A long-term trade war would hurt consumers with high prices, former Tiffany & Co. President James Quinn told CNBC.
“If it’s a long-term trade war, it becomes a tax on the consumer,” Quinn, who served as president of the luxury jeweler from 2003 until his retirement in 2012, said Monday on “Closing Bell.” He joined the company in 1986.
“Those costs will be passed along to the consumer, and it will certainly hurt purchases at the retail level because things will become more expensive,” Quinn said.
The Trump administration first proposed tariffs in March to fix what President Donald Trump deemed unfair trading practices. Most recently, the U.S. imposed levies on $34 billion worth of Chinese goods. Beijing responded with tariffs of its own and accused the U.S. of causing the “largest trade war in economic history.”
So far, the Trump administration has placed no new duties on retail items such as apparel and electronics — something market watchers have awaited in fear.
“China [is] still a huge manufacturer for apparel and shoes,” Quinn pointed out. “Inevitably, if that’s going to be a long-term addition to costs, it’s going to show up in consumer prices.”
Still, the market rallied Monday with all three indices closing positive and fears of trade wars waning.
While the outcome of the tariffs is still unclear, Quinn said U.S. consumers have benefited from the long-standing trade agreements with China and the multitude of products imported at reduced prices.
“We haven’t played real hardball yet with the trade violations in China,” he said. “If this is an opening gambit to address those things, then it could be a very positive outcome. But it’s not clear — at least not to me — that there is an overall strategy to addressing the real trade conflict.”
