The whole world has been shocked by the fact that the U.S. and China were able to work out a “trade deal” in just a single weekend. Ultimately, I think that the Chinese were a lot more motivated to get something done than a lot of us originally thought. So that is good news. But both sides are telling us that the details of the “trade deal” will not be released until Monday. To me, that is a major red flag. If this “trade deal” is so good, why not release the details to the world right away? In this article, I am going to share what I will be watching for when the details of the “trade deal” are finally unveiled on Monday morning.
Sometimes the hype does not match reality when a big announcement is teased. Just look at what happened when we were being told that the “Epstein files” were being released. But this time it does appear that this is a really big deal, because the White House is calling this a “China trade deal”…
Top Trump administration officials said they reached a trade agreement with China after two days of negotiations in Geneva, marking a potentially massive victory for President Donald Trump amid his trade war with Beijing.
The White House announced a “China trade deal” in a May 11 statement, but did not disclose details. The apparent agreement came together sooner that most observers expected after Trump’s 145% tariffs on Chinese imports virtually halted $600 billion in annual trade between the world’s two largest economies.
That sounds pretty definitive.
And U.S. Trade Representative Ambassador Jamieson Greer has told the press that the two sides “were able to come to agreement”…
“This was, as the Secretary pointed out, a very constructive two days. It’s important to understand how quickly we were able to come to agreement, which reflects that perhaps the differences were not so large as maybe thought. That being said, there was a lot of groundwork that went into these two days. Just remember why we’re here in the first place — the United States has a massive $1.2 trillion trade deficit, so the President declared a national emergency and imposed tariffs, and we’re confident that the deal we struck with our Chinese partners will help us to work toward resolving that national emergency.”
So it appears that a deal is definitely here.
I am sure that the agreement will cover areas such as intellectual property theft and currency manipulation, but to me the most important element of the agreement will be the tariff rates.
I can’t wait to get the details.
More specifically, what will the tariff rate be on goods that are imported from China moving forward?
We know that it won’t be less than 10 percent. In fact, on Sunday Commerce Secretary Howard Lutnick made it clear that the 10 percent baseline tariff on goods from virtually all nations will “be in place for the foreseeable future”…
Commerce Secretary Howard Lutnick said Sunday that the 10% baseline tariff rate on imports from other countries is likely to “be in place for the foreseeable future,” echoing President Donald Trump’s comments from days prior.
“We do expect a 10% baseline tariff to be in place for the foreseeable future,” Lutnick told CNN’s Dana Bash on ‘State of the Union.’
The commerce secretary rejected the idea that consumers would take on increased costs caused by the tariffs, insisting that business and countries will pay.
Tomorrow, if we learn that the tariff rate on Chinese imports has been lowered all the way down to 10 percent, that would be a major victory. Considering everything that has happened in recent weeks, we should all go out and dance in the streets if that actually happens.
If the tariff rate on Chinese imports is set at 20 or 25 percent, that would be damaging, but we could survive that. So I would consider that to be a victory as well.
If the tariff rate on Chinese imports is set at somewhere around 50 percent, that would be disastrous. Most of the products that are coming over from China would still be shipped across the Pacific in such a scenario, but we would see dramatic prices increases all over the country.
If the tariff rate on Chinese imports is set at 75 percent or higher, that would kill most trade with China, and everything that I have been warning about regarding shortages and empty shelves would still apply.
I am really hoping for a tariff rate on Chinese imports of under 50 percent.
If we do not get that, large numbers of small companies that rely on Chinese imports will start going out of business. Even after a single month of high tariffs, many such small businesses are already on the verge of going belly up…
The owner of a San Francisco card-game company cashed in his money-market funds. The founder of a tent maker is looking for investors. A watch and jewelry company in Colorado is holding off on signing a new office lease. And a New Hampshire consumer-product company has laid off more than half its staff.
Around the country, small businesses that import goods made in China are taking actions—big and small—to try to outlast the current 145% tariff regime on items from that country. But many are worried that their companies won’t survive.
One small business owner says that he has already had to reduce the number of workers that he employs from 12 to 5…
“Nobody in power seems to care about small business,” said Scott Anderson, owner of 5 Star North, which works with Chinese manufacturers to make its products ranging from acrylic markers to tiki torches. “At this point the only option I see is selling out the rest of what we have and shutting our doors.”
Anderson now has five employees, down from 12 at the start of the year. Three are looking for jobs and Anderson expects them to leave by the end of the month. The New Hampshire company is also running low on stock and expects to be out of most items in the next few months.
A tariff rate of less than 50 percent on Chinese imports would at least give these small business owners a prayer of surviving.
In recent weeks that has been a lot of talk about “buying American”, but when push comes to shove the truth is that what most people want is lower prices.
One small business owner decided to test this, so he gave his customers a choice. They could buy a Chinese-made shower head for $129 or the exact same shower head made in America for $239.
He ended up selling 584 of the shower heads that were made in China and zero of the shower heads that were made in America…
Armed with real numbers, he set out to do a test with two identical products, with the only difference being their origin and, critically, their price: visitors to Afina’s website were presented with the option of a Chinese-made item for $129 or a US-made version for $239.
“I’m big on just testing it out with real data and real purchases,” van Meer said. “Not asking customers, not a survey, not even add-to-carts.”
“When somebody has to pay for it, that’s the actual real data,” he added.
After several days and more than 25,000 visitors, he said he sold 584 of the lower-priced shower heads and not one single purchase of a US-made version.
This is the reality of the world that we live in.
There is a very small percentage of the population that will pay more to buy something that is made in America, but most people simply want the lowest price they can get.
Unfortunately, if the tariff rate on Chinese imports is set very high, the prices of thousands upon thousands of products that Americans purchase on a regular basis will soon go up dramatically.
Michael’s new book entitled “10 Prophetic Events That Are Coming Next” is available in paperback and for the Kindle on Amazon.com, and you can subscribe to his Substack newsletter at michaeltsnyder.substack.com.
About the Author: Michael Snyder’s new book entitled “10 Prophetic Events That Are Coming Next” is available in paperback and for the Kindle on Amazon.com. He has also written nine other books that are available on Amazon.com including “Chaos”, “End Times”, “7 Year Apocalypse”, “Lost Prophecies Of The Future Of America”, “The Beginning Of The End”, and “Living A Life That Really Matters”. When you purchase any of Michael’s books you help to support the work that he is doing. You can also get his articles by email as soon as he publishes them by subscribing to his Substack newsletter. Michael has published thousands of articles on The Economic Collapse Blog, End Of The American Dream and The Most Important News, and he always freely and happily allows others to republish those articles on their own websites. These are such troubled times, and people need hope. John 3:16 tells us about the hope that God has given us through Jesus Christ: “For God so loved the world, that he gave his only begotten Son, that whosoever believeth in him should not perish, but have everlasting life.” If you have not already done so, we strongly urge you to invite Jesus Christ to be your Lord and Savior today.
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