Updated: Aug 27, 2019
In 2017, the U.S. launched an investigation into China’s trade policies. According to President Donald Trump, “For many years China (and many other countries) has been taking advantage of the United States on Trade, Intellectual Property Theft, and much more. Our Country has been losing HUNDREDS OF BILLIONS OF DOLLARS a year to China, with no end in sight...”
In 2018, the U.S. imposed tariffs on approximately $250 billion of goods imported from China. China retaliated by imposing tariffs on approximately $110 billion of U.S. imported goods.
As of August 2019, the trade war is still being fought. Here is what this war means for American Consumers:
Higher car prices: China placed higher tariffs on steel and aluminum - key products for car manufacturers. Car companies such as BMW will pass these costs onto consumers.
Tech stock losses: Although the tariffs on technological goods like iPhones were pushed back to December 15, technology stock has already started to lose value as a result of the trade war.
$650 per year: According to estimates from Kathy Bostjancic, chief U.S. financial economist for Oxford Economics, this is the approximate amount of additional money consumers can expect to spend as a result of the imposed tariffs.
Lower gas prices: The Chinese placed tariffs on U.S. Crude, causing oil prices to drop.
Farm losses: Chinese tariffs on agricultural products such as meat, beans and fruit have significantly slowed sales of exported goods from farms. The U.S. government has offered $28 billion to U.S. farmers to counter their losses.
Apparel, shoes, and other goods will be hit with tariffs later on this year. All of this is happening as we prepare to enter a recession in 2020. If there was ever a time to make sure your emergency fund was adequately financed, this is the time.