If you make or sell anything in the US, or really anywhere, you need stuff from China. Anything that contains any electronics (i.e almost everything important), many resources, plastic parts, anything the US has outsourced is ordered via sea freight from China.
Now it’s 64% less things over a single week. Your whole economy relies on cheap stuff from China and they made it not cheap anymore. So companies will not order anymore, because they can’t afford it, knowing that can’t just double their prices. Most companies probably hope, that this is temporary and want to delay their orders until they have some level of security, that shit is not two or three times as expensive as it was the month before.
If that doesn’t happen, everything down the supply chain will be affected. From food to cars to data centers and IT, consumer goods, cosmetics, healthcare. The shipping companies themselves. Logistics, ports, trucks. Building materials like steel and concrete. Everything. And most companies hold very little things in storage these days, they rely on just-in-time delivery because material on stock is expensive, so this impact will come very quick.
And nothing, outside of a gigantic national effort that would be comparable to the brutal industrialization of the Soviet Union or China, could compensate for this. The consequences are a massive economic crisis agaist which 2008 or Covid looks like peanuts.
Trump will bend. Or he might have to dodge a few more bullets.
Because prices to import things are getting unprofitable, due to the tarriffs, companies are not booking ships to move the stuff from China to America.
If 60% of all the food a neighbourhood gets is from this one dude, but the residents of that neighbourhood only account for 30% of that dude’s income, trying to antagonize the dude hurts the whole neighbourhood a lot more than the dude is hurt. Now you have to pay even more, or go without your favorite foods. Meanwhile, everyone needs food, the guy selling food can just make less food tomorrow and spend his time doing other things, or find other hungry people and work out a deal.
The DoorDash drivers have reported bookings for the dude’s food in said neighbourhood have plummeted by 64%. This is bad for the guy selling food. It’s much worse for the people in the neighbourhood who may have to deal with malnutrition.
TL;DR ELI5 WTFDTM (what the fuck does this mean?)
If you make or sell anything in the US, or really anywhere, you need stuff from China. Anything that contains any electronics (i.e almost everything important), many resources, plastic parts, anything the US has outsourced is ordered via sea freight from China.
Now it’s 64% less things over a single week. Your whole economy relies on cheap stuff from China and they made it not cheap anymore. So companies will not order anymore, because they can’t afford it, knowing that can’t just double their prices. Most companies probably hope, that this is temporary and want to delay their orders until they have some level of security, that shit is not two or three times as expensive as it was the month before.
If that doesn’t happen, everything down the supply chain will be affected. From food to cars to data centers and IT, consumer goods, cosmetics, healthcare. The shipping companies themselves. Logistics, ports, trucks. Building materials like steel and concrete. Everything. And most companies hold very little things in storage these days, they rely on just-in-time delivery because material on stock is expensive, so this impact will come very quick.
And nothing, outside of a gigantic national effort that would be comparable to the brutal industrialization of the Soviet Union or China, could compensate for this. The consequences are a massive economic crisis agaist which 2008 or Covid looks like peanuts.
Trump will bend. Or he might have to dodge a few more bullets.
Because prices to import things are getting unprofitable, due to the tarriffs, companies are not booking ships to move the stuff from China to America.
If 60% of all the food a neighbourhood gets is from this one dude, but the residents of that neighbourhood only account for 30% of that dude’s income, trying to antagonize the dude hurts the whole neighbourhood a lot more than the dude is hurt. Now you have to pay even more, or go without your favorite foods. Meanwhile, everyone needs food, the guy selling food can just make less food tomorrow and spend his time doing other things, or find other hungry people and work out a deal.
The DoorDash drivers have reported bookings for the dude’s food in said neighbourhood have plummeted by 64%. This is bad for the guy selling food. It’s much worse for the people in the neighbourhood who may have to deal with malnutrition.