Trump's Tariffs and Possible Trade War

Huckleberry

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I think this issue is important enough to have its own thread. I'll start with a statement from the National Association of Manufacturers:

National Association of Manufacturers President and CEO Jay Timmons released the following statement on the executive orders imposing significant tariffs on imports from Canada, Mexico and China.

“Manufacturers understand the need to deal with any sort of crisis that involves illicit drugs crossing our border, and we hope the three countries can come together quickly to confront this challenge.

“At the same time, protecting manufacturing gains that have come from our strong North American partnership is vital. The success of President Trump’s landmark trade agreement, the United States-Mexico-Canada Agreement, has strengthened North American supply chains and bolstered economic power across the region, boosting jobs, wages and investments here in the United States.

“Thanks to this agreement, one-third of critical U.S. manufacturing inputs now come from Canada or Mexico, rather than from competitors like China that often engage in unfair trade practices.

“However, with essential tax reforms left on the cutting room floor by the last Congress and the Biden administration, manufacturers are already facing mounting cost pressures. A 25% tariff on Canada and Mexico threatens to upend the very supply chains that have made U.S. manufacturing more competitive globally. The ripple effects will be severe, particularly for small and medium-sized manufacturers that lack the flexibility and capital to rapidly find alternative suppliers or absorb skyrocketing energy costs. These businesses—employing millions of American workers—will face significant disruptions. Ultimately, manufacturers will bear the brunt of these tariffs, undermining our ability to sell our products at a competitive price and putting American jobs at risk.

“We stand ready to work with President Trump to ensure a trade strategy that reinforces American strength—holding bad actors accountable while preserving the gains of the successful USMCA and advancing policies that sustain manufacturing growth here at home.”

 

Huckleberry

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From Brian Mann, NPR's first national addiction correspondent:

President Trump explained his tariffs in part by pointing to the carnage caused by #fentanyl. That's my area of expertise so here's my fact-check of the White House fact sheet released today.


Fatal overdoses, from fentanyl and all other street drugs, have dropped nationally by more than 21% since June 2023, according to the latest CDC data, falling below 90,000 deaths in a 12-month period for the first time in roughly half a decade.

President Trump has repeatedly said “300,000 people a year ” are dying from illegal drugs smuggled from Mexico. This number is starkly wrong. At its worst in 2022-2023, fatal overdoses peaked at around 114,000 per 12-month period. Fatal overdoses are now much lower.

The President’s fact sheet explaining these tariffs says 75,000 U.S. deaths per year are currently attributable to fentanyl. The latest CDC data suggests the current level of street fentanyl overdose mortality has dropped to around 58,000.

Canada’s role in fentanyl smuggling to the U.S. is extremely marginal. PM Trudeau describes it as less than 1%. Last year according to the DEA, 43 lbs of fentanyl was seized at the northern border. That compares with roughly 21,000 lbs. seized at the southern border.

CDC data shows the drop in drug deaths before these tariffs were not only unprecedented--the declines were (and apparently still are) accelerating. Some states have seen a 30-50% drop in drug deaths since the summer of 2023.

China is now suggesting it will retaliate against US tariffs by curbing cooperation on anti-fentanyl efforts. Foreign Ministry: “Imposing additional tariffs is not constructive and will inevitably affect and damage future cooperation between the two sides on drug control.”

Finally, according to the U.S. DEA, the amount of fentanyl entering the U.S. and its potency were both already dropping sharply in 2023 and 2024 before these tariffs. Independent drug policy experts generally agree this trend was and is real: https://www.dea.gov/press-releases/...al-family-summit-fentanyl-highlights-progress
 

Huckleberry

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Washington Post gift link

Here’s what could get more expensive with Trump’s new tariffs signed today
President Donald Trump’s tariffs against Canada, Mexico and China could target over 40 percent of all imports.

President Donald Trump signed orders imposing tariffs on products from Mexico, Canada and China on Saturday — a move that could significantly increase prices on goods from three of America’s most important trading partners.

Since taking office, Trump has threatened tariffs on an array of trading partners, including Europe, Russia, Brazil and India. His threatened tariffs of up to 50 percent on Colombian goods, after Bogotá’s government refused to allow U.S. military aircraft carrying deported migrants to land, got the Colombian government to agree to his terms. The three executive orders signed Saturday are the first tariffs officially enacted by the president in his second term.

Tomatoes, T-shirts, crude oil and cars are among the items that could get more expensive with the new tariffs, according to a Washington Post analysis of international trade data from the Census Bureau.
Mexico is the largest source of imports to the United States, followed by China and Canada. Together they account for 43 percent of the $3.1 trillion in goods that are imported.
 

JDCrimson

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Thanks for starting this thread as its a serious issue and will likely result in more food insecurity for the lower income in our country.

The last time Trump did this he had to spend $25b bailing out our farmers as our buying partners retailiated by levying tariffs on our ag goods. It will be the same this go around as well. Our ag markets have not fully recovered since the last time he did this. Many of our buying partners have moved on to other markets like South America for their ag goods. Corn and cotton are currently trading at prices well below breakeven. This influences the cost of consuming commodities like livestock.

So where are we on the eve of Trump Tariffs 2.0...

On the Frontline of the Bird Flu Outbreak - you literally cant buy an egg anywhere at any price. Think RFKJr will allow poultry vaccination which appears to be the only viable aolution out of this bird flu outbreak?

Cattle Inventory Falls to Lowest Level in 64 Years - Cattle are selling at 3x their price pre-covid. Most cattle farmers are older and looking at retirement and their kids moved off the farm. Prices will stay high.

Screw worm Outbreak - Then there is the screw worm outbreak that is furthering threatening the import of beef. South American governments became unstabilized which resulted in increased immigration but also poor inspection and quarantine efforts of screw worm in cattle.

Where precisely is Trump going to find the labor to replace the retiring Boomers in our workplace? Managing through Boomer retirements was already going to be a gigantic problem economically. Now we are just clubbing ourselves with tariffs topping this off.

These tariffs will be highly inflationary imo.
 

Huckleberry

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“President Trump campaigned on lowering prices for Americans, but this could have the opposite effect ... Experts say these tariffs could cause American families to pay $830 more on average this year.”



Canadian Prime Minister Justin Trudeau and Mexican President Claudia Sheinbaum both responded Saturday evening to the imposed tariffs.

Trudeau said Canada will implement 25% tariffs on $155 billion of U.S. goods.

"This includes immediate tariffs on $30 billion worth of goods effective Tuesday, followed by further tariffs on $125 billion worth of American products in 21 days," the prime minister said.

Trudeau encouraged Canadians to read labels at the grocery store and choose "Canadian rye over Kentucky bourbon," forgoing orange juice from Florida and "changing summer vacation plans" to visit places within Canada.

Sheinbaum said she has instructed officials in her government to implement Plan B, "which includes tariff and non-tariff measures in defense of Mexico's interests."

Canadian Ambassador to the U.S. Kirsten Hillman told ABC News' "This Week" on Sunday that Canadians expect their government to "stand up for itself."

"I don't think we're not at all interested in escalating, but I think that there will be a very strong demand on our government to make sure that we stand up for the deal that we have struck with the with the United States," she said.

The tariffs imposed by the White House could raise prices for an array of products ranging from avocados to tequila to auto parts.
 

JDCrimson

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Low income people spend most of their income on food and they spend money on buying auto parts to repair their car because the cant afford a new one. And medicine too.

If you are not in the top 5% economically Trump does not care about you. It's the Age of the Robber Barron 2.0.
 

tusks_n_raider

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None of this is about drugs and it's intellectually insulting that it is being presented this way.

(Not your info OP but the way it's being presented to the public)

Trump is just going to end up making enemies of all our allies until we have nothing but enemies all while the 99% get poorer and the 1% get richer.

He's not going to stop or slow down drug abuse by doing any of this.

We are going to be closer to the beginning of WWIII than the end of Drug Abuse.
 

UAH

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Anyone who has been involved in international trade must become knowledgeable about the global Harmonized Tariff Schedule that must be included to identify the specific product included on every Bill of Laden in any international product shipment.

That is why this appears to be so pathetically dumb to apply tariffs as a set percentage across all shipments and and apply it to irreplacable food items from Mexico such as avocados and vegetables and patroleum from Canada.

It defeats the purpose of addressing Chinese and other products being trans-shipped (hypothetically) across our borders. Of course Trump has no idea how dumb this appears to our long term trading partners.

Obviously a lot to discuss regarding China!
 
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dWarriors88

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As soon as I heard Trudeau's speech I sold half of my crypto holdings, all in profits. Lock those greens in and pick up when this bubble burst. My 401k's been in MMKT for about a year now about 80% . I've been anticipating a correction/collapse in the markets and I think the scary's from the "Deepthink" saga last week was the biggest signal indicator of my thesis. We are declaring Trade War and the Bear's are coming out hibernation.
 
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Huckleberry

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Brussels vows ‘firm’ response to threatened Trump tariffs as EU braces for trade war
European Commission says the bloc “regrets” new U.S. tariffs on Mexico, Canada and China.


The European Union is warning U.S. President Donald Trump the bloc will retaliate if he imposes tariffs on EU goods.

The European Commission, the EU’s executive body, said it “regrets” Trump’s decision to impose blanket tariffs on Canada, Mexico and China on Saturday. The U.S. president has vowed to take similar measures against the EU.

“Our trade and investment relationship with the U.S. is the biggest in the world. There is a lot at stake,” a Commission spokesperson said on Sunday. “Tariffs create unnecessary economic disruption and drive inflation. They are hurtful to all sides.”

Nevertheless, the spokesperson said, “the EU would respond firmly to any trading partner that unfairly or arbitrarily imposes tariffs on EU goods.”

France’s Industry Minister Marc Ferracci went further, demanding a “biting” response from Brussels, which manages trade relations on behalf of the EU's 27 member countries.

"Trade negotiations with Donald Trump must assume a form of power dynamic," Ferracci told France Info on Sunday.

Given Trump's threats to impose tariffs against the EU, “it is obvious that we must react,” Ferracci said, although he added that “we are waiting for the American administration’s decisions on what will concern Europe.”

Ferracci added that for countermeasures to be effective, “the response must focus on products that are important” to the U.S and that "it must be 'biting,' meaning it should have an impact on the American economy to have a credible threat in negotiations." He called on Brussels to not be naive and draw up a “Buy European Act.”

German Chancellor Olaf Scholz stressed the benefits of open trade, but at the same time hinted that the EU has the ability to respond to any potential moves by the U.S.
 
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75thru79

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As soon as I heard Trudeau's speech I sold half of my crypto holdings, all in profits. Lock those greens in and pick up when this bubble burst. My 401k's been in MMKT for about a year now about 80% . I've been anticipating a correction/collapse in the markets and I think the scary's from the "Deepthink" saga last week was the biggest signal indicator of my thesis. We are declaring Trade War and the Bear's are coming out hibernation.
Dude, you've lost a ton of return since you sold everything a year ago. My advice to you is to never try to time the market. It's just too hard and rarely works out. These bumps are normal. As long as you aren't in your 70's and need the money to survive it is almost always better to stay invested. Just shift your holdings into blue chips rather than a money market.
 

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