CRYPTO MECHANIC
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Trump imposing tariffs can lead to high inflation and let me explain why
1. Tariffs make things like electronics, clothes, or materials from other countries more expensive. If businesses rely on these imports, they raise their prices to cover the extra cost. If you're buying something at higher prices you will sell it for higher price right?
2. If imported materials (like steel or parts) are taxed, companies using them to make products (like cars or appliances) will charge more to cover the higher costs.
3. Tariffs protect local businesses from foreign competition. With less competition, local companies might raise prices because they don’t have to worry about cheaper foreign options.
4. If the U.S. taxes imports, other countries might tax U.S. exports in return. This hurts U.S. businesses, and they might raise prices to make up for lost sales.
5. Tariffs can mess up the flow of goods, making it harder and more expensive for businesses to get what they need. This can also push prices up.
6. If everyone thinks prices will go up because of tariffs, workers might ask for higher wages, and businesses might raise prices in advance, creating a cycle of inflation.
In short, tariffs make things more expensive, and those higher costs often get passed on to consumers, leading to inflation.
**Now you might be thinking if tariffs can do so much damage then why does Trump want to impose it? **
I think the main goal is to protect U.S. jobs, reduce trade imbalances, push for fairer trade deals, and strengthen domestic industries. He wants the US to produce more products.
I can share more about why he is interested in imposing tariffs. If you guys are interested, Let me know in comments 👇🏻
1. Tariffs make things like electronics, clothes, or materials from other countries more expensive. If businesses rely on these imports, they raise their prices to cover the extra cost. If you're buying something at higher prices you will sell it for higher price right?
2. If imported materials (like steel or parts) are taxed, companies using them to make products (like cars or appliances) will charge more to cover the higher costs.
3. Tariffs protect local businesses from foreign competition. With less competition, local companies might raise prices because they don’t have to worry about cheaper foreign options.
4. If the U.S. taxes imports, other countries might tax U.S. exports in return. This hurts U.S. businesses, and they might raise prices to make up for lost sales.
5. Tariffs can mess up the flow of goods, making it harder and more expensive for businesses to get what they need. This can also push prices up.
6. If everyone thinks prices will go up because of tariffs, workers might ask for higher wages, and businesses might raise prices in advance, creating a cycle of inflation.
In short, tariffs make things more expensive, and those higher costs often get passed on to consumers, leading to inflation.
**Now you might be thinking if tariffs can do so much damage then why does Trump want to impose it? **
I think the main goal is to protect U.S. jobs, reduce trade imbalances, push for fairer trade deals, and strengthen domestic industries. He wants the US to produce more products.
I can share more about why he is interested in imposing tariffs. If you guys are interested, Let me know in comments 👇🏻
Disclaimer: Includes third-party opinions. No financial advice. May include sponsored content. See T&Cs.