Trump will add copper to the 25% tariffs on Canadian steel and aluminum.
Don't have enough copper? "Tariff man" has the solution --- raise prices even more. That'll fix it ---NOT! It's like watching a train wreck in slow motion.
Simple minded solutions for simple minded people --- that are all but certain to fail after inflicting a lot of damage.
When people talk about resources on HN the common narrative is that they don't "run out", some reserves are just less economic than others, you could always squeeze out more, the price just has to be right.
The first order effect of tariffs is that imports get more expensive.
The second-order effect is supposed to be a subsidy/stimulus to domestic production but I don't know enough about US copper reserves to say whether 25% would move the needle or not?
Probably the third order effects are for people to figure out how to bust the tariffs by "smuggling" resources through "friendly" (less tariffed) supply chains (I imagine people will make fortunes doing this). Also incentivising companies to come up with ways to use less copper.
Old Donald is going to make some supply chain consultants very rich and a lot of average Americans poor.
His "just shout something" style absolutely does not work for the complexity of international trade and tariffs. People will work around them. Customs rules are super complex, you can't change the rules on a few days notice and not cause all kinds of loopholes and unwanted side effects.
Ah, unless I'm wrong, our national stockpile of copper is the 30 B pre-1982 pennies in circulation, excluding the steel pennies during WWII. So, $300 m street value. If those weigh 88,500 metric tons in aggregate, then we're talking a scrap value of $850 m.
Pennies from 1982 onward are mostly zinc, and I suspect not worth reclaiming. But we have to talk about how to separate these. Let's claim that, in a great coordinated effort of patriotism, the American people squint and sort their pennies. Maybe taking them to the nearest post office for a spot credit of 2 cents. Some inventive people with access to buckets of 'em might automate a sensitive scale and flicker, or contract for inexpensive or captive labor. A roll of 100 pennies weighs 311g if copper-based, 250g if zinc-based. To nudge hoarders to participate, Trump promotes a limited-time stamp with his image in the style of Ea-nāṣir.
88,500 metric tons is about a month of USA copper imports. So, the hardworking miners of Arizona get a month to retool.
National stockpiles also include known resources .. material that has been sufficiently sampled and measured to have a well enough known to near certainty layout of various densities of the ore of interest .. AND .. a sound plan for extraction that is "economically feasible" with known and costable technology.
Resolution Copper counts to some as part of the USofA national stockpile of copper, albeit as yet unmined, contested for environmental and native title reasons, and with mineral leases held by a transnational company.
Rio Tinto has reported an inferred resource of 1.624 billion tonnes containing 1.47 percent copper and 0.037 percent molybdenum at depths exceeding 1,300 metres (0.81 mi).
The proposed mine is one of the largest copper resources in North America.
Following the passage of the 2015 National Defense Authorization Act, many Native American and conservation groups oppose the copper mine because it will destroy the area above Oak Flat and around the deposit.
Well, peak domestic copper production was in 1980 and 2016. It declined under Reagan, but increased under Obama. So, maybe we ask Barack Obama for some help writing policy.
I don’t know, how about holding on to our phones and computers a little longer, and not replacing perfectly good copper-laden objects just because there is a newer, shinier version on the market?
It's far more ominous: if no intensity of tariff brings down the street price of copper, Trump will have to either pronounce out loud that it's failed, or turn to the threat of military action.
There's something to be said about "supporting domestic production", but the way it's being done feels only remotely related to doing just that -- it's being done as a simple punitive tool.
But there's a part to this that doesn't get enough attention (yet), and that is that these efforts are intended to be new revenue sources so that income tax on the rich can be be eliminated "because we have all of this beautiful free tariff money".
Trump will add copper to the 25% tariffs on Canadian steel and aluminum.
Don't have enough copper? "Tariff man" has the solution --- raise prices even more. That'll fix it ---NOT! It's like watching a train wreck in slow motion.
Simple minded solutions for simple minded people --- that are all but certain to fail after inflicting a lot of damage.
To paraphrase Warren Buffet: if the tariffs don’t spontaneously generate copper, then what?
When people talk about resources on HN the common narrative is that they don't "run out", some reserves are just less economic than others, you could always squeeze out more, the price just has to be right.
The first order effect of tariffs is that imports get more expensive.
The second-order effect is supposed to be a subsidy/stimulus to domestic production but I don't know enough about US copper reserves to say whether 25% would move the needle or not?
Probably the third order effects are for people to figure out how to bust the tariffs by "smuggling" resources through "friendly" (less tariffed) supply chains (I imagine people will make fortunes doing this). Also incentivising companies to come up with ways to use less copper.
Old Donald is going to make some supply chain consultants very rich and a lot of average Americans poor.
His "just shout something" style absolutely does not work for the complexity of international trade and tariffs. People will work around them. Customs rules are super complex, you can't change the rules on a few days notice and not cause all kinds of loopholes and unwanted side effects.
The immediate side effect --- less supply and higher prices.
Who benefits from this anytime soon? Not the consumer. And in the US economy, squeezing the consumer hurts the overall economy.
Tariffs didn't work very well in the 19 century and only a fool would think they are economic magic for the 21st century.
Ah, unless I'm wrong, our national stockpile of copper is the 30 B pre-1982 pennies in circulation, excluding the steel pennies during WWII. So, $300 m street value. If those weigh 88,500 metric tons in aggregate, then we're talking a scrap value of $850 m.
Pennies from 1982 onward are mostly zinc, and I suspect not worth reclaiming. But we have to talk about how to separate these. Let's claim that, in a great coordinated effort of patriotism, the American people squint and sort their pennies. Maybe taking them to the nearest post office for a spot credit of 2 cents. Some inventive people with access to buckets of 'em might automate a sensitive scale and flicker, or contract for inexpensive or captive labor. A roll of 100 pennies weighs 311g if copper-based, 250g if zinc-based. To nudge hoarders to participate, Trump promotes a limited-time stamp with his image in the style of Ea-nāṣir.
88,500 metric tons is about a month of USA copper imports. So, the hardworking miners of Arizona get a month to retool.
National stockpiles also include known resources .. material that has been sufficiently sampled and measured to have a well enough known to near certainty layout of various densities of the ore of interest .. AND .. a sound plan for extraction that is "economically feasible" with known and costable technology.
Resolution Copper counts to some as part of the USofA national stockpile of copper, albeit as yet unmined, contested for environmental and native title reasons, and with mineral leases held by a transnational company.
https://en.wikipedia.org/wiki/Resolution_Copper
Ah, I didn't know that. Other resources are talked about in terms of proven reserves and stockpile.
Who's going to open a new copper mine based on Trump's insane tariffs? They'll probably be gone in 4 years if not sooner.
Well, peak domestic copper production was in 1980 and 2016. It declined under Reagan, but increased under Obama. So, maybe we ask Barack Obama for some help writing policy.
With the way things are working, all decrees have a two week half life. It is impossible to make long term plans in this environment.
> then what?
I don’t know, how about holding on to our phones and computers a little longer, and not replacing perfectly good copper-laden objects just because there is a newer, shinier version on the market?
The amount of copper in consumer electronics is minuscule. You're not accomplishing anything by holding on to an old phone with a cracked display.
It's far more ominous: if no intensity of tariff brings down the street price of copper, Trump will have to either pronounce out loud that it's failed, or turn to the threat of military action.
Wonder if aluminum wiring will make a comeback…
There's something to be said about "supporting domestic production", but the way it's being done feels only remotely related to doing just that -- it's being done as a simple punitive tool.
But there's a part to this that doesn't get enough attention (yet), and that is that these efforts are intended to be new revenue sources so that income tax on the rich can be be eliminated "because we have all of this beautiful free tariff money".