Economy

Whirlpool Just Had Its Worst Day in 31 Years

JM Ashby
Written by JM Ashby

I wouldn't normally take time to discuss it when any particular company's stock tanks, but in this case it's connected to everything else we've been discussing for the past year.

Whirlpool saw its value drop by nearly 15 percent yesterday, its worst day since 1987, and we can point a finger directly at Trump's trade war and Whirlpool's own hubris.

You see, Whirlpool CEO Marc Bitzer praised Trump when he imposed tariffs on foreign washing machines from the likes of Samsung because, like too many other Americans, he was only looking out for himself and his company.

But Trump didn't stop at washing machines and Whirlpool is now taking a beating from Trump's greater trade war and, more specifically, his tariffs on foreign metal.

"Global steel cost has risen substantially and, particularly in the US, they have reached unexplainable levels," Whirlpool CEO Marc Bitzer told shareholders during a conference call Tuesday. [...]

Three months after calling the government's actions on trade an "incredible" outcome, Bitzer said on Whirlpool's first-quarter earnings call April 24 that costs "have risen substantially and, as a result, we're revising our raw material inflation guidance for 2018."

On Monday, Whirpool again raised its guidance for costs of steel and aluminum in its second-quarter report, while the company again adjusted its expected 2018 profits downward.

"We are impacted by the tariffs, as we are an import of record of our suppliers who have to basically pay the tariffs," Bitzer said.

Trump's actions are indeed "incredible," but for all the wrong reasons.

Trump imposed tariffs on foreign washing machines, but then he raised prices for domestic washing machines by imposing tariffs on foreign metal. We've seen a similar pattern play out with all of Trump's tariffs which are still escalating and cascading into unintended and often contradictory consequences.

For example, Trump wants to impose tariffs on foreign uranium while at the same time he wants to subsidize nuclear power plants that use foreign uranium as input.

Trump can pay off farmers whose livelihoods he has destroyed, but can't bail out everyone. He can't bail out Whirlpool and he won't be able to bail out the automobile industry if he goes through with his tariffs on cars and parts. He won't be able to bail out the countless number of small businesses that will be destroyed if he goes through with his plan to impose tariffs on all $500 billion in products we import from China each year.

  • muselet

    I’m honestly not sure who’s dumber: Donald Trump for imposing unjustifiable tariffs or Marc Bitzer for not seeing the (ever-so-slightly) larger picture about those tariffs.

    Yes, okay, fine, the correct answer is “both men are morons.” My question remains, though: is imposing sanctions or believing they’re going to be painless a purer expression of imbecility?

    –alopecia

  • doodlebugrusty

    sigh, how many times do I have to explain it? republicans ALWAYS bankrupt the economy. They plan on it. It’s their way of making money. They short the market when it’s at it’s highest. Everyone else bails out because the market is crashing. Then the ultra rich step in, buy back everything at cheap prices, democrats get in, the economy recovers. Their base is too stupid to realize it. The extra money is stashed overseas. We fix everything. They use propaganda and all the media they own to tell their base it was all the democrats fault, and the unwashed believe them. They regain power and it starts all over again.

    • ninjaf

      Getting pretty damned exhausting, TBH.

  • Badgerite

    trump can go bankrupt and be shielded by US bankruptcy laws and get bailed out by cash seeking a cover for illegal and fraudulent schemes played out in other countries, but your average consumer and certainly the American economy cannot.

  • katanahamon

    Meanwhile..

    “Putin’s Soccer Ball for Trump Had Transmitter Chip, Logo Indicates”

    Yeah..that was too easy..we all already knew Putin has hacked Rump’s ball..s..

  • Global steel cost has risen substantially and, particularly in the US, they have reached unexplainable levels….

    Holy Baby Jeebus, it’s explainable!!!! It’s the tariffs that you were praising previously. These Republican gits just slay me.

  • katanahamon

    I don’t see why Rump should have unlimited, unchecked powers to ruin the economy and then directly buy votes with both parties’ taxes. This is unacceptable..but then again, I always feel like I’m Principal Snyder yelling “this is simply unacceptable,” then getting eaten by the giant snake demon anyway. Why are there no checks at all happening? Why aren’t analysts going on tv and saying “helloooo..voters..helllooooo! Your president is ruining the economy..!” It’s like there’s just nothing stopping Rump at all..no scandals matter, no lies matter, no ludicrous, crude, unpresidential conduct and statements matter, what the hell is happening???

    • Aynwrong

      The Republican party is insane.

      • ninjaf

        And scared. Keeping power is more important so they kowtow.