In the last month, the United States President Donald Trump announced plans to impose tariffs on steel and aluminum imports. The proposal would amount to tariffs of 25% for steel and 10% for aluminum, and every trading partner would have to deal with this. An article from Stansberry Research recently discussed how this increase could inch the United States closer to a trade war.
Almost instantly, the proposal was shot down by not only those opposed to most of Trump’s ideas but by some members of his own administration. Some experts are thinking this could just be a negotiation tactic, but as discussed in Stansberry Research, this could happen and cause quite a few issues.
A tariff that high on steel and aluminum is unlikely to really make the type of change and meet objectives Trump is looking for. In the United States, those industries have really struggled to keep jobs stateside. Only about 300,000 Americans in the United States work in the two industries, but the job loss can’t be directly linked to outsourcing. It’s had some impact, but a tariff would not entice companies outsourcing jobs to move them back right away.
Instead, higher prices mean higher prices and profits for companies that produce the materials. More importantly, it could also lead to higher cost for companies that use these materials, which could have huge ripple effects. Companies would be forced to either lose profits, or cut jobs, or increase prices for the consumer.
Which companies use steel and aluminum? An increase in prices could change anything from food and drink prices to automobiles. The tariff, according to the article on Stansberry Research, could really turn into nothing more than a glorified tax hike for many people in the United States.
The most fearful ramification outlined on the Stansberry Research website is that trading partners could become very frustrated with the tariff. The European Union has already set up a proposal if the tariff is implemented. It would basically become a 25% tit-for-tat levy on products imported from the United States. China could also push a similar tariff. So many United States consumer goods are produced in China that it would be impossible for most companies to avoid being part of this trade war.
There is always a chance that the proposal fails to develop into anything, but no one at this point knows exactly what is going to happen. Trump’s top economic advisor, Gary Cohn, stepped down in March. He was very critical of the proposal. He stepped down during a time in which he was constantly at odds with the president, leading many to believe that perhaps Trump is serious about making this proposal a reality.
With the ripple effect, every citizen in the United States could be affected by a tariff on two very important industries. It’s something that Stansberry Research plans to continually monitor as new stories develop. It is clear that President Trump is frustrated with the lack of jobs within the United States in these industries, but the fix could cause a lot more harm than good if the European Union and China, among others, counter with their own type of tariff that directly affects consumers. Increased costs across the board will simply cause a tax hike that the majority of the American people can’t afford at this point.
About Stansberry Research
With close to 20 years in business, Stansberry Research has turned into one of the top privately owned publishing companies in the United States. Based in Baltimore, Maryland, the company specializes in researching investments. Anything from oil companies to healthcare investment opportunities are covered by the company, which usually publishes newsletters monthly or bi-monthly for their subscribers.
Stansberry Research was founded in 1999 by Porter Stansberry and has since grown into a company that has subscribers in over 100 different countries
Currently, Stansberry continues to act as the editor of Stansberry’s Investment Advisory in order to stay active within the financial community. He really started to make a name for himself initially when he served as the first American editor of The Fleet Street Letter. Most in the financial world know of The Fleet Street Letter as the oldest English-language financial newsletter.
Along with Stansberry, a number of other writers and editors have experienced success before and after working with Stansberry Research. Steve Sjuggerud launched True Wealth in 2001. It has turned into one of the most popular Stansberry Research publications (DailyWealth). David Eifrig is the man behind Retirement Millionaire, although he also makes appearances in other publications from time to time.
Dan Ferris joined the company around the same time, but gained notoriety a few years ago when his book, World Dominating Dividend Growers: Income Streams That Never Go Down, was published.
Stansberry Research prides itself on being a company that focuses on transparency, accountability and long-term successful relationships with customers. No reader wants to feel like they can’t trust what they are reading. Real-life examples are constantly cited, and investment advisors within the company are constantly providing tips they learned through the years.
Since the focus is always on the customer with Stansberry Research, the company stresses that their customer service extends to no-risk subscriptions. If a customer is not completely satisfied in the beginning, they are allowed to “part as friends” without any financial risk.
More about Stansberry Research at https://www.bloomberg.com/research/stocks/private/snapshot.asp?privcapId=108542404