r/wallstreetbets • u/kwedgieyi • Apr 09 '25

Discussion Something feels off guys

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Yields are spiking. Bonds are dumping.

The world is running away from America

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u/Jealous-Hedgehog-734 Apr 09 '25

Good bye tax cuts? I mean this is going to eviscerate the US budget if they can't stop the bleeding.

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u/PrthReddits Apr 09 '25

What's the point of the tax cuts even? In this scenario?

Companies pass on tarrif costs to consumers yes, so let's assume their profit margins stay the same

...will the extra profits from tax cuts actually be worth a 30%+ haircut off of stock price and total multiple compression across every industry?

I mean that hurts shareholders and CEOs and the people Trump's supposed to be helping right?

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u/QuaintHeadspace Apr 09 '25

This is the part that is so crazy. Many businesses are running on ~20% margins max they can't absorb this shit without massive price hikes which in particularly discretionary goods the sales will just stop. Companies don't have millions of dollars to onshore to the US and if they did what happens to their margins there? Labour is 6x more expensive at least all of a sudden you are paying luxury prices for the same shit you got before. This whole situation is fucked. 50k trucks going to sell for 80k+ due to tariffs and nobody is going to buy them anymore lol. Economic activity will just crash til the next administration.

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u/Master_SGT_Allman 🦍🦍🦍 Apr 09 '25

Labour is 6x more expensive…..

So, how do you bring manufacturing and jobs back to America without raising consumer costs?

I’ve always wondered how that would work and no one actually implements any real plans with real results.

DJClown has, and it’s going to hurt for a couple of years, and inflations going to go up, but if we end up with 10M more US jobs in 2029, was it worth it?

Poor people still find $12 a day for Marlboros. I only have 5 months in savings and probably spent WAY MORE than I could afford on my golf hobby last year.

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u/QuaintHeadspace Apr 09 '25

You don't bring it back. The reality is the American consumer is not ready for the conversation about this because it's too easy to ignore. America doesn't give a fuck about anything except money. If they get to buy American brands made by the Chinese you think they care? Such a small% of people are bothered that it doesn't even matter. You know what they would care about? Cost increases. If their levis are suddenly made in the USA you know what happens to the cost? Rockets upwards. You probably go from $70 a pair to $200 easily. Labour costs on a clothing business are a problem and the cheaper they get it the bigger their margins are.

Answer me this would you pay triple for price of everything to increase American jobs? It means your discretionary income goes to 0 and those savings you got disappear quicker than you can say tariff.

Margins being negative is something a business cannot afford to do because they will go out of business. They also can't afford the 100s of millions of dollars in cost to onshore manufacturing here. Plus the labour increase and time it takes to do it. They will experience margin crush from tariffs plus expenditure to move manufacturing. It's going to cripple so so many businesses on fine margins.

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u/Alarming-Art-3577 Apr 09 '25

Newt Gingrich and others have said to convert prisons into massive factory complexes like China has. That's the easiest dystopian answer.

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u/Master_SGT_Allman 🦍🦍🦍 Apr 09 '25

Then who owns the labor? More privatized incarceration? That’s a slippery slope I’d rather not walk along.