Six months into tariffs, businesses have no idea how to price anything • Hacker News Board

Re: Six months into tariffs, businesses have no idea how to price anything

#91

Post by macintux » Sat, Aug 30, 2025, 10:46 PM UTC

hippo22 wrote: post #85

I’d like to lay out an argument about why tariffs are good. The only businesses that are derailing with tariffs issues are those that import goods to sell. The argument against tariffs is that they make goods more expensive. Of course, this argument is true. But that’s not the end of the story. Because prices are higher for imported goods, demand for domestically produced goods increases. This increase in demand lead…

How do businesses hire local labor for non-existent manufacturing facilities? Why would anyone spend the massive amounts of money over years required to make new factories when people expect that eventually sanity and rule of law will return to the White House?

Re: Six months into tariffs, businesses have no idea how to price anything

#92

Post by kristjansson » Sat, Aug 30, 2025, 10:46 PM UTC

hippo22 wrote: post #85

I’d like to lay out an argument about why tariffs are good. The only businesses that are derailing with tariffs issues are those that import goods to sell. The argument against tariffs is that they make goods more expensive. Of course, this argument is true. But that’s not the end of the story. Because prices are higher for imported goods, demand for domestically produced goods increases. This increase in demand lead…

A cogent, long range tariff and industrial policy might accomplish something like this over a period of years. Does that describe the last 6 months?

Re: Six months into tariffs, businesses have no idea how to price anything

#93

Post by platevoltage » Sat, Aug 30, 2025, 10:47 PM UTC

declan_roberts wrote: post #65

SpicyLemonZest wrote: post #53

Earlier quoted context omitted.

I don't understand the point of this comment. If you consider the most important target to be China, so important that it's worth a 10,000% tariff unless certain demands are met, shouldn't you be furious that the tariffs the source article describes on copper and India and Turkey are distracting from the important things?

No because it's obvious those countries don't have the leverage to negotiate. Trump hasn't even started discussing h1b with India.

Trump has all of his grifty garbage made in china. Trump uses H1Bs. None of this is to make you or anyone you know's life better.

Re: Six months into tariffs, businesses have no idea how to price anything

#94

Post by imglorp » Sat, Aug 30, 2025, 10:47 PM UTC

declan_roberts wrote: post #50

0cf8612b2e1e wrote: post #32

Earlier quoted context omitted.

Soybean farmers are predicting a world of hurt as China continues to acquire from South America instead. “Overall, export sales of this fall’s (U.S.) soybean crop are down 81% from the five-year average,” Brasher reported. https://www.usatoday.com/story/news/2025/08/20/soybean-farme...

South America doesn't produce enough soy beans for them to replace America even if China bought every single ounce of soy. When it comes to soy, America has enormous leverage and China already accepted they're negotiating from a position of weakness.

China may elect not to replace the whole shortfall. They may value the message it sends more.

Re: Six months into tariffs, businesses have no idea how to price anything

#95

Post by sneak » Sat, Aug 30, 2025, 10:47 PM UTC

hippo22 wrote: post #85

I’d like to lay out an argument about why tariffs are good. The only businesses that are derailing with tariffs issues are those that import goods to sell. The argument against tariffs is that they make goods more expensive. Of course, this argument is true. But that’s not the end of the story. Because prices are higher for imported goods, demand for domestically produced goods increases. This increase in demand lead…

This would make sense if there were a single labor market. There isn’t, so this simply increases prices (even for domestic goods, as raw materials are frequently imported).

There is no meaningful path to restoring much of the US’s lost manufacturing capacity. The rent is too damn high, and the cost of goods is rising quickly as well. Labor is expensive and becoming moreso daily. Manufacturing in the US can never compete with SE asia even with 50% tariffs due to the gigantic disparity in the cost of labor.

It’s not going to increase wages, it may even result in even more offshoring due to the increases in cost for raw materials.

Re: Six months into tariffs, businesses have no idea how to price anything

#96

Post by anigbrowl » Sat, Aug 30, 2025, 10:47 PM UTC

thayne wrote: post #11

casey2 wrote: post #3

This is how you know most economic theory is a total lie, if it wasn't they would just "price what people are willing to pay" and be forced to eat the loss. Is that cause copper bathtubs are a special item or are you just making up more rules after the fact to patch holes in your leaky theory.

It's because basic economic theory makes some really bad assumptions. It assumes everyone has the information they need, and sellers can instantaneously change prices in response to changes in demand or cost of production. Neither of which is true in the real world.

It's not so much that theory makes these assumptions, as that they describe the simplest economic models. You can make your models as detailed or not as you'd like, but the more work to construct/operate/understand them, the lower your likely return on that effort. It's just like how some people want simplistic games like Candy Crush, others want high investment ones like Dwarf Fortress.

Re: Six months into tariffs, businesses have no idea how to price anything

#97

Post by haunter » Sat, Aug 30, 2025, 10:47 PM UTC

In the end it's the biggest leopard ate my face moment ever:

China has very high growth momentum that surpasses American living standards soon, and not long before it will surpass American security standards too. China's purchasing power is probably more comfortable than most western countries, with extensive housing and high speed rail and electric cars etc. When a country becomes rich, inevitably other countries ask for their help. That's why China's growth must be curbed, fast > tariff them to their death or so. But I really don't think it will work at all. And personally I don't even think it's a good idea at all to begin with.

Re: Six months into tariffs, businesses have no idea how to price anything

#98

Post by underlipton » Sat, Aug 30, 2025, 10:48 PM UTC

habinero wrote: post #84

underlipton wrote: post #71

Earlier quoted context omitted.

Their workers and vendors only suffer if their owners and executives decide to pass the buck of 1) poor management (not being able to set prices adequately), and 2) being in the socioeconomic class with the most influence on the most recent election. That class has expanded their wealth ludicrously during the last 3 presidential administrations, while most Americans have suffered. Any hits they take now are completel…

"The workers only suffer if the owners deliberately act against their own interest" is "the workers will suffer" with more words tacked on the end.

"The workers only suffer if the owners deliberately act against their own short-term self-interest in order to secure their workforce, their industry, and, ultimately, the economy, over the long term," is the more correct characterization, and accurately portrays the behavior as misanthropic and illogical for anyone expecting to live beyond the next handful of quarters.

Iwata took a paycut. The least our guys could do is take responsibility.

https://www.cnbc.com/2024/02/13/nintendo-ceo-once-halved-sal...

Re: Six months into tariffs, businesses have no idea how to price anything

#99

Post by hippo22 » Sat, Aug 30, 2025, 10:48 PM UTC

kristjansson wrote: post #92

hippo22 wrote: post #85

I’d like to lay out an argument about why tariffs are good. The only businesses that are derailing with tariffs issues are those that import goods to sell. The argument against tariffs is that they make goods more expensive. Of course, this argument is true. But that’s not the end of the story. Because prices are higher for imported goods, demand for domestically produced goods increases. This increase in demand lead…

A cogent, long range tariff and industrial policy might accomplish something like this over a period of years. Does that describe the last 6 months?

Sure, a cogent policy would be ideal. But you can’t let perfect be the enemy of the good. America was getting their lunch eaten well before Trump. At least the tariff policy is an attempt at rectifying the situation.

Re: Six months into tariffs, businesses have no idea how to price anything

#100

Post by esseph » Sat, Aug 30, 2025, 10:48 PM UTC

hippo22 wrote: post #85

I’d like to lay out an argument about why tariffs are good. The only businesses that are derailing with tariffs issues are those that import goods to sell. The argument against tariffs is that they make goods more expensive. Of course, this argument is true. But that’s not the end of the story. Because prices are higher for imported goods, demand for domestically produced goods increases. This increase in demand lead…

Both raw materials and finished goods are tariffed.

So if the idea is to be more self sustaining: we cannot.

Also, read this: https://www.molsonhart.com/blog/america-underestimates-the-d...