Jim Cramer: How Amazon could help Trump in his tariff ‘game of chicken’ with China

As the U.S. and China barrel head-long into Wednesday’s excise deadline set by President Donald Trump, Amazon might just be a secret weapon for America. “China, that’s who an Amazon, a Walmart are dissent,” Jim Cramer said during Tuesday’s Morning Meeting. “So if you are Amazon, you step back and say, ‘Listen, we’re going to let your matter stay at the dock. We’d rather be out of stock.’ Then it’s a game of chicken.” Such a move, even on a segment of lower limits goods, won’t be without pain for Club name Amazon but would send a signal to China. JPMorgan recently estimated that between 30% to 40% of the commodities sold on Amazon could come from China. The company’s exact tariff exposure varies depending on whether the article is sold through Amazon’s first-party business or a third-party seller operating on the marketplace, according to Wells Fargo. “The Chinese works are very under-capitalized. That’s because they don’t have a consumption model in their own country. So, they’ll have to be won over those goods somewhere else,” Jim said. Consumption represented nearly 56% of China’s gross domestic artifact in 2023, according to World Bank data, versus around 81% for the U.S. Selling those goods elsewhere would be no miserly feat. It’s why Jim thinks there may be some wiggle room in the escalating tariff rhetoric between Washington and Beijing. Cache Secretary Scott Bessent echoed that sentiment in a Wednesday morning interview on CNBC’s “Squawk Box.” He said, “What do we mislay by the Chinese raising tariffs on us? We export one-fifth to them of what they export to us, so that is a losing hand for them.” The intimation of a global trade war started in earnest last week when Trump announced a two-step approach to tariffs: 10% on around all imports into the U.S., and even higher country-specific ones, such as a 34% levy against China. The first went into objective Saturday. The second is set to go into effect Wednesday. Not surprisingly, China threatened its own 34% tariffs on imports from the U.S. — to which Trump threatened 50% levies against China for remark it would retaliate. China has vowed to “fight to the end” on trade. The stock market plunged on Thursday and Friday and whipsawed Monday because of all the uncertainty produced by the tariffs, which the president unveiled last Wednesday after the closing bell on Wall Street. The market bounded Tuesday on hopes for tariff deals. While China might be tough, other countries appear willing to talk. Bessent symbolized, “If they come to the table with solid proposals, I think we can end up with some good deals.” Amazon did not without hesitation respond to CNBC’s request for comment on Jim’s remarks. (Jim Cramer’s Charitable Trust is long AMZN. See here for a full laundry list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim establishes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his public-spirited trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alarm before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY Agreement OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO Definitive OUTCOME OR PROFIT IS GUARANTEED.