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Trump To Ignite Wholesale Silver Shortage? “Imposing A 20% Tax On ALL Imports From Mexico”

from Silver Doctors:

Two weeks ago we asked a question on Metals & Markets that the market has not (yet): Could Trump’s Border Tax Ignite CHAOS in the US Silver Market?

Moments ago WH Press Secretary Sean Spicer confirmed this risk while discussing Trump’s plans to make Mexico pay for his wall: “by imposing a 20 percent tax on ALL IMPORTS from Mexico…“

After a chaotic Twitter back and forth between President Trump and Mexican President Pena Nieto resulted in the cancellation of the upcoming meeting to renegotiate NAFTA, Trump vowed Mexico will pay for his wall one way or another.  

Speaking to reporters aboard Air Force One Thursday, Press Secretary Sean Spicer revealed Trump plans to force Mexico to pay for his wall via a border tax on ALL IMPORTS:

 

“When you look at the plan that’s taking shape now, using comprehensive tax reform as a means to tax imports from countries that we have a trade deficit from, like Mexico. If you tax that $50 billion at 20 percent of imports — which is by the way a practice that 160 other countries do — right now our country’s policy is to tax exports and let imports flow freely in, which is ridiculous.

By doing it that we can do $10 billion a year and easily pay for the wall just through that mechanism alone. That’s really going to provide the funding.”

 

The risk to the US Silver market (which is HEAVILY supplied by Mexican mining operations) is that the Trump Administration doesn’t single out manufacturing like GM, Chrysler and Ford for import taxes, but rather taxes ALL IMPORTS, which according to Sean Spicer, sounds like will be the plan:

“by imposing a 20 percent tax on all imports from Mexico.”
Just how much might the US silver market be affected if imports are suddenly taxed by 20%?

We suspect more than most would be willing to admit.

According to expert silver analyst Steve St. Angelo, the US imported a whopping 3,440 metric tonnes of silver in 2015 – the majority from Mexico.  

 

US Silver imports increased further to record levels in 2016, with 1,547 metric tonnes of the metal imported from June-August 2016 alone. 

Meanwhile, US silver production was down a stunning 14% YOY in 2016. 

If President Trump goes through with his plan to tax ALL IMPORTS…including ore and 1000 oz silver bars – the disruption to the precious metals markets in the US will be significant.

 

silver-eagle

 

US silver prices could jump above global prices and create a bifurcated market.
Wholesale silver shortages would likely result, as refineries and mints scrambled for alternative non-Mexican sources of silver.  

The problem is that while Mexico led the world in silver production in 2015 with 189.5 million oz of productionaccording to the Silver Institute, a MASSIVE 21% of total global silver production!

US silver output was only 35 million oz in 2015 – not even enough to meet demand for US Mint Silver Eagle bullion coins!  (US Mint demand was over 48 million oz of silver in 2015 for bullion Silver Eagles and bullion ATB coins alone).

China’s 109 million oz of annual production and Russia’s 50 million are certainly not headed to the US of A.

 

Courtesy the Silver Institute

Courtesy the Silver Institute


It quickly becomes clear that IF Trump enacts a plan to tax ALL Mexican imports at 20%, US silver prices could be revalued 20% higher overnight, and the ensuing chaos could cause massive shortages of physical silver – and this time in the wholesale market as well as the retail market.

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12 comments to Trump To Ignite Wholesale Silver Shortage? “Imposing A 20% Tax On ALL Imports From Mexico”

  • mike

    a 20% tax on all Mexican imports is 64 billion/year.Trump is a very stupid man and so are morons who think there will be a 20% tax.Mexico imports 360 billion/year. The import tax to pay for the wall only needs to be 2.8% for 1 year. So hate to burst this dumb idea silver will surge. Trump is really stupid and someone in his admin will point this out unless they’re all morons.

    • Eric

      So hate to burst mike’s bubble, but Silver will surge. Bitcoin will underperform.
      So far Silver is UP 7.26% and Bitcoin is DOWN 5.75% in 2017. Can’t wait to outperform mike again in February.

      https://memegenerator.net/instance/75120110

    • Eric

      I also enjoy how mike pulls his numbers out of a big sombrero. A 20% tax across all imports would currently be about 54 billion.

      http://www.businessinsider.com/us-imports-from-mexico-2017-1

      I’m sure mike didn’t listen to this weeks update from the Doc, Eric Dubin, and Dave Kranzler so I’ll just point out how they discussed this topic thoroughly and talked about how it is unlikely to be as high as 20%. I’m sure mike has never noticed that Trump always goes big and then compromises and makes a deal. That’s how you get what you want and come out on top. You ask for the world and then compromise.

      I wonder how many boats with holes in the bottom of them mike’s sharp negotiating skills have obtained for him.

      • mike

        Retard..Trump wants to tax the trade deficit at 20% he has said that by an import tax. The only way to tax 60bil in a deficit is to tax Americans.Mexico does 360bill/yr in us imports. A 20% tax is 72bill/yr.The wall cost 10 bill. so you cant tax a deficit but you can tax imports and 2.8% is all you need.Trump is an Epic moron there is no doubt in my mind.He has no clue lol.

        • mike

          Trump and his idiot spokesman sphincter were thinking 60 bill just the deficit thats how the moron came up with 20% ah haha…He forgot about 300 bill.Jesus seriously the man is clueless.Trump is going to be kicked out of office for sure.You made a another bad bet thats all.

          When you have to make up excuses as to what Trump is thinking its time to move on.

          • Eric

            Clueless is the guy who can’t even document the bullshit that comes out of his big mouth.

            Clueless is the idiot who doesn’t know the difference between imports and exports.

            Clueless is the dumbshit who doesn’t know how trade even functions.

            You’re doing really well mike. Keep discrediting yourself.

          • Eric

            mike, in your first comment you state that…

            “a 20% tax on all Mexican imports is 64 billion/year.”

            Then above you say that…

            “A 20% tax is 72bill/yr.”

            Well which is it? 64 billion or 72 billion?

            3 boats with holes in them then?

        • Eric

          lol! Where does it say he wants to “tax a deficit?” Do you even know what a deficit is mike?

          More mike math. It’s no wonder you don’t know anything about finance or economics.

          And he is not going to tax US imports into Mexico dumbshit. He is going to tax Mexican imports into the US.

          http://www.cnn.com/2017/01/26/politics/donald-trump-mexico-import-tax-border-wall/index.html

          An Epic moron doesn’t know the different between imports and exports. Seriously, do you even have a brain?

          • mike

            60 billion is the trade deficit.What is 20% of 60 billion?

            12 billion, the dumbshit moron you call the golden gods financing for the wall.
            Since now Americans will be paying for the wall by an import tax and Mexico imports 360 billion in goods the tax only needs to be 2.8%.

            I thought Mexico was supposed to pay for the wall but in typical politician double speak Americans will pay.That is your moron in action.Mexican gov wont be paying a penny even with an import tax Americans will.

            Was going to reserve judgement but Trump is an imbecile and this took the cake.

            Trump and Sphincter were citing 60billion, the trade deficit. lol

            Deport Eric and Krell im reporting you to trump so we can build a northern wall as well. don’t want the sickening subject mindset creeping down from Canada…We should probably just annex the place and “Relocate” the inhabitants to KBR run fema camps to keep you tards safe.

    • Eric

      Cost of wall… 10-15 billion. Possibly as high as 25 billion.

      http://www.ksl.com/?sid=42987306&nid=757

      2.8% for 1 year. lol.

      Document your work mike. That’s the only way you will have any credibility.

      Oh I forgot. You got a D- in basic arithmetic.

    • mike

      The moron in his own words TAXING THE TRADE DEFICIT OF 60 BILLION LOL AHAHAH

      I am affraid the sickening lemming canadian subject mindset has already infected you Eric..GOLDEN GOD SCREWING AMERICANS ….NICE!

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