Saturday, January 19, 2019

Trump and foreign trade

From Yahoo! Finance: 2019-01-04
AAPL
CNBC Videos • Fri 1:57 PM
Trump: China is paying us tremendous tariffs

AAPL
Fox Business Videos • Fri 1:59 PM
Trump: I want Apple to make their products in the US

AAPL
CNBC • Fri 2:53 PM
Trump says he's not concerned about Apple because it builds products in China

Who is paying the “tremendous tariffs?  It is not the Chinese.  They just pass those tariffs on to the U.S. customers.

But the complexity gets worse.  Do U.S. manufacturers cut their costs by manufacturing in other countries.  If they cut their costs, do they pass those savings on to their customers or do they just add them to their profits.

If the savings are passed on, the customers benefit.  If the savings are considered profits, do those at the top get bigger bonuses or do the share-owners get bigger dividends or bigger profits when they sell their stock.