Trumpenomics
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@LuFins-Dad said in Trumpenomics:
Okay, so moving beyond the outright tariff policies, there has been a lot of talk about non-tariff trade barriers including currency manipulation. Is that accurate? And what are the other trade barriers they are alluding to?
I think they've pivoted to this because they can hand-wave "non-tariff barriers", but not tariffs, which are publicly known and unambiguous. The example of a non-tariff barrier I've heard them use is a VAT, or sales tax, in Europe, and I've heard that calling that a barrier is nonsense, because it applies to Europe's own domestic products too.
And as a side note, Netanyahu is now saying he planes on eliminating the trade deficit between Israel and the US. Please explain to me how a nation of 10M can possibly equal the economic consumption of a nation of 350M? Especially when much of that trade is based on precious jewels, which the US has little industry in mining…
I'm hoping "trade deficits" are computed per-capita. They still wouldn't be a bad thing per se, but at least they would be a reasonable thing to talk about.
@Horace said in Trumpenomics:
And as a side note, Netanyahu is now saying he planes on eliminating the trade deficit between Israel and the US. Please explain to me how a nation of 10M can possibly equal the economic consumption of a nation of 350M? Especially when much of that trade is based on precious jewels, which the US has little industry in mining…
I'm hoping "trade deficits" are computed per-capita. They still wouldn't be a bad thing per se, but at least they would be a reasonable thing to talk about.
I'm a bit concerned there is a concern about trade deficits in the first place. They aren't inherently bad, and one could argue in the current environment, they're actually a good thing most of the time. We're also in a global economy...different countries produce different goods with respective efficiencies. Let USA focus on what we're good at, let China do what they're good at. Plus it promotes peace, to an extent, too.
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The idea that trade deficits are inherently bad really is surprisingly stupid. Does Trump actually believe this?
I was only joking
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Okay, so moving beyond the outright tariff policies, there has been a lot of talk about non-tariff trade barriers including currency manipulation. Is that accurate? And what are the other trade barriers they are alluding to?
And as a side note, Netanyahu is now saying he planes on eliminating the trade deficit between Israel and the US. Please explain to me how a nation of 10M can possibly equal the economic consumption of a nation of 350M? Especially when much of that trade is based on precious jewels, which the US has little industry in mining…
@LuFins-Dad said in Trumpenomics:
And as a side note, Netanyahu is now saying he planes on eliminating the trade deficit between Israel and the US. Please explain to me how a nation of 10M can possibly equal the economic consumption of a nation of 350M? Especially when much of that trade is based on precious jewels, which the US has little industry in mining…
Buy more weapons.
Only non-witches get due process.
- Cotton Mather, Salem Massachusetts, 1692
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The idea that trade deficits are inherently bad really is surprisingly stupid. Does Trump actually believe this?
The idea that trade deficits are inherently bad really is surprisingly stupid. Does Trump actually believe this?
Yes, I am convinced he actually does. He also equates purchasing something as a subsidy. He is quite thick headed that way.
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Broad swaths of Western PA, Eastern Ohio, and Michigan view trade deficits as the reason why they and their communities are riddled with drugs, overdoses, and rusted out husks of factories. They don’t blame their unions, which essentially drove the factories into bankruptcy, but instead blame the foreign manufacturers. Japanese steel, in particular. Trump feels beholden to those groups. They got him elected, after all.
The Brad
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@LuFins-Dad said in Trumpenomics:
And as a side note, Netanyahu is now saying he planes on eliminating the trade deficit between Israel and the US. Please explain to me how a nation of 10M can possibly equal the economic consumption of a nation of 350M? Especially when much of that trade is based on precious jewels, which the US has little industry in mining…
Buy more weapons.
@jon-nyc said in Trumpenomics:
@LuFins-Dad said in Trumpenomics:
And as a side note, Netanyahu is now saying he planes on eliminating the trade deficit between Israel and the US. Please explain to me how a nation of 10M can possibly equal the economic consumption of a nation of 350M? Especially when much of that trade is based on precious jewels, which the US has little industry in mining…
Buy more weapons.
We'll have to give them more money to do that - so perhaps, they should arrange to contribute more to Trump, his relative and of course, to member of congress and their families.
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Broad swaths of Western PA, Eastern Ohio, and Michigan view trade deficits as the reason why they and their communities are riddled with drugs, overdoses, and rusted out husks of factories. They don’t blame their unions, which essentially drove the factories into bankruptcy, but instead blame the foreign manufacturers. Japanese steel, in particular. Trump feels beholden to those groups. They got him elected, after all.
Broad swaths of Western PA, Eastern Ohio, and Michigan view trade deficits as the reason why they and their communities are riddled with drugs, overdoses, and rusted out husks of factories. They don’t blame their unions, which essentially drove the factories into bankruptcy, but instead blame the foreign manufacturers. Japanese steel, in particular. Trump feels beholden to those groups. They got him elected, after all.
That very well may be the case, although I hope the angry proletarian rabble understands that it is just a matter of time before Trump will turn against their sacred cow labour unions. Cost of hourly US labour plus benefits is far too high for the Trump agenda (if there is indeed one) to even get off the ground.
That may be the time you predicted to see Vance’s exit; either sidelined from the Emporer’s court or jettisoned altogether.
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Broad swaths of Western PA, Eastern Ohio, and Michigan view trade deficits as the reason why they and their communities are riddled with drugs, overdoses, and rusted out husks of factories. They don’t blame their unions, which essentially drove the factories into bankruptcy, but instead blame the foreign manufacturers. Japanese steel, in particular. Trump feels beholden to those groups. They got him elected, after all.
@LuFins-Dad said in Trumpenomics:
Broad swaths of Western PA, Eastern Ohio, and Michigan view trade deficits as the reason why they and their communities are riddled with drugs, overdoses, and rusted out husks of factories. They don’t blame their unions, which essentially drove the factories into bankruptcy, but instead blame the foreign manufacturers. Japanese steel, in particular. Trump feels beholden to those groups. They got him elected, after all.
Right, so he thinks (or pretends to, at least) that he can make US manufacturing competitive without reducing the salaries to competitive levels by taxing the shit out of foreign products and we can all go back to living in the golden age of the 1970's.
Funnily enough, I remember the 1970's as being a bit shit, to be honest.
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@LuFins-Dad said in Trumpenomics:
Broad swaths of Western PA, Eastern Ohio, and Michigan view trade deficits as the reason why they and their communities are riddled with drugs, overdoses, and rusted out husks of factories. They don’t blame their unions, which essentially drove the factories into bankruptcy, but instead blame the foreign manufacturers. Japanese steel, in particular. Trump feels beholden to those groups. They got him elected, after all.
Right, so he thinks (or pretends to, at least) that he can make US manufacturing competitive without reducing the salaries to competitive levels by taxing the shit out of foreign products and we can all go back to living in the golden age of the 1970's.
Funnily enough, I remember the 1970's as being a bit shit, to be honest.
@Doctor-Phibes said in Trumpenomics:
@LuFins-Dad said in Trumpenomics:
Broad swaths of Western PA, Eastern Ohio, and Michigan view trade deficits as the reason why they and their communities are riddled with drugs, overdoses, and rusted out husks of factories. They don’t blame their unions, which essentially drove the factories into bankruptcy, but instead blame the foreign manufacturers. Japanese steel, in particular. Trump feels beholden to those groups. They got him elected, after all.
Right, so he thinks (or pretends to, at least) that he can make US manufacturing competitive without reducing the salaries to competitive levels by taxing the shit out of foreign products and we can all go back to living in the golden age of the 1970's.
Funnily enough, I remember the 1970's as being a bit shit, to be honest.
Not at all. I very much doubt that’s the goal. Oh, he would like to bring some more manufacturing back to the US, but the little that does happen to come back will go to Texas or Florida. States that are more competitive in recruiting business interests. The fact is that Western Pennsylvania has been too ruined by poor work ethics and standards thanks to those unions that it won’t recover through manufacturing, but the area is slowly being rehabilitated through gentrification. And they hate that, too. But oh well.
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I think Pennsylvania etc. have quite a bit in common with the north of England. We had mills, coal mining, steel, car manufacturing. Leyland (of Leyland Motors and British Leyland fame) is about 10 miles from where I lived. When I was at school the joke was that if you worked there you got a free company mattress for the night shift. I do remember there were a lot of strikes in the 1970's. There's nothing left of it now, of course.
Boris Johnson promised to re-invest heavily in the north following Brexit. They haven't seen much other than bullshit.
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A great piece from a manufacturer with experience here and in China. An excerpt:
To start manufacturing in the United States, a company needs to make a large investment. They will need to buy new machinery and if no existing building is suitable, they will need to construct a new building. These things cost money, a lot, in fact. And significantly more in the USA, than they do in other countries. In exchange for this risk, there must be some reward. If that reward is uncertain, no one will do it.
Within the past month, the president put a 25% tariff on Mexico, and then got rid of it, only to apply it again, and then get rid of it a second time. Then, last week, he was expected to apply new tariffs to Mexico, but didn’t.
If you’re building a new factory in the United States, your investment will alternate between maybe it will work, and catastrophic loss according to which way the tariffs and the wind blows. No one is building factories right now, and no one is renting them, because there is no certainty that any of these tariffs will last. How do I know? I built a factory in Austin, Texas in an industrial area. I cut its rent 40% two weeks ago and I can’t get a lick of interest from industrial renters.
The tariffs have frozen business activity because no one wants to take a big risk dependent on a policy that may change next week.
Even further, the tariffs are confusing, poorly communicated, and complex. Today, if you want to import something from China, you need to add the original import duty, plus a 20% “fentanyl tariff”, plus a 34% “reciprocal tariff”, and an additional 25% “Venezuelan oil” tariff, should it be determined that China is buying Venezualan oil. The problem is there is no list of countries which are importing Venezuelan oil provided by the White House, so you don’t know if you do or don’t need to add that 25% and you also don’t know when any of these tariffs will go into effect because of unclear language.
As such, you can’t calculate your costs, either with certainty or accuracy, therefore, not only do you not build a factory in the United States, you cease all business activity, the type of thing that can cause a recession, if not worse.
For the past month, as someone who runs a business in this industry, I have spent a huge portion of my time just trying to keep up with the constant changes, instead of running my business.
Whole thing worth a read.
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Heads they win, tails we lose.
The more common strategy is to dismiss anybody who cares as a "wealthy wall streeter". That this is the price we need to pay, for main street.
But there are so many people on main street with 401ks, depending on them for their retirements. Not to mention the whole job loss and recession thing, which won't go well for main street either.
