The deal includes $600bn (£446bn) of EU investments in the US, and the bloc will buy $750bn (£558bn) of US energy and also purchase American military equipment.
Mr Trump said: “I think it’s great that we made a deal today instead of playing games and maybe not making a deal at all.”
He said: “We are agreeing that the tariff… for automobiles and everything else will be a straight across tariff of 15%.” However, the 15% baseline rate would not apply to steel and aluminium, for which a 50% tariff would stay in place.
How so?
The price of the import remains constant, maybe jumps a bit, but the costs rise. That means less profits and the cost is paid to the seppo government, hence my comment about diverting profits from europe to the seppo government.
If a company isn’t going to make a profit selling to America, they aren’t going to sell it.
So the item the previously listed for $100 and made a $10 profit on, will now cost $115 for that same $10 profit. They won’t all of a sudden drop the price by $15 to keep the sale price at $100 and then take a $5 loss on each sale, they will simply stop selling the item or Americans will need to pay $115 for the item and the government gets $15 and the company still gets $10, but it’s still the Americans paying that $15 to the government, unless there is already a locally made item which sells for $105 then Americans will buy that instead and the European company can’t compete anymore and will stop selling their product and Americans have less choice in the stores.
Thats why i said less profits and not no profits. If they could have sold it for $115 they would have. There might be some price gouging using the tariffs as an excuse but its not gonna be such an effect across the board i dont think.
What I was thinking of was an item with a >15% profit margin now being less but not necessarily unprofitable.
If there is no profit to be made then yeah all the previous profits will go into the hostile countrys private sector since the gap is gonna be closed by domestic companies which is what trump means when he says that tariffs will bring jobs back.
What does that mean?
Seppo = Septic Tank = Yank = American.
If the product is 15% more expensive, it might push it over the threshold where it’s no longer the most competitive product, and a competitor gets the sale instead.