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Americans have been warned to brace for higher prices within days of Donald Trump pulling the trigger on Monday, imposing US tariffs on goods from Canada and Mexico and hiking tariffs on China.
Global stock markets came under pressure again on Tuesday, with leading indices falling sharply – and the benchmark S&P 500 losing all its post-election gains – as Canada, Mexico and China vowed to retaliate, and investors balked at the prospect of an acrimonious trade war.
US retail giants predicted that prices were “highly likely” to start rising on shelves almost immediately after a 25% duty came into effect on exports from Mexico to the US.
Most Canadian exports to the US also now face a 25% duty, with a 10% rate for energy products. The Trump administration imposed a 10% levy on all Chinese exports to the US last month, which has now been doubled to 20%. With US retailers relying heavily on imports from Mexico and Canada to stock their shelves, top executives claimed they would have no choice but to increase prices.
Target, for example, relies heavily on Mexican produce during the winter months, and fruit and vegetable prices in its stores could rise as soon as this week, according to Brian Cornell, its CEO: “The consumer will likely see price increases over the next couple of days”, pointing to produce including strawberries, avocados and bananas. “If there’s a 25% tariff, those prices will go up.”
The consumer electronics retailer Best Buy said it expected the new tariffs to make their way along its supply chain. “We expect our vendors across our entire assortment will pass along some level of tariff costs to retailers, making price increases for American consumers highly likely,” CEO Corie Barry told investors.
The US’s largest trading partners have already hit back. Canada retaliated overnight with its own tariffs on US exports worth C$30bn ($20.71bn), from orange juice to motorcycles, and threatened to impose tariffs on a further C$125bn ($86.29bn) wave of US goods later this month. China plans to hit US farm products including chicken, beef, wheat and corn with 15% tariffs from next week. Mexico pledged to lay out its response on Sunday.
On Wall Street, the S&P 500 fell 1.22% and the Dow Jones industrial average fell 1.55%. The FTSE 100 retreated 1.27% in London.
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Comments
https://cnn.com/2025/03/03/business/warren-buffett-tariffs-trump/index.html
Politico on last night's speech (which I did not watch): "Trump also acknowledged his protectionism may create “a little disturbance” within the U.S. economy, but added: “We’re OK with that. It won't be much." Let’s see if those lines come back to haunt him in the months ahead."
If tariffs are 'an act of war', then those countries which have had high tariffs on the US for decades have been at war with the US for decades. Time to fight back, and stop being patsies for other countries. Stop being victims. Of course, blue-inclined voters love to engage in promoting victimhood..
Its a war we cannot win, though Orange will try to get people to think he achieved something. But oh man are they gonna feel at the retail level.
Trump 1.0 implemented tariffs and the economy was phenomenal until the pandemic hit the world. Tariffs built this country in the 19th century by incenting the buildup of industry within our borders. Every thing will be alright. We are gonna get through this.
Costs may -- or may not -- be able to be passed on to consumers. There is no way you or I can know. Neither of us has a crystal ball. The certitude with which predictions are made is interesting.. Supply/demand will adjust, however it does -- as it always does.
More cars (and other things) will be built in this country growing incomes in this country, and adding supply (longer term). Middle-class jobs. In America.
Very interesting sticker shock hitting the lots.
Businesses will do what they always do, they will adapt to the changing economic environment. The only thing that is constant IS change. Medium/large firms -- the ones typically engaged in cross-border movement of goods - have procurement depts, legal depts, supply-chain experts. These people are not idiots (well, not mostly). They know how to adapt to change. They do it all the time. That's what they get paid to do. I know. I am one of those people
Moreover, a simple Google search indicated CEO pay averaged 204X that of the typical US worker -- or $13.8 million/year. If a CEO collecting $13.8MM/year cannot navigate change, then the board needs to fire him/her/they/it.
The sky is (still) not falling, its OK to come out from under the bed.
"Its (not) the end of the world as we know it, and I feel fine... " (REM)
There are many high-priced CEOs who couldn't manage their companies out of a paper bag. CEO salary is not an indicator of their wisdom or management competence.
If the rules of the road (regulations, tariffs, etc) change month-to-month, or hour-by-hour (as they seem to nowdays) that is not a condusive environment for businesses to develop long-term plans and/or seek stability.
First, it's appropriate (for YOU) that you quoted REM to try to drive home your point, as it's a band named after Rapid Eye Movement, you know, a dream-state condition.
LMFAO!
That pretty much says it all. But here's more to the point(lessness) of your post...
Let's just take chips, as I trust you've heard (?), they've been driving stock markets for about two years now, and what's holding back the market this year. So they are a great place to provide an example of what @rforno succinctly and accurately stated.
Here's some comments on tariffs as they relate to that industry by somebody who has elevated his game beyond wild-eyed investment forum posts.
TRY to understand what he says here. I know it's gonna be virtually impossible for you, but please, do at least TRY.
https://www.cnbc.com/2025/03/06/trump-tariffs-live-updates-businesses-warn-of-ripple-down-effects-from-tariffs-because-of-rising-costs.html
Excerpt: (BOLD added):
Trade uncertainty weighing on chip companies, says ‘Chip War’ author
The semiconductor industry is particularly vulnerable to tariffs due to how globally integrated its supply chains are, according to Chris Miller, Tufts Fletcher Schooler professor and ‘Chip War’ author.
Even if chips are assembled in the U.S., many of the components used are not manufactured in the U.S., Miller noted.
“The complexity of the supply chains makes devising a tariff policy around carve outs very, very difficult, which is why the industry is hoping there won’t be any changes at all — because they’ve been structured around the assumption that you can move goods back and forth across borders without this type of tariff uncertainty,” Miller told CNBC’s “Squawk Box” on Thursday.
That said, I'm going to stop reading your posts because I'm losing too many brain cells in doing so.
Assuming Dump is forced to rescind most of his tariffs within days or weeks, what kind of residual damage to the US economy are we looking at?
When you befuddle the public with half-baked policies, businesses tend to freeze purchasing and hiring. People lose confidence and have to curtail spending.
This little short-term experiment could still be costly.
Link
On the matter of tariffs. and companies adapting to them.
https://www.reuters.com/business/retail-consumer/walmart-asks-china-suppliers-price-cuts-trump-tariffs-bloomberg-news-reports-2025-03-06/
Walmart asks China suppliers for price cuts on Trump tariffs, Bloomberg News reports
https://www.pbs.org/newshour/show/as-trump-delays-tariffs-on-mexico-and-canada-businesses-brace-for-repercussions
The market is just nervous because it's anticipating all the wonderful money and profits that will be coming into this country under the current administration's chaotic policies! It's all part of the plan, believe me. And if you happen to pay more for your groceries or electronics or home improvement, just "bear with me" for a while -- you're making America great again, you lovely beautiful patriots!!
Will Russia stand with us after the Europeans circle the wagons? We need Putin, we can trust him. Very trust worthy.
How much will it cost to get my piece of Gaza strip waterfront property? Can I buy it from Donnie direct?
So many questions, so much wasted effort and diversion.
All these damn tariffs, even if they are "paused", are going to test the resolve of the American people. You can't run the country like a corporation, or worse, some kind of bad reality TV show.
It ain't working out.