Trump just doesn’t go away…..

[tommyguns2]

The consumer price numbers are in for July.

https://www.cnbc.com/2025/08/12/cpi-inflation-report-july-2025.html

Inflation was less than expected (2.7% annualized vs. 2.8%). Report showed that tariffs are increases prices in some areas, but not in other areas. Prices are certainly not going through the roof.

Then again, gov't reported numbers have been, let's say, not extremely accurate, the past 18 months.

 

[fasttwitch]

The consumer price numbers are in for July.

https://www.cnbc.com/2025/08/12/cpi-inflation-report-july-2025.html

Inflation was less than expected (2.7% annualized vs. 2.8%). Report showed that tariffs are increases prices in some areas, but not in other areas. Prices are certainly not going through the roof.

Then again, gov't reported numbers have been, let's say, not extremely accurate, the past 18 months.

Tommy, you still have to answer a question, without being elusive please.. Will a 30% increase in supplier costs raise prices at some point?

If not, who will pay those costs?

I used to pay $50 to import a particular brass shuttle valve I sell, and now that same shuttle valve costs me $45, that is an extra $15. What will most like happen?

The pricing pressure for us sellers is building up. If not now, then soon prices will be increasing. What should I do, Tommy? Eat the cost? Do you think that is feasible?

 

[tommyguns2]

I concede that absent you purchasing that valve elsewhere, that part will cost you 30% more. I'm assuming that part is part of an assembly that you put together and sell in the states. You will do one of a couple of things: (1) you'll simply raise the price of your final assembled product to cover your cost increase and see how that affects demand, (2) you'll not raise your price for your final assembled product and reduce your margin on that product, or (3) you'll do (1) or (2) AND you'll start getting quotes for that valve from a US manufacturer or another manufacturer with a lesser tariff and/or who is willing to compete on price for your business.

Business is dynamic. You're still in business today because you don't just roll over and raise your prices. You get your Chinese supplier to lower his price, you shop a quote around to others, you re-design your product to not need that valve, etc. Yes, that's disruptive, but business adapts ALL the time.

So in the short term I do see some price increases, and in the medium term I see you getting that valve elsewhere, or redesigning your product. Sometimes that isn't possible, sometimes (often times) it is, and until you have the economic motivation to do so, you don't. Now you have incentives to look for other sources, and some of them in the US.

 

[fasttwitch]

(1) you'll simply raise the price of your final assembled product to cover your cost increase and see how that affects demand,

I sell loose parts, not assemblies. No way to bury the cost. There are no American companies who will ever produce most of what China does. It is insane for them to make less money when they can make more money producing things of greater value. This is why the USA produces quantum computers, super computers, airplanes, high end equipment, etc, instead of $50 widgets.

This isn't even mentioning the fact that America no longer has access to enough capital to fund reindustrializing. Again, 40 trillion is a large number, even for the United States. Bringing back all the manufacturing from China means not only the factories that make the end product, but all the industrial raw materials, inputs and ancillary companies. It will never happen. Anyone thinking it will is living in a fantasy world.

This is what will happen. Full stop. We will do what every other company is doing (once we have exhausted every trick up our sleeves in an attempt to hold prices) and we will raise prices. Slowly. Steadily. We will all act in unison, not from collusion, but just from monkey see monkey do and survival instincts. Watching each other continuously each week or month the prices will edge up until they reach the 30%.

In the end you will pay a higher price. If not today, then tomorrow or the next day or in the months to come.

 

[JackD]

Countries will still need to import raw materials and make products.

Guess what happens when all these price increases happen and production switches to US supplies? The prices stay the same or go up. Most likely, they will increase. So how does anything happening now have a long-term effect on bringing prices down or making anything more affordable? Will any of these moves increase consumer spending? The long-term picture here is currently not sustainable for people, and now, it will be even less affordable for people.

 

[testboner]

I do agree with several of your points TB. I do think that significant tariffs, particularly in the short to medium term will result in slight increases the prices of various goods. Some more than others, as might be expected. At the same time, every company presently importing some or all of their product now have a different calculus in deciding where to manufacture. The U.S. will become a better place to manufacture, as the tariffs in place now make the playing field more even.

What I'm not sure I agree about is the strategy Trump employed in implementing the tariffs. I will agree with you that the method he used was a dizzying, frenetic, shock and awe implementation. Was that intentional or just a byproduct of the trade people not being ready? I don't know for sure. But what did, in fact, happen?

When Trump got into office around 1/20, he clearly indicated that 4/2 was liberation day (or whatever he called it), and told the whole world what he was going to do. Did anyone pay much attention? Not really. A few countries said, "let's initiate trade talks." Just like the old days. Let's meet in some swank locale, drink good wine, eat good food, and talk and talk and talk. When nothing happens, they can say we're in negotiations. That can and will go on forever. Instead, Trump drops the hammer, and all those smug EU wankers and like "holy shit" this guy is nuts. Between 4/2 and 6/30 we saw a lot more earnest negotiations didn't we?

I hate to say it. But Trump's style works. He knows where he has leverage and he's not afraid to use it when he thinks it's important. He's happy to talk, but gets tired of talk, talk, talk when he perceives it's just BS delay. In those instances, he lights a fire, and surprise, surprise, things get done.

I think the Dems have been talking about this type of trade strategy for 40 years, but never pulled the trigger. Trump, previously a Dem, has been talking about this since around 1990, and he's doing it. So the experiment is being implemented, and we shall see over the next several years how this plays out. We know how the previous trade regime worked. Other countries screwed us (i.e., not fair trade). So I'm willing to see where this goes.

It is disruptive, no doubt. But if the present framework is broken, maybe disruptive is the right thing.

Clearly I’m nowhere near as optimistic. Trump as a lifetime character in general, and gov’t has confidently convinced ME that there is zero cause for faith in either. I’m only able to use my wildest imagination in trying to fathom any reason for there to be the percentage of public that believes in either.

 

[testboner]

The US will never provide the combination of both quality and good price on anything it manufactures. Our entire cultural character in regard to ethics, values, morals, a general empathetic egalitarianism would have to transform - and that’s not about to happen no way no how.

 

[fasttwitch]

The US will never provide the combination of both quality and good price on anything it manufactures. Our entire cultural character in regard to ethics, values, morals, a general empathetic egalitarianism would have to transform - and that’s not about to happen no way no how.

A month ago I contacted a Chinese supplier. I had previously used their catalog to order some items, not a lot though. Still a little unfamiliar with their many offerings, I contacted them by accident intending to contact another Chinese company about an item I was interested in. An item I had seen in another company's catalog.. I was doing some work late at night and wanted a price quote on this small item. But I accidently contacted the wrong Chinese company.

When I say the item was small I mean small. This is an item I've sold thousands of, buying them from an American company for $2.20. But the American company decided it was not worth it to make such a small item, anymore. Well, it was not worth it for them perhaps. Maybe they made $1 on the item they sold me for $2?? They were moving on to bigger and better things. But I buy these for $2.20, bundle them into 10-packs and sell the 10-pack for $60.

In any case I contacted the wrong Chinese company, my bad. My bad, or was it? The company contacted me back within a few hours. Although they do not make the product they did some searching and found it. Turns out the company's rep has a brother who knows a guy who knows a guy. One of those deals. They now offer it. And they can beat the $2.20 at $1.90 with additional price breaks for quantities of thousands.

The American company had basically told me "tough luck."

The Chinese company also told me to please let them know if another Chinese company tries to beat their price.

China is willing to put in the effort.

 

[testboner]

The CBO (Congressional Budget Office) report is out on who will benefit and who won’t from the BBB (“Big Beautiful Bill”). The wealthiest gain the most - the poorest lose the most. It literally is constructed to transfer $ from those who have the least, to those who have the most. The CBO is structured nonpartisan and is headed by a Republican.
The worst off, and then the avg working class both lose the most and gain the least. Way to go! What a system - yay America, “We’re number one!”
So much for the claim of being a “Christian nation.”

 

[fasttwitch]

The CBO (Congressional Budget Office) report is out on who will benefit and who won’t from the BBB (“Big Beautiful Bill”). The wealthiest gain the most - the poorest lose the most. It literally is constructed to transfer $ from those who have the least, to those who have the most. The CBO is structured nonpartisan and is headed by a Republican.
The worst off, and then the avg working class both lose the most and gain the least. Way to go! What a system - yay America, “We’re number one!”
So much for the claim of being a “Christian nation.”

At this point in time when somebody tells me they are a conservative and a Christian all I think is... Hateful. Close-minded.

To be fair though the Trumpies are not conservative in the American historical sense of the word. It is a cultish club full of ideological contradictions built on a bedrock of hate and resentment funded by the very deep state forces they pretend to be fighting. It is a huge con being perpetrated against the gullible.

 

[Iron1]

Countries will still need to import raw materials and make products.

Guess what happens when all these price increases happen and production switches to US supplies? The prices stay the same or go up. Most likely, they will increase. So how does anything happening now have a long-term effect on bringing prices down or making anything more affordable? Will any of these moves increase consumer spending? The long-term picture here is currently not sustainable for people, and now, it will be even less affordable for people.

I work in American manufacturing.
Prices are up for all of our materials. We're trying to source domestically but even the raw materials for our domestic suppliers are subject to tariffs and are going up in price.

My industry is directly related to construction/renovation and I can say with 100% certainty that our costs are being passed onto the consumer.

Our operation is international with 8 locations around the world. I can also tell you that our international satellite branches are shifting manufacturing from our location to theirs so they can continue to supply global customers without having to deal with US tariffs. We have $22 million worth of machinery sitting idle because we've lost that business to our international counterparts and competition out of China but we're still stuck paying those machines off.

We produce commodity materials, there is only so much we can increase price before the overseas competition is more appealing even with the tariffs.

On the organization level, investment projects in the US are being cut in favor of international projects. The Japanese holding company that owns our group and several others would rather invest in more stable areas of the world.

 

[Glycomann]

I work in American manufacturing.
Prices are up for all of our materials. We're trying to source domestically but even the raw materials for our domestic suppliers are subject to tariffs and are going up in price.

My industry is directly related to construction/renovation and I can say with 100% certainty that our costs are being passed onto the consumer.

Our operation is international with 8 locations around the world. I can also tell you that our international satellite branches are shifting manufacturing from our location to theirs so they can continue to supply global customers without having to deal with US tariffs. We have $22 million worth of machinery sitting idle because we've lost that business to our international counterparts and competition out of China but we're still stuck paying those machines off.

We produce commodity materials, there is only so much we can increase price before the overseas competition is more appealing even with the tariffs.

On the organization level, investment projects in the US are being cut in favor of international projects. The Japanese holding company that owns our group and several others would rather invest in more stable areas of the world.

I can ditto this through friends in various mid to high level positions in manufacturing.