I went to the grocery store today and everything was up by quite a bit. Eggs have doubled, just arbitrary, out of the blue. They were normally 2.25 for a large dozen, now 4.40. I'm going to go back to my local free range egg suppliers.

I have a big project that i need metal for, and i'm cleaning out my savings to get it before the prices skyrocket.

The market adjusts. Say an item costs $100, then Donnie slaps a 10% tariff on it.

The seller can't sell as much at $100, which costs the customer $110, nor would it make sense to absorb all the damage by lowering the price to $90.91, which would make the cost to the customer back up $100.

So the seller will make the price somewhere in between, maybe $92, $95, $98, whatever, depending on what's optimal in the market (it depends on the elasticity of demand).

So *nominally*, prices will go down, allowing Donnie to claim a win on inflation, even though customers will have to pay more.


Yes it's more complicated for tariffs, domestic producers could in theory raise prices and still be selling at an effective discount against imports, but this assumes that the domestic producers don't use any raw materials that are themselves subject to tariffs.

It also assumes other countries don't retaliate.