by a simple vote.
Our Democrat house of representatives
hasn’t exercised that power.
Bottom line Tariffs are an additional
tax.
China is not the bad guy here.
American Democrats are the
bad guys.
And just why would the House Democrats stop it? Their entire platform that they run on is based on inflicting scarcity and then handing out lollipops after.
They got nothing else. It’s not in their interest to stop Trump from hanging himself. If the public dies right along with him… well… they won’t ALL die. Probably. Whatever. Dems will get in office so who cares. Free hookers and blow for all of them.
I would be a little more complicit with the line about how the tax on me is helping me have more money, if the tariffs on a specific product supported blighted, US industries, selling that same product.
Rather than making gate rapists, rapist ex cons, and other quota cases a condition of federal bailout, they could use high production values and trad social standards, imo.
Though not purely competitive, subsidies could pay for products designed to last, in a society designed to last. That kind of favoritism might be believable.
For those of us whom are not comfortable buying goods from a communist dictatorship whom uses slave labor, we’re not really feeling anything different with this ‘trade war’, except perhaps finally a light at the end of the tunnel and some hope. I’ve been paying exorbitant premiums for the past 10 years and have put in a disproportionate amount of time and effort to simply source Made in USA or at least not made in China products. For everyone ‘feeling the heat’ of this trade war, well, if you’re so into slave labor go get a damned slave yourself then, or move to china and be one. Support your own cause or pipe down. It’s unbelievable, china has killed more people than hitler and people are still on board buying everything made in china. Every time I turn around, thinking I was getting a decent product, there it is, made in china again. Try hard to avoid this but the positive spin on these issues, we’re really really excited to see products begin to be made available to us, made in places OTHER THAN CHINA. Which slave labor government sanctioned cellular spy device did you choose? Lemmings do what lemmings see. Be a contentious consumer and focus on lasting quality, not bottom dollar cost. Sick of throwing things away lately, and if it’s made of plastic or contains plastic components, we will seek out alternatives if available. This made in USA F&L Classic top grain leather tri fold wallet I just bought online and got in the mail yesterday seems like a real winner, only 40 bucks and I’d bet this one will last me 10, if not 20 years.
The US, and Americans in general, are bloated, wasteful, obese and degenerate. This state of affairs is only able to happen because the world does America’s work.
It is now time Americans get lean and get productive and earn their keep in the world. This means getting rid of EBT cards, the welfare culture, the drug dependency, the fat, mouthy knee grows.
A lean America can thrive again because liberty and America’s advantages are very attractive to people around the world. If America took the money it currently wastes in keeping its knee grow population fat and happy and instead invested this money in well educated and driven Chinese and Indians, America’s economy would soar.
Suck it up, America. Becoming dependent on a communist dictatorship for cheap crap, rare earths, and a slew of other things is about the dumbest thing this country ever did.
Trump is trying to wean us off this insidious relationship.
MAGA!
Chuck