Trump approves tariffs on Chinese goods including $1 billion in bike products

[drewski]

Originally Posted by redir

This thread would be closed if I were to answer that question honestly. Lets just say you will never hear me utter the word President before the word Trump but rather always refer to it as 'this administration.' Someone(s) is/are in control here and then there is one who makes rash, uninformed, childish, ignorant, decisions. A sort of malignant Chauncey Gardner if ya know what I mean.

But yes I was not thinking of that but rather China where most of the focus is on and for good reasons.

"I watch TV." Spot on.

[HenryA]

Originally Posted by jtbadge

Similar report from White Industries:

http://www.whiteind.com/teriff/

TARIFF surcharge

In your recent orders you may have noticed there is a now a line item that says "TARIFF SURCHARGE: USA COMMODITY INCREASE DUE TO RECENTLY IMPOSED TARIFFS."

The surcharge is due to severe increases in material and bearing cost. Despite using US made aluminum, steel, and titanium, we have still seen an increase of well over 28% in raw material cost alone. For this reason we have had to start attaching a 4% surcharge on all orders. Rather than increasing our prices, the tariff surcharge is listed making it easy for us to adjust or hopefully eliminate this surcharge when/if the tariff situation stabilizes. Thank you for understanding.




-White Industries

Or they could buy American aluminum. Nah that’d cost more which is why they use “import” material. And that’s not a knock against White or anyone in particular, but if you build your pricing on off shore materials or labor it might work out for you or it might not. Here, not so much.

And to address the Paragon price increase, I wonder what would happen if a Chinese manufacturer decided to knock off their catalog of parts and flood the market at 40% of Paragon’s current selling price? It’d be bad. Real bad.

[joosttx]

Originally Posted by HenryA

Or they could buy American aluminum. Nah that’d cost more which is why they use “import” material. And that’s not a knock against White or anyone in particular, but if you build your pricing on off shore materials or labor it might work out for you or it might not. Here, not so much.

And to address the Paragon price increase, I wonder what would happen if a Chinese manufacturer decided to knock off their catalog of parts and flood the market at 40% of Paragon’s current selling price? It’d be bad. Real bad.

WI claims to use USA made metal and claim that cost is going up. Just read what they wrote.

I doubt much would happen since there is enough innovation and brand loyalty in and for PMW to keep it moving and ahead. I would not buy a custom bike that used knocked off PMW products. I assume I am a normal buyer of custom bikes.

[mjb266]

Originally Posted by HenryA

And to address the Paragon price increase, I wonder what would happen if a Chinese manufacturer decided to knock off their catalog of parts and flood the market at 40% of Paragon’s current selling price? It’d be bad. Real bad.

Happened long ago. Look at Nova Cycle Supply. Paragon stuff is higher quality. Regarding Tarrifs, it’s going to create a lot of bad blood with no appreciable benefits but lots of downside risk. Stupid.

[verticaldoug]

Originally Posted by jtbadge

Similar report from White Industries:

http://www.whiteind.com/teriff/

TARIFF surcharge

In your recent orders you may have noticed there is a now a line item that says "TARIFF SURCHARGE: USA COMMODITY INCREASE DUE TO RECENTLY IMPOSED TARIFFS."

The surcharge is due to severe increases in material and bearing cost. Despite using US made aluminum, steel, and titanium, we have still seen an increase of well over 28% in raw material cost alone. For this reason we have had to start attaching a 4% surcharge on all orders. Rather than increasing our prices, the tariff surcharge is listed making it easy for us to adjust or hopefully eliminate this surcharge when/if the tariff situation stabilizes. Thank you for understanding.




-White Industries

I think many of you are missing the irony of this post and it does prove why tariffs do not work.

Steel tariffs are 25% and aluminum 15%. Other products are starting at 10% and will increase to 25% at year end.

So common sense says the blended rate is <25%. So if the price increase White is seeing is 28%, then the suppliers are using tariffs as an excuse to hike prices.

I always saw this historically in Japan when they first introduced then raised national sales tax. If sales tax went up 3%, then prices would rise >3% since some vendors used tax confusion to hike prices.

A tariff is a tax, nothing more nothing less

You are introducing bad artificial inflation and usually when you tax something, you get less of it.

[joosttx]

Originally Posted by verticaldoug

I think many of you are missing the irony of this post and it does prove why tariffs do not work.

Steel tariffs are 25% and aluminum 15%. Other products are starting at 10% and will increase to 25% at year end.

So common sense says the blended rate is <25%. So if the price increase White is seeing is 28%, then the suppliers are using tariffs as an excuse to hike prices.

I always saw this historically in Japan when they first introduced then raised national sales tax. If sales tax went up 3%, then prices would rise >3% since some vendors used tax confusion to hike prices.

A tariff is a tax, nothing more nothing less

You are introducing bad artificial inflation and usually when you tax something, you get less of it.

This is an excellent example, I agree. It benefits the manufactures of steel. All I can say is I am sooooooooo happy I am not running a business selling high value inputs to soybean growers. imagine if china decided not to sell us antibiotics.

[dancinkozmo]

so these tariffs are how theyre going to recoupe the projected lost revenue from the recent "tax reform" legislation ?

[jtbadge]

Originally Posted by dancinkozmo

so these tariffs are how theyre going to recoupe the lost revenue from the recent "tax reform" legislation ?

No, they're just going to cut civil services that the government "can't afford anymore."

[ColonelJLloyd]

Originally Posted by jtbadge

No, they're just going to cut civil services that the government "can't afford anymore."

[goonster]

Originally Posted by joosttx

WI claims to use USA made metal and claim that cost is going up. Just read what they wrote.

In all likelihood, the aluminum starts out as an ingot from a smelter in Canada, and is then reprocessed in the U.S. into bar and sheet stock.

The merits of broad tariffs are subject to debate, but here's what isn't: "China" isn't paying them, American consumers are.

Argentina tried this in the 50's, and the stated objectives were not achieved. Can anyone point to a relevant example where they were successful?

[rnhood]

Well, France has tariffs, and they say that its been successful. Otherwise, they wouldn't have them. Germany, the same. In fact just about every industrialized nation has tariffs, most of which are higher than ours. Don't you think that they would remove them if they were not successful?

[bobswire]

Originally Posted by rnhood

Well, France has tariffs, and they say that its been successful. Otherwise, they wouldn't have them. Germany, the same. In fact just about every industrialized nation has tariffs, most of which are higher than ours. Don't you think that they would remove them if they were not successful?

Hey I'm all for the European mode of Social welfare, let's do it!!!!

[echappist]

Originally Posted by redir

I think this trade war is less about trade deficits then it is about Intellectual Property. People like Jack Ma have gotten rich by selling ripped of IP from around the world. IP isn't just computer chips it's also guitars and rubber duckies. There is a serious problem with it and from what I understand while it's gotten better it's been negotiated on before and isn't where it should be. So perhaps sometimes you just have to draw the line.

Of course the problem is history shows otherwise that there are any winners in a trade war.

Trump assumes the U.S. can act unilaterally without consequences. Economic history shows this doesn’t work. Arguably the last trade war led us into the Great Depression and the world’s economies are way more interdependent now than they were then.

So just as we are finally getting out of a recession, buckle up for whats to come.

Selling of counterfeit goods is small fry in the grand scheme of things (though it does make a few insanely rich). The real theft is the forced tech transfers. Foreign companies aren't allowed to operate on their own volition in China, and they have to form a "joint venture" in order to operate.

Mind you, this isn't just something directed only at American companies, and one could argue that if all the foreign countries had demanded something be changed, there could have been concessions. TPP was supposedly one way of banding together.

[HenryA]

Originally Posted by rnhood

Well, France has tariffs, and they say that its been successful. Otherwise, they wouldn't have them. Germany, the same. In fact just about every industrialized nation has tariffs, most of which are higher than ours. Don't you think that they would remove them if they were not successful?

I’m thinking about it and I think you have made a good point!

[goonster]

Originally Posted by rnhood

Well, France has tariffs, and they say that its been successful. Otherwise, they wouldn't have them. Germany, the same. In fact just about every industrialized nation has tariffs, most of which are higher than ours. Don't you think that they would remove them if they were not successful?

Yes, they have tariffs, intended to protect key industries and market sectors, at rates that have evolved over time into a complex web of negotiated trade relationships. As have we.

They have not rushed headlong into a trade war, imposing tariffs and threatening more in case of retaliation, until the furnaces at the Maxhuette, Hayange and Liege are firing again.

I have also lived in a developing country, under a regime sometimes described as "export-oriented industrialization," in which very high tariffs on consumer goods are used to protect government-aligned industries. This can have good outcomes if GDP growth is reinvested in infrastructure, but it only works for a limited time, depresses living standards and is essentially incompatible with democracy.

We have historically low unemployment, steady GDP growth, and low inflation. We also have income stagnation, growing wealth disparity, stagnant capital and irresponsible fiscal policy. The trade deficit on goods is in neither column.