Trump Suggests Tariffs Could Be Placed on iPhones and Laptops Imported From China

[pshufd]

Looks like a miscalculation on the Chinese side: https://www.wsj.com/articles/why-ch...-in-trade-talks-11557358715?mod=djemalertNEWS (paywall)

The new hard line taken by China in trade talks—surprising the White House and threatening to derail negotiations—came after Beijing interpreted recent statements and actions by President Trump as a sign the U.S. was ready to make concessions, said people familiar with the thinking of the Chinese side.


High-level negotiations are scheduled to resume Thursday in Washington, but the expectations and the stakes have changed significantly. A week ago, the assumption was that negotiators would be closing the deal. Now, they are trying to keep it from collapsing.


Adding to the pressure, the U.S. formally filed paperwork Wednesday to raise tariffs on $200 billion of Chinese goods to 25% from the current 10% at 12:01 a.m. Friday. Beijing’s Commerce Ministry responded by threatening to take unspecified countermeasures.

It's pretty clear that China negotiated in bad faith but what do you expect from the Chinese?

 

[stylinexpat]

I for one think it's great, the extra money goes into the government coffers and government deficits. We all need to pay more taxes.

When they need more money they can easily print it. Don't worry about them needing money. FED does not need to work 40 hours a week to come up with $500. They collect taxes from over 350 million people every day and they are still in debt. They were in debt before we were born and will remain in debt after we die.
[doublepost=1557362968][/doublepost]

Trump is not a free trader. He's a guy who likes tariffs. Not even his party stands with him on that, in fact they're tearing their hair out because he's laying waste to the support of heartland farmers they need in the 2020 elections.

Trump is just a guy who picked up an idea 50 years ago and thinks he can still run with it. He's running on a field with at best a team of maybe one now (Navarro, if he's even still around) who's dumb enough to try to pass that ball labeled "Just lay on tariffs!" in the era of global trade.

Still, many a guy in his admin has discovered that if you try to argue about tariffs with Trump you will lose the argument because he's not listening and can say "Get out of my office" and make it happen when you want to try one more time to reason with him -- even if you bring him one page charts or PICTURES or whatever. His mind is made up about trade. Tariffs. Tariffs.

The only way around his fetish for tariffs is be like his envoy Lighthizer who tries to keep the details off the front page so Trump doesn't realize there are not really any sky high tariffs on the table a day at a time in negotiations the US is actually engaged in.

Even so, stuff gets past the watchdogs. Somehow Trump and probably some golf buddy in Florida got that 17% Mexican tomato tariff suspension agreement erased as of today, so a hundred bucks worth of tomatoes that didn't get over here last night now costs $117. No big deal now but by October tomatoes will cost a consumer 80% more once Florida's major crop season is over.

Cut that in half for wholesale and imagine what it will cost to make pasta sauce from October to June... and how unhappy pasta sauce makers will be considering supermarket margins are tiny and no market wants to handle a price jack from any supplier

So another sector skates away from support of Mr. MAGA Trump.

And the Florida tomato growers are suddenly surprised to realize that guess what, fastest-growing tomato exporters since 2013 were: Azerbaijan (up 281.9%), China (up 157%), Portugal (up 73%), Morocco (up 34.5%) and Netherlands (up 16%). source

Ya think maybe a US produce importer for supermarkets can persuade a Moroccan exporter to undercut a 17% duty on a Mexican tomato and past that come in under the price of one from Florida?

If their overhead expenses were not so high here in the US then they would not have to worry about being undercut by other suppliers from other countries. What affects cost in the US is the government and not the actual supplier/farmer. You have high transport costs, high labor costs and high farming expenses due to government regulations along with water expenses which the government controls.

 

[pshufd]

When they need more money they can easily print it. Don't worry about them needing money. FED does not need to work 40 hours a week to come up with $500. They collect taxes from over 350 million people every day and they are still in debt. They were in debt before we were born and will remain in debt after we die.
[doublepost=1557362968][/doublepost]
If their overhead expenses were not so high here in the US then they would not have to worry about being undercut by other suppliers from other countries. What affects cost in the US is the government and not the actual supplier/farmer. You have high transport costs, high labor costs and high farming expenses due to government regulations along with water expenses which the government controls.

The Fed is actually shrinking the money supply through quantitative tightening.
[doublepost=1557363201][/doublepost]WSJ:
China Threatens Retaliation as U.S. Files Paperwork to Raise Tariffs

In a tweet on Wednesday, Mr. Trump said that “China has just informed us that they…are now coming to the U.S. to make a deal. We’ll see, but I am very happy with over $100 Billion a year in Tariffs filling U.S. coffers.”


The U.S. isn’t collecting $100 billion a year in tariffs. In the first six months of the government’s fiscal year, the U.S. collected $34.7 billion in tariffs, though an escalation of tariffs such as that planned for Friday could get the figure closer to $100 billion.

https://www.wsj.com/articles/u-s-fi...557323595?mod=hp_lead_pos3&mod=article_inline (paywall)

 

[stylinexpat]

The Fed is actually shrinking the money supply through quantitative tightening.
[doublepost=1557363201][/doublepost]WSJ:
China Threatens Retaliation as U.S. Files Paperwork to Raise Tariffs

In a tweet on Wednesday, Mr. Trump said that “China has just informed us that they…are now coming to the U.S. to make a deal. We’ll see, but I am very happy with over $100 Billion a year in Tariffs filling U.S. coffers.”


The U.S. isn’t collecting $100 billion a year in tariffs. In the first six months of the government’s fiscal year, the U.S. collected $34.7 billion in tariffs, though an escalation of tariffs such as that planned for Friday could get the figure closer to $100 billion.

https://www.wsj.com/articles/u-s-fi...557323595?mod=hp_lead_pos3&mod=article_inline (paywall)

It is possible that they are shrinking it as they printed and bought so much the last 10 years and Trump recently called for more and an increase in QE.


What Trump said below was what he hoped would do against Iran and Palestine if he became President which of course he did do (to abandon previous agreements agreed upon by prior administration and other world leaders) so it's only OK if he does it but not others
Trump said China is hoping that, if a Democrat is elected president in the 2020 election, the new administration will abandon the aggressive trade rhetoric.

 

[pshufd]

It is possible that they are shrinking it as they printed and bought so much the last 10 years and Trump recently called for more and an increase in QE.


What Trump said below was what he hoped would do against Iran and Palestine if he became President which of course he did do (to abandon previous agreements agreed upon by prior administration and other world leaders) so it's only OK if he does it but not others
Trump said China is hoping that, if a Democrat is elected president in the 2020 election, the new administration will abandon the aggressive trade rhetoric.

The Fed always wants to normalize so that they have ammunition for the next recession.

Janet Yellen always talked about raising rates back from 2013 to 2016 and they never were able to because the economy was so weak. They started raising and going from easing to tightening when Trump came in. You recall Powell as in super-hawkish mode in 2018, even when the economy showed that it was clearly slowing down. Then in late 2018, he realized what the markets realized five months prior - still he didn't cut rates nor did he end quantitative tightening - he only talked about ending it. It ends in September - still at higher levels than the Fed wanted.

 

[stylinexpat]

The Fed always wants to normalize so that they have ammunition for the next recession.

Janet Yellen always talked about raising rates back from 2013 to 2016 and they never were able to because the economy was so weak. They started raising and going from easing to tightening when Trump came in. You recall Powell as in super-hawkish mode in 2018, even when the economy showed that it was clearly slowing down. Then in late 2018, he realized what the markets realized five months prior - still he didn't cut rates nor did he end quantitative tightening - he only talked about ending it. It ends in September - still at higher levels than the Fed wanted.

Not having QE funds buying by the FED in the US is almost like a person not having a credit card in the US

 

[pshufd]

Not having QE funds buying by the FED in the US is almost like a person not having a credit card in the US

I don't think that's an appropriate analogy.

The Fed creates money out of nothing, buys debt and then holds it. The debt pays a return so the Fed makes a profit (the interest) and then transfers the interest to the US Treasury. When the debt matures, then the Fed gets the proceeds of the debt. They then have to buy further debt to maintain or increase levels of QE.

Quantitative Tightening isn't buying back the debt. What happens is that they just don't purchase additional debt as debt expires. So the old stuff matures, they get the principal back and the money loaned out gets un-created.

The reason it works is that the people or organizations that get the cash for their debt go out and do something else with it. You hope that it eventually works its way into the real economy. The experience of the past decade shows that it works. The US started it and other countries thought that it was crazy. Then they followed suit when they saw that it works.

To a certain degree. It has diminishing returns with time and amount. The idea of QE was to get the economy back to a strong enough footing so that it could run on its own and that the QE would be unwound. It has been in the unwinding process but we're not going to get all the way back to zero this time around.

 

[stylinexpat]

I don't think that's an appropriate analogy.

The Fed creates money out of nothing, buys debt and then holds it. The debt pays a return so the Fed makes a profit (the interest) and then transfers the interest to the US Treasury. When the debt matures, then the Fed gets the proceeds of the debt. They then have to buy further debt to maintain or increase levels of QE.

Quantitative Tightening isn't buying back the debt. What happens is that they just don't purchase additional debt as debt expires. So the old stuff matures, they get the principal back and the money loaned out gets un-created.

The reason it works is that the people or organizations that get the cash for their debt go out and do something else with it. You hope that it eventually works its way into the real economy. The experience of the past decade shows that it works. The US started it and other countries thought that it was crazy. Then they followed suit when they saw that it works.

To a certain degree. It has diminishing returns with time and amount. The idea of QE was to get the economy back to a strong enough footing so that it could run on its own and that the QE would be unwound. It has been in the unwinding process but we're not going to get all the way back to zero this time around.

Very true, I agree. QE basically is to help stabilize or help get the economy back on track which is a form of manipulation. This is what Trump accuses China of "manipulation".

DOW is at -464 as I type. NO QE Intervention last few days I see.

 

[pshufd]

Very true, I agree. QE basically is to help stabilize or help get the economy back on track which is a form of manipulation. This is what Trump accuses China of "manipulation".

DOW is at -464 as I type. NO QE Intervention last few days I see.

I don't see the case for QE. The $INDU is 5.5% from its all-time-high.

 

[stylinexpat]

Trump "They broke the deal" , sort of like how he broke the Iran deal and he claims he is the master at making deals . He sure did make the Americas a good deal by making them foot the bill for all of his so called great deals.

 

[pshufd]

Trump "They broke the deal" , sort of like how he broke the Iran deal and he claims he is the master at making deals . He sure did make the Americas a good deal by making them foot the bill for all of his so called great deals.

I was looking that the NYTimes article on this and the comments section and a lot of comments state that this is something that should be done. There are those, like Sanders, who disagree with how Trump is going about it but not on the problem with China.

I was puzzled by Biden's comments that China isn't a problem as I think that Blue Collar workers, tech companies and manufacturers believe that China is a problem. Hopefully his advisors give him a refresher. President Obama tried tariffs on Chinese tires in 2009 and that saved a bunch of US tire jobs (1,000 I think) so Biden should know that there has been a trade problem with China for decades.

 

[stylinexpat]

I was looking that the NYTimes article on this and the comments section and a lot of comments state that this is something that should be done. There are those, like Sanders, who disagree with how Trump is going about it but not on the problem with China.

I was puzzled by Biden's comments that China isn't a problem as I think that Blue Collar workers, tech companies and manufacturers believe that China is a problem. Hopefully his advisors give him a refresher. President Obama tried tariffs on Chinese tires in 2009 and that saved a bunch of US tire jobs (1,000 I think) so Biden should know that there has been a trade problem with China for decades.

A lot of the companies in the US today and a lot of the stock valuations today in the US would not be there today if it were not for China

I personally believe that manufacturing job related issues are related to expenses the manufacturer has to face in the US due to all the regulations and extra fees that they incur here in the US. Just like the FED backs the market the government needs to back their manufacturers and not just back their own pockets. Government only cares about profiting from all of this. Differences are just an excuse to milk the sheep

 

[pshufd]

A lot of the companies in the US today and a lot of the stock valuations today in the US would not be there today if it were not for China

I personally believe that manufacturing job related issues are related to expenses the manufacturer has to face in the US due to all the regulations and extra fees that they incur here in the US. Just like the FED backs the market the government needs to back their manufacturers and not just back their own pockets. Government only cares about profiting from all of this. Differences are just an excuse to milk the sheep

It's complex of course. Our corporate executives sold out their employees to other countries for low costs and now get to face Chinese competition at home and abroad. I actually don't mind companies from other countries coming here to set up shop.

One of the other problems that we have is that we don't have enough kids. Or don't allow enough legal immigration. And education. And others that have an effect on this. But China will have the demographic problem even worse because of their One-Child policy.

As far as the stock prices go - let's say Apple had made their phones in the US or Mexico. Would they have had the competition that they face from the Chinese manufacturers today? Apple makes their laptops in Taiwan and I think that Taiwan was okay until Chinese companies started bribing Taiwanese employees for IP. The same thing, of course, could happen here. But I would hope that it would be harder and it would likely be a lot easier to catch. Those researchers stealing IP from MD Anderson were caught by looking at their tax information as they were getting money from other sources besides their employer.

 

[BuddyTronic]

Get ready to pay more. If you think by picking Trump for President he is saving you money (think again).

https://www.phonearena.com/news/Trumps-tariff-threats-could-hit-the-iPhone-this-time_id115788

https://9to5mac.com/2019/05/06/tariff-threat/

https://www.cultofmac.com/623762/trump-trade-tweet-apple/

The Sky is Falling, The Sky is Falling.

People do not understand Trump's negotiation tactics. The deal is happening - of course - because Trump.

Trump also has to look like a hero doing it, so let it play out and relax. It's in the script! He wouldn't even bother with all this if he couldn't be the hero. And Trump is actually right.

Only the big boys in the stock market can time these things out. Just hold on.

The normal human condition is mis-cognition.


The real thing to notice here is that China is to become dominant globally, if not completely apparent just now, hang in there for another 10 years. All the rest of it is meaningless.

 

[stylinexpat]

The Sky is Falling, The Sky is Falling.

People do not understand Trump's negotiation tactics.

The normal human condition is mis-cognition.

I understand his negotiation tactics. This negotiation tactics are not exactly all his own tactics. He is following orders of others to implement what he would like done. I can not say that I disagree with everything he has to say about fairness in trade because although I am not a fan of Trump or agree with everything he says, he does have some valid points on some trade issues with China. There are definitely some valid trade points being brought up by Trump. What is brought to light in front of the public is the valid ones while others are hidden. The ones that we see are often valid but mixed in with what the general public is not completely aware of. These are combined together where China is now being asked to sign on to a trade agreement with what is actually right and actually wrong. It's not just about the numbers for import and export duties. Keep in mind that China buys a lot of US Treasuries,Bonds,Notes,Etc.. from the US and quite a bit of that money comes from money that China collects from import duties as well. It is rather complicated and not so easy as some make it appear to be.

If you look below at the what China holds or has bought in the first few months of this year you will see that these numbers make up for trade differences. The Chinese people are quite interesting people. On one side there are some very unreasonable sides to them and on the other side there are some very reasonable sides to them. The unreasonable is often quite unreasonable and the reasonable is quite often very reasonable..

https://www.bloomberg.com/news/arti...-of-u-s-treasuries-increase-for-a-third-month

 

[pshufd]

I understand his negotiation tactics. This negotiation tactics are not exactly all his own tactics. He is following orders of others to implement what he would like done. I can not say that I disagree with everything he has to say about fairness in trade because although I am not a fan of Trump or agree with everything he says, he does have some valid points on some trade issues with China. There are definitely some valid trade points being brought up by Trump. What is brought to light in front of the public is the valid ones while others are hidden. The ones that we see are often valid but mixed in with what the general public is not completely aware of. These are combined together where China is now being asked to sign on to a trade agreement with what is actually right and actually wrong. It's not just about the numbers for import and export duties. Keep in mind that China buys a lot of US Treasuries,Bonds,Notes,Etc.. from the US and quite a bit of that money comes from money that China collects from import duties as well. It is rather complicated and not so easy as some make it appear to be.

If you look below at the what China holds or has bought in the first few months of this year you will see that these numbers make up for trade differences. The Chinese people are quite interesting people. On one side there are some very unreasonable sides to them and on the other side there are some very reasonable sides to them. The unreasonable is often quite unreasonable and the reasonable is quite often very reasonable..

https://www.bloomberg.com/news/arti...-of-u-s-treasuries-increase-for-a-third-month

TIC data show that China has been selling Treasuries over the past 12 months.

I work with many people from China that have been living and working here for 5, 10, 15, 20, 25 years. A lot of them basically sound like natives in a variety of life aspects. I've also seen a lot of Chinese culture and there are oddities to it. I'm Chinese myself but grew up in the United States. Sometimes you see stereotypes in Chinese movies and you wonder if people are really like that - and yes, people are really like that. Or they were.

The Chinese people that have emigrated to the United States that I talk to agree that China has been abusing trade for quite some time. I'd guess that the past four Presidents would agree. President Bush and President Obama tried on a small scale and I think that the results weren't good. The country as a whole was just leaking too much stuff.

So people may suffer from stuff costing more. And it may create more jobs for people here. Kind of like the old days in the 60s and 70s when we had far less stuff and little things were more precious.

 

[stylinexpat]

TIC data show that China has been selling Treasuries over the past 12 months.

I work with many people from China that have been living and working here for 5, 10, 15, 20, 25 years. A lot of them basically sound like natives in a variety of life aspects. I've also seen a lot of Chinese culture and there are oddities to it. I'm Chinese myself but grew up in the United States. Sometimes you see stereotypes in Chinese movies and you wonder if people are really like that - and yes, people are really like that. Or they were.

The Chinese people that have emigrated to the United States that I talk to agree that China has been abusing trade for quite some time. I'd guess that the past four Presidents would agree. President Bush and President Obama tried on a small scale and I think that the results weren't good. The country as a whole was just leaking too much stuff.

So people may suffer from stuff costing more. And it may create more jobs for people here. Kind of like the old days in the 60s and 70s when we had far less stuff and little things were more precious.

This is quite true as I have many Chinese friends here in the US as well which share the same view points (although not all do). I have spent about 25 years living between Taiwan, China and Hong Kong so I can see perspectives from both sides. From the Chinese perspective they also have a fair point as well as the US has been abusing international fair trade for them as well by forcing all international's trade require an ok from the US to go through and mandating all financial transactions to take place via US banks in New York. To be fair, the abuse thing is 50/50 if you ask me as I can see abuse from both sides.

 

[pshufd]

This is quite true as I have many Chinese friends here in the US as well which share the same view points (although not all do). I have spent about 25 years living between Taiwan, China and Hong Kong so I can see perspectives from both sides. From the Chinese perspective they also have a fair point as well as the US has been abusing international fair trade for them as well by forcing all international's trade require an ok from the US to go through and mandating all financial transactions to take place via US banks in New York. To be fair, the abuse thing is 50/50 if you ask me as I can see abuse from both sides.

The Exorbitant Privilege argument. China and Russia are settling in other currencies now for some things. The world will eventually go multi-polar on reserve currencies so that will be a solved problem. The issue of IP theft and lost jobs will remain for a long time.

 

[stylinexpat]

The Exorbitant Privilege argument. China and Russia are settling in other currencies now for some things. The world will eventually go multi-polar on reserve currencies so that will be a solved problem. The issue of IP theft and lost jobs will remain for a long time.

The IP Theft part is something that China and the US both fight at behind closed doors. The jobs issue is something both sides have to worry about. China has roughly 1.5 Billion jobs to worry about and the US probably around 350 million jobs to worry about so each is looking after their own personal interests. High unemployment numbers in either country would lead to a financial storm.

 

[pshufd]

The IP Theft part is something that China and the US both fight at behind closed doors. The jobs issue is something both sides have to worry about. China has roughly 1.5 Billion jobs to worry about and the US probably around 350 million jobs to worry about so each is looking after their own personal interests. High unemployment numbers in either country would lead to a financial storm.

Asian countries historically weakened their currencies to grab more jobs from Western countries. Western corporations lapped it up to pad profit margins. China's one-child policy will eventually result in a ton of retirements - hopefully they figure out who will take care of their elderly. They still have the geographic-demographic problem of the west, middle and east (or coast).

I discuss the IP theft issue with other tech managers and they all tell me that it's real and that they don't know how far they can trust their own employees. So that is a big deal. I can say that personally. The jobs situation is a transfer from the US to China. And Mexico and other places too. But I don't know that the other places required technology transfer and worked so hard at corporate espionage.
[doublepost=1557433265][/doublepost]The signs are accumulating: Manufacturers of shoes, cameras and iPhones are looking to move production beyond China. American officials are forcing Chinese investors to sell their stakes in American startups. Chinese scientists’ visas to visit the U.S. are facing delays.


How much further this decoupling goes depends critically on what sort of deal, if any, emerges from the current negotiations. A new Cold War of limited and tightly controlled interactions isn’t likely: China is simply too big and too globally integrated. Nonetheless, American and Chinese investors, businesses and scholars could find themselves increasingly operating in separate spheres pursuing separate strategies.

https://www.wsj.com/articles/can-th...ntegration-frays-11557414600?mod=hp_lead_pos5 (paywall)

 

[stylinexpat]

Not quite over yet. Trump just announced another 25% on another $325 Billion which are not taxed yet. The average American will start paying 25-30% more for cost of goods this year. If miscellaneous taxes increased 25-30% (keep in mind that 25% is tariffs at port before additional expenses are added on) and cost of fuel is up 5% and people ended up paying more taxes on their income taxes or getting less back the people are pretty much going to have at least 25-30% increase in goods cost and perhaps 5-10% more in losses from I come taxes. Wait till retail sales numbers come out next quarter the let’s see what GDP numbers will be at for the next 2 quarters along with earnings numbers from companies on Wall Street.

https://www.google.com/amp/s/www.ws...ard-with-china-tariffs-trump-says-11557424081

 

[stylinexpat]

So Trump imposes Tariffs as deadline passes. Notice how he is very worried about the market. This tells you that he had a hand in the markets climbing before. See iow often he checks markets lol..

https://www.google.com/amp/s/amp.cn...vesting/china-trade-petraeus-trump/index.html

 

[VictorTango777]

Tariffs are contributing to price fixing as some American manufacturers, such as home appliances, have started taking advantage by raising prices on products made and sold in the US. So much for competition.

 

[pshufd]

Tariffs are contributing to price fixing as some American manufacturers have started taking advantage by raising prices on products made and sold in the US.

Who makes laptops in the United States?

 

[Rogifan]

Trump has ordered raising tariffs on all remaining imports from China valued at $300B.

https://ustr.gov/about-us/policy-of...es/2019/may/statement-us-trade-representative

What’s he going to do when this starts hitting ordinary Americans i.e. Walmart shoppers pocketbooks?