Election Year or Fear!

[ramAnag]

So, after the two elections…any thoughts, especially from the more economically literate amongst us, about the reasoning behind and consequences of the orange ogre’s new tariffs?

[MadAmster]

Wanting to tank the economy and thereby the stock market so his rich buddies can buy up everything for next to nothing and own just about everything?

Vance was chuntering on about Europeans/Japanese etc not buying many American cars while the US consumer buys lots of them. Just a thought but, might this be down to a couple of things that stare one right in the face. US cars are, in the main, huge beasts with engines of 4, 5, 6 or more litres which guzzle a lot of petrol and petrol is way more expensive over here? We don't want cars the size of a double decker. Is part of the charm of European/Japanese cars to Americans that they are smaller, easier to park, more reliable and cheaper to run? Is another reason for US cars being less popular in Europe that they are all automatics and we prefer manual? 24% of cars in the UK are automatics, 19% in NL.

[Trickytreesreds]

Could have been worse, we could be in the EU.
Had the politicians got their arse in gear, we could have had a deal with the US the last time trump was in power.

NB, tariffs.
does not Trump have a point that US goods, are tarriffed up to the max all over the world?

From the BBC-

What tariffs do countries currently have?
While most countries have a range of tariff rates covering different goods imports, they also report an average external tariff to the WTO, external, which reflects the overall average tariff rate applied to all imports.

The US had an average external tariff of 3.3% in 2023.

That was slightly lower than the UK's average tariff of 3.8%.

It was also below the European Union's average tariff of 5% and China's average tariff of 7.5%.

America's average tariff was considerably lower than the average tariff of some of its other trading partners.

For instance, India's average tariff was 17%, while South Korea's was 13.4%.

America's average tariff was lower than Mexico's (6.8%) and Canada's (3.8%), though trade agreements between the US and these countries mean that American exports to them are not subject to tariffs. The same is true for South Korea, with which the US has a free trade agreement

But, broadly speaking, it is legitimate for Trump to point out that some countries have a higher average tariff on imports than America's.

[ramAnag]

Could have been worse, we could be in the EU.
Had the politicians got their arse in gear, we could have had a deal with the US the last time trump was in power.

NB, tariffs.
does not Trump have a point that US goods, are tarriffed up to the max all over the world?

From the BBC-

What tariffs do countries currently have?
While most countries have a range of tariff rates covering different goods imports, they also report an average external tariff to the WTO, external, which reflects the overall average tariff rate applied to all imports.

The US had an average external tariff of 3.3% in 2023.

That was slightly lower than the UK's average tariff of 3.8%.

It was also below the European Union's average tariff of 5% and China's average tariff of 7.5%.

America's average tariff was considerably lower than the average tariff of some of its other trading partners.

For instance, India's average tariff was 17%, while South Korea's was 13.4%.

America's average tariff was lower than Mexico's (6.8%) and Canada's (3.8%), though trade agreements between the US and these countries mean that American exports to them are not subject to tariffs. The same is true for South Korea, with which the US has a free trade agreement

But, broadly speaking, it is legitimate for Trump to point out that some countries have a higher average tariff on imports than America's.

Hmmm…but we’re now talking about comparatively huge tariffs and it would seem the US$ has fallen to a six month low this morning on the back of yesterday’s announcements, but then I don’t claim any economic expertise beyond the personal. GP…Swale?

[Andy_Faber]

So, after the two elections?any thoughts, especially from the more economically literate amongst us, about the reasoning behind and consequences of the orange ogre?s new tariffs?

Could you offer a list of who you are excluding there please?

[ramAnag]

Could you offer a list of who you are excluding there please?

Not excluding anyone. Just recognise that that most on here, like me, do not possess a level of economic awareness that fully understands the complexities of international finance/trade wars/tariffs etc. so help from those who do would be appreciated.

[Geoff Parkstone]

Tarrifs are a double edged sword and can either help US industry by increasing domestic demand as home grown is cheaper, but also **** US industry as counter reprisal tarrifs get introduced by export partners. There isn't a simple answer but it's a pretty crude tool most likely used to bring trade partners to a renegotiation table.

The man in the street will suffer as the price of his, say, Mitsubishi, goes up and the government will win as the import duty ends up in their pocket. Industry may win or lose as above.

Like everything in international trade these things tend to even out over time as the tarrifs become fine tuned. Currencies shift in reaction and this may exaggerate the effect (eg US imports become more expensive as (1) tarrif is added to landed cost and (2) the currency depreciates so the USD price increases for the consumer). Equally currency shifts may offset the effect - it all depends on how the money markets respond to the tarrif imposition, net of retaliation. This can also have knock on effect on interest rates etc and inflation.


"The foot bone's connected to the leg bone
The leg bone's connected to the knee bone
The knee bone's connected to the thigh bone
Now I hear the word of the Donald"
.


.

[SithHappens]

So, after the two elections…any thoughts, especially from the more economically literate amongst us, about the reasoning behind and consequences of the orange ogre’s new tariffs?

So all those who voted brexit can say 'finally' a benefit we can shout about.

[ramAnag]

So all those who voted brexit can say 'finally' a benefit we can shout about.

Of course, especially as, at the time of the Brexit referendum Trump hadn’t been elected the first time let alone dumped and then elected a second time. Even the most fervent Brexiteer can hardly claim they saw this coming.

[Ramshank72]

Could have been worse, we could be in the EU.
Had the politicians got their arse in gear, we could have had a deal with the US the last time trump was in power.

NB, tariffs.
does not Trump have a point that US goods, are tarriffed up to the max all over the world?

From the BBC-

What tariffs do countries currently have?
While most countries have a range of tariff rates covering different goods imports, they also report an average external tariff to the WTO, external, which reflects the overall average tariff rate applied to all imports.

The US had an average external tariff of 3.3% in 2023.

That was slightly lower than the UK's average tariff of 3.8%.

It was also below the European Union's average tariff of 5% and China's average tariff of 7.5%.

America's average tariff was considerably lower than the average tariff of some of its other trading partners.

For instance, India's average tariff was 17%, while South Korea's was 13.4%.

America's average tariff was lower than Mexico's (6.8%) and Canada's (3.8%), though trade agreements between the US and these countries mean that American exports to them are not subject to tariffs. The same is true for South Korea, with which the US has a free trade agreement

But, broadly speaking, it is legitimate for Trump to point out that some countries have a higher average tariff on imports than America's.

It misses the point that those are %s, and the cost of goods from for example India, are a lot cheaper than the cost of goods from the US, so the reciprocal value isn't the same %. To "level up", the US will effectively have to produce their own goods, a lot more cheaply, ie lower wages, lower quality of goods. Good luck to them, I think it opens up opportunity for us to leverage trading benefits where the US will have a reduced footprint, but it hurts us all in the short term, and I suspect the US will hurt the most.
Might cash in on some USD while it crashes against the pound ready for our next trip.