It is also another 3 dollars on the price of a widget. So fewer items containing widgets will be sold overall.
How many workers will be put out of work by that? More than the one extra widget maker?
If there are fewer goods sold overall because they cost more, therefore fewer workers overall, and with goods cost more per item, who is winning?
Economics is not a zero sum game.
There can be win/win situations, but trade wars, tend to be lose/lose situations.
higher demand means more jobs which means more money in peoples pockets which means more demand…
as to no one buying the item with the widget in it the company wants to sell them or they go out of business so they swallow the 3 dollars. if the item costs 1000 bucks they simply offer it at 995. The masses see that as a discount and buy it.
how many times have you seen a special offer in the supermarket buy 1 get 1 free on certain items but you can buy a bigger one for less money. shampoo or washing up liquid is a good one for that. yet when you go to the till there are people with 2 smaller ones in their basket.
bt / virgin do it all the time as well they will come up with an offer of 6 months free then 14.99 a month there after but you have to sign up for 24 months or the standerd price is 10 quid a month. ie it costs 269.82 instead of 240 to have the 6 free months
? And?
Buying widgets from smaller, less efficient companies, or making them in-house*, increases cost, as you already said. Increased cost reduces demand.
True costs are a totally different subject to pricing and marketing ploys.
*car companies do not make starter motors, nor many. many other things for good reason.
Trump threatened tariffs against Mexico and Canada.
Mexico has now promised more troops on their side of the border.
Maybe they are extra troops funded by the Mexican tax-payer? Maybe they will be troops transferred from seeking out the drug smugglers shifting stuff from other countries? Will that be good or bad overall for the US?
Canada threatened retaliatory tariffs, so now Canada and US are talking.
What has actually been achieved so far?
Talks are ongoing, but we now know that the US not to be trusted as a trading partner of they think they can tear up deals overnight.
How will that affect Canada and it’s position? Will they give the US a better deal or hedge their bets more? If you didn’t really trust someone in business, wouldn’t you charge them more to make your increased risk worthwhile?
Trump has grabbed some headlines, again, but has he benefitted the US population?
only 2 reasons that things wernt made in house.
1 cost of outfitting a workshop, space and time
2 can be made cheaper else where
second one has been dealt with by the tarriffs. so again they just have to buy from a home grown supplier to eliminate the first issue. That simple
so what. the shop down the road does doesnt mean you have to ship it 1000’s of miles back and forth
Yes. It is in fact cheaper to ship some components thousands of miles.
It isn’t done for fun, but to reduce costs.
Making stuff in house, or more locally, means higher costs, so we pay more for our cars etc, and have a generally lower standard of living.
There is an argument for that. But I didn’t have you down as someone who knitted their own home grown lentils.
Tariffs do not reduce costs for anyone. It is subsidence of less efficient factories. It increases costs for all.
Why are so many, of all political colours, always shouting about great new free trade deals?
for the umpteenth time the only reason it is cheaper to ship things 1000’s of miles is because the chinese can afford to live on a pound a day that is it.
employ someone localy you pay more in wages but that money goes into the local economy because the localy employed person spends the money localy. all giving it to a forign company does is boost forign economy.
i shouldnt have to explain this but if im on the dole i will get 393.45 a month. minimum wage is 11.44 per hour so if i work 37.5 hours a week is 429 so i get 376.57 a week in my pocket or to make it relivent to the uc claim 1631.80 a month over 4 times as much.
to brake it down even more over a month i will of paid 162.30 in tax and 64.02 in ni contributions. so rather than taking 393.45 i have contributed those amounts. Plus every single penny i spend goes into british business which in turn grow. every penny i save in the bank is invested.
No. You are contradicting your own previous posts.
Wages are one factor, but not the only one.
Canadian workers are arguably (much!) better off than their US counterparts.
where am i contradicting myself??
more local business means more local jobs yes or no
more money in peoples pocket means they can afford better things yes or no
more money in the government coffers means more can be spent on infostructure improving quality of life for all yes or no
no one is being laid off more jobs are being created. The companies already exist to make the part or every single thing would be imported. there are less time delays in manufacture and shipping. the whole thing goes round and round like i said.
what hasnt been covered is the tax breaks that trump has given to american businesses
Canadians are not on Chinese pay scales.
Making the same stuff with more labour input is being less efficient.
Doesn’t much matter if that labour is next door or far away. More labour for a product equals higher prices and less sales and less overall .
It is an example of a lose/lose game strategy.
Has that much difference on the cost of production?. It will mean less income for the Gov and therefore less to spend on defence, healthcare etc by the Gov.
Either that or personal income taxes will be increased.
I suspect that the richer will be even better off, and the US is already an inequitable society (look at the GINI) , and the poor will be poorer.
stop being so bloody obtuse.
nor are canadians chinese so bloody what. apples and oranges
if i need 1 man to make 10 items an hour then 2 men can make 20 get how that works… the order volume has doubled so i need twice the labour hence why or otherwise i employ more labour (in this case 1 man) its common bloody sense
i know this is a hard concept to grasp but less of somthing is more than nothing
lets take it a stage further. company a produces 100 widgets at 10 dollars profit each thats a taxable income of 1000 dollars lets set tax at 10% for easy maths thats 100 dollars tax paid.
the same company now produces 200 widgets at 7 dollars profit (3 dollars for the more expencive item) thats 1400 in taxable income lets say they are given a 2% tax break 8% of 1400 is 112 dollars ie 12 dollars more in tax but the company has saved 28 dollars. see how it works now
Exactly, and so you talking about Canadian tariffs and Chinese wages is nonsense.
Not quite that simple.
Starter motor factories produce more than one car maker needs. It is not efficient to have state of the art starter-motor-machines for every car maker.
You seem to assume that the amount of production is a constant.
It isn’t.
Increased price leads to reduced demand and reduced production and reduced employment and wages.
Economics is not a zero sum game.
If an employee can make more the company needs then a new (full time) job is not created. The company invests in a machine that is idle half a week. Extra cost for no extra output.
Dropping costs does not produce demand in a saturated market.
Dropping the price of a car by a tiny %, is not going to produce a surge in demand, certainly dropping a couple of points, on what is already a fraction of the overall price will not double car sales.
explain the bit your having dificulty with and ill do my best to simplyfie it even more.
if a company is ordering 100 widgets from company a they are still going to need a 100 widgets in this context it matters not which company supplies them the demand doesnt change just because the supplier does
so food has gone up we are all going to starve because suddenly everyone will stop eating. what a load of horlics
the only things that have gone up are employment tax revenue and money in peoples pockets.
the market isnt satuated according to you they have all got laid off and starved to death so there are no cars or what ever.
Well done! Do you feel better for that?
Let it aaalll out.
Only of there is the same demand. If costs increase then demand decreases.
If the market has less disposable income overall, then the production volume goes down, and unit costs increase, further dropping demand.
Putting Canadians out of work will decrease the market for US cars and whiskey etc. Everyone loses.
Overall, making a few widgets on site is less cost effective than having a specialist widget maker. Investing in expensive machines to produce lots cheaply is better than having lots of people on site hand crafting widgets.
We were talking about (a conversation you started) widgets, not food. Necessities and discretionary purchases are different beasts.
I will purchase food no matter the cost, I will buy a better car if the price is right, but can use a bus otherwise.
It is foolish to expect that Trump will garner all jobs inside the US and prosper. It may very well make him a richer man, and may make the US richer than it’s neighbours, but overall they will all be poorer.
i give in… when america prospers you can carry on telling us all how its poorer because trump had the conkers to do somthing
Copied from Phil Moorhouse’s YT channel, a comment about the sudden and stronger than expected announcements and sudden change of heart… @geoffreyduckworth6062
Maybe we should also ponder on “Dow rebounds from steep decline … after Trump pauses tariffs …” (CNBC). It was clear that the markets would react negatively when tariffs were imposed and equally clear that they would react positively if tariffs were removed. Now anyone who knew exactly when the tariffs would be removed or suspended could make a ■■■■ load of money.
He’s not struggling with anything mate, just being his usual obnoxious self thinking he knows better than everyone else.
Viz: Packard Merlin Engine. Different priority but RR jobs never threatened which they would have been without the specialist volume producer.