Trump announces 25% tariff on all imported vehicles!

[BradS1]

Please explain how these tariffs will spur the American economy.
Many people inside and outside the US do not seem to understand, me included.
I do understand the simple maths, but this is not about simple maths.

Thanks in advance, Fabio

In order to avoid the tariff/tax, foreign companies can move production to the US creating domestic jobs/investment... or their countries can cut trade deals which reduces US costs. There is essentially a tax discrepancy. The logic is to use a reciprocal 1 for 1 tax/tariff in an attempt to either cut deals or eliminate the taxes/tariffs all together to spur free trade. No way to know what will happen but that is the fundamental logic of it. I think most countries will come to agreements rather quickly.

 

[BradS1]

The logic only works if you actually believe that the US is disadvantaged in the global trade network. If you actually understand even a little about how the world functions, that false premise is exposed and all subsequent arguments fall apart completely.

Are you suggesting the US isn't at a trade disadvantage? China's competitive advantage is beyond wild. Most other countries will cut deals quickly I'm sure, many have already come to the table.

 

[mcdoogs]

In order to avoid the tariff/tax, foreign companies can move production to the US creating domestic jobs/investment... or their countries can cut trade deals which reduces US costs. There is essentially a tax discrepancy. The logic is to use a reciprocal 1 for 1 tax/tariff in an attempt to either cut deals or eliminate the taxes/tariffs all together to spur free trade. No way to know what will happen but that is the fundamental logic of it. I think most countries will come to agreements rather quickly.

Point proven right here. Actual belief that goods being exported to the US (some by US companies that moved operations overseas) to supply American demand is somehow ‘unfair’ to the US. This is helped by believing that every other country (even the uninhabited ones) has huge tariffs on US exports. They dont, the math on the administrations numbers are here. they hinge on trade deficits, not tariffs.

Last i read, the EU for example had an average tariff duty on US imports around 1%.

I’d have more respect for an argument that is almost certainly closer to reality that went something like “Trump is using trade wars to trigger a recession to force the Fed to lower rates so the market can again”. At least that ones plausible lol and doesnt imply that the speaker actually thinks bringing sweatshops back to America is a good thing.

 

[255/85]

This guy believes you are bang on the money.

Trump is out to destroy the global economic order, and it will cost us all

Donald Trump's tariffs are not a negotiation tactic. They are a very deliberate plan to destroy the liberal global trading and financial system the US itself established. And all of us could pay a heavy price for his attempt to reshape the world order.

www.abc.net.au

Please explain how these tariffs will spur the American economy...

Thanks in advance, Fabio

They won't. Not much anyway. I don't see Americans lining up for jobs stamping out ironing boards or sewing up pants (underwear). That's nostalgic reverie for all the old timers and romantic daydreaming for the Gen Z contingent. Neither demographic is capable of sustained hard work.

From the article cited above:

"Finally, will the aggressive US tariff strategy drive its erstwhile allies into the arms of its adversaries?"

Yep. Trump's compulsive flop-sweat policy changes will result in a kind of nervous exhaustion - like when the boy cried wolf one too many times - and everyone will look for serious partners. BRICS will likely be strengthened in the long run.

 

[BradS1]

Point proven right here. Actual belief that goods being exported to the US (some by US companies that moved operations overseas) to supply American demand is somehow ‘unfair’ to the US. This is helped by believing that every other country (even the uninhabited ones) has huge tariffs on US exports. They dont, the math on the administrations numbers are here. they hinge on trade deficits, not tariffs.

Last i read, the EU for example had an average tariff duty on US imports around 1%.

I’d have more respect for an argument that is almost certainly closer to reality that went something like “Trump is using trade wars to trigger a recession to force the Fed to lower rates so the market can again”. At least that ones plausible lol and doesnt imply that the speaker actually thinks bringing sweatshops back to America is a good thing.

Some of it IS unfair. As it connects to deficits... Reflect on our ability to function during covid, we couldn't even produce a working refrigerator for 2 years. Which is also a component of this move. Many companies are already pivoting, which in time WILL create domestic capital investment. Some of our domestic companies are reshoring their inventory domestically already. Taiwanese chip manufacturing, Nissan, Honda, samsung, lg, domestic companies are pivoting their manufacturing back to the states... We're only a couple of days in...

 

[S52]

Please explain how these tariffs will spur the American economy.
Many people inside and outside the US do not seem to understand, me included.
I do understand the simple maths, but this is not about simple maths.

Thanks in advance, Fabio

Job creation first and foremost. Honda and Toyota have 12 and 10 plants already on US soil. Honda is planning to build another for the next gen civic due to these new tarrifs.

Just those two companies alone have created over 55,000 jobs across multiple states. These jobs all obviously spur the economy. “Simple maths” as you stated.

Lots of $$$ and job creation in construction, maintenance, logistics of these facilities too not even related to the jobs of the factory workers themselves. People will move to these states for the jobs, have families, spend their paychecks, which all combines to bolster the local economies.

BMW, and Mercedes also have manufacturing stateside, and just read an article that Nissan is planning a similar move.

I am hopeful that the big 3 domestics will make the shift out of Mexico and resume operations up here too.

I really hope to see a shift in electronics/ computer production. I have a bunch of retro equipment from the 70’s and 80’s all made right here in silicon valley. Would be spectacular to bring that production back stateside out of the PRC and Taiwan. Thats a huge card up China has on us and the big driver towards a potential conflict with them.

Yeah I get it maybe my iphone will go up in price a bit. But be better all around geopolitically. Also nice to see these companies stop exploiting cheap- practically slave labor in that part of the world.

I am a label checker though, and am happy to spend a few more $$$ for a made in USA product when feasable and it suits my needs.

 

[Jeremy996]

Consumerism is based on the abundant supply of of cheap goods; bringing stuff back into the high cost USA manufacturing sector is more likely to raise costs and reduce demand.

For me it is likely to be a win/win; my personal goal is "Reduce, Reuse , Recycle", which is anti-consumerist, and I bought my Grenadier as a forever car, (buy fewer, better quality goods). Breaking the old trade expectations is likely to accelerate the demise of wasteful consumer obsolescence and potentially drive a move to more quality and craft based goods, (which the USA could be good at, but needs a massive reduction in the economic distance between the working poor and the economic elite).

Whatever happens, I'll be astonished if the USA gets what is being trumpeted by the current incumbent; stagflation and civil unrest seems more likely than the promised sunny uplands. Those of the elite in gated developments had better hope their gate guards are paid enough to consider putting themselves at risk for their betters.

 

[LabRat]

Wouldn't be the first time Americans were underestimated.

 

[DaveB]

Aaaaand you could do that with a real pickup, and not have the 2500 pound payload 80% behind the rear wheels.

There are a number of US style pickups on the roads in Australia but they are really only suited to long distance towing on roads (In Australia)
Our roads, carparks, of road tracks and trails are just not suited to them.

You are correct with the positioning of the payload as many dual cab utes with trays snap at the back
The other problem in Australia is the US Pickups are generally rated as Light Trucks and require a different license to drive and zero alcohol.
Obviously they also have to be converted to RHD.
The Quartermaster chassis is pretty strong and if the load is distributed correctly they should handle this pretty well.
But only time will tell
It also depends on the quality and engineering of the installation

View: https://www.youtube.com/watch?v=u8VhWeDzbQ8&t=62s

View: https://www.youtube.com/watch?v=bXgFifXBPpg

 

[DaveB]

Please explain how these tariffs will spur the American economy.
Many people inside and outside the US do not seem to understand, me included.
I do understand the simple maths, but this is not about simple maths.

Thanks in advance, Fabio

98% of all clothes and shoes sold in the US are imported.
The US has zero capacity to make them, or the components of them.
They could of course build factories to do it but the prices would be unaffordable.
So the countries that do make them just got hit with the highest tariffs.

Of course the US do make some high end very good quality suits and footwear for billionaires.

 

[DaveB]

In order to avoid the tariff/tax, foreign companies can move production to the US creating domestic jobs/investment... or their countries can cut trade deals which reduces US costs. There is essentially a tax discrepancy. The logic is to use a reciprocal 1 for 1 tax/tariff in an attempt to either cut deals or eliminate the taxes/tariffs all together to spur free trade. No way to know what will happen but that is the fundamental logic of it. I think most countries will come to agreements rather quickly.

So Australia has a free trade agreement with the US.
We do not put any tariffs on US goods.
US did not put any tariffs on Australian goods.
US now puts a 10% tariff on Australian goods.
Not sure how we can negotiate to reduce from 0%

The only products we block from the USA,or any other country, are ones that don't meet our health or other standards.

 

[DaveB]

Are you suggesting the US isn't at a trade disadvantage? China's competitive advantage is beyond wild. Most other countries will cut deals quickly I'm sure, many have already come to the table.

Just because Donald says many have come to the table doesn't mean they actually have.
Numerous times he has said that about a certain country/countries only for the leaders of those countries to come out and say "no we haven't"
He never lets the truth get in the way of a good story.

 

[Zimm]

I love how we’re going to magically move a supply chain that has evolved over the past 40 years to include the rest of the world, to the US before the market collapses and there’s no money to move the industry, not to mention, where are all of these people going to come from? The whites the MAGA/Trump/muskets want to run the world don’t have a growing population, and they are tossing out all the immigrants. Hell, they don’t even want the white Ukrainians.

I love all these idiotic conflicting economic theories as to why they are doing this. It’s simple. These are grifters, and crooks whose existence requires an oligarchy, not the rule of law, so they are tearing down the system, and they suckered a bunch of pseudo Christians with the offer of a religious state. And now, the grand experiment dies.

 

[CrazyOldMan]

So Australia has a free trade agreement with the US.
We do not put any tariffs on US goods.
US did not put any tariffs on Australian goods.
US now puts a 10% tariff on Australian goods.
Not sure how we can negotiate to reduce from 0%

The only products we block from the USA,or any other country, are ones that don't meet our health or other standards.

That’s what is so insane - there is a free trade agreement between the US and Australia, and Australia runs a trade DEFICIT. So where is the “ripping off” between these close allies? Is it just a “beef about beef” (that’s a tiny number, and Australia technically opened that market back up). Because there’s basically nothing else where Australia runs a trade surplus with the US. Is it that Trump wants Australia to “take one for the team” and restrict trade with China? None of this makes ANY sense - there is NOTHING to be gained by the US with respect to Australia tariffs.

 

[LabRat]

You mean the system that put us in $36T in debt, without counting in unfunded liabilities at the federal level. That system?

 

[BradS1]

Just because Donald says many have come to the table doesn't mean they actually have.
Numerous times he has said that about a certain country/countries only for the leaders of those countries to come out and say "no we haven't"
He never lets the truth get in the way of a good story.

It is a very complex topic. I could go on and on and on. For every one point someone makes, there is a counter point that is just as valid. Bottom line it is happening whether you approve or not so, if you're investing be prepared to adapt.

 

[DaveB]

You mean the system that put us in $36T in debt, without counting in unfunded liabilities at the federal level. That system?

I agree in principle that the US has serious issues financially, employment, governmental system. etc etc etc.
Something seriously needs to be done and it should probably start with education.

Obviously the people on this forum are far better educated than most so what I am about to say doesn't apply to you/them.
But it takes no effort at all to discover that large portions of the American population have zero education on global issues, or even geography.

Europe is a small area containing many countries and many different languages and cultures, this means they generally learn about global issues.
I know many europeans that speak 2, 3 or even 5 languages and travel to other countries regularly.

In Australia we are an island and import/export regularly and interact with Europe, Asia, Africa and the Americas regularly.
At school we learn the history of Australia but also UK, europe, Asia and the middle east.
We also travel overseas a lot.

I am sure that many Americans actually believe what Trump is saying ....but honestly most people outside the US are just shaking their head and thinking/saying....well that clearly isn't true......how would anyone believe that.

 

[CrazyOldMan]

You mean the system that put us in $36T in debt, without counting in unfunded liabilities at the federal level. That system?

I think our OWN fiscal policies are more than adequate to explain that - we want all the goodies and want to charge it all to credit. The bill has to be paid, eventually. The national debt funds our government spending - NOT trade deficits for the collective economy (which is composed of private enterprises). I’m a conservative (I haven’t ever voted democrat) and got my MBA at the University of Chicago (arguably the academic home for free markets). I never would have thought I would be in this fight with Republicans - it’s like trying to explain remedial economics to a bunch of AOC, bleeding heart liberals - only this time, they’re on “my side.”

I’m unplugging from this whole discussion and will only interact on matters Grenadier. In the meantime, I need to figure out what to do with the carnage that is happening - not the sideline theory from people who don’t actually have to deal with this.

Enjoy the trails, guys - sure hope INEOS can weather this storm, because they have been an answer to prayer - even with the glitches and misses.

 

[NQ94]

There are a number of US style pickups on the roads in Australia but they are really only suited to long distance towing on roads (In Australia)
Our roads, carparks, of road tracks and trails are just not suited to them.

You are correct with the positioning of the payload as many dual cab utes with trays snap at the back
The other problem in Australia is the US Pickups are generally rated as Light Trucks and require a different license to drive and zero alcohol.
Obviously they also have to be converted to RHD.
The Quartermaster chassis is pretty strong and if the load is distributed correctly they should handle this pretty well.
But only time will tell
It also depends on the quality and engineering of the installation

View: https://www.youtube.com/watch?v=u8VhWeDzbQ8&t=62s

View: https://www.youtube.com/watch?v=bXgFifXBPpg


View attachment 7892311View attachment 7892312View attachment 7892313View attachment 7892314

The. LC79 is the only vehicle those photos that is not a factory dual cab. It is a South African conversion.

 

[mcdoogs]

So, wildly optimistic speculation hinging on companies ignoring the economic conditions (that still exist) that prompted offshoring of sweat shop/child labor manufacturing in the first place and spending billions to trillions in collective capital expenditure to ‘on-shore’ manufacturing back to the US? Also you are sure that these theoretical factories are going to include a ton of jobs, and not be as automated as possible, and also not potentially materialize for several years (2028)?

Why is bringing low wage manufacturing back the US a good thing again, in this speculative, hypothetical fantasy?

Btw making absolute bank on $SPY and $TSLA puts last few days and Monday looks like more of the same