Americans are stockpiling in anticipation of tariffs – here’s why that may not be necessary

Many Americans are stockpiling goods and upgrading appliances to get ahead of potential price increases that could be brought on by tariffs. This would likely happen should President-elect Donald Trump tariff goods from other countries, as those countries would almost certainly respond with tariffs of their own.

A quarter of Americans surveyed said that it was a good time for major purchases, as they expect prices to go up next year. This is a record high, and went up from only 10% of Americans who believed prices would go up a month ago.

President-elect Donald Trump has long threatened, and sometimes used, tariffs on other countries, as a way of punishing them for what he says are their unfair trade practices, and US trade deficits with those countries.

Tariffs are often used as a way of protecting a country’s workers; preventing foreign nations from undercutting the domestic workers. But it almost inevitably results in tit for tat tariffs, which increase prices for everyone.

It seems that Mr. Trump is banking on his tariffs breaking other nations and forcing them to comply, before the tariffs from those nations hurt the American consumer too much.

For example, Donald Trump has threatened to tariff Canadian goods at 25% if they do not improve their border security. Should the tariffs be implemented, Canada will implement their own tariffs.

But in such a scenario, Canada’s economy would be decimated, and a recession would occur. American consumers would also be negatively effected, but not nearly as much as Canadians will be. This could eventually force Canada to comply.

But we will have to see what the situation is on January 20, 2025, when Donald Trump is sworn in for his second term, before we can make any definitive predictions.