The trade and economy mega-thread (1 Viewer)

[superchuck500]

Is there a trade deal with China? Is it really a deal or just a pull-back to status quo ante? Is Trump advancing US interests in this well-executed trade battle plan or was this poorly conceived from the start . . . and harmful?

I think the jury's still out, but I haven't seen that the Chinese are offering much in compromise - and it's not even clear if there's going to be an agreement. But it's clear they are working on something and I'm sure Trump will sell it as the greatest trade deal ever. The proof will be in the details.

 

[Intensesaint]

Ending the trade war is encouraging, but it looks like we're just going roughly back to where we were before this began, right? What was the point of the last 2 years of trade wars then?

Well it seems we did well good through the 2 years of the trade wars. Now that it's ending, we should do even better. A lot of people predicted we would be in a terrible recession right now. Even heard that Trump was going to 'destroy the economy'.

 

[Dadsdream]

Ending the trade war is encouraging, but it looks like we're just going roughly back to where we were before this began, right? What was the point of the last 2 years of trade wars then?

Economic saber rattling and brinksmanship. Now both countries declare victory, everybody saves face and we have trade stability until the next stage.

 

[UncleTrvlingJim]

Well it seems we did well good through the 2 years of the trade wars. Now that it's ending, we should do even better. A lot of people predicted we would be in a terrible recession right now. Even heard that Trump was going to 'destroy the economy'.

People love hyperbole, and partisanship makes it worse.

The trade war was a drag on our economy which you admit in your statement above, right? So, if we just go back to the way things were before the trade war, then was that economic drag worth it?

We are doing fine, roughly maintaining the job creation numbers of the last few Obama years, but with substantially higher deficits. Which is fine if we get something out of it in the end. What were seeing right now are some marginal things, not the structural changes that would justify the trade war.

 

[UncleTrvlingJim]

Economic saber rattling and brinksmanship. Now both countries declare victory, everybody saves face and we have trade stability until the next stage.

I think this correct. Hopefully the next stage is a bit more productive in substance. Maybe the sabre rattling helps set the stage for that, but it's not my preferred method

 

[Intensesaint]

People love hyperbole, and partisanship makes it worse.

The trade war was a drag on our economy which you admit in your statement above, right? So, if we just go back to the way things were before the trade war, then was that economic drag worth it?

We are doing fine, roughly maintaining the job creation numbers of the last few Obama years, but with substantially higher deficits. Which is fine if we get something out of it in the end. What were seeing right now are some marginal things, not the structural changes that would justify the trade war.

Sure it was a drag, it could have been even better, things can always be better. But like Kramer said recently on CNBC, these are some of the best jobs numbers we have ever seen.

Also, I am glad to see you approve of the way Trump has handled the economy outside of the trade wars.

 

[MT15]

Small farmers took a huge hit for the tariffs, and a pretty substantial number of them didn’t survive. When farmers lose their farms it’s a devastating blow to a community and that family in particular, as farms are often passed down to the children. Suicides are not unknown to happen when a man loses a farm that was passed down to him and that he feels he should have been able to pass down to his own children.

This is the kind of arrogance that people criticized Democrats for on their stances which enabled companies to easily move manufacturing jobs out of the US.

“The American Farm Bureau Federation, also known as the Farm Bureau, published a report in July that dove into farm loan delinquencies and bankruptcies based on Federal Deposit Insurance Corporation and U.S. court data.

The information showed that, “the delinquency rates for commercial agricultural loans in both the real estate and non-real estate lending sectors are at a six-year high and … were above the historical average of 2.1%.” “

Amid Trump Tariffs, Farm Bankruptcies And Suicides Rise

Farmers have seen their incomes slashed due to factors outside of their control. However, tariffs imposed by Trump and China’s retaliation are making their situation even direr. This has led to a rise in farm bankruptcies and multiple people warning about the increased stress leading to suicides.

www.forbes.com

So, the point that UTJ made is especially poignant. If we are right back where we started, and we caused a lot of pain and suffering, caused a six year high in farm bankruptcies, and spent more than we spent on the US auto manufacturers in farm subsidies, what was the gain?

This puts a tremendous amount of pressure on Trump to deliver on the rest of these negotiations, IMO.

 

[Joe Okc]

While doing my Christmas shopping I found this... I guess that the USA just doesn't make anvils anymore and we need them shipped in from China?

Take the Joe Christmas Challenge.. See how many thing that you buy as gifts this Christmas that Says Made in China... Probably 100% of everything you give this season I will wager.

 

[samiam5211]

While doing my Christmas shopping I found this... I guess that the USA just doesn't make anvils anymore and we need them shipped in from China?

Take the Joe Christmas Challenge.. See how many thing that you buy as gifts this Christmas that Says Made in China... Probably 100% of everything you give this season I will wager.

Yea, it sucks. The free market doesn't care whether or not all the anvil factories in the Midwest close.

I guess it is the price we pay for capitalism.

 

[JimEverett]

There are still a few anvils made in the USA

Hasn't China "promised" to buy a lot of products in the past - particularly agricultural products - fro the USA only to end up not doing it? I am talking before Trump.

 

[Joe Okc]

It's funny... The Anvil.. Damned thing weighs a ton.. But are they being made so inexpensively that it is cheaper to have one that is made in China.. Shipped overseas on a freighter? a freakin anvil...

Take Shrimp... I posted this on the EE one time... But Gulf Shrimp is selling for about $7 ro $8 a bag in the local WalMart... While Shrimp from Overseas is being sold for about $4 - $5 a bag...

Now I am not sure that last time that I looked at a map... But I thought for sure that the Gulf was closer to me than China is...

Again.. Take a look at everything you buy this Christmas season... Made in China.

 

[Infoman]

It's labor costs Joe... China essentially has a "slave labor" force to mass produce every item people in the US want... Since labor cost is a huge factor in any type of production... no one can compete with China from a pricing standpoint.... unless we employ labor that's 4 times less costly than we do now... or people decide to pay 4 times more for products made in the US... (not exact $$$- but you get what I mean)

 

[Nebaghead]

It's funny... The Anvil.. Damned thing weighs a ton.. But are they being made so inexpensively that it is cheaper to have one that is made in China.. Shipped overseas on a freighter? a freakin anvil...

Take Shrimp... I posted this on the EE one time... But Gulf Shrimp is selling for about $7 ro $8 a bag in the local WalMart... While Shrimp from Overseas is being sold for about $4 - $5 a bag...

Now I am not sure that last time that I looked at a map... But I thought for sure that the Gulf was closer to me than China is...

Again.. Take a look at everything you buy this Christmas season... Made in China.

Shipping is pretty cheap. I’m always amazed when I buy a wire dongle or some item like that on eBay for 1.99 with shipping. I couldn’t mail the item across town for a 1.99.

 

[Joe Okc]

It's labor costs Joe... China essentially has a "slave labor" force to mass produce every item people in the US want... Since labor cost is a huge factor in any type of production... no one can compete with China from a pricing standpoint.... unless we employ labor that's 4 times less costly than we do now... or people decide to pay 4 times more for products made in the US... (not exact $$$- but you get what I mean)

Yes.. I understand that... and that strengthens my concerns for America...

 

[Infoman]

I think everyone understands it... the issue is there are only 2 logical ways to address it... The US as a whole has to spend less for production labor (or pay people less), or people (US consumers) have to be willing to pay more for items made in the US.... because cheap Chinese products produced with quasi-slave labor are not going anywhere... and people already cry that they aren't paid enough, and that things cost too much....

 

[samiam5211]

Yes.. I understand that... and that strengthens my concerns for America...

What do you think can be done to improve the situation though?

I don't believe that we're going to compete with China on cost.

The quality of things isn't as important as it used to be since technology has made it so most things become outdated before they become broken.

We can't punish companies for producing things in places that are best for profits and claim to support capitalism or free markets.

Between third world factory workers and automation, there isn't any point in pretending we are bringing any jobs back. We have to find new sources for employment or embrace the reality that in the future we can't expect people to work for a living.

 

[Joe Okc]

What do you think can be done to improve the situation though?

Well, I do believe that is what Trump was trying to do with Tariffs... Make China pay more and try to help US manufacturing...

 

[samiam5211]

Well, I do believe that is what Trump was trying to do with Tariffs... Make China pay more and try to help US manufacturing...

I don't think Tariffs are going to be a solution. How high would tariffs have to be to make up the difference between workers getting 30 bucks a month v/s a good factory job in the US which is closer to 30 bucks an hour by the time you add in benefits.

Trump wants to convince people that he is going to bring back manufacturing to what it was 40 years ago, but that just isn't going to ever happen.

Trying to bring back the old days of manufacturing are hurting us in the long run IMO. We need to be forward looking and training workers and building infrastructure for the economy 40 years from now, not 40 years ago.

 

[B4YOU]

Well, I do believe that is what Trump was trying to do with Tariffs... Make China pay more and try to help US manufacturing...

I think more people would be ok with tariffs if Trump didn’t BS people about manufacturing. The easy justification is “Trump wants to move US production out of China to limit the loss of intellectual property and weaken a competitor”.