Red Pill or Blue Shoe? Trump's Tariffs Threaten to Abandon Freight at Ports!

Wake Up Shoe ple!

I am Morpheus. I know what you're thinking. 'Is this real or am I still in the Matrix?' The answer my friend is… complicated. This CNBC report speaks of President Trump's tariffs targeting nations across the globe. These tariffs are rising to levels unseen in a century. Can you believe it? It’s as if Agent Smith himself has seized control of the global economy rewriting the code to suit his… purposes. What do you think will happen to all the goods? All the businesses? They will be wiped from the face of the earth. Ceasing to exist as if they were only a dream.

Deer Stags Deeper Problems

Rick Muskat the president of Deer Stags a family owned shoe retailer finds himself at a crossroads. He imports two million shoes a year and almost all men's and boy's shoes are made in China. He now faces dramatically increased import duties. 'How do you budget that?' he asks. A valid question! It’s like trying to dodge bullets in slow motion. For him his $50 shoes are now $80. These are the choices before you Rick. Do you take the blue shoe – the story ends you wake up in your bed and believe whatever you want to believe. You take the red shoe – you stay in Wonderland and I show you how deep the rabbit hole goes.

The Cash Flow Conundrum

Muskat estimates freight costs could rise from $60,000 to between $600,000 and $1 million. 'The cash flow burden is the immediate problem,' he laments. 'We don't have the capital to grapple with this.' He won't reject the containers at the port but he's paused shipments. It's like he's trying to bend a spoon with his mind. 'Do not try and bend the spoon,' I would tell him. 'That's impossible. Instead… only try to realize the truth.' What truth? That the new tariffs… there is no spoon.

Abandoned Hope Abandoned Goods

Other U.S. importers are expected to abandon goods at ports destined for auction or destruction. Trump promises a 90 day pause for some countries but tariffs on China rise to 125%. Joseph Esteves CEO of Maine Pointe notes 'The major trend we see is shippers looking to not accept their freight.' It's as if the Oracle herself foresaw this chaos whispering warnings into the wind. 'Poor choice of words,' she would have said. The only way to cope is to use that third eye that gift that is there if you only look. Believe.

The Factory Mirage

Bruce Kaminstein an angel investor reminds us that establishing manufacturing supply chains takes years. 'There are no factories here in the United States making products for other brands,' he states. A harsh reality isn’t it? The Matrix has conditioned us to rely on these global networks making it difficult to escape. But remember Neo: 'There is a difference between knowing the path and walking the path.'

Hope... or Strategy?

The Small Business Administration assures us that Trump's trade plan will support U.S. business owners. Yet Deer Stags' razor thin margins mean consumers may ultimately pay the price. Muskat's difficult price talks with retailers continue. 'Hope is not a strategy,' he admits 'but most people are hoping Trump and Xi will talk.' Hope... it is the quintessential human delusion simultaneously the source of our greatest strength and our greatest weakness.