When you shop at Target, Walmart or Costco, you probably don’t think much about the trips the things you buy have taken.
It turns out that things made in China can travel up to 10,000 miles to arrive on American soil. Last ships carry everything from laptops, smartphones, furniture, lamps, clothes, toys, sports equipment, shoes and more to the US that eventually lands in your neighborhood stores.
Since the beginning of April, when the United States added a 145% duty on goods imported from China, traffic in the freight ship has fallen. About 40 cargo ships are on the way from China to the United States, but this number is down by approx. 40% just before the tariffs were introduced. These ships carry about 320,000 containers according to Bloomberg. That’s about a third less than just before the 145% tariff was set.
Looking ahead, traffic in the cargo ship could slow down even more. At the end of April, HAPAG-LLOYD AG, the world’s fifth largest container carrier, announced that approx. 30% of bookings from China to the United States have been canceled.
While the trade war is still young and although the United States has said that the customs rate in China will fall, trade is going now.
What does this mean to you, the economy and the gold?
In mid -May, thousands of US companies, even giant retailers such as Target and Walmart, have to refill inventory. Experts predict that we can start seeing empty shelves in some of your favorite stores in a few weeks.
The United States is a consumer -led economy. In some accounts, consumer costs create approx. 70% of our gross domestic product. For the economy, math is simple. Fewer goods to sell means less expenses, slow economic growth.
What about gold? The noble metal has risen almost 30% since the beginning of the year, at least partly burnt largely by a safe port buying in the midst of volatility in the stock market, concern about a recession and the impact of customs on the economy.
The price of gold continues to hit a record by record, recently surpassing $ 3,400 per day. Ounce, and it still climbs. Many on Wall Street, including JP Morgan and Goldman Sachs, expect gold to hit $ 4,000 by 2026. Given how fast gold is climbing, $ 4,000 could come even earlier.
While many Americans have not yet seen the first -hand effect of the trade war, it could come within a few weeks. Logistics experts warn that spring is when retailers start placing orders for back-to-school and Christmas inventory. In a typical year, the first holiday shipments would hit the water and start this journey in mid -May. Currently, many of these orders are canceled or are on wait.
While the jury is still out on any customs agreement between China and the United States, fewer goods are coming to our country now. While it can put a crimp in shopping for school, it will continue to support the historic increase in gold prices. Do you own enough?
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