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Alcoa (AA -11.7%) is today's biggest decliner on the NYSE, as aluminum tariffs that were meant to protect the industry from foreign competitors instead take a bite out of the earnings of the largest U.S. producer. Alcoa cut its 2018 profit projection as tariffs on imported aluminum present what CEO Roy Harvey called a “significant” headwind.
While demand remains strong, Harvey said he is concerned that industrial customers eventually could move operations outside of the U.S. so they can buy metal that is not subject to the tariffs.
That's their problem then. They should have thought about their moves before they decided to sell out America for profit. Sucks to be them. Bye Felicia!
That's their problem then. They should have thought about their moves before they decided to sell out America for profit. Sucks to be them. Bye Felicia!
In other words:
The tariff is going to hurt US business but "sucks to be them".
They should be buying metal from America not overseas, that's the point of all of this.
You need raw materials like bauxite, which is not found in US. They don't have a choice, but to import it and pay massive Trump taxs. Some industries will have to relocate out of the US in order to survive.
You need raw materials like bauxite, which is not found in US. They don't have a choice, but to import it and pay massive Trump taxs. Some industries will have to relocate out of the US in order to survive.
And that's the key point: Some industries will have to move overseas, taking jobs with them, if this tariff continues.
The steel nail industry has been hit hard as 100% of the product is steel.
Mid Continental Nail is one of the few left in the US, with 80% of the market being imports (with tariffs) from Asia.
Sales have plummeted due to the new tariffs as they use Mexican steel and a $27 case is now $27+$5 tariff.
They were competitive until the tariffs and laid off over 100 employees last month, They don't expect to survive beyond a few more months.
US steel is even more expensive so that's not an option.
They should be buying metal from America not overseas, that's the point of all of this.
This is my simple version. So Trump puts tariff on imports -- so other nations put tariffs on their imports (our exports), that makes the USA product more expensive. In much the same way Trump is protecting American produced goods -- other countries protect their goods.
So for American manufacturers that use the product or export the product, they lose business overseas.
They then move some of their operations to avoid paying the tariffs.
YEs Americans should by American but it isn't just about Americans buying goods -- it's about who Americans sell their goods to.
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