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re: Trade Data Shows Trump’s Tariffs Are Working

Posted on 6/10/26 at 9:19 am to
Posted by Flats
Member since Jul 2019
28277 posts
Posted on 6/10/26 at 9:19 am to
quote:

Yes, it is odd. It is odd because the issue is clearly multifactorial,


So we shouldn't discuss the individual factors? Your hand-waving "it all works out in the end" is more substantive than figuring out if consumers are paying higher prices?
Posted by NC_Tigah
Make Orwell Fiction Again
Member since Sep 2003
139552 posts
Posted on 6/10/26 at 9:20 am to
quote:

Break enough windows and you'll certainly have a "productive capacity increase"
No. You don't understand the fallacy presented. The shopkeeper's loss is a setback which subtracts from production, whether that is one window or 10,000.
Posted by NC_Tigah
Make Orwell Fiction Again
Member since Sep 2003
139552 posts
Posted on 6/10/26 at 9:22 am to
quote:

Your hand-waving "it all works out in the end" is more substantive than figuring out if consumers are paying higher prices?
There is no "figuring" to be done. Your question was answered. Now, address the other factors.
Posted by ManBearSharkReb
Member since Dec 2018
6466 posts
Posted on 6/10/26 at 9:22 am to
quote:

Trade Data Shows Trump’s Tariffs Are Working


And causing inflation. Highest level of inflation in 3 years.
Posted by Penrod
Member since Jan 2011
56088 posts
Posted on 6/10/26 at 9:22 am to
quote:

His argument was that monetary outflow to international partners results in a need for those partners to put their money to work someplace. Often the result is the money being transferred to US debt instruments. The purchase of US debt instruments is (presumably) financed at a lower rate than the growth generated through the imported materials.

This is an important point. A country going into debt is like a business going into debt, good if the money is well spent and bad if it’s poorly spent.

It’s hard to argue we’ve been spending it wisely on Learing Centers and the like. China is another example of pissing away the money on infrastructure no one wanted or uses.
Posted by NC_Tigah
Make Orwell Fiction Again
Member since Sep 2003
139552 posts
Posted on 6/10/26 at 9:25 am to
quote:

And causing inflation.
Do you know the difference between a one-off cost increase, and inflation?
Because if you don't, you should.

If you do, then you recognize your post is uninformed.

E.g. is a corporate tax increase ever considered inflationary?
Posted by SlowFlowPro
With populists, expect populism
Member since Jan 2004
477880 posts
Posted on 6/10/26 at 9:36 am to
quote:

TSMC is increasing its US footprint. Its spending around $165 billion in Arizone on a facility now.

Foxxconn is putting abnout a billion dollars iand 1500 jobs into the US.

I mean that is 2 examples of companies that sped up their time line to invest in the US because of tariffs.


Isn't this primarily driven by pre-tariff public subsidies from the Biden term?
Posted by Jjdoc
Cali
Member since Mar 2016
55705 posts
Posted on 6/10/26 at 9:38 am to
We talked about this in Trumps first term. You want to direct the conversation to one aspect to win an internet argument.

The truth is as NT stated. There is way more to it than you are willing to admit.

Thats due to your unwillingness to view it in its entirety.


We, on the other hand, understand the whole picture and have stated that over and over. Would you like to hear it again?
Posted by SlowFlowPro
With populists, expect populism
Member since Jan 2004
477880 posts
Posted on 6/10/26 at 9:39 am to
quote:

You can't think of a solution where we bring back high end manufacturing only?


Bring it....back?

We dominate high end manufacturing
Posted by Jjdoc
Cali
Member since Mar 2016
55705 posts
Posted on 6/10/26 at 9:43 am to
The inflation data had zero to do with tariffs. It has everything to do with Iran.

Core CPI month-over-month: +0.2%, which was relatively tame and slightly below expectations.

Bless your heart man.
Posted by UtahCajun
Member since Jul 2021
6128 posts
Posted on 6/10/26 at 9:48 am to
quote:

But free traders crafted a plan to shift revenue collection from international organizations to US Citizens via the income tax

So if the tariffs are indeed working, can we expect the Federal government to stop using us to generate revenue? Seems only fair.
Posted by ManBearSharkReb
Member since Dec 2018
6466 posts
Posted on 6/10/26 at 9:48 am to
I do construction for a living.
Materials prices have shot up after the tariffs. I guarantee you don’t work in the real world.
Posted by Flats
Member since Jul 2019
28277 posts
Posted on 6/10/26 at 9:53 am to
quote:

The shopkeeper's loss is a setback which subtracts from production, whether that is one window or 10,000.


I do understand that. What you apparently don’t understand is that in your example there is also loss which subtracts from production. It’s just in the form of dollars instead of a window.
Posted by Taxing Authority
Houston
Member since Feb 2010
63564 posts
Posted on 6/10/26 at 10:02 am to
quote:

In simple terms, the reference is to secondary economic benefits associated with previously nonexistent domestic jobs. If a new manufacturing plant is built in the United States and employs 100 workers, the ancillary effect his job provision of 100 to 300 positions outside of that plant. Then there are the associated revenue effects with the 200 to 400 newly employed taxpayers. None of which existed prior to the new manufacturing plant's existence.

Even at a marginally increased consumer cost, there are very obvious benefits.
You’ve left out the marginal increase in cost of those paying those additional workers. The idea seems to be “any job created is a good thing”. But that’s not the case. For the employer hiring workers at $20/hr is not a win over a labor cost of $5/say.

The employer loses all that opportunity cost for the more expensive COGS unless they can raise prices by an equal amount of the increased cost. *poof*

Posted by Jjdoc
Cali
Member since Mar 2016
55705 posts
Posted on 6/10/26 at 10:03 am to
I own 2 businesses. Wife owns 1.

You are simply wrong.

Construction Materials Cost Increases by Year
Based on broad BLS/FRED Producer Price Index for Construction Materials

Year | Avg. Construction Materials Index | Increase vs. Prior Year
2006 | 180.2 | +6.3%
2007 | 183.2 | +1.6%
2008 | 196.4 | +7.2%
2009 | 189.2 | -3.7%
2010 | 194.5 | +2.8%
2011 | 201.1 | +3.4%
2012 | 205.8 | +2.3%
2013 | 209.3 | +1.7%
2014 | 214.5 | +2.5%
2015 | 213.5 | -0.4%
2016 | 213.9 | +0.2%
2017 | 221.6 | +3.6%
2018 | 235.8 | +6.4%
2019 | 235.7 | 0.0%
2020 | 239.2 | +1.5%
2021 | 303.4 | +26.9%
2022 | 341.5 | +12.6%
2023 | 331.8 | -2.9%
2024 | 328.5 | -1.0%
2025 | 337.9 | +2.9%
2026 YTD Jan-Apr | 353.8 | +6.6% vs Jan-Apr 2025.... this is due mainly to fuel costs. So again Iran.

Summary:
From 2006 to 2025, construction materials rose from an average index of about 180.2 to 337.9.

That equals roughly a 3.4% compounded annual increase.

The biggest spike happened in 2021 and 2022:
2021: +26.9%
2022: +12.6%

So you are simply wrong.

I mentioned my wife's business that deals with children. If the economy is bad, parents cut services like hers. It not needed. The opposite has happened. She doubled her clients this summer.

That does not happen in years of financial crisis for parents.

This post was edited on 6/10/26 at 10:07 am
Posted by Taxing Authority
Houston
Member since Feb 2010
63564 posts
Posted on 6/10/26 at 10:10 am to
quote:

You adjust your cost, along with the importer to account for those costs, little is passed on to the consumer, Bessent even showed these to us, and concluded the same.
This is like claiming you can go to a car dealer and tell them what price the car will be. I suggest walking into a BMW dealer and telling them their car will cost $25,000.

We've had a thread on this already: LINK Two studies with very similar results:

quote:

We highlight two main results. First, 94 percent of the tariff incidence was borne by the U.S. in the first eight months of 2025. This result means that a 10 percent tariff caused only a 0.6 percentage point decline in foreign export prices.
quote:

Table 1 reports our baseline estimates across all trading partners. The coefficient on log tariffs in the unit value regression (column 3) is -0.039, statistically significant at the 10% level. This implies that foreign exporters absorb less than 4% of the tariff burden; the remaining 96% passes through to US importers.


Any lack of price increase we're seeing is almost certainly due to contraction in demand. (NC_Tigah was right about that!)
This post was edited on 6/10/26 at 10:11 am
Posted by Taxing Authority
Houston
Member since Feb 2010
63564 posts
Posted on 6/10/26 at 10:14 am to
quote:

TSMC is increasing its US footprint. Its spending around $165 billion in Arizone on a facility now.
That fab also expanded in 2022 and 2024 before tariffs were even announced.
Posted by Jjdoc
Cali
Member since Mar 2016
55705 posts
Posted on 6/10/26 at 10:16 am to
Just a few products that have gotten cheaper over the past 2 years / recently:
Eggs
Used cars & trucks
Leased cars & trucks
Car & truck rentals
Motor vehicle insurance
Dairy products
Cheese
Chicken
Fresh whole chicken
Bananas
Frankfurters / hot dogs
Lunchmeats
Major appliances
Clocks, lamps & decorator items
Televisions
Prescription drugs
Medicinal drugs
Motor oil, coolant & fluids
Posted by Taxing Authority
Houston
Member since Feb 2010
63564 posts
Posted on 6/10/26 at 10:17 am to
quote:

In simple terms that's the broken window fallacy.
quote:

No.
quote:

The key is opportunity cost.
Indeed. Building the plant and overpaying for labor are not positive uses of capital. They are lost opportunity costs. Not gains. And making it worse it hurts cash flow going forward, because even after paying back the CAPEX asset cost, COGS is higher. Where is the win?
This post was edited on 6/10/26 at 10:18 am
Posted by Taxing Authority
Houston
Member since Feb 2010
63564 posts
Posted on 6/10/26 at 10:19 am to
quote:

Isn't this primarily driven by pre-tariff public subsidies from the Biden term?
Yep.
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