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Guys, look over here, Trump is about to stir up a trade war again, announcing a 25% punitive tariff on cars from all over the world. This hit his big aide Musk very hard, because many parts of Tesla cars are sourced from all over the world, and suddenly the procurement costs have skyrocketed. But Trump doesn't care what Musk thinks; he has to do this, and now Canada and Europe are threatening to retaliate. Trump also said, if you dare to retaliate, I will double the punitive tariffs that previous administrations didn't impose, let's see who is tougher! Anyway, it's my market, I call the shots! If you have the ability, don't sell to our country!!!
What on earth is Trump doing? Recently, he increased tariffs on steel and aluminum, and now he's raising tariffs on all cars, treating big and small countries the same, regardless of whether they are allies or rivals. This has left Canada, Europe, and Japan confused; they don't know how to respond and dare not speak out. So what exactly does Trump want to do? Let me show you a big number: in terms of China-U.S. relations, China's manufacturing accounts for 33% of the global total, but its consumption only accounts for 12% of the global total. In contrast, the U.S. accounts for 29% of global consumption, while its manufacturing only accounts for 15%. Therefore, 15% of manufacturing cannot support 29% of consumption. Meanwhile, China's 33% manufacturing overly supports its own 12% consumption. This means that China's production capacity is aimed at the whole world, especially the U.S. market.
Trump hopes to bring manufacturing back, but how can manufacturing return? By setting high tariffs, no products can enter the United States. When international capital sees that the prices in the U.S. market are so high due to the increased tariffs, they might as well invest in the U.S. to make a profit. This way, capital is attracted back, which is referred to as de-globalization. This is the tactic that the U.S. is employing.