« prev   random   next »

1
3

A Trade War Primer

By marcus following x   2018 Jun 5, 3:20pm 479 views   30 comments   watch   sfw   quote     share    


https://www.nytimes.com/2018/06/03/opinion/a-trade-war-primer.html?rref=collection%2Fsectioncollection%2Fopinion-columnists&action=click&contentCollection=columnists®ion=stream&module=stream_unit&version=latest&contentPlacement=10&pgtype=sectionfront


The world trading system is actually a quite remarkable construction – a framework that has consistently produced a high level of global cooperation. It has been pretty robust in the face of even severe shocks – notably, the world did not see a major resurgence of protectionism after the 2008 financial crisis. But it was never designed to deal with a major world leader who has contempt for anything resembling the rule of law.

Past presidents have used their authority to impose tariffs, and not always for the best of reasons. Even Obama imposed a temporary “market disruption” tariff on Chinese tires. They have always, however, been circumspect: their tariff actions were limited, and the economic basis for their actions was at least vaguely defensible.

But Trump has gone ahead and imposed tariffs using the national security argument, in a context that makes no sense. There is no coherent argument about why imports of Canadian aluminum pose a national security threat; there will be even less justification if he does the same for autos. In fact, his administration is barely even trying to pretend that real national security concerns are at work. He’s just doing this because he can.

1   Heraclitusstudent   ignore (1)   2018 Jun 5, 6:26pm   ↑ like (3)   ↓ dislike (0)   quote        

Everything you read about commerce is always 1 sided: using the cheap guy abroad is more efficient than using our guys. Which of course it is. Forget that other countries have deliberate strategies against us while we champion laissez faire. We let our industries go away in the name of getting a few crumbs in other markets. What has been the result so far?
- Yes we got efficiency, and cheap crap as a result.
- But the US has run continuously a massive trade deficit against all continents save Antarctica for many decades.
- to compensate, we went (and are still going) into massive debts.
- The federal reserve constantly lowered rates inflating bubbles that had caused extreme economic destruction.
- A large fraction of the population has become useless, unskilled (because skills come from working), future-less, and the basic government response has been to make sure they get opioids - to forget.
- We however imported massive amount of labor to beat down wages and squeeze a little bit more growth from our vegetating industries.
- And the entire scheme produced ok results for the top 10% and massive riches for the 0.1%.
- And - let's not forget - in the process we created an anti-democratic behemoth in Asia that is poised to become much larger than the US, while we created deep faults in US politics, and set in motion forces than could tear apart our institutions.

Oh yeah, we created efficient supply chains. Was it worth it?
2   Tenpoundbass   ignore (11)   2018 Jun 5, 6:31pm   ↑ like (1)   ↓ dislike (0)   quote        

marcus says
He’s just doing this because he can.


And he can because he's qualified. As he's shown time and time again.
3   Heraclitusstudent   ignore (1)   2018 Jun 5, 6:34pm   ↑ like (5)   ↓ dislike (0)   quote        

Just project it out for 1 or 2 more decades:
China will be the center of the civilized world, dominating key industries, including: tech, movies, etc... While the US will be left a poorer, and deeply divided nation, left to work like slaves and devalue their currency to pay past bills.
Hope you enjoyed your cheap crap.
4   TwoScoopsOfWompWomp   ignore (2)   2018 Jun 5, 7:03pm   ↑ like (0)   ↓ dislike (0)   quote        

I might have to pay $500 for a laptop instead of $300, though.

Even though that would mean I'd get a $15/hr manfuacturing job with some benefits full time, versus $9/hr part time with food stamps.

Fuck that $15/hr+benefits job 40 hours a week, 50 weeks a year. Give me $9/hr at 20 hours, just to save me $200 every 3 years when I buy a laptop!!! I'm saving money that way!!!
5   Feux Follets   ignore (0)   2018 Jun 6, 2:38am   ↑ like (0)   ↓ dislike (0)   quote        

Heraclitusstudent says
China will be the center of the civilized world, dominating key industries, including: tech, movies, etc.


China’s Lock on Drugs - The Asian giant’s control of world’s essential drugs complicates U.S. desire to seek new trade deal.

Two pillars of Trump administration policy – combating the soaring prices for prescription drugs and equalizing the U.S. trade imbalance with China – appear to be on a collision course, drug and foreign policy experts say.

That's because the key ingredients for so many essential drugs, from antibiotics and birth control pills to treatments for cancer, depression, high cholesterol and HIV/AIDS, are purchased from China, says Rosemary Gibson, co-author with Janardan Prasad Singh of a new book called "ChinaRx: Exposing the Risks of America's Dependence on China for Medicine."

China has exclusive manufacturing agreements for drugs for anesthesia, cancer and HIV/AIDS, along with other medicines that "we use every day, not only in hospitals but in our own medicine chests," Gibson says, adding that China is now the world's only source of antibiotics, including the main ingredient in vancomycin, a treatment of last resort that is used by patients who are suffering from infections that are resistant to other treatment.

If the Trump administration's import policies provoke a trade war with China, Beijing could retaliate by raising prices on or reducing supplies of components needed to make necessary drugs. Pressuring drug companies to find their supplies outside of China could also lead to higher prices, experts say.

"Imagine our being totally dependent on China, which could become our adversary, for all of our medicine including medicine for our military. It's lunacy," says Daniel Slane, a former member of the U.S.-China Economic and Security Review Commission, created by Congress two decades ago to report on the national security implications on the U.S. relationship to China.

The White House, the Food and Drug Administration and Pharma, the trade association that represents drug manufacturers, did not respond to U.S. News & World Report requests for comment.

Much More: https://www.usnews.com/news/best-countries/articles/2018-05-08/trumps-quest-for-lower-drug-prices-may-provoke-china-trade-war-experts-warn

Remember Trumpettes trade wars are fun, easy to win and will help you achieve MAGA if you or one or more family members can live without your prescriptions
6   TwoScoopsOfWompWomp   ignore (2)   2018 Jun 6, 2:59am   ↑ like (0)   ↓ dislike (0)   quote        

Feux Follets says
Remember Trumpettes trade wars are fun, easy to win and will help you achieve MAGA if you or one or more family members can live without your prescriptions



Strongly dubious of this claim because China has almost no Rx patents relative to the rest of the World, and I'm exceptionally dubious that China "worlds' only source of antibiotics". Note that is the claim, with Vancomycin being used as an example. Not a single one of the world's 20 largest Pharma companies is Chinese. Not a single one.

~$500B dollars annually is China's problem, not ours. The Europeans never let themselves get dependent on China like we did. Getting off the cheap Heroin will be painful, but if we don't do it we'll be broke and frozen, dying in an alleyway.

One thing the solution definitely is not, is doing nothing.
7   APOCALYPSEFUCKisShostikovitch   ignore (30)   2018 Jun 6, 3:41am   ↑ like (3)   ↓ dislike (0)   quote        

This is easy:

Ban trade with slave states.

PRC collapses in 3 months starved of all capital and trade except with Liberia and Albania.
8   Feux Follets   ignore (0)   2018 Jun 6, 3:49am   ↑ like (0)   ↓ dislike (0)   quote        

The Greater Danger of U.S.-China Trade Tensions

The long-term danger, however, is that if those tensions fester, they could begin to undercut the interdependence that has been so essential to keeping strategic competition between the two giants in check.

Chinese officials are at least amenable to a conversation about the trade deficit. They are far less willing to consider the Trump administration's demand that it scale back its “Made in China 2025” initiative, which aims to make China a global leader in advanced manufacturing by enhancing its competitiveness in 10 industries, including aerospace, robotics, and biopharmaceuticals. Chinese officials say that for them to consider putting that undertaking into play, Washington would have to designate China as a market economy, eliminate restrictions on Chinese imports of high-tech goods, and drop a longstanding provision that bans Chinese telecommunications equipment maker ZTE from purchasing U.S. parts.

Given the inauspicious outcome of this first round of talks, few observers on either side expect subsequent rounds to yield major breakthroughs. Indeed, many in Washington are expressing growing concern about the potential impact of deteriorating trade relations on the U.S. economy. This past Thursday, over 1,100 economists—including 15 Nobel laureates—signed an open letter warning the Trump administration that “new tariffs in response to trade imbalances” would harm workers across the country, much like protectionist measures did in the 1930s. Today, of course, Washington depends far more on trade, supply chains, and globalization than it did over three-quarters of a century ago. A Brookings Institution analysis published last month estimated there are “some 2.1 million jobs in the 40 industries that produce products now slated for Chinese retaliation.” If Washington and Beijing proceed with reciprocal impositions of tariffs, an even more recent study concludes (PDF), nearly 134,000 Americans would lose their jobs, and American farmers' net income would fall by 6.7 percent.

Over the long term, though, the main risk of indefinitely heightened trade tensions between the two countries is not commercial, but strategic: Robust economic interdependence has played a central role in preventing vigorous competition between the United States and China from devolving into outright hostility.

https://www.rand.org/blog/2018/05/the-greater-danger-of-us-china-trade-tensions.html
9   lostand confused   ignore (0)   2018 Jun 6, 4:08am   ↑ like (2)   ↓ dislike (0)   quote        

LOl-love it dems are corporate loving free traders now! If trump support gay marriage, dems will now extol the virtues of traditional marriage!
10   Feux Follets   ignore (0)   2018 Jun 6, 4:08am   ↑ like (2)   ↓ dislike (0)   quote        

TwoScoopsOfDragonEnergy says
China has almost no Rx patents relative to the rest of the World


They are not selling - they are making the stuff. Ship it here, then out glorious pharmaceutical industry can mark up the price like no one's business
and it's a win-win.

How come Potus never wants to punch a Big Pharma, Kock Brother, Wall Street Exec in the face like he does with protestors or football players - these guys do more damage to everyone than anyone else.
11   BlueSardine   ignore (1)   2018 Jun 6, 6:53am   ↑ like (1)   ↓ dislike (0)   quote        

This is the key to enacting real change. Dont do what other administrations "always" do, and get the same results: trade imbalance.
Its called thinking outside the box. 17 boxes deep...
marcus says
They have always, however, been circumspect: their tariff actions were limited, and the economic basis for their actions was at least vaguely defensible.
12   BlueSardine   ignore (1)   2018 Jun 6, 6:56am   ↑ like (0)   ↓ dislike (0)   quote        

With this thread argument it is libbies who appear conservative and resisting change and the crackeretts who appear liberal in implementing change
Fascinating.
13   marcus   ignore (1)   2018 Jun 6, 7:04am   ↑ like (1)   ↓ dislike (2)   quote        

lostand confused says
LOl-love it dems are corporate loving free traders now!


What century do you live in ? When was the last time democrats wanted to have a trade war ? Yes, both democrat and republicans know the stupidity of this.

But there are those who will defend everything Trump does. He said it himself, he could walk out on to 5th avenue and shoot someone...
14   Sniper   ignore (11)   2018 Jun 6, 7:59am   ↑ like (2)   ↓ dislike (0)   quote        

marcus says
But Trump has gone ahead and imposed tariffs using the national security argument, in a context that makes no sense.


Crap, how does this happen:

Trump's "Trade War" Is Working: US Trade Deficit Collapses.

One month after the biggest plunge in the US trade deficit since the financial crisis - good news for Trump who has engaged in "trade war" with the rest of the world to boost US trader and exports - the good news continued in April, when according to the Census Bureau, the US deficit shrank again, down 2.1% from a revised $47.2BN to $46.2BN - the lowest since September 2017, and beating not only the $49BN consensus estimate, but also also the lowest Wall Street estimate of $46.2BN.

The number was so good, some were wondering why Trump didn't pre-tweet it, as he did with the payrolls report.

Incidentally, with today's revision, the March plunge in the US trade deficit has now risen to $10BN, the highest since 2008, and the second biggest improvement in the US deficit on record.

According to the census bureau, the deficit decreased from a revised $47.2 billion in March to $46.2 billion in April, amid a perfect trade environment as exports rose and imports declined for the second month in a row, or as Trump would say, "his policies to boost US trade worked."

https://www.zerohedge.com/news/2018-06-06/trumps-trade-war-working-us-trade-deficit-collapses

15   Feux Follets   ignore (0)   2018 Jun 6, 9:49am   ↑ like (0)   ↓ dislike (0)   quote        

Sniper says
Crap, how does this happen:


A few months of good news is far too early to claim a substantial and convincing win but what the heck.
16   Feux Follets   ignore (0)   2018 Jun 6, 9:52am   ↑ like (0)   ↓ dislike (0)   quote        

4 charts showing why putting tariffs on your friends is a bad idea by William Hauk

As an economist who studies international trade, I thought it’d be instructive to explore the trade relationships the U.S. has with each partner to show just how important they are – and what would be the consequences of a full-blown trade war.

While the purpose of Trump’s tariffs is to shift U.S. steel consumption away from foreign producers and towards domestic producers, Americans will share some of the pain as well.

For example, if automakers have to pay more for the steel used in cars, you’ll see that effect when you visit your local dealer. One estimate put it at an additional $175 per vehicle.

And higher prices for things that require steel or aluminum like cars, planes, construction and appliances can slow the rest of the economy.

When President Bush tried a similar tariff in 2001, it was estimated that it cost American consumers $400,000 for each domestic steel job saved

The reaction of the EU, Canada and Mexico raises the possibility the U.S. is facing down a full-blown trade war – even as it does the same with China. Whether tensions can be turned down before serious harm is done remains to be seen.

http://theconversation.com/4-charts-showing-why-putting-tariffs-on-your-friends-is-a-bad-idea-97582
17   TwoScoopsOfWompWomp   ignore (2)   2018 Jun 6, 9:55am   ↑ like (0)   ↓ dislike (0)   quote        

Feux Follets says
They are not selling - they are making the stuff. Ship it here, then out glorious pharmaceutical industry can mark up the price like no one's business
and it's a win-win.

How come Potus never wants to punch a Big Pharma, Kock Brother, Wall Street Exec in the face like he does with protestors or football players - these guys do more damage to everyone than anyone else.


What was the Obama and 2008-2009 Dem Congress proposal?

Or is this another, Gee Wilikers, it's the Global Economy, nothing we can do about it.
18   Feux Follets   ignore (0)   2018 Jun 6, 10:08am   ↑ like (0)   ↓ dislike (0)   quote        

TwoScoopsOfDragonEnergy says
What was the Obama and 2008-2009 Dem Congress proposal?


Not talking about Barry - this one is on the current Potus.

China can at significant financial damage to itself inflect serious problems on this country by screwing around with something most people are not aware of.

They do not even have to stop shipments - just do an American style "work slowdown and shipping slowdown" and blame the slowdown on anything and everything.

Pull the funding for anything Trump related, same for copyrights etc. handed out to the clan and the U.S. will be asking sir, can I have one more please.
19   TwoScoopsOfWompWomp   ignore (2)   2018 Jun 6, 10:28am   ↑ like (0)   ↓ dislike (0)   quote        

Feux Follets says
Not talking about Barry - this one is on the current Potus.


If it's not POTUS we have to talk about the alternative. What is the Democrats' plan?

Feux Follets says
They do not even have to stop shipments - just do an American style "work slowdown and shipping slowdown" and blame the slowdown on anything and everything.


I think there are a ton of emergency powers no court would dare halt if it came to a drug shortage.
20   Feux Follets   ignore (0)   2018 Jun 6, 2:08pm   ↑ like (1)   ↓ dislike (0)   quote        

TwoScoopsOfDragonEnergy says
What is the Democrats' plan?

Doesn't matter right now since the GOP is control of everything and therefore owns it all - lock, stock and barrel.

TwoScoopsOfDragonEnergy says
I think there are a ton of emergency powers no court would dare halt if it came to a drug shortage.


How's that work out when Longshoremen's Union pulls one of their wildcat job actions but better yet - the infamous "work slowdown". No need to go out on strike - just be a good American and go in every day and do it really half-assed.

These guys and their affiliated unions can bring one or more sections of the country to painful financial mess at whim and going slow at work is not really a firing offense especially when all of the affiliated unions will support the one on strike and then everything moves at turtle speed.

Just like Potus they always have no shortage of people and or conditions to blame it all on.
21   Feux Follets   ignore (0)   2018 Jun 8, 2:28am   ↑ like (0)   ↓ dislike (0)   quote        

China Holds The Cards In Trump’s Trade War !

China is preparing a broad swath of new metals futures contracts through the London Metals Exchange. This is in addition to the gold futures contract launched last year.

The more alternatives that countries like Turkey, Venezuela and Iran have to keep their supply chains full the better they can resist the obvious push towards regime change which is what the sanctions are trying to achieve.

These moves are subtle. They operate below the headlines in the practical world of actual markets, not the avaricious dreams of Certified Crazy People like John Bolton, Mike Pompeo and Nikki Haley.

China’s central bank and its finance ministry are staffed with people who cut their teeth in Western bond and commmodity pits not M.B.A. programs at Ivy League schools.

It’s one of Trump’s real advantages as a President, his real world experience. But, it’s also one of his failings as well. He’s never really run a successful deal on people like the Russians and the Persians. The former see through his nonsense and the latter he hasn’t been allowed to negotiate with because of U.S. policy.

It’s a weakness in that he doesn’t get the cultural imperatives and their sense of history. They are looking at remaking the world for the next century. Trump is trying to get through the next election.

http://uschnews.com/china-holds-the-cards-in-trumps-trade-war/
22   lostand confused   ignore (0)   2018 Jun 8, 4:38am   ↑ like (1)   ↓ dislike (0)   quote        

marcus says
What century do you live in ? When was the last time democrats wanted to have a trade war ? Yes, both democrat and republicans know the stupidity of this.

Just accept it you love free trade and corporate globalism-except for government jobs . I mena why can't we bust up govt unions and bring in say hordes of Indians and Chinese who will work for 5 bucks an hour and work much harder with no benefits and pension too or just ship govt jobs over there for pennies on the dollar?

So the democrat positon is now everybody in the private sector free trade, deregulation, globalism-everybody in the public sector unions, can never fire, rules, regulation, high pay, pension. benefits, health care and take form the ever decreasing pie of the private workers and oh yeah high taxes-wow,just wow.
23   HEYYOU   ignore (13)   2018 Jun 8, 7:26am   ↑ like (0)   ↓ dislike (0)   quote        

Feux Follets says
How come Potus never wants to punch a Big Pharma, Kock Brother, Wall Street Exec in the face like he does with protestors or football players - these guys do more damage to everyone than anyone else.


As intended by Republican & Democratic voters.
The 140,000,000 that didn't vote are to busy texting & on social media.
27   Feux Follets   ignore (0)   2018 Jun 22, 3:12pm   ↑ like (0)   ↓ dislike (0)   quote        

Steel and Aluminum Tariffs are Causing HVAC Manufacturers to Increase Prices 4-6% on July 1, 2018

For the first time since Homesense has been around, our equipment suppliers are raising prices in the middle of the season.

We’ve been advised of a 4-6% increase in equipment cost across the board for the most expensive things home owners purchase, which will mean hundreds of dollars more on each new piece of equipment replaced by our team moving forward.

For homeowners with older systems close to failure, we are strongly encouraging them to consider making a purchase in June to avoid these frustrating increases in prices.

https://trusthomesense.com/blog/equipment-price-increases-loom-as-manufacturers-respond-to-tariffs/

Being reported on all of the local news stations...
28   Heraclitusstudent   ignore (1)   2018 Jun 22, 3:21pm   ↑ like (0)   ↓ dislike (0)   quote        

Feux Follets says
Steel and Aluminum Tariffs are Causing HVAC Manufacturers to Increase Prices 4-6% on July 1, 2018


What good is "cheap", if you don't have a job?
Efficiency goes 110% to the top 10% and screws the rest of America.
The entire problem we are looking at is how to be less efficient but still gain for middle America, still lower inequalities, still gain for America as a whole.
"increase price" is not an argument here.
29   Feux Follets   ignore (0)   2018 Jun 22, 3:52pm   ↑ like (0)   ↓ dislike (0)   quote        

Not sure how much of a gain for middle America - local HVAC contractors are quoting an average $500 - $600 increase on the price of a new install which I hope means both a furnace and AC unit.

For those looking, if you are a Costco member, get a quote from them for a replacement system, if you are in the market.

Did mine two years ago and got a mid-range (there are three) Lenox system for the price of a basic contractor grade system from everyone else.

That was in addition to getting a $600 Costco Cash Card, energy rebates on my taxes etc.

Did the number crunching and could not come up with a good enough set of numbers to go top tier which would have added about $1,400 to the price.
30   HowdyThere   ignore (0)   2018 Jun 22, 6:22pm   ↑ like (0)   ↓ dislike (0)   quote        

Booger says


Trump really needs to replace his NAFTA negotiation team. He obviously has no faith in them to make a good deal if he has to jump in and impose tariffs. I guess after the drubbing the Mexican and Canadian negotiators gave the US in the original deal he's not taking any chances.




The Housing Trap
You're being set up to spend your life paying off a debt you don't need to take on, for a house that costs far more than it should. The conspirators are all around you, smiling to lure you in, carefully choosing their words and watching your reactions as they push your buttons, anxiously waiting for the moment when you sign the papers that will trap you and guarantee their payoff. Don't be just another victim of the housing market. Use this book to defend your freedom and defeat their schemes. You can win the game, but first you have to learn how to play it.
115 pages, $12.50

Kindle version available


about   best comments   contact   one year ago   suggestions