Current events discussion

[Jimi77 Premium Member]

This isn't the first time. A good ~10 years ago a college in Denver was caught graduating people that couldn't read or write.

 

[Jimi77 Premium Member]

I don't know exactly how it's all worked out. I assume it's part of discretionary funding, but I'm not positive....and I don't care to look it up.

Which is kinda my point, it's all intermingled. SS is supposedly separate, but they dip their hands into when there is a surplus. I wonder if they'll be so anxious to return that money when there is a shortfall - or will we just resort to more printing money?

 

[Jimi77 Premium Member]

That's not how it works at all. Let's use Walmart as an example because they import tons of stuff to sell. If they're buying a product from China at a wholesale price of $100....in order to get it into the country....they'll need to pay the government the tariff percentage (which would be $125 if the rate is 125%). So in essence.....the Chinese manufacturer will receive the same $100 from Walmart regardless of the tariff rate. But Walmart's costs for that product are now $225 rather than $100 (with the excess going to the government). Walmart has to significantly raise the cost of the product or not import and sell it at their stores.

I think we all understand that that is how this will work. For a real life example, I know a furniture retailer that made agreement with Chinese manufactures that they would split the cost the tariff and keep retail prices the same. That works with a 10-15% tariff, obviously it's impossible with a 125% tariff.

 

[Jimi77 Premium Member]

A person with Delusional Trump Supporter Syndrome would completely fail to see that the excessive tariff plan didn't work the first time around, and historically has not ever worked.

That same person with DTSS would probably not know that the tariff idea was foisted on Trump by a guy who wrote a book about China and tariffs, basing his theories on an "expert" who was a non-existent person.
That same person would probably not know that the non-existent "expert" was sending memos around Washington, lauding the fantastic idea of fighting the world by imposing massive import tariffs on goods.

That same person with DTSS might for some silly reason believe that a US import tariff is paid by a foreign exporter, and they absorb the cost out of the goodness of their heart.

That person with DTSS would likely believe what Trump claims, despite all of the import laws that say Trump is lying, the likes of which can be viewed by any member of the public with internet access.
They would probably believe it if Trump said "tomorrow, you will stop on green, and go on red".

When have I ever said exporters will absorb the cost out of the goodness of their hearts? They have and will absorb small tariffs if they think keeps them in the sweet spot of the supply & demand curves.

 

[Jimi77 Premium Member]

View attachment 64481

Some day traders made a killing in that ~15 minutes.

 

[stocker08 10+ year member]

Which is kinda my point, it's all intermingled. SS is supposedly separate, but they dip their hands into when there is a surplus. I wonder if they'll be so anxious to return that money when there is a shortfall - or will we just resort to more printing money?

Well yeah. SS has a specified funding source through FICA taxes. At the current rate, social security will be insolvent by 2033-2034. So at some point, decisions will have to be made to figure out how to better fund it. Pulling the cap or at least extending it past the current $168k or whatever it is would go a long way.

I think we all understand that that is how this will work. For a real life example, I know a furniture retailer that made agreement with Chinese manufactures that they would split the cost the tariff and keep retail prices the same. That works with a 10-15% tariff, obviously it's impossible with a 125% tariff.

Yeah, a 125% tariff rate is basically just an embargo because at that point....almost everything produced will cost more with the tariff added on top than they'll be able to sell the items for. Going to be particularly messy for any companies that have chinese inputs for the products that they manufacture here.

 

[Jimi77 Premium Member]

No, you literally just do not understand this stuff very well. Setting a reciprocal tariff rate is entirely acceptable. If China sets theirs at 8%....it's entirely reasonable for Trump to set ours at 8%. That's not what's happening here. Trump has shot way past that amount and China is responding by increasing their tariff rates. Trump is trying to get some sort of win at the expense of everyone else. It's not well thought out and makes little sense.

I don't think reciprocal tariffs will work. The system is more complicated than that. I don't blame Trump for trying to get the better end of the deal. China sure AF got the better end of the deal for the last 30 years. We've basically built up there economy and military to get cheap coffee makers - stupid, stupid and stupid.

 

[Jimi77 Premium Member]

Well yeah. SS has a specified funding source through FICA taxes. At the current rate, social security will be insolvent by 2033-2034. So at some point, decisions will have to be made to figure out how to better fund it. Pulling the cap or at least extending it past the current $168k or whatever it is would go a long way.

I agree with lifting the cap. That said, when "they" were raiding the SS trust fund, we were told they would pay it back with interest. Given the state of the budget, it's more likely they'll resort to the money press.

Yeah, a 125% tariff rate is basically just an embargo because at that point....almost everything produced will cost more with the tariff added on top than they'll be able to sell the items for. Going to be particularly messy for any companies that have chinese inputs for the products that they manufacture here.

I don't think the "embargo" will last. Ultimately the message is bring manufacturing back to the US. That said, I do think Trump is missing a golden opportunity to cooperate with Mexico (and Canda?) as trade/manufacturing partners with low/favorable trade arrangements. It might even be as simple as optics - ie if Mexico's tariff is 50% and China's is 125%, then Mexico already has a favorable trade arrangement.

Additionally, I'll maintain that the level of (legal & illegal) immigration we've allowed from Mexico is a huge disservice to Mexico. As far as I can tell the Mexican/Hispanic community tends to be hard working and entrepreneurial, so in essence we've been "stealing" Mexico's best workers and entrepreneurs, etc and left Mexico with an artificially depressed economy that is beholden to cartels.

 

[Jimi77 Premium Member]

In 2024, the US had a trade deficit with China of $295.4 billion, meaning China earned more from the US than the US earned from China, with the US importing $438.9 billion worth of goods and exporting $143.5 billion.
The difference between imports and exports, resulting in a trade deficit of $295.4 billion for the US.

Still think this is fair trade.

It's a bad idea since that trade deficit is building China's economy and military.

 

[Jimi77 Premium Member]

Sony seemingly bakes tariff penalty into its new US TV pricing

The best OLED of 2025 comes at a very hefty price.

www.theverge.com

 

[RobGMN Premium Member]

I don't think that is how it works.

If China sells us a pair of shoes for $100 and there is a 25% tariff they will pocket $75. If they want to make their profit margin China will have to raise the price of their shoes. Which will reflect an even higher price here. The higher the prices rise here the less demand for that product and China will lose money quickly. This means it's time to make a deal.

It's an IMPORT tariff. That means a tariff paid by the IMPORTER.
An EXPORT tariff is paid by the EXPORTER.

To make the above words official, this is taken from the government website. I made an important word bold.

• A tariff or duty (the words are used interchangeably) is a tax levied by governments on the value including freight and insurance of imported products. Different tariffs applied on different products by different countries.
• https://www.trade.gov/import-tariffs-fees-overview-and-resources

China is an EXPORTER when they send goods here. If there is an EXPORT tariff, China would charge the EXPORTER in China.
Trump does not get to set EXPORT tariffs for Chinese EXPORTERS. Trump has no authority in China to do that.

So, Trump puts an IMPORT tariff on goods that get paid by the IMPORTER. An IMPORTER is located in the country where the goods land, to be bought by the consumer.
When the goods land here the IMPORTER has to pay the IMPORT tariff on those goods to the US government. Not coincidentally, the words IMPORTER and IMPORT tariff really seem to go together. The process is much like when you buy a Rolex in Switzerland, then have to pay a duty to US ccustoms when you get here.
With that purchase, you became an IMPORTER, and have to pay the fees. Rolex of Switzerland doesn't pay them for you.

Before, I only had to pay tariffs for goods I imported that exceeded the de minimis of $800. I paid this to the US Government. Now, I will have to pay a tariff for ALL goods I bring in. When the goods get here, the shipping agent will not be calling the seller and asking for the money, they will be demanding it of me before they hand over the product.

So, that carbon fiber bike frame that I got for $500 and was simply delivered to my door before, will now be delivered to my door but will not be left there until I pay the IMPORT tariff of $125. Those funds which go directly from my pocket to the US government.

 

[RobGMN Premium Member]

When have I ever said exporters will absorb the cost out of the goodness of their hearts? They have and will absorb small tariffs if they think keeps them in the sweet spot of the supply & demand curves.

You said that it was "word games" to suggest that importers pay import tariffs, and that it was TDS to say Trump is a liar when he claims (and his sycophants heartily believe) that China is paying import taxes on stuff that we bring here.
You basically denied that the importer pays these costs, thus my line about the Chinese exporters just dropping their prices out of the goodness of their hearts.

If exporters will absorb the hit, and China is placing reciprocal import tariffs on us, that means OUR exporters will absorb the hit.
Where's the win?

If they DON'T absorb the hit, then we just pay more for goods so the gov't can get more money, and the retailer makes more profit.
Winning?

 

[RobGMN Premium Member]

In 2024, the US had a trade deficit with China of $295.4 billion, meaning China earned more from the US than the US earned from China, with the US importing $438.9 billion worth of goods and exporting $143.5 billion.
The difference between imports and exports, resulting in a trade deficit of $295.4 billion for the US.

Still think this is fair trade.

What does the trade deficit work out to, per person?

I keep hearing about or "unfair trade" with Canada, but Canadians outspend the US on an order of 600% or so, when you factor in the population size. They spend in the high $7K per person on American goods, while we spend less than $2k per person on Canadian goods.
Seems like THEY are the ones getting rawdogged in that deal.

 

[Jimi77 Premium Member]

You said that it was "word games" to suggest that importers pay import tariffs, and that it was TDS to say Trump is a liar when he claims (and his sycophants heartily believe) that China is paying import taxes on stuff that we bring here.
You basically denied that the importer pays these costs, thus my line about the Chinese exporters just dropping their prices out of the goodness of their hearts.

If exporters will absorb the hit, and China is placing reciprocal import tariffs on us, that means OUR exporters will absorb the hit.
Where's the win?

If they DON'T absorb the hit, then we just pay more for goods so the gov't can get more money, and the retailer makes more profit.
Winning?

If it pays down the deficit/debt, I'll take it. If this helps bring back manufacturing to America, I'll take it.

 

[Jimi77 Premium Member]

And who probably was most influential in this decision? I'm going to guess a guy that makes electric cars that liberals often refer to as a member of the old German Nationalist Socialist party.

Trump tariff pause sends markets soaring, with S&P 500 seeing one of biggest days since second world war – business live

Trump insists ‘China wants to make a deal’ after raising tariffs to 125% while as 90-day tariff pause for most countries sparks market surge

www.theguardian.com