by Michael Snyder, The Economic Collapse Blog:
Do you remember the panic buying that we witnessed during the early days of the pandemic? It’s back, and I have a feeling that it is only going to intensify in the days ahead. As more Americans begin to realize that products made in China will soon more than double in price and that some may no longer be available at all, there will be a feverish rush to purchase Chinese-made goods. Ironically, this may actually give a short-term boost to the U.S. economy, and the economic numbers for the first half of this year may end up looking better than they otherwise would have.
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Before I get too deep into this article, there are a couple of things that I want to clarify.
First of all, I do not think that the U.S. should have ever begun trading with communist China at all, because communist China has always been an incredibly evil regime.
Secondly, it was a catastrophic error for the U.S. to become so deeply dependent on imports from China. This is something that I have been writing about for years. Our stores are now teeming with products that were made in China, and thousands of our supply chains simply cannot function without equipment, parts or products that come from China.
But our leaders refused to listen to those of us that were sounding the alarm, and now we have a real mess on our hands.
Because we have become so deeply dependent on China, the trade war that has now begun is really going to hurt, and everyone should be able to see that.
On Thursday, the White House confirmed that the total tariff rate on Chinese imports has now risen to 145 percent…
The U.S. tariff rate on Chinese imports now effectively totals 145%, a White House official confirmed to CNBC.
Trump’s latest executive order hikes tariffs on Beijing to 125% from 84%.
But that comes on top of a 20% fentanyl-related tariff that Trump previously imposed on China.
One economist is warning that high tariff rates on both sides will lead to “a hard decoupling”, and he says that it would be “really hard to overstate the expected shocks this is going to have”…
“This is probably the strongest indication we’ve seen pushing towards a hard decoupling,” said Nick Marro, principal economist for Asia at the Economist Intelligence Unit, referring to an outcome where the two economies have virtually no trade or mutual investment.
“It’s really hard to overstate the expected shocks this is going to have, not just to the Chinese economy itself, but also to the entire global trading landscape,” as well as on the US, he said.
I fully agree with his assessment.
What we are witnessing is going to cause a tremendous amount of disruption.
Apparently lots of other people see things the same way, because a wave of panic buying has now started…
Across the country, people have been rushing to stores or going online to buy everything from iPhones to coffee to designer bags and jewelry in anticipation of the toll the tariffs will take on their wallets.
If there is something that is made in China that you really need, I would get it now while you still can.
One woman that just visited her local Costco said that she has “never seen it so busy”…
Costco was a total nightmare yesterday. I’ve never seen it so busy. I walked out after seeing the lines going down each aisle with no end in sight.
Another woman that lives in New York City admitted to a reporter that her mother is literally “panicking”…
“Actually, I already have. I’ve already started stocking up. My mother has a whole stockpile, and she’s panicking. But I told her we’re going to be okay, as we live in New York City,” said Amelia Guilford, a retail worker who was visiting her mother in the city.
The price hikes that we will soon see will be quite a shock to the system, and this will particularly be true for big ticket items.
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