Trump's Vietnam Trade Tango: 20% Tariff and the Chaos Dragon

Sorting Out Your Damn Room: Trade Edition

Alright folks settle down. Let’s unpack this… *situation* with Trump and Vietnam. A 20% tariff he says on Vietnamese goods. Now straight off the bat it sounds like someone’s been raiding the chaos cupboard again. It’s all a bit like trying to organize your sock drawer with a hammer – effective perhaps but at what cost? He’s talking about opening up Vietnam's markets to the US tariff free which on the surface is like getting your room in order but is the room next door about to explode? In essence this is about responsibility. Whose? Well that's what we're figuring out now isn't it?

The Transshipping Tango: Dodging the Dragon

Now this transshipping business…sneaky isn't it? Goods hopping from one country to another to avoid tariffs. It's like a game of international trade whack a mole. Trump wants a 40% tariff on goods transshipped through Vietnam. Is it a solution? Well maybe. But let's not kid ourselves. It's a complex world and these simplistic solutions might just create a new set of problems. The devil as they say is in the details and in this case he's probably hiding in a shipping container somewhere in the South China Sea. You need to face the dragon you can't just slap a tariff on it.

Vietnam Will Pay...Or Will They?

Trump says "Vietnam will pay." But here's the rub: tariffs are generally paid by importers. Which means in essence American companies are footing the bill. It's a bit like saying you're going to punish the dog but you're the one who ends up cleaning the mess. Someone needs to clean their room here. This agreement was unveiled less than a week before a 90 day pause on many of Trump's so called reciprocal tariffs was set to expire sending U.S. duties on imports from dozens of countries soaring. Under that protectionist trade plan Vietnamese imports to the U.S. were subject to a 46% blanket tariff. That rate was lowered to 10% during the 90 day interim. Raising the tariff on Vietnamese goods to 20% will hike costs for U.S. importers which could be passed on to consumers or suppliers. The S & P 500 nevertheless rose slightly on news of the trade deal.

SUVs in Hanoi: A Vision of…Something

And then there's the bit about SUVs. “Large Engine Vehicle which does so well in the United States will be a wonderful addition to the various product lines within Vietnam.” Is that so? Are we trying to superimpose our values on another culture again? Or are we just trying to sell more gas guzzlers? It's a bit like telling a vegan to embrace the paleo diet because it's good for *you*. You need to be in touch with yourself and your own values before stepping out there and changing the world. Although I must admit that mental image of Hanoi's streets filled with Ford Explorers does induce a wry smile.

Economic Uncertainty: The Monster Under the Bed

Critics are saying this creates economic uncertainty. Well no kidding! Uncertainty is the monster under the bed that keeps everyone awake at night. It’s hard to make plans when the rules keep changing. You need to figure out what is true before you can project the future. But Trump's defenders are countering that tariffs bring in billions. So is it a necessary evil? A gamble? Or just a chaotic mess? The numbers are the details and the details are the truth.

Summer Tariff Blues: Buckle Up Buttercup

Jerome Powell bless his heart is saying we’ll see the impacts of these tariffs more during the summer. Translation: get ready for price hikes. And those analysts saying there hasn't been a widespread impact yet? Pre tariff stockpiling. A clever move to circumvent the immediate consequences of an otherwise rash decision. Buckle up buttercup. It’s going to be a bumpy ride. The lesson here boys and girls is clean your room. And maybe just maybe the chaos dragon will leave you alone. Now go forth and be fruitful…or at least try to make sense of it all.