Monkey-chaos as constantly changing but ever-recurring kaleidoscope policy, with fake deals and real drama: the Trump performative tariff-threat theater of 2025 is a show running 24/7, and a...
I hope someone if tracking all the small businesses that are getting the Presidential Shaft. Most of them source manufacturing and or materials from tariff countries. They are faced with far more financial uncertainty than large companies. Trump has shown total disregard for any trade agreements.
Dems need to be running ads featuring all the small business owners who are impacted.
I have read that the EU was treading very carefully because they needed US weapons for Ukraine and time to rebuild their own armaments industries. However, the 30% tariff made in some sort of pique means that the EU will now have to retailiate anyway. (Better stock up on all that European produce and goods before the price increases!)
Trump seems to want to be the "ruler of the world," using imposed tariffs as his big stick. He already knows that his "deals" didn't happen, and even his billionaire toadies must be reminding him of this failure, hence the imposition of tariffs as "deals" that are not. Meanwhile, China is doing deals to offset the tariffs imposed on it. I hope the EU, and even the UK can do something similar. Maybe this will even push the UK to build much closer ties to the EU, now that Brexit promises are demonstrably a bust and proving a liability in this situation.
What I don't understand is that everyone knew Trump reneged on business deals, stiffed his suppliers, and left his investors holding the bag. Why did governments think that his behavior would change when in government? Trump admin 1.0 should have disabused them of that.
I didn't mean how Trump was elected. That was insanity on the electorate's part. I meant that other governments should have understood his behavior from both his business and his first administration's actions, and acted accordingly. Or maybe they did, but had no choice.
I've been thinking about the timing of the tariffs, the pause and the furious pressure to get the BBB passed into law BEFORE the tariff pause ended.
Now the the 2017 tax cuts are in for at least another decade with some additionals, along with a recipe for reduced IRS compliance and a delay in spending cuts, the need for tariff revenue seems high.
So the talk of deals might have been a smokescreen to keep markets up and thus manufacture consent in Congress while the plan all along was to shift the tax burden to the lower classes.
An additional $70B a quarter when we are already selling $500B+ to a no longer friendly crowd who, by our actions, need to build out their militaries (as we begin to reverse the decades of reduced redundancies)...well it will be interesting.
"Markets are underpricing the risk of enduring institutional damage"
They do so even more blatantly with seculare deficits (with the cynical caveat that the regressive distributional shift could possibly be favorable to high-income taxpayers/avoiders by enough to compensate for the reduced aggregate growth).
Decoupling of trade also means decoupling of foreign investment. The rule of law is now Truth Social posts. The Fed's independence is short-lived. Will foreign investors accept such volatile uncertainty? We are approaching the point where many nations' domestic debt and currency is more stable than the US, so they should let their T-bills mature (not dump), then invest in a diversified portfolio.
Foreign currency debt is, to a large degree, a claim on a nation's future production of goods and services. What does the US produce? Education, tourism, and industry have been sabotaged. Industrial policy subsidizes low-return commodity goods and shuns new technology. The US is left with social media, finance, and LLM algorithms. It's hard to see those supporting $60+ trillion of foreign investment, for either a foreign central bank or a foreign insurance company. As for the USD, they would be better served trading with a derivative based on a basket of major currencies.
When the foreign money is gone, so too will be the trade deficit. Americans will lose a level of consumption unknown in the history of the world. They will be poorer, but perhaps no wiser.
"Three generations of Europeans have lived in a world in which they’ve been vassals of either the United States or the Soviet Union. That has taken a severe mental toll, and we can see it in our political leadership on this continent. Europeans have been dependent on the United States - militarily, economically and culturally - for so long that they’ve lost the ability to imagine a world that’s any different." - https://davekeating.substack.com/p/an-eight-point-plan-to-free-europe
"America’s major trading partners—Canada, Mexico, the EU, and the UK—have now learned that appeasement and symbolic concessions gain them nothing."
There's a certain tension between these formulations but I think it can be reconciled. Put in "should now have learned" and they become quite close.
I hope someone if tracking all the small businesses that are getting the Presidential Shaft. Most of them source manufacturing and or materials from tariff countries. They are faced with far more financial uncertainty than large companies. Trump has shown total disregard for any trade agreements.
Dems need to be running ads featuring all the small business owners who are impacted.
Hey, I live in Cleveland!
I have read that the EU was treading very carefully because they needed US weapons for Ukraine and time to rebuild their own armaments industries. However, the 30% tariff made in some sort of pique means that the EU will now have to retailiate anyway. (Better stock up on all that European produce and goods before the price increases!)
Trump seems to want to be the "ruler of the world," using imposed tariffs as his big stick. He already knows that his "deals" didn't happen, and even his billionaire toadies must be reminding him of this failure, hence the imposition of tariffs as "deals" that are not. Meanwhile, China is doing deals to offset the tariffs imposed on it. I hope the EU, and even the UK can do something similar. Maybe this will even push the UK to build much closer ties to the EU, now that Brexit promises are demonstrably a bust and proving a liability in this situation.
What I don't understand is that everyone knew Trump reneged on business deals, stiffed his suppliers, and left his investors holding the bag. Why did governments think that his behavior would change when in government? Trump admin 1.0 should have disabused them of that.
Governments did not elect him.
I didn't mean how Trump was elected. That was insanity on the electorate's part. I meant that other governments should have understood his behavior from both his business and his first administration's actions, and acted accordingly. Or maybe they did, but had no choice.
I've been thinking about the timing of the tariffs, the pause and the furious pressure to get the BBB passed into law BEFORE the tariff pause ended.
Now the the 2017 tax cuts are in for at least another decade with some additionals, along with a recipe for reduced IRS compliance and a delay in spending cuts, the need for tariff revenue seems high.
Pete Navarro is expecting $2.8T over the next decade: https://www.foxnews.com/opinion/how-cbo-got-wrong-again-trumps-economic-bill-set-generate-trillions-surplus-not-debt
So the talk of deals might have been a smokescreen to keep markets up and thus manufacture consent in Congress while the plan all along was to shift the tax burden to the lower classes.
An additional $70B a quarter when we are already selling $500B+ to a no longer friendly crowd who, by our actions, need to build out their militaries (as we begin to reverse the decades of reduced redundancies)...well it will be interesting.
MMM??? A repeat of "Fortress America" where in economic warfare, international trade is the ICBM??????
"Markets are underpricing the risk of enduring institutional damage"
They do so even more blatantly with seculare deficits (with the cynical caveat that the regressive distributional shift could possibly be favorable to high-income taxpayers/avoiders by enough to compensate for the reduced aggregate growth).
That's the problem with "deep" markets; once they're trawled, recovery takes decades.
Decoupling of trade also means decoupling of foreign investment. The rule of law is now Truth Social posts. The Fed's independence is short-lived. Will foreign investors accept such volatile uncertainty? We are approaching the point where many nations' domestic debt and currency is more stable than the US, so they should let their T-bills mature (not dump), then invest in a diversified portfolio.
Foreign currency debt is, to a large degree, a claim on a nation's future production of goods and services. What does the US produce? Education, tourism, and industry have been sabotaged. Industrial policy subsidizes low-return commodity goods and shuns new technology. The US is left with social media, finance, and LLM algorithms. It's hard to see those supporting $60+ trillion of foreign investment, for either a foreign central bank or a foreign insurance company. As for the USD, they would be better served trading with a derivative based on a basket of major currencies.
When the foreign money is gone, so too will be the trade deficit. Americans will lose a level of consumption unknown in the history of the world. They will be poorer, but perhaps no wiser.
"Three generations of Europeans have lived in a world in which they’ve been vassals of either the United States or the Soviet Union. That has taken a severe mental toll, and we can see it in our political leadership on this continent. Europeans have been dependent on the United States - militarily, economically and culturally - for so long that they’ve lost the ability to imagine a world that’s any different." - https://davekeating.substack.com/p/an-eight-point-plan-to-free-europe
"America’s major trading partners—Canada, Mexico, the EU, and the UK—have now learned that appeasement and symbolic concessions gain them nothing."
There's a certain tension between these formulations but I think it can be reconciled. Put in "should now have learned" and they become quite close.