My objective is to show that tariffs would not have a singificant inflationayr impact.
The lowe’s statment is astandard legalese disclaimer that warns about everyhthing from the next pandemic to domestic terrorist attacks.
Might as well run a newspaper headline as follows:
“Run and Hide Eveyone!! Lowe’s Predicts Terror Attack will Harm the Economy.”
You have been victimized by very bad journalism.
If your goal is to assail Trump because of his tariff proposals, (and Isuspect thatis yourtruengoal) there is plenty of room to that.
Assail them as “too broad.”
I actually have no problem with tarrifs. I have a bigger problem of trying to eliminate different forms of income taxes. Not only will shy ticket the deficit it will also drive inflation for sure
Your argument is highly valid IMO @Gaius
Have thought about it multiple times but wasn’t able to explain it.
Also 2 thing I want to point out. Lower class people don’t spend much on junk, they’re too busy buying food, gas, rent and electricity etc. None of those will be effected by tariffs.
That junk that people do want to buy will help lower the deficit…after all isn’t that want most people want? And bright spot poor people won’t be hurt.
I’m not assailing Trump, I’m concerned about his plans.
I think you’re downplaying the message from these retailers. It’s significantly more than “standard legalese.”
“We’re concerned that significantly increased tariffs could lead to increased costs for our customers at a time when they are still feeling the remnants of inflation.”
“Roughly 40% of our cost of goods sold are sourced outside of the U.S., and that includes both direct imports and national brands through our vendor partners,” Sink said on the call, per Yahoo. “And as we look at potential impact, certainly would add product costs, but timing and details remain uncertain at this point.”
Well if there is a 20%tax on goods
but 60% of the economy is services . . . how much inflation could the tariff cause? 20% times 60% equals 12%. Right?
Now
what if the tax was only on imported goods? It would be less.
what if raw goods like oil were excluded? It would be less still, right?
So, since 8.5% of the economy consists of manufactured goods imported from abroad then a 20% tariff on those might be might be 1.7%, right?
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Still wrong.
Actually it would be even less because the tariff is charge at the harbor and A LOT of what you payin retail is “post-harbor costs.” (coining my own term.)
Here, let me repost the table.
(MS Copilot, like wikipedia, is not always accurate, but I see no obvious errors here.)
it is not only that. The tariffs will not be paid by Walmart, they will be paid by the company importing the goods into the US. It is not the buyer that pays tariffs, it’s the seller. So lets say they have something they buy for $1.00 and sell for $3.00. To get their $1 the seller will have to charge $1.25. Is Walmart going to go up to $3.75? NO. Why? A large part of the cost is transportation, which with cheaper energy costs will be going down. In all likelihood, it won’t effect the price to the consumer at all.
Using that chart if I’m not mistaken, raising tariffs on imported good about 30 percent would raise trillion dollars.
Bam!!! would almost wipe out the spending deficit.
Not economic expert nor I pretend to be one…so I might be mistaken here.
Edit to add…that’s total import counting oil.
last year we imported 426 billion dollars from China.
100 percent tariffs would raise how much? But again we would lose some exports.
https://www.census.gov/foreign-trade/balance/c5700.html
We imported 451 billion from EU…20 percent would be 90 billion. But again we would lose 54 billion in exports if they impose 20 percent tariffs.
Personally I think that’s good trade off.
Those elites will continue buying up those BMW’s. So it will place tax burden on those that can afford to pay. 
Well, imported manufactured goods = 8.5% of the economy.
A 20% tax on that would be roughly 1.7% of the economy
(If all the cost is passed on to the US side.)
Our federal deficit is roughly four times that (6.4%) so yeah, it sure would be nice to see thisline come crashing down 25%.
The idea that “It will cause significant inflation,” just does not hold much water.
That’s 20 percent…but China and other not so friendly countries that’s flooding our market will be higher. 60 to 100 percent is what I’m seeing.
That and DOGE could cut few more hundreds of billions.
And we all be back in the black…can I even say that without being racist?
Seems like libs would love this idea…since “better off” will be paying most of it. They don’t care about couple bucks here and there.
If I understand i correctly he proposes a 20% broad tariff, plus punitive tariffs in special cases and has threatened 40, 60, 100, even 200%
Not if they cut spending.
So,
If Walmart pays (I dunno) 60¢/bottle for a 12-pack of Pepsi (delivered to the back of the store)
it then charges either
Either way, a 20% tax on the cost of pepsi when it comes in the door is 12¢/bottle. It is less than 20% of the final sales price, and in some cases a lot less than 20%.
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Imports work the same way. A 20-percent tariff
It does not impact the price of housing (30% of the economy).
It does not impact the price of healthcare (17% of the economy)
and the tiny portion that it does impact will increase in price far less than 20%.
Indeed. Higher end retailers make decent margins…but no where near 300%.
OEM’s make great margins…memory in smart phones? Those margins are above 500% Which they get away with due to demand.
And his proposed tax cuts will wipe out those gains in lowering the deficit.
The truth (or lack of truth) in that statement depends on two things.
1.) What is the product involved, (Pesi 12-packs vs cold Pepsi singles
and
2.) Are we measuring from the port to the cash register, or from the back of the store to the cash register.
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Cell Phones? From the loading dock behind the store, tothe cashregister, the store might mark up the product only 10-20%.
But from the harbor? Different story. Way different.
Apple pays and estimate $558 for each iPhone 15 Pro Max.
It sells for $1,500. A 300% mark-up.
The cost of the plastic screen-protector (sold seperately) is a few pennies. It sells for $22.08 on Amazon.
Does that also include R&D, Marketing etc…?
I am surprised they make that good of a margin on the phone itself…they have loyal followers.
I have never owned an Iphone.
