Image result for tariffLeveling the playing field has always been somewhat manipulated by the other sides. Example, when another country -not all- buys a car from the US for $3,000, they sell it over there for $100,000! What do you think will happen? Would you spend $100,000 for a $3,000 car? No. The people will buy another car, particularly one that the country chose not to have a high markup on, one that they built themselves, says a source who witnessed the prices himself on an oversea visit.  Ahha!
Tariff (taxes) is the key to prices….Image result for tariff examples
plural noun: tariffs
  1. 1.
    a tax or duty to be paid on a particular class of imports or exports.
    synonyms: taxdutytollexciselevychargeratefeecountervail;

    price list
    “the lower tariffs across the border”

    Source: investopedia.com

    What is a ‘Tariff’?
    A tariff is a tax imposed on imported goods and services.

    BREAKING DOWN ‘Tariff’

    Tariffs are used to restrict imports by increasing the price of goods and services purchased from overseas and making them less attractive to consumers. A specific tariff is levied as a fixed fee based on the type of item, for example, $1,000 on any car. An ad-valorem tariff is levied based on the item’s value, for example, 10% of the car’s value.Image result for apple tariff breakdown

    Governments may impose tariffs to raise revenue or to protect domestic industries – particularly nascent ones – from foreign competition. By making foreign-produced goods more expensive, tariffs can make domestic-produced ones more attractive. By protecting these industries, governments can also protect jobs. Tariffs can also be used as an extension of foreign policy: imposing tariffs on a trading partner’s main exports is a way to exert economic leverage.

    Tariffs can have unintended side-effects, however. They can make domestic industries less efficient by reducing competition. They can hurt domestic consumers, since a lack of competition tends to push up prices. They can generate tensions by favoring certain industries over others, as well as certain regions over others: tariffs designed to benefit manufacturers in cities may hurt consumers in rural areas, who do not benefit from the policy and are likely to pay more for manufactured goods. Finally, an attempt to pressure a rival country using tariffs can devolve into an unproductive cycle of retaliation, known as a trade war. (More on History)

    The White House’s war over steel tariffs, explained

    Image result for the cost to make a apple iphone
    How Much iPhone Cost To Apple


    Source: usatoday.com

    How Trump’s planned steel, aluminum tariffs affect you

    Last week, President Trump said he would impose a 25% tariff, or tax, on steel imports and 10% on aluminum, sparking a big sell-off in stocks.

    The stock market drop reflected a bigger concern: a possible “trade war” if other countries hit by the tariffs impose tariffs in retaliation, sparking a back-and-forth of rising tariffs that hurt the growth of economies.

    Why does Trump plan to impose tariffs?tariff-explained

    For years, China has been accused of selling steel and aluminum in the U.S. at prices that are below the cost of production, partly because China has so much capacity. Trump says the practice has cost the U.S. steel industry hundreds of thousands of jobs. Trump won the election by promising blue-collar voters in Midwestern, steel-producing states that he would get tough on imports. Now, he’s making good on that vow.

    Can any country slap on tariffs so easily?

    Normally, the administration would present its case to the U.S. International Trade Commission, says Gary Hufbauer, senior fellow at the Peterson Institute for International Economics. Trump, however, invoked a rarely used provision of the Trade Expansion Act to argue that the steel and aluminum imports pose a national security threat. For example, only one U.S. company now makes the type of aluminum needed for military aircraft. The provision allows the president to impose unlimited tariffs unilaterally. Critics say the idea that the imports present a national security threat is highly questionable.


Here’s a small example of the shake up that’s occurring from overseas. We’ll do Harley Davidson.

Source: indiatoday.in trump_reuters

Donald Trump slams India for ‘unfair’ import tariff on Harley-Davidson bikes

US President Donald Trump today slammed India for a high import tariff on Harley-Davidson motorcycle, calling it “unfair”, even as New Delhi slashed customs duty on imported motorcycles from high-end brands to 50 per cent.

Trump, during a discussion with members of the Congress over steel industry, also threatened to increase the tariff on import of Indian motorcycles to the US.

He said the recent decision of the Indian government to reduce the tariff from 75 per cent to 50 per cent was not enough and asked that it should be reciprocal, as the US imposes “zero tax” on the import of motorcycles.

“We have so many countries where we made a product, they make a product, ..We pay a tremendous tax to get into their countries — motorcycles, Harley Davidson — it goes into a certain country. I wont mention the fact that it happens to be India, in this case,” Trump said amidst laughter from the audience.

Image result for tariff examplesIn fact, he also indirectly referred to the recent conversation he had with Prime Minister Narendra Modi in this regard.

“And a great gentleman called me from India and he said, we have just reduced the tariff on motorcycles, reduced it down to 50 per cent from 75, and even 100 per cent,” Trump said in an apparent reference to his last weeks conversation with Prime Minister Modi.

“We have — if you are Harley Davidson, you have 50 to 75 per cent tax, tariff to get your motorcycle, your product in. And yet they sell thousands and thousands of motorcycles, which a lot of people don’t know, from India into the United States. You know what our tax is? Nothing,” he told the lawmakers and his other Cabinet colleague. (more)


Source: thestar.com 

thestar.com Logo

If the tariff includes finished goods, Apple’s Mac and iPhone costs could go up by as much as 0.2 per cent, assuming the tax is a percentage of the metal components of Macs and iPhones, one expert said.From Bud Beer to Apple Macs, Trump’s proposed aluminum and steel tariffs have a widespread impact

Trump’s tariffs have ramifications for a wide range of businesses, including items consumers purchase significantly more frequently.

U.S. President Donald Trump says his proposed aluminum and steel tariffs are about putting America first, but they may affect all kinds of products people in the U.S. consume or use daily—from Bud Light to Hershey’s Kisses to Mac computers.

While the metal levies would hit the auto and aerospace industries hardest, they have ramifications for a wide range of businesses, including items consumers purchase significantly more frequently. Beer, soft drinks, candy, canned soup and even pharmaceuticals rely on aluminum for cans, wrappers and blister packs, and many electronics include the metal. Containers and packaging make up about 18 per cent of aluminum consumption in the U.S., according to Bloomberg Intelligence.

Higher costs would force the companies that make those products to cut jobs and increase prices for shoppers, according to Matthew Shay, chief executive officer of the National Retail Federation.

“When costs of raw materials like steel and aluminum are artificially driven up, all Americans ultimately foot the bill in the form of higher prices for everything from canned goods to automobiles,” he said in a statement. “These tariffs threaten to destroy more U.S. jobs than they will create.”

Trump said Thursday the U.S. will impose tariffs of 25 per cent on imported steel and 10 per cent on aluminum for “a long period of time.”Image result for tariff examples

Molson Coors Brewing Co. and Anheuser-Busch InBev NV, the largest brewers in the U.S., urged the Trump Administration not to follow through with the proposal.

“About 2 million jobs depend on America’s beer industry. We urge the Department of Commerce and U.S. President Trump to consider the impact of trade restriction tariffs,” Felipe Dutra, AB InBev’s chief financial officer, said on a call with analysts. (more)


Source: washingtonpost.com

Here’s a rundown of the likely winners and losers.


Image result for tariff picturesAluminum and steelworkers. In parts of Pennsylvania, Ohio and elsewhere in the Rust Belt, celebrations are going on as workers who lost their jobs think they might be able to get them back. The United States had 216,400 steelworkers in 1998. That fell by about a third to 139,800 in 2016, according to the Commerce Department. The aluminum-related job losses have been even more precipitous: About 13,000 people were employed in making raw aluminum in 2013. Now only about 5,000 work in the industry.

“We’d like to see the jobs come back. It’s been a pretty hard last three years since 2015,” said Andy Meserve, president of United Steelworkers Local 9423 in Hawesville, Ky., where Century Aluminum says it will hire 300 workers, about the same number who lost their jobs in 2015 when the company downsized the facility as global metals prices crashed.

Aluminum companies. The U.S. aluminum industry would be able to charge higher prices as soon as the tariffs go into effect (the price was already rising at the end of last week). The two main U.S. companies — Century Aluminum and Alcoa — saw their stocks jump Thursday after Trump made his big announcement. Century Aluminum rose more than 10 percent as chief executive Michael Bless told The Washington Post and other outlets that the company would immediately expand U.S. production once the tariff goes into effect. “We’re just concentrating on bringing back U.S. jobs and restarting 60 percent of our Hawesville, Kentucky, plant that was shut down,” said Jesse Gary, general counsel of Century Aluminum. The United States has gone from having 23 aluminum smelters in 1993 to just five today, and not all of the remaining ones are operating at full capacity. The Commerce Department says 90 percent of the aluminum used in America annually comes from overseas.

Steel companies. U.S. steel companies are also smiling at the prospect of tariffs by the end of the week. Steel stocks jumped at the end of last week, with U.S. Steel, for example, surging about 8 percent Thursday. Higher prices mean fatter profits for these companies. U.S. manufacturers that use steel would also have to buy a lot more domestically, another boon for American steel companies. The Commerce Department says about 30 percent of the steel America uses comes from overseas. It’s not as big a percentage as aluminum, but raising that percentage even a little would mean larger profits.

Peter Navarro. The person whispering loudest in Trump’s ear about trade is Peter Navarro, a former professor at the University of California at Irvine’s business school who believes strongly in tariffs. He wrote a book and made a movie called “Death by China,” in which he argues that the United States needs to hit back forcefully at the second-largest economy on the planet. Navarro was sidelined for much of last year after mainstream economists ridiculed him, including at the conservative-leaning American Enterprise Institute. But he is having his moment of triumph now. He appeared several times on Fox News and Fox Business where he argued, “It’s really important to understand that the impact of these tariffs from a macroeconomic point of view are zero.” Few economists and business leaders agree, but Navarro appears to have won over the one person who matters: the president.

Foreign auto, tool and machine part makers. No one in the White House likes to talk about this one, but foreign companies that take raw steel and aluminum and make it into parts that go into cars and airplanes and refrigerators are also likely to cheer Trump’s tariffs. They stand to do very well from this. As prices of aluminum and steel jump in the United States, it makes the prices of parts rise as well and that makes foreign parts look more appealing than American ones. Instead of buying from American parts and tool markers, big companies that sell cars and microwaves and other products may simply decide to make the entire product abroad and then import it. That would probably get around the tariff, but still keep costs low.

Robots. Some jobs that come back in steel and aluminum mills might go to robots. There’s a push in manufacturing to make everything more efficient, a code word for using less energy and having fewer workers. In the 1980s, it took an average of 10.1 person-hours per finished ton of steel, according to the American Iron and Steel Institute. By 2014, it took just 1.9 person-hours to make the same product, with many plants able to produce a ton of finish steel “in less than one man-hour.” The recently enacted GOP tax cuts also give companies an extra tax break if they invest more in machines and new equipment, another reason for executives in all industries to see if robots can do more in factories.

Some Democrats. A handful of Democrats from Rust Belt states like Sen. Joe Manchin III of West Virginia and Sen. Robert P. Casey Jr. of Pennsylvania have been pushing for Trump (and Barack Obama before him) to do more to revive the domestic steel and aluminum industries. Manchin said over the weekend, “I like where the president is going on this,” setting up a potential unintended “win” with blue-collar voters for some Democrats who want to be seen as fighting for workers and able to work with Trump when it matters. Manchin and Casey are both up for reelection this year.


Canada. America’s neighbor to the north is by far the largest source of foreign steel and Image result for the more you know rainbowaluminum coming into the United States. It stands to get hurt the most if Trump moves forward with the blanket tariff on all nations. Many businesses and the pro-free-trade faction in the White House are pushing for Canada to be exempted from the tariff. Canada accounts for about 40 percent of U.S. aluminum imports and about 16 percent of U.S. steel imports.

Ford and GM. There’s a lot of steel in American cars. As the price of steel rises, companies like Ford and GM either have to eat the costs or risk trying to pass them on to consumers. Goldman Sachs projects Ford and GM will both lose $1 billion each this year if Trump’s tariffs go through. Both stocks fell sharply Thursday, a potential harbinger of what’s to come.

U.S. auto parts makers. The Aluminum Association has been pointing out to anyone who will listen that only 3 percent of the jobs in America that are tied to the metal are in smelters that manufacture so-called primary aluminum. The other 97 percent of the jobs — about 156,000 — are in “downstream” industries that take the raw aluminum sheets and make them into parts for washing machines, cars and other items. Those downstream industries are likely to be the biggest losers in all of this. It’s similar in steel. The Trade Partnership, a consulting firm hired by the downstream steel industries, released a reportMonday saying five jobs are likely to be lost in the United States from Trump’s tariffs for every one job gained at a primary metal smelter. A similar scenario played out after President George W. Bush’s 2002 tariffs on steel: 200,000 jobs were lost, according to research from the same consulting firm, which is more than the total number of people employed in the primary steel industry at the time.

“If you really think about for a second, U.S. manufacturers, the guys that use this stuff . . . now we’re going to have a 25 percent disadvantage to anyone else,” said Mike Smith, co-owner of Termax Automotive Corp. in Illinois, which makes steel parts for big car and appliance companies.

U.S. farmers and agriculture companies. Canada, Europe and other nations are already threatening to retaliate if Trump goes through with the tariffs. One of their top targets is likely to be U.S. agriculture. They know it would hurt another key part of Trump’s voter base. Farmers have been lobbying the White House to keep NAFTA and other trade agreements in place. China is the world’s top soybean buyer, for example, and Canada imports about $25 billion worth of agriculture products every year from the United States.

Kentucky bourbon makers. Europe has already said if Trump goes through with the tariffs, the European Union will probably put retaliatory tariffs on American blue jeans and bourbon. Bourbon is a clear hit at the state of Kentucky, the home of Senate Majority Leader Mitch McConnell and a state that would stand to gain some jobs if Century Aluminum expands its operations there because of the tariffs. The European Union wants to counterbalance any job gains by punching back at Kentucky.

Global free trade. America has been the leader of the global free trade movement for decades. Trump’s actions threaten to end that, especially his argument that these tariffs must be done to protect “national security,” a claim that is hardly ever made (and hasn’t tried since the early 1980s). Normally, countries like the United States will argue that another country such as China is illegally dumping cheap steel (or another good) onto the global market and try to target any tariffs or quotas very specifically to harm that one country. But Trump wants to put a tariff on all countries, treating them all the same, whether or not they have been behaving badly. It sets up the potential for a trade war in 2018 and, even more so, for other countries to start doing their own blanket tariffs and defending them by saying they are doing exactly what the United States did.

Paul D. Ryan (and most other Republicans in Congress). GOP leaders thought their best chance for victory in the 2018 midterms was to campaign on the economy. Growth is up, the stock market has done well, and unemployment is low. The tax bill has also been gaining in popularity, setting up a strong talking point for Republicans seeking reelection. But the tariffs threaten to upend all of that. The economy and markets could easily slide if a trade war breaks out. History also shows that past tariffs under George W. Bush and Obama resulted in net job losses. “This is a policy absolutely bereft of logic,” said Bernard Baumohl, chief economist at the Economic Outlook Group, an independent forecaster. “The White House will only end up fueling more inflation, drive interest rates much higher, and ultimately result in a net loss of at least 25,000 jobs.” (more)


Source: marketwatch.com

Beer cans and sedans: the tariff debate is centering on two product categories

Last week, President Donald Trump unexpectedly announced that he would be

A can of beer could become 1 cent more expensive under the aluminum tariff, Wells Fargo Investment Institute calculates

instituting tariffs on both steel and aluminum imports. That spurred a flurry of analysis over what products could be hurt by such a policy—even setting aside the potential retaliation by trading partners—and in large part it centered on two: aluminum cans, used notably in packing food products, and steel-heavy cars.

Both products were seen as likely to be under pressure by tariffs, although analysts differed on the severity of the possible effects.

Opinion:10 popular stocks that would be hit hard if Trump started a trade war

Paul Christopher, the head of global market strategy at the Wells Fargo Investment Institute, suggested that the resulting increase in prices, or inflation, from tariffs might be minimal. He said companies can hedge their exposure to spikes in the price of commodities like steel and aluminum, and that they can benefit from new technologies and techniques that might decrease the use of those raw materials.

“New techniques make a beer can wall no thicker than a human hair (and at a cost of around 10 cents),” he wrote in a research note. “The tariff’s production cost impact may be only an extra penny per can.”

The comments echoed a statement by Commerce Secretary Wilbur Ross, who last week called the tariffs “no big deal,” citing what he implied was the de minimis increase in the costs of the price of a can of Campbell’s CPB, +0.87%  soup. Per his estimation, tariffs would add just six-tenths of 1 cent to a can.

However, companies disputed that the impact would be modest. MillerCoors tweetedthat “American works and American consumers will suffer as a result of this misguided tariff,” while a spokesperson for Anheuser-Busch BUD, +0.99%  told MarketWatch that the aluminum tariff “will likely cost U.S. brewers millions of dollars.” Campbell Soup, in a statement to CNBC, said that “any new broad-based tariffs. will result in higher prices,” although it didn’t say how much prices could rise by. In a research report, Credit Suisse said the soup company would be among the food companies most affected by any tariffs.

Read more:Yes, a can of Coke will cost more under Trump’s steel tariffs

Cars are another product category whose prospects are being re-examined in light of last week’s tariff announcement. Wells Fargo’s Christopher said “a two-ton automobile may be roughly 50%-70% steel, and at current steel prices, some estimates suggest a car price may rise by $150-$200” under the new trade policy. He doesn’t view this rise as a game-changing event, and added that the positive impact of the recently pass tax-reform bill “should still exceed the lost competitiveness from the tariffs.”

While an extra $200 may not break the bank for a consumer in the market for a new car, the effect could be more severe for the automakers themselves. Goldman Sachs forecast that both General Motors Co. and Ford Motor Co. would each take a $1 billion profit hit if the steel tariffs advance. Such a headwind would reduce their adjusted 2017 operating income by 12% and 7%, respectively.

Read:Goldman slams Trump’s tariff plan: It would make the U.S. ‘less competitive’

Other companies that use heavy amounts of steel, including 3M Co. MMM, +0.37%and Boeing Co. BA, -2.13% were also seen as having an outsize effect from tariffs because they could be vulnerable to retaliation from U.S. trading partners. (more)


Who are the winners and losers of Trump’s tariff plan?

Source: money.cnn.com

Steel CEO on tariffs: Thank you, Mr. President

Big business has sent distress signals since President Trump decided to impose tariffs on steel and aluminum.

But Tim Timken couldn’t be happier. The CEO of TimkenSteel was in the room at the White House last week when Trump made the surprise announcement.

“We view it as a very positive thing,” says Timken, who represents the fifth generation in the 101-year-old business. “I’m confident by the end of the week we’re going to end up with something we’re going to be very supportive of.”

Trump plans to impose a 25% tariff on foreign steel and a 10% tariff on foreign aluminum. It’s unclear whether certain countries will be exempt.

TimkenSteel is a publicly traded company, and the family has a controlling stake. It employs about 2,800 workers. Average pay is about $90,000 a year, including benefits, Timken says.

 TimkenSteel’s customers include General Motors (GM), Ford (F), Honda (HMC), Halliburton (HAL)and Caterpillar (CAT), among others.

Related: Steel tariff could cost Ford and GM $1 billion each

It’s been a tough few years for the company. Between 2015 and 2017, TimkenSteel laid off 380 employees because steel prices fell too low. It has hired back about 175 workers in the last several months.

China has long been accused of flooding the global market with cheap steel at prices that are unfairly low by US standards. Previous US administrations have imposed a litany of trade barrierson Chinese steel, which only accounts for about 2% of US steel imports. But China continues to sell en masse elsewhere, which suppresses global prices.

Trump’s measure would also target US allies such as Canada, Mexico, South Korea and Brazil, all of which import more steel to the United States than China.

All those countries have warned they will retaliate against American exports. Even one of TimkenSteel’s competitors with US operations, ArcelorMittal, has asked Trump to give Canada an exemption because it has a factory there too.

Related: Larry Summers: Trump’s tariffs are ‘crazy, dumb’

Timken says people need to relax, and he says no countries should be exempt, but that there’s a fair case to made for some exemptions for certain products.

There’s a lot of talk about trade wars and retaliation. History would say those fears are mostly overblown,” Timken says.

He points out that President George W. Bush imposed a 30% tariff on imported steel in 2002. Timken argues that the Bush tariff didn’t cause widespread economic damage or trigger a trade war, with other countries imposing tariffs on US goods. (more)

Image result for tariff trump So…. Papa Trump wants to end the massive tariff abuses. Image result for the more you know rainbow


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