TL;DR

Trump’s 245% tariffs on Chinese goods spark trade war déjà vu, echoing historical blunders like Smoot-Hawley. Main Street pays the price, again.

Story

Trump’s trade war escalates: China faces 245% tariffs. Sounds unbelievable? History says otherwise. Think Smoot-Hawley Act (1930) – similar protectionist policies worsened the Great Depression.‣ Protectionism: Trying to help your country’s businesses by making imported goods more expensive.

How it works: Trump adds tariffs (extra taxes) on goods from China. China retaliates. Costs skyrocket. Like a trade war with nukes – everyone loses.

Impact: John, a small business owner, now faces exorbitant costs for Chinese parts. His business, built over decades, crumbles like a house of cards.‣ Tariff: Tax on imported goods.

Remember 2008? Subprime mortgages packaged as safe investments? Same story, different costume. We’re wired to chase quick wins, blind to long-term risks. ‣ Subprime mortgage: Loan given to someone with a poor credit history.

Lessons:

• No free lunches in trade. Tariffs hurt everyone.
• Political rhetoric rarely reflects economic reality.

Conclusion: Doubt everything, especially promises of easy wins. History doesn’t repeat, but it rhymes.

Advice

Diversify investments. Don’t put all your eggs in one basket, especially if that basket is made in China.

Source

https://www.reddit.com/r/stocks/comments/1k0bs3n/wh_china_now_faces_up_to_245_imports/