The trade and economy mega-thread (4 Viewers)

[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.

 

[MT15]

Good lord, I saw that spike and immediate plunge and wondered what happened. Musk is just such a moron to run Twitter the way he has been.

 

[MT15]

 

[Optimus Prime]

 

[UriUT]

in essence: "They are dumb".

What the heck happened to the US?

 

[UriUT]

Anyone has watched that movie "the Invention of Lying"? It's a world where no one can lie. Except one person learned that he can do it. This is America right now staring at maga propagandists.

 

[cuddlemonkey]

Hey China, aint coming to table? ok have another 50% added

so if my math right, now its 104% tariff on China

The fact that he ends it with "Thank you for your attention to this matter" reminds me so much of Grandpa speaking in tongues in the Simpsons movie, having a major freakout, and ending with, "Thanks for listening".

 

[MT15]

 

[MT15]

Timeline of the crap they pulled on the market today.

 

[UriUT]

i have a thought on that too.

The core supporters dont hold much in way of value/wealth - they want to FEEL wealthy but havent got what many others have. The cheering is because now so many more are being brought back down to their level. And they love it.

They think this is a game.

The Free-Trade Paradox

Economists may have to accept that convincing most people of the value of free trade is a losing fight.

www.foreignaffairs.com

“We must always take heed that we buy no more of strangers than we sell them, for so we should impoverish ourselves and enrich them.” Those words, written in 1549 and attributed to the English diplomat Sir Thomas Smith, are one of the earliest known expressions of what came to be called “mercantilism.”

Yet the economists Adam Smith and David Ricardo made the definitive case against mercantilism and for free trade more than 200 years ago. Their arguments have convinced virtually every economist ever since, but they seem to have made only limited inroads with the broader public. Polls show only tenuous public support for free trade and even less understanding of its virtues.

This is the sticky part of selling free trade:

Some of the problem comes from the nature of the case for trade. Unlike other economic concepts, such as supply and demand, the idea of comparative advantage—which holds that two countries can both benefit from trade even when one can produce everything more cheaply than the other—is counterintuitive. Defenders of free trade also have to contend with populist politicians and well-financed opponents who find foreign workers and firms easy scapegoats for domestic economic woes. Worst of all, economists may be fundamentally misunderstanding what most people value in the economy. These are hard problems to solve. Governments should do more to help those hurt by trade, but building the necessary political coalitions to do so is tricky.

Removing trade barriers specializes a country to what they are really good at with high returns. Take car manufacturing. The 80s onwards showed that mass producing them elsewhere can be done cheaply and just as well. In return, we get higher paying jobs in sectors like high tech, financial services, and R&D. We attract intelligent and innovative minds. The secondary gains are there even for those not in this sector. Studies showed that in areas of high income/education, those who don't have degrees benefitted with their services; thereby increasing their own income greatly. For example, some may open coffee shops, delis and a great comfortable living.

The downside, however, is the labor that were displaced and find it resentful that they are left behind. Hillary and Obama expressed this post mortem after 2016. They didn't sell free trade well enough and didn't do enough for the displace. Examples can be providing subsidies/grants for education in a different field.

The benefits are clear. Trade benefits both parties. Trump and his kind think in mercantilists' mindsets. To them, trade must have a winner and loser.

Trump was able to push so many Americans into sixteenth-century thinking because most Americans’ belief in free trade is a mile wide but an inch deep. Polls show that the level of support depends on what is meant by “free trade,” how the question is posed, and when it is asked. Taken in isolation, the phrase “free trade” seems to meet with approval. For example, a poll by NBC and The Wall Street Journal in February 2017 asked Americans, “In general, do you think that free trade between the United States and foreign countries has helped the United States, has hurt the United States, or has not made much of a difference either way?” Free trade won: 43 percent of respondents said it helped, and 34 percent said it hurt. That’s not overwhelming, but it’s good news for free traders.

Use the word “globalization,” however, and attitudes change. A poll by CBS and The New York Times in July 2016 defined “globalization” as “the increase of trade, communication, travel and other things among countries around the world.” It then asked, “In general, has the United States gained more or lost more because of globalization?” Globalization lost this poll decisively: 55 percent to 35 percent.

Put any mention of jobs into the question, and the results for international trade get even worse. A CBS poll in 2016 asked Americans, “Overall, would you say U.S. trade with other countries creates more jobs for the U.S., loses more jobs for the U.S., or does U.S. trade with other countries have no effect on U.S. jobs?” About 15 percent of respondents gave what economists would call the right answer: trade has little or no effect on the number of jobs. About seven percent were unsure. Among the others, 29 percent thought trade created jobs and 48 percent thought it destroyed them. And in a poll conducted that same year by Bloomberg, which juxtaposed the costs of restrictions on imports and protecting American jobs, trade restrictions won: 65 percent to 22 percent.

It seems that Americans favor trade in the abstract but often not in the concrete. And support fades fast if trade is connected to jobs or globalization. Most important, in almost every case, public beliefs about international trade differ enormously from the lessons of Economics 101. So if the case for free trade is so compelling, why have economists failed to sell it?

It goes on. The authors blame the complexity of free trade (comparative advantage for example), not helping those displaced, and of course, figures like Trump who exploit misunderstanding and just blame the boogie man for problems. Lastly, the problem may be on economists.

Economists’ focus is squarely on the well-being of consumers.

The well-being of producers is secondary—if it enters the picture at all. In the economists’ vision, firms exist to serve the ultimate goal of consumer welfare.


But what if economists have this wrong? What if people care as much (or more) about their role as producers—about their jobs—as they do about the goods and services they consume?

The producer perspective seems to dominate public opinion.


A 2016 Bloomberg poll, for example, asked Americans whether they would pay a little more for domestically produced merchandise. Even with no direct mention of saving jobs, the results were lopsided: 82 percent of respondents said they were willing to pay a little more; only 13 percent wanted the lowest prices.

 

[coldseat]

"Ron Vera" .....

Start watching at 5:45

 

[Optimus Prime]

 

[Optimus Prime]

 

[MT15]

 

[bird]

How could people be this forking stupid

Tariffs welcomed in Ohio's industrial Trump country

As economic uncertainty swirls and the markets take a hit, many in this deeply Republican area back the president's plan.

www.bbc.com

That’s my state. Stupider than a bag of hammers.

 

[superchuck500]

 

[superchuck500]

"Ron Vera" .....

Start watching at 5:45

Yeah this is totally nuts - but we have known about it for years and nobody ever brings it up. It’s just mental that someone supposedly an expert in a field would have routine citations in his books to a fictitious person he created to give the appearance of peer agreement. Totally menacing.

 

[bird]

Um, Kenny? There is no “G-D” formula. Trump just makes schlitz up.

 

[MT15]

Um, Kenny? There is no “G-D” formula. Trump just makes schlitz up.

Well, someone made up a formula. Which economists everywhere have ridiculed as meaningless drivel.

My own thought is that they are using some form of AI to both write the formula, and apply it to their crazy arse list of countries. That would explain the nonsensical nature of the formula, and the weird list of countries without any regard to whether they are actually inhabited or not.