Trump Says Bad Economy Will Be Your Fault

[eccieuser9500]

Originally Posted by eccielover

LOL. It would be so much more convincing if you could spell tariffs, but I'll let that pass.

It happens when you're getting "ready for some FOOTBALL!!!" A Sunday night party". Drinking light today. Might go heavy tonight.

To end the trade imbalance? Make sure we have enough supply for their demand. And be sure there is no other source of supply for China.














Here we go . . . .

[eccielover]

Originally Posted by eccieuser9500

It happens when you're getting "ready for some FOOTBALL!!!" A Sunday night party". Drinking light today. Might go heavy tonight.

To end the trade imbalance? Make sure we have enough supply for their demand. And be sure there is no other source of supply for China.

I'll give you another pass for Sunday football drinking, but WTF are you saying about the trade imbalance?

Are you suggesting a trade embargo to make sure China doesn't have supply? How would that go?

[eccieuser9500]

The U.S. has no leverage when we don't have the supply to meet Chinese demand. Especially when China can get their supply from other sources.

It seems like we need China more than they need us. They can hold out. The POTUS wants to hold out for the election. But can the economy tolerate the downward spiral before the bottom drops?

I use the term "seems" definitely. The soy bean farmers are suffering. China might have to lock in a trade partner for it soon. Or make its people suffer. The pork industry is another agribusiness that needs to lock in future buyers.

I know there are innumerable nuances to it, but that is my basic understanding. Where is the Great Negotiator when the farm business needs him? Embarrassed still, from the G7 summt.

[eccieuser9500]

JP Morgan has created an index to track the effect of Trump's tweets on financial markets: 'Volfefe index'



https://www.cnbc.com/2019/09/08/dona...nd-market.html

Trump's 3:00 am tweets are also more common than 3:00 pm tweets, which can be a nuisance for U.S. rates markets, since overnight market depth tends can be thin. Trump is presumably asleep from 5:00 am to 10:00 am, according to the report, since there's a lull in tweeting activity during that time.

My fault?

[Redhot1960]

Originally Posted by Tiny

What a load of crap. The reason the economy's growing 2% instead of 3% is because of Peter Navarro's trade war. Blaming it on the Fed is chicken shit. American manufacturing employment is stagnant, in part because of the trade war.



As to the USMCA, did it really change much? The big change is that there's a 16 year sunset clause and 6 year reviews. This means that a manufacturer can't invest in a new factory and integrate it into the North American Supply Chain unless he's willing to run the risk the rug will be pulled out from under him. But since Trump has established treaties mean nothing anyway that's not a big deal. Otherwise the changes are pretty marginal, higher local content for autos, a little better access to Canada for American dairy farmers, etc. The main point of USMCA was to provide Trump with something he could call a victory.

Tiny Globalist bernie bros, huff and puff alot... fluffers

[eccieuser9500]

Originally Posted by Redhot1960

Tiny Globalist bernie bros, huff and puff alot... fluffers

Is Tiny a racist AND a Globalist now?

[Tiny]

Originally Posted by eccielover

LOL. It would be so much more convincing if you could spell tariffs, but I'll let that pass.

Tariffs are also used as a political cudgel to effect some sort of change in either methods or trading practices.

Even the threat of them with Mexico has caused them to begin paying for that big beautiful wall by deploying thousands on their side to stop illegal border crossings and thus lowering our costs in dealing with illegals at the border. Certainly a win for Tariffs.

China is more complex. You either ignore the trade imbalance for the status quo, which is what most POTUS's have done to date, or you step up as Trump has done and try to level the playing field. Sure it could be temporarily at the expense of the average tax payer, but we've been paying and paying and paying for years. How do you end it with China?

Trump says the Chinese take us to the cleaners to the tune of $400 billion a year, or whatever the difference is between our imports from China and our exports to China. This of course is not true. You could argue it's the other way. They send us toys, clothes, electronics parts, etc. And we send them paper, that is, dollars.

This is one of the reasons many economists would say your fears are unfounded. A second is that bilateral trade balances are irrelevant. Australia runs a large trade surplus with China, because of the iron ore, coal and other commodities they export to the Chinese. On the other hand, Australia runs a large trade deficit with the USA because of the aircraft, machinery, vehicles, etc. that they buy from us. Each country produces what it's best at producing, and we're all better off in the end for it.

You can argue our trade deficit with China swamps our deficits with other countries, and we're running a huge trade deficit with the rest of the world. Fair enough. EccieUser hinted at the reason why. Basically we consume more than we produce. Like I said, the rest of the world sends us real stuff, and we send them dollars. This has actually had a favorable effect on our economy so far. The exporters of the world end up with excess dollars, but since the rest of the world values our dollar, our government bonds, our companies, our real estate, etc., there haven't been adverse consequences.

Intuitively this does worry me though, like the national debt. I wish we weren't a country of spendthrifts, and that we saved more and produced more. If that happened the trade deficit would shrink or go away. I'm not sure exactly how you make it happen. Some of the ways to chink away at the problem, if it is actually a problem, would be through encouraging savings, lowering government spending, and, as Trump has done, encouraging companies to produce more with lower corporate taxes and deregulation. Paul Ryan had a tax plan that would have gone further, by replacing the corporate income tax with something like a value added tax (VAT), and then exempted U.S. exports from the VAT. That may deserve consideration. Europe and some successful Asian exporters do something similar.

[eccieuser9500]

Originally Posted by Tiny

Trump says the Chinese take us to the cleaners to the tune of $400 billion a year, or whatever the difference is between our imports from China and our exports to China. This of course is not true. You could argue it's the other way. They send us toys, clothes, electronics parts, etc. And we send them paper, that is, dollars.

This is one of the reasons many economists would say your fears are unfounded. A second is that bilateral trade balances are irrelevant. Australia runs a large trade surplus with China, because of the iron ore, coal and other commodities they export to the Chinese. On the other hand, Australia runs a large trade deficit with the USA because of the aircraft, machinery, vehicles, etc. that they buy from us. Each country produces what it's best at producing, and we're all better off in the end for it.

You can argue our trade deficit with China swamps our deficits with other countries, and we're running a huge trade deficit with the rest of the world. Fair enough. EccieUser hinted at the reason why. Basically we consume more than we produce. Like I said, the rest of the world sends us real stuff, and we send them dollars. This has actually had a favorable effect on our economy so far. The exporters of the world end up with excess dollars, but since the rest of the world values our dollar, our government bonds, our companies, our real estate, etc., there haven't been adverse consequences.

Intuitively this does worry me though, like the national debt. I wish we weren't a country of spendthrifts, and that we saved more and produced more. If that happened the trade deficit would shrink or go away. I'm not sure exactly how you make it happen. Some of the ways to chink away at the problem, if it is actually a problem, would be through encouraging savings, lowering government spending, and, as Trump has done, encouraging companies to produce more with lower corporate taxes and deregulation. Paul Ryan had a tax plan that would have gone further, by replacing the corporate income tax with something like a value added tax (VAT), and then exempted U.S. exports from the VAT. That may deserve consideration. Europe and some successful Asian exporters do something similar.