How the US-China trade war could impact you
OKLAHOMA CITY (KOKH) —
America’s trade war with China escalated Tuesday, as the Trump administration identified an additional $200 billion in Chinese products the U.S. intends to hit with import tariffs.
The move comes after China’s retaliation for the initial U.S. tariffs on $34 billion in Chinese goods.
“Worst case scenario, this would be a sustained war,” said Brad Bertrand, a financial advisor at Retirement Solutions in Oklahoma City. “Unfortunately for the consumer, that means higher prices and inflation. So that’s a short term result of tariffs.”
However, Bertrand doesn’t think those higher prices will be that noticeable for families – at least, not yet.
“The good news is for Oklahomans, our economy is largely based on energy,” he said. “So as a result, the impact in this local economy is not as a great as it might be in other economies where specific products are being affected.”
The U.S. has placed duties on steel and aluminum from Canada, Mexico, and the European Union, who in turn have retaliated. In addition, the Trump administration is locked in a back-and-forth with China over tariffs.
If things continue to escalate, it could also cost jobs, as U.S. companies absorb the higher costs of goods.
“It’s created some upheaval in the marketplace, particularly in the stock market,” said Bertrand.
If you check your 401k balance this week, you’ll likely see it’s down, but Bertrand says that doesn’t necessarily mean you need to take action.
“Because fundamentally the market is strong,” he said. “We think that if you’re in a position where you are investing and you have had some losses, the best thing may be to stay the course.”
Bertrand believes the short-term impacts will be worth it in the end.
“And the reason I say that is it’s going to force our trade partners to come to the table and say, let’s be fair,” he said.
Economists are hopeful this battle ends with the U.S. getting better trade terms.