Are you buying now because you anticipate higher prices?

[Noske]

Consumption taxes suck monies out of those who can least afford. Check those new car prices, how long do you expect Ford to eat those
additional cost? Shift the tax burden down, grift the little guy. Get ready for a lower standard of living. Enjoy the ‘Muzak’… We really seem to
have few ideas about how to be analog in a digital world. At least I have my iems. Enjoy those ‘stable coins’, just don’t forget where you put your
wallet. Ohh, go ask the wizard, only he can fix anything. Now where’d I put those clothes…?

Yes, sales taxes are what is known as regressive -same as a flat income tax. Those who earn less get hit relatively harder, the opposite of what seems right.

You mention Ford. GM has recently come out with some numbers how it is absorbing tariffs (manufacturers use a LOT of imported components, perhaps something that wasn't thought through enough because people seem to be too busy to think).

It is showing big red blotches on GM's profit and loss statement.

 

[levimax]

Cutting income taxes and increasing consumption taxes (tarrifs) and encouraging investment with tax breaks is potentially sound economic policy. While consumption taxes are potentially regressive they do collect from hookers and drug dealers and there are also large tax breaks for low income earners. Halting illegal immigration will also drive up wages for lower income workers. While tarrifs are bad for relatively wealthy people wanting to buy cheap electronics from China, as part of a much larger economic policy perspective they may not be so bad. Time will tell but so far the plan appears to be working.

 

[pablolie]

I don't want my messages to turn this into a political party discussion. Which is kinda hard these days.

It is the classic matter of government intervention in market economics. I honestly find it funny when the declared believers in market economy also suddenly intervene in different ways. Privatize this, but tax this, and stop collecting taxes on that.

Tariffs are a very tricky thing. Protectionism may utterly hurt a country's global competitiveness. I know the moderators watch China "bashing" very closely, but no one can doubt "we" heavily invested in building out their capabilities while thinking that'd mean they'd open another billion consumer market. Tragic.

I am not declaring myself an expert in how to reestablish more balance (which is clearly needed, but which we also voluntarily inflicted on ourselves). But I question if making consumers pay for the transition (IF it comes to that, because up to now it seems the tariff discussions are a classic play-chicken game) is the right strategy, although for now it seems to be a working tactic.

PS: I am super impressed this topic has stayed this civil and constructive!

 

[drewdawg999]

Bought a yoyo for $6.50 after coupon and coins on AliExpress. It's quite nice, it's the unresponsive kind that you need to do binding to make it return.

Here it is on the left, quite the looker. Next to it is a Yoyofactory 888, it cost me more than 100 bucks. Performance is pretty similar to me. That's progress for ya. Last Chinese purchase for the foreseeable future.

 

[Noske]

I don't want my messages to turn this into a political party discussion. Which is kinda hard these days.

Discussing economics is not and has never been political.

Government intervention is well recognised in economics as desirable in many circumstances. That doesn't make it political. Even Adam Smith recognised the desirability of government intervention sometimes, although it is not widely known.

That some people think economics is political is their own business. Their loss.
.
In some circumstances carefully thought out tariffs may aid certain industries in an economic manner that society as a whole will be better off. Win-win.

The tariffs under discussion do not fit into those circumstances. At best, they are win-lose.

 

[pablolie]

Discussing economics is not and has never been political.

Oh but it is, imo... let me try to say why I believe that while in no way contradicting your core argument: Indeed Adam Smith warned that leaving everything to market economics was flawed thinking (which has been violated in practice regularly).

Then you had Keynes, and his approach is used based on convenience (like now) or condemned at times as socialist (just ask Milton Friedman).

And then there's been the planned economy approach Marx proposed, and which actually misguided protectionist economic policy fully emulates. As do subsidies. If you save an uncompetitive industry with government subsidies (and that happens plenty) it's basically a planned economy approach.

Note I use the politics term in the Greek sense, as in "matters of citizens".

The fact seems to be we bounce back and forth between systems based on convenience or lobbyism - not on conviction - these days.

Not at all disagreeing, just nuancing, if permitted.

 

[Snoopy]

The de minimis exemption ends Aug. 29 for imports into the U.S., according to white house. The exemption currently allows imports under $800 to enter the U.S. duty and tax free.

I mean $800 is insane to be duty and tax free .. it has been years that you could order goods into the EU without paying VAT on stuff below 25€ (Blu-ray’s , electronics) and things like tea where you could order for something like 60€ ..

Now everything you order from let’s say eBay gets automatically slapped VAT on top.

Complaining about that is really so „American“

 

[Noske]

Oh but it is, imo... let me try to say why I believe that while in no way contradicting your core argument: Indeed Adam Smith warned that leaving everything to market economics was flawed thinking (which has been violated in practice regularly).

Then you had Keynes, and his approach is used based on convenience (like now) or condemned at times as socialist (just ask Milton Friedman).

And then there's been the planned economy approach Marx proposed, and which actually misguided protectionist economic policy fully emulates. As do subsidies. If you save an uncompetitive industry with government subsidies (and that happens plenty) it's basically a planned economy approach.

Note I use the politics term in the Greek sense, as in "matters of citizens".

The fact seems to be we bounce back and forth between systems based on convenience or lobbyism - not on conviction - these days.

Not at all disagreeing, just nuancing, if permitted.

Read up on positive economics.

Governments of whatever flavour use Keynesian economics. Often quite poorly. They just don't know it.

That some economists trip over themselves with politics is their own business. It detracts from their analysis.

I'd like to like Austrian school of economics, but can't. In the pursuit of their own agenda they make so many fundamental errors. Conveniently leave things out etc.

 

[pablolie]

Read up on positive economics.

Governments of whatever flavour use Keynesian economics. Often quite poorly. They just don't know it.

That some economists trip over themselves with politics is their own business. It detracts from their analysis.

I'd like to like Austrian school of economics, but can't. In the pursuit of their own agenda they make so many fundamental errors. Conveniently leave things out etc.

Reagan was all supply side economics, pretty much 100%. Milton Friedman was the mastermind behind Reaganomics. Sometimes -for good and bad- there have been more one-sided economic politics. I think the trend towards an economic multimix is more recent.

 

[Waxx]

That's the definition of a shadow tax (not an outright tax). If tariffs lead to price increases, and consumers carry the increased price change burden (plus the resulting sales tax increase, I live in California)... how is that not a shadow tax?
Of course I am free to decide what I buy or not. Of course I would welcome bringing back a lot of high tech manufscturing to the US (and I'd be happy to pay higher prices). But that transition is basically paid for by consumers. The government budget impact is through shadow tax, really. It is consumers who carry the burden of the tariffs if they decide to buy the product. Which I don't mind if it ends up benefiting the health of our economy during a transition phase, let me be clear about it.
But if consumers stop buying altogether because of that, all calculations kinda go out of the window.

PS: VAT in EU is 15%,but can be as high as 27% in some countries (Hungary). I live in California where the sales tax is 7.25% but also has a more obscure luxury tax I can't make sense out of even though I have lived here for 25 years.

VAT in Europe is between 5 and 27% with an average of 15%. Vat depends on what you sell to who and where. This is for all goods, import or own production, but only on end user sales.

 

[Noske]

Reagan was all supply side economics, pretty much 100%. Milton Friedman was the mastermind behind Reaganomics. Sometimes -for good and bad- there have been more one-sided economic politics. I think the trend towards an economic multimix is more recent.

I don't use the words good or bad in the context of economics. (Music? That's different!) Now that you have read up on positive economics you can tell me why.

 

[Mart68]

Economic theory is like political theory - ideology or dogma. The world is too complex for those things to work in a 'one size fits all' way.

Finding the right solution for a specific problem is the way to go, regardless if that solution is labelled as Keynesian, Marxist, whatever.

Adam Smith's definition of a 'Free Market' was a market which was a level playing field for all with no cabals, consortiums or monopolies - he advocated for regulation to prevent them. Latterly 'Free Market' in general parlance seems to have come to mean a 'free for all' with no regulation but that doesn't happen in reality and wouldn't be a good idea.

I've noticed some people seem to think import tariffs are new and didn't exist previously.

There has always been tariffs on imports - all that's changed is the tariffs have gone up percentage-wise.

Mostly the end user pays them so, whilst increased tariffs might reduce a country's balance of payment deficit, it's the people in that country who are reducing the balance of payments shortfall out of their own pockets.

Unless the imports are replaced by domestic production, of course.

In theory, and over a long period of time, that's what should happen; but in practice it's unlikely to happen on a significant scale, for many and complex reasons.

 

[Noske]

I've noticed some people seem to think import tariffs are new and didn't exist previously.

There has always been tariffs on imports - all that's changed is the tariffs have gone up percentage-wise.

Well I didn't know that. Isn't that a relief! All this fuss about nothing then.

 

[amper42]

MSFT doesn't care about any STINK'IN TARiFF's.
Rocket launched on crazy good earnings. PRICE Plus 8%

Microsoft (MSFT) 3.65 EPS, 76.4B Revenue

Apparently, Apple has lost its MOJO. Great hardware, but no real AI in the works. They are missing the boat?
Perhaps it's just a phone company that's gotten lazy?

 

[jeffbook]

I upgraded my miniDSP equipment in December 2024 from Deer Creek Audio (USA). It was an intended purchase in order to better integrate my Denon AVR with my Linkwitz based system. Saved about $150 relative to the current tariff policy...

 

[bigguyca]

It's hard to know what numbers are real and which are fake. Tarriff rates are all over the board by country. Low = 15% high = 150%.
My guess is the latest GDP calculations have been changed not to show vast government layoff impact. But without full disclosure it's hard to trust any of the current data being released. We have entered a period of political massaging of economic numbers.

FYI, a reduction in imports is directly reflected in as a dollar to dollar increase in GDP.

At least some of the former government employees will hopefully find jobs which will increase the GDP.

 

[bigguyca]

That's the definition of a shadow tax (not an outright tax). If tariffs lead to price increases, and consumers carry the increased price change burden (plus the resulting sales tax increase, I live in California)... how is that not a shadow tax?
Of course I am free to decide what I buy or not. Of course I would welcome bringing back a lot of high tech manufscturing to the US (and I'd be happy to pay higher prices). But that transition is basically paid for by consumers. The government budget impact is through shadow tax, really. It is consumers who carry the burden of the tariffs if they decide to buy the product. Which I don't mind if it ends up benefiting the health of our economy during a transition phase, let me be clear about it.
But if consumers stop buying altogether because of that, all calculations kinda go out of the window.

PS: VAT in EU is 15%,but can be as high as 27% in some countries (Hungary). I live in California where the sales tax is 7.25% but also has a more obscure luxury tax I can't make sense out of even though I have lived here for 25 years.

plus adders which vary by county and city depending on how stupid the voters were. Per memory the rate in the City of Los Angeles and perhaps San Francisco in now at least 10%. A rare piece of good news in that the voters in here in San Diego County voted down an added .5% sales tax in the November, 2025 election. The S.D. County rate is 7.75% per memory. Some of the cities in S.D. County may be more.

 

[pablolie]

FYI, a reduction in imports is directly reflected in as a dollar to dollar increase in GDP.

GDP is " the monetary value of final goods and services - that is, those that are bought by the final user - produced in a country in a given period of time". Hence, imports generally have a net-zero effect on GDP. *If* the imported goods are replaced by local production, then they add to the GDP.
Gets more complicated in scenarios that are not totally uncommon: a US company manufactures its products in China... then I think (but welcome corrections) the imported value is deducted from the sales&services revenue - and that is then included in GDP.

 

[bigguyca]

Crutchfield USA usually prices new samples in even dollar amounts. New samples of select Revel speakers are now priced with '95 cents' in the asking price instead of an even dollar amount. This may reflect the cost of tariffs. Crutchfield now shows a price of $9,679.95 each for the Revel PerformaBe F328Be loudspeaker - up from $8,800 each earlier this week.

https://www.crutchfield.com/p_265F328BEW/Revel-PerformaBe-F328Be-High-Gloss-Walnut.html

Hopefully you aren't advocating that members pay list or close to list for AV equipment including Revel loudspeakers.

 

[bigguyca]

GDP is " the monetary value of final goods and services—that is, those that are bought by the final user—produced in a country in a given period of time". Hence, imports generally have a net-zero effect on GDP. *If* the imported goods are replaced by local production, then they add to the GDP.

It's nice that you have your own definition. It's good to see independent thinking!

When the U.S. Government calculates GDP, imports are subtracted from GDP and exports are added. You may disagree with how the government calculates GDP, but this is how it is done.

This effect in obvious in the two most recently reported GDP numbers. The GDP in the 1st quarter of 2025 had a negative change due to front running of imports, and thus a large subtraction from GDP, to beat tariffs. The 2nd quarter of 2025 that was just reported, showed a +3.0% change in GDP due to greatly reduced imports. This effect was widely reported.