President Trump shocked economists last to impose tariffs on steel and aluminum imports. Stansberry Research, an independent financial research firm known for delivering unbiased investment advice, recently reported on how it will affect U.S. markets, and they see the President’s tariffs costing Americans. Stansberry closely monitors trading opportunities in the global stock, currency, and commodity markets along with price and news updates on all the major stock markets of the world.
Trump’s tariff plan was immediately met with widespread opposition by Republicans and even the president’s top economic adviser Gary Cohn. The President expressed his desire to start a “trade war” further rattling the markets. It is unknown if Trump will follow through with his tariff plan or not, the threat could be a negotiation tactic meant to garner more favorable terms for trade deals.
Stansberry Research believes the plan is unlikely to meet its objectives. While it is true about the overall decline of the steel and aluminum industries, they employ less than 0.1% of the U.S. population. It would take more than tariffs to change this. Most companies that have outsourced jobs would still have little incentive to bring those jobs back. Stansberry concludes, “Only a small number of Americans would benefit, while the rest of us would bear the costs.”
Higher steel and aluminum prices mean higher costs for any companies that use these materials in production. Companies would either have to cut jobs or raise prices for consumers. Tariffs would also likely trigger retaliatory tariffs from our trade partners, which would drive up costs of everything. The EU has already planned levies on many U.S. exports, and the fallout from China would be even worse since they are our largest producers of consumer goods as well as the biggest holders of U.S. Treasury debt.
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