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Trump's new tariff proposals include a 25% tax on video game consoles

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Here's my take. It will only be temporary, and China cannot win a trade war with the U.S. so they will eventually break and then prices will be lower again and the U.S. will reap the benefits of having done it in the first place by having American made products purchased more because the tarrifs increase the cost of foreign imports and make them less of a steal. We import far more from China than they import from us, so they cannot win this fight. It's just a matter of time.



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spemanig said:
I'm stupid - do tariffs effect digital software or just physical products?

Depends on the legislation, but most certainly would apply to all.

At least in Brazil all gaming SW have the same tariff independent of being on any hardcopy.



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Dulfite said:
Here's my take. It will only be temporary, and China cannot win a trade war with the U.S. so they will eventually break and then prices will be lower again and the U.S. will reap the benefits of having done it in the first place by having American made products purchased more because the tarrifs increase the cost of foreign imports and make them less of a steal. We import far more from China than they import from us, so they cannot win this fight. It's just a matter of time.

Multinational companies can avoid tarrifs by shipping product to one country say Vietnam then ship to USA or they might move manufacturing base to another low cost country.  Multinationals have been jumping countries to lowest labor for decades and China labor cost are rising. Basically they are cheap bastards and profit is number one because that's the whole point of a company to make money.



Dulfite said:
Here's my take. It will only be temporary, and China cannot win a trade war with the U.S. so they will eventually break and then prices will be lower again and the U.S. will reap the benefits of having done it in the first place by having American made products purchased more because the tarrifs increase the cost of foreign imports and make them less of a steal. We import far more from China than they import from us, so they cannot win this fight. It's just a matter of time.

Or they just wait 20 months. Non-democracies can afford to play the long game.



 

 

 

 

 

sethnintendo said:
Well there aren't many products left to threaten tariffs. He said he wanted tariffs on all products and we are about to get there. In a full blown trade war now. I'm going to take half my money out of 401k with loan because here comes the correction. Plus I will prob die before retirement. I plan on working till I die

Depending how your 401k is codified it may be considered a retirement account, and if you do withdraw money from your 401k and it is considered a retirement account, then you will be hit a very heavy tax (around 35% if I remember correctly). Just FYI.



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spemanig said:
I'm stupid - do tariffs effect digital software or just physical products?

Since these tariffs concern China, only products that are manufactured in China will be affected. This includes all consoles and probably most controllers.

All console manufacturers have production of physical games outside of China, so digital game prices won't rise for the purpose of making prices for digital and physical software match each other, simply because physical games are not affected by the tariffs.



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Megiddo said:
sethnintendo said:
Well there aren't many products left to threaten tariffs. He said he wanted tariffs on all products and we are about to get there. In a full blown trade war now. I'm going to take half my money out of 401k with loan because here comes the correction. Plus I will prob die before retirement. I plan on working till I die

Depending how your 401k is codified it may be considered a retirement account, and if you do withdraw money from your 401k and it is considered a retirement account, then you will be hit a very heavy tax (around 35% if I remember correctly). Just FYI.

No that only applies if I cash out.  If take loan can only take half of your balance and you payback (you borrowed from your own money) through your paycheck.  To do this Fidelity charges about 2 or 3 percent interest to borrow own money (edit- just looked it up and apparently it is 6.5% which kind of sucks, apparently they might have raised the rate).  I figure if stocks tank than so what I buy back in at lower price while repaying my loan.  Sure I could put into bonds which could crash too or straight cash to safeguard but fuck it I want the money.

Last edited by sethnintendo - on 25 May 2019

Dulfite said:
Here's my take. It will only be temporary, and China cannot win a trade war with the U.S. so they will eventually break and then prices will be lower again and the U.S. will reap the benefits of having done it in the first place by having American made products purchased more because the tarrifs increase the cost of foreign imports and make them less of a steal. We import far more from China than they import from us, so they cannot win this fight. It's just a matter of time.

China can easily win a trade war with the U.S. They have far more buyers for their exports than just the United States. Whereas in the US many of our exports were sent mainly to China and we are having difficulty finding other partners. China is in a much, much more advantageous position to 'win'.



KLXVER said:
So now americans will just have to pay a little less than most of the world for their consoles instead of much less...

I was going to say.



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haxxiy said:
Dulfite said:
Here's my take. It will only be temporary, and China cannot win a trade war with the U.S. so they will eventually break and then prices will be lower again and the U.S. will reap the benefits of having done it in the first place by having American made products purchased more because the tarrifs increase the cost of foreign imports and make them less of a steal. We import far more from China than they import from us, so they cannot win this fight. It's just a matter of time.

Or they just wait 20 months. Non-democracies can afford to play the long game.

I considered including that option in my post, but for some reason decided not to do so. You are right, they could just wait until a more pro-globality candidate wins office (in a year or 5 years) like Hillary Clinton, and Biden is certainly in that mold (and also by far the most likely Democratic nominee).