Trump tariffs on Mexico could spell higher prices on consumer goods

PHILADELPHIA (WPVI) -- President Trump's announcement on Thursday that he might impose tariffs on all imports from Mexico didn't go over well with investors.

The Dow lost 355 points on Friday.

Trump is threatening to start with five percent tariffs on all imports starting June 10 if Mexico doesn't stop illegal immigrants from central America from crossing into the U.S.

With American consumers already starting to pay higher prices because of tariffs on China, this could get very expensive.

The surprise move on tariffs would affect everything the U.S. imports from Mexico, from produce - in particular, avocados - to consumer goods like washing machines. The cost of auto parts could also go up, which could then increase the cost of new vehicles by up to $1,300.

Dr. Michelle Casario is a professor of economics at Villanova.

"Potentially the impact of the tariffs on Mexico would be much greater than the tariffs on China where those are more industrial type goods," said Professor Casario.

The tariffs would impact merchants like those at the Italian Market in South Philadelphia selling produce imported from Mexico.

"We need to buy the stuff from Mexico right, but if the prices come up, we need to raise our produce prices," said merchant Pham Nhan.

That means consumers would also be impacted. Some are really not all that worried about the president's tariffs.

"A little bit but we'll still come here to buy what we're gonna buy, it's not gonna stop us," said Dave Derecolo of South Philadelphia.

Others like Cecil Goodman of South Philadelphia are worried.

"He needs to come shopping for himself to see how much the prices cost and not have somebody shopping for him," said Goodman.

"I say buy everything that you can now before the prices go up, I believe they will," said Dale Joyner.

Some believe that something definitely has to be done about the problem at the border.

"They need to do something and it depends on both sides said," Gustafs Loko of Southwest Philadelphia. "Both countries need to work on the problem."

But some argue about the wisdom of merging trade with the immigration problem.

Jason Lampieri said, "Raising tariffs on products doesn't work, right? It's what we keep hearing, right? It doesn't work. You hit China, then they just fire back, same with Mexico. I'm sure they'll have something that they will do. It's really a circular argument."

Professor Casario said, "I do not think this would be an effective way, the border security and tariffs are two very separate issues and they should be dealt with separately."

Mexico is sending its foreign minister to Washington to try and stop the tariffs.