Why Haven’t Tariffs Trashed the Global Economy? Explaining the ‘Global Resilience Puzzle’ | Metals Mine

  • Why Haven’t Tariffs Trashed the Global Economy? Explaining the ‘Global Resilience Puzzle’

    From niesr.ac.uk

    When we start a new year, it’s good to look back and take stock of where we’ve been. The global economy faces significantly higher trade barriers than it did just a year ago. And rather than being consigned to the economic history books, tariffs are now just a part of life. We expected this to weigh on growth and impact inflation. But so far, it hasn’t quite turned out that way. At the start of 2025, we forecast the US economy to grow 2.4 per cent and the global economy to grow 3.2 per cent. But, after tariffs were announced, we revised our forecasts for growth down, to 1.6 per cent and 3 per cent, ... (full story)

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OutThere
Feb 10, 2026 10:23am
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Summary:
US gets screwed.

Tariffs are a tax on imports. And, just like any tax, firms pass some of these costs onto consumers. So, US tariffs raise domestic prices, and reduce economic activity.

But for the global economy US tariffs push down on prices. This is because, from the perspective of exporters, a big chunk of global demand has gone as US consumers demand fewer imports. This leaves an excess supply of goods on the global market, and therefore lower global inflation.
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ocd
Feb 10, 2026 10:19am
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So the big scare was gonna be the hit to China. And what did China do? They now send their mass produced, cheap products to the African continent giving the recipients the illusion of forward progress. Good for the African consumer, good for China, good for the US companies, good for US consumers.

China found another market and the US companies in bed with its' mass production of various components, what will they do? Who cares? They are only interested in giving the CEO a huge bonus while paying the workers as little as they can either legally or what it takes to get them to stay.
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