Most people are wrong answering this. Yes, factories* are closing in China because American businesses have stopped buying stuff from them. China’s exports are quite a big chunk of their economy.
I’ve listened to journalists in China reporting on factories closing down when DT put the tariffs at 145%. Not large ones but a number of medium and small ones. Unfortunately, there’s not much in the way of statistics. [Edit-though you can read the thoughtful comments of Jeff Duda below. Apparently, there is a period of adjustment and China in the big picture will do okay.
Okay, so they are closing. But what does that mean? What it means is that there will be items that Americans were buying that you simply can’t get anymore. Suppose that around Christmas time, there’s a shortage of toys – and the prices of what is there is going to be sky high because of the demand and that there just aren’t toys there. (The US with 4% of the world’s population buys 40% of the world’s output of toys, 90% of which are made in China.)
Empty shelves. Remember the lack of toilet paper during covid? There will be a number of products produced by them that will start to lead to either empty shelves or the prices are going to go way up.
The US has by far the world’s largest economy – not even close. So when America stops buying stuff, it affects Chinese factories. With over a billion people, even a small sudden drop of 1% production means a lot of people will lose their jobs.
Plus, Americans love to buy stuff – and if stuff is not available or too expensive – they will stop, which means closing of businesses and stores. For the DT supporters this means the economy will shrink.
I’ve been getting comments about buying American products. Why not? First, DT in his first administration had made a big deal with Foxconn to make a factory in 2018. What came out of all the huge amounts of money spent? Nothing.
Yes, China will go through some hardships if the tariffs stay in place more than a few days.
But don’t cry for China. Wait until you go to Walmart and see a third of the shelves empty. And we may only be a few weeks away from that. Remember last time that happened, during the Trump Virus in 2020, empty store shelves. It was apocalyptic when I saw that the first time — also during Trump’s presidency.
The tariff war will impact Americans much worse than it hurts China. And once the supply chain is screwed up, we already know from experience it takes years to recover from it, inflation goes crazy, we have long-term shortages of some items. This is a Trump disaster in the making.
Trump has succeeded in making China the largest up-and-coming world trade partner…except with the U.S. All our previous trade partners around the world are now making deals with China. Trump has made us a pariah. We are not trustworthy because of him.
He ‘rewrote’ the NAFTA so he could claim credit, even though he didn’t change anything but the name. Then when he gets back in office he ripped up the deal. No on knows from hour to hour what he’s going to change next.
His signature/word means nothing. Now he wants all countries doing business with the US to use cryptocurrency through his business so he gets the transaction fees! Other countries are now getting together to create a new currency instead of the American dollar.
Our credit score has tanked and Japan is talking about selling our bonds. That’s the money we borrowed because of our deficit. If Japan sells a lot of bonds there would be more bonds available which will decrease the value and drive up interest rates for everyone in the US.
Long story short, China is profiting from Trump’s idiocy.
