Even though the president had said that there would be no exemptions, that was before yesterday when Trump took a step back and reevaluated what he had done. Speaking to the press yesterday, the president held out hope for many smaller companies by saying that those firms that got hit the hardest by the tariff scheme could get some relief. Of course, Apple is not a small business but that doesn’t take away from the impact on Apple products that the ever-rising tax on Chinese imports to the U.S. has.
Tim Cook could have trouble getting to sleep because of this one word uttered by the president
Trump’s relationship with Tim Apple Cook should count for something but what might have Apple’s CEO suffering sleepless nights (besides the Dodgers losing three straight) is that his dear friend the president said that exemptions would be handed out based on “instinct.” Look, when it comes to politics it is hard to find a flaw in Trump’s strategies because just 10 years ago there was no MAGA movement and look at it now. But even his most ardent (took that word right out of my PA bio) supporters would admit, especially in light of the last week, that when the president turns to his instinct, bad things have been known to happen.
Tim Cook’s relationship with President Trump might not be enough to save Apple from a 125% tariff. | Image credit-Apple
If the president keeps the status quo in this pissing match with China, the big question will be how much pain Apple can take eating the higher import taxes itself before it finally feels that it must ask Americans to pay for some part of the import tax. Whether he knows it or not, the president did help Apple out a little by dropping tariffs on countries like India and Vietnam to 10% for the next three months. This will allow Apple to keep prices unchanged for iPhones made in India and other devices made in Vietnam.
The problem remains China
The part of the above video that has meaning for Apple starts at the 10:35 mark.
As for Apple stockholders, their stomach acid is bubbling up toward their throat again today. After Wednesday’s huge rebound Apple’s stock is back in the red. As of 1:25 pm EDT, the shares are down $13.37 (a 6.72% decline) from the previous close of $198.85. A few days ago, Apple relinquished its title as the most valuable publicly traded U.S. company to Microsoft. Now, Apple is back on top but only by a slim margin. Apple has a market capitalization of $2.81 trillion compared to Microsoft’s $2.79 trillion.
