Trump's tariff wars...long post.

[asingardenof]

1 hour ago, tegs07 said:

All the above. I will add that in part the agenda is ideological and fuelled by deep seated loathing rather logic or strategic thinking. I think for the same reasons Trump will pull the USA out of NATO (incrementally at first and then altogether).

Assuming he doesn't invade Greenland first, a de facto declaration of war against Denmark, another NATO member, at which point, if the various clauses of the treaty come into force, the rest of NATO should come to Greenland's defence and the US will be expelled. There's nothing in the treaty about one member attacking another though, so it's all a bit theoretical.

[tegs07]

36 minutes ago, Pseudonym said:

 

I have been watching Line of Duty recently. The targets of the investigations are usually wily, cunning, rather flash and cocky officers whose inherent willingness to bend the rules leads to them getting into ever-deeper waters until they sink under the combined weight of evidence and exhausted luck. Until that happens, however, dramatic conventions require that these cunning and flash officers seem to be getting the better of the team that seeks to box them in with the truth.

 

Trump thrives on destabilisation. He is a gifted opportunist, not least because he has routinely exploited a kind of precedural asymmetry that often places him at an advantage against people who are working within generally accepted guidelines.

 

He is not really trying to execute a master strategy. He is striving to get to the end of the episode. I think that is probably part of his appeal to his base, because a lot of those voters do not have the luxury of strategic plans. They are trying to get through the week. In that regard, the range of outcomes from tariff brinksmanship is far too wide to be predictable, and the kinds of people who care about predictability are the kinds of people who want reliable plans -- not the kinds of people for whom glib recommendations to keep an emergency fund of six months' living expenses are both laughable and in some way humiliating. As for his wealthiest backers, they are very noticeably the ruthless opportunists we love to hate in narratives: adrenaline-driven tech types, old-school corporate-raider types, seat-of-the-pants crypto gamblers, and other kinds of people who usually get played as charming rogues (or antic-comic fall guys) in dramas that also portray any version of the establishment as desiccated and dull.

 

It does little harm to analyse all of the current events in economic terms, but I honestly think one might as well look at audience responses to Goodfellas or ponder why it is sad to see what happens to Robert de Niro in Heat. When the status quo has disappointed you, the action is the juice. Catharsis is deeply satisfying, and the cost is tomorrow's problem.

 

There is little to be gained from trying to understand the plot of an action movie by scrutinising the actual market for whatever loot the baddies are trying to unload, or whether the hero could really chase anyone on the subway after sustaining those injuries. We are in it for the payoff, not the process. The moment the American electorate decided to favour someone from the television industry over a career prosecutor, process scarcely matters. Only the payoff matters. That is also why everybody associates catchphrases with the performers who utter them rather than with the writers who write them.

 

I don't think suspension of disbelief is indefinitely sustainable. I just know it is effective.

 

 

 

He’s not the messiah. He’s a very naughty boy.

[Pseudonym]

26 minutes ago, tegs07 said:

He’s not the messiah. He’s a very naughty boy.

 

Well, he certainly has the Caddy on the payroll.

[TimR]

1 hour ago, asingardenof said:

Assuming he doesn't invade Greenland first, a de facto declaration of war against Denmark, another NATO member, at which point, if the various clauses of the treaty come into force, the rest of NATO should come to Greenland's defence and the US will be expelled. There's nothing in the treaty about one member attacking another though, so it's all a bit theoretical.

 

 

They'll put sanctions on the US. The first will be to close all US Airbases in the North Altlantic.

[Pseudonym]

2 hours ago, asingardenof said:

Assuming he doesn't invade Greenland first, a de facto declaration of war against Denmark, another NATO member, at which point, if the various clauses of the treaty come into force, the rest of NATO should come to Greenland's defence and the US will be expelled. There's nothing in the treaty about one member attacking another though, so it's all a bit theoretical.

 

There are various levels of interstate disputes involving military action that fall short of a state of war. They often seem to involve fish.

[TimR]

20% on EU.

10% on UK.

25% on cars.

 

Starting midnight EST.

[tegs07]

12 minutes ago, TimR said:

20% on EU.

10% on UK.

25% on cars.

 

Starting midnight EST.

I think the tariffs on Asia are more illuminating. Things are going to get very expensive in the USA.

[binky_bass]

No tariffs for Russia then?? 🤔

 

They weren't featured on his 'chart'. 

Edited yesterday at 21:33 by binky_bass

[Daz39]

9 minutes ago, binky_bass said:

No tariffs for Russia then?? 🤔

 

They weren't featured on his 'chart'. 

It’s ok: he’ll add it in with sharpie later…!

[tegs07]

I wonder how fast companies like Nike and the big US tech companies can pivot from Asia?

[Woodinblack]

1 minute ago, tegs07 said:

I wonder how fast companies like Nike and the big US tech companies can pivot from Asia?

 

To where? The semiconductors are made in Taiwan, there is not a hope that they can be made in the US any time soon, could be possible to do something in mexico but obviously that is no use, so they will just have to accept that semiconductors from now cost 30% more

[prowla]

1 hour ago, TimR said:

20% on EU.

10% on UK.

25% on cars.

 

Starting midnight EST.

He says UK tariffs are 10%, so that seems equitable.

[prowla]

18 minutes ago, Woodinblack said:

 

To where? The semiconductors are made in Taiwan, there is not a hope that they can be made in the US any time soon, could be possible to do something in mexico but obviously that is no use, so they will just have to accept that semiconductors from now cost 30% more

Apple products MIC. 

[peteb]

8 hours ago, tegs07 said:

All the above. I will add that in part the agenda is ideological and fuelled by deep seated loathing rather logic or strategic thinking. I think for the same reasons Trump will pull the USA out of NATO (incrementally at first and then altogether). He is an idiot. Working in an echo chamber of ideologues.

 

I would caution anyone against thinking that these are sound decisions formed by a master strategist. I can find scant support from any economists or analysts who actually have experience and knowledge about these issues.

There is a very good reason that these things haven’t been forced through before!

 

Anthony Scaramucci (an ex Trump adviser and a very good centre right pundit these days) reckons that Trump is trying to “Brexit” the US from the rest of the world, aping the last Conservative government in the UK and pushing policies (i.e. tariffs and DOGE) that are similar in intent to austerity and Brexit. He suggests that this will have disastrous consequences for ordinary Americans, or as he puts it “Austerity plus Brexit, no bueno for the average person in the country". 

 

https://www.huffingtonpost.co.uk/entry/ex-aide-says-trump-trying-to-brexit-america_uk_67ebc39ae4b0d9a17eccc67f?fbclid=IwY2xjawJaHBZleHRuA2FlbQIxMQABHRSzC5vrMrzkgLrQVqnr7ID70_vh4nGkKaSF5Adr1ALDsoXNGF7jvVtwtg_aem_anEwx5GxDnhKnI3dDYdb3w

 

Edited yesterday at 22:29 by peteb

[Al Krow]

So if you're making stuff in the EU and exporting to the US and facing 20% US tariffs, then you could instead:

(i) make stuff in the US (with import duties on raw materials and parts); or

(ii) make it in the UK with lower labour costs than the US.

 

I suspect a lot of EU company boards tomorrow morning are going to be having emergency meetings and some of them will be thinking the exact same thing. If so, these Trump tariffs could prove to be an unexpected gift and the 10% differential could provide quite a boost to the UK, particularly on things we're already good at e.g. pharmaceuticals. 

 

In addition the UK govt is currently looking to negotiate a trade deal with the US that could lower tariffs further. Getting the the EU 27 to agree a trade deal with the US won't be quick, although 20% tariffs are going to focus a lot of minds I suspect!

 

Pity the US consumer who is going to be picking up a big chunk of the tab for all of this.  Everyone's going to be watching to see if Trump gets caned in the mid-term elections and becomes a lame duck?

 

Edited 23 hours ago by Al Krow

[Downunderwonder]

AFAIK NZ has no tariffs on anything except petroleum. There is a small amount of import duty and excise is same as domestic production.

 

We respectfully request everyone drop theirs on our stuff, or at least not increase it.

[tauzero]

30 minutes ago, Al Krow said:

So if you're making stuff in the EU and exporting to the US and facing 20% US tariffs, then you could instead:

(i) make stuff in the US (with import duties on raw materials and parts); or

(ii) make it in the UK with lower labour costs than the US.

 

I suspect a lot of EU company boards tomorrow morning are going to be having emergency meetings and some of them will be thinking the exact same thing. If so, these Trump tariffs could prove to be an unexpected gift and the 10% differential could provide quite a boost to the UK, particularly on things we're already good at e.g. pharmaceuticals. 

 

In addition the UK govt is currently looking to negotiate a trade deal with the US that could lower tariffs further. Getting the the EU 27 to agree a trade deal with the US won't be quick, although 20% tariffs are going to focus a lot of minds I suspect!

 

Pity the US consumer who is going to be picking up a big chunk of the tab for all of this.  Everyone's going to be watching to see if Trump gets caned in the mid-term elections and becomes a lame duck?

 

I think firms would be quite reluctant to invest vast amounts of money in shifting production to the UK when there's no saying what the Tangerine Terror will do next in one of his man-baby tantrums. Plus the lead time would be such that by the time production was up and running, Trump would have come to the end of either his term or his life, and if one assumes a successor with some rationality, a complete changer of tack.

[Dad3353]

Naïve, I suppose, but wasn't the WTO (World Trade Organisation...) supposed to sort all of these things out..? Most countries signed up to it in 1995 (USA, UK and NZ, as well as EU countries...). Is it off the table now, for everyone, or does it still hold good for most member states..? 

[Al Krow]

13 minutes ago, tauzero said:

 

I think firms would be quite reluctant to invest vast amounts of money in shifting production to the UK when there's no saying what the Tangerine Terror will do next in one of his man-baby tantrums. Plus the lead time would be such that by the time production was up and running, Trump would have come to the end of either his term or his life, and if one assumes a successor with some rationality, a complete changer of tack.

 

Yeah, that's fair / all makes sense.

 

But some decisions e.g. to close a plant in Luton and move the work to the EU would be less likely to happen now. So, at the margin, it will make the UK a relatively more attractive place to set up shop.

[TimR]

He's basing it on trade defects. The greater the imbalance between imports and exports, the greater the tarrif.

[Staggering on]

Canadians are relaxing a bit tonight, today's announcement leaves things pretty much as they have been for the last month or two. Of course things could change at any time if the orange one makes more snap decisions but at least we are OK for now. 

[JoeEvans]

5 hours ago, TimR said:

He's basing it on trade defects. The greater the imbalance between imports and exports, the greater the tarrif.

Just read that this morning. Although Trump claimed that the new tariff rates were set at 50% of the tariffs charged by other countries on US goods, that turns out, inevitably, to be a flat-out lie. Instead they've calculated the percentage trade imbalance and halved that. So if a county sells $2bn of goods to the US and only buys $1bn, ie 50%, they've been slapped with a 25% tariff.

Personally I think that if Trump is serious about this and persists with it, it's the beginning of the end for him. The effect on the US economy and inflation rates will be massive and extremely damaging, and in the short term at least it will delivery precisely the opposite effect to what he's promised. I suspect that although US citizens will apparently put up with a great deal by way of lies, racism and damage to democracy, they won't like inflation, stock market crashes and loss of jobs one bit.

[tegs07]

5 hours ago, TimR said:

He's basing it on trade defects. The greater the imbalance between imports and exports, the greater the tarrif.

Hence why some of the world’s poorest countries are hit by some of the highest tariffs. I doubt that the people of Myanmar have much in the way of US consumer luxuries.

 

…. and ´currency manipulation’ however Trump defines this.

 

As @Woodinblack has said a lot of the imports hit by tariffs can’t magically be suddenly produced in the USA and even if they could they would depend upon raw materials that were subject to tariffs. In the case of food this thinking is utter madness as most of the imported food can’t be produced in the US. Coffee for example. 

[TimR]

Well all these foreign companies that are going to go down in value because they can't trade with the US will have 'someone' buying them up.

 

And then when Trump releases he's made a mistake and removes the tariffs, their value will rise, and those investors will have made a ton of money.

 

Although I'm not sure Trump is really that clever to have masterminded that process. Might be something he read in a book somewhere about Disaster Politics. 😆

 

I think I'm giving that conspiracy theory far too much legs. 😆

[tegs07]

10 minutes ago, JoeEvans said:

Just read that this morning. Although Trump claimed that the new tariff rates were set at 50% of the tariffs charged by other countries on US goods, that turns out, inevitably, to be a flat-out lie. Instead they've calculated the percentage trade imbalance and halved that. So if a county sells $2bn of goods to the US and only buys $1bn, ie 50%, they've been slapped with a 25% tariff.

Personally I think that if Trump is serious about this and persists with it, it's the beginning of the end for him. The effect on the US economy and inflation rates will be massive and extremely damaging, and in the short term at least it will delivery precisely the opposite effect to what he's promised. I suspect that although US citizens will apparently put up with a great deal by way of lies, racism and damage to democracy, they won't like inflation, stock market crashes and loss of jobs one bit.

Totally agree. All the opposition and judiciary have to do is give Trump enough rope. His master plan relies on massive government subsidies, environmental degradation and a pool of cheap non-union labour who will tolerate bad working conditions. This is how China got all the manufacturing to begin with. It takes years to achieve, even in a non democratic country. In the meantime the cost of living is going up. His lies about Biden and the cost of living crisis were what convinced the non MAGA cult to vote for him. Inflation going up and a potential recession and stock market crash are not big vote winners.

Edited 16 hours ago by tegs07