Trump announces 25% tariff on all imported vehicles!

[Tazzieman]

That is how I understood JD Vance's "peasant" comment:

Many people, some even on this forum, would understand him to be another rich , condescending prick who hides behind lawyers!

 

[Jeremy996]

I understand a peasant to be tied to the land that they do not own. They lack the autonomy and freedom that are the ideal of post Enlightenment Western Civilization in part because they lack property that allows them to make decisions that differ from official government policy. In communist and other dictatorship / oligarchical systems, property ownership is either absent or ownership's prerogatives are highly constrained. That is how I understood JD Vance's "peasant" comment: no matter how well educated a citizen of China is, he is still a "peasant" in his lack of autonomy. Being a peasant goes with the territory if you live in a communist country.

I think he fundimentally misunderstands Chinese communisum. Centralised direction for the communal good reduces personal automny but speeds up change desired by the central party. It is both a strength and a weakness and is underestimated at your peril.

So long as the Chinese central party can keep a lid on social cohesion, they can out-compete the western world by ignoring everything other than the main chance. The West needs to understand that chasing profit is not the only objective; the western commercial sector has forgotten that, the Chinese never did.

 

[Gaffer]

I think he fundimentally misunderstands Chinese communisum. Centralised direction for the communal good reduces personal automny but speeds up change desired by the central party. It is both a strength and a weakness and is underestimated at your peril.

So long as the Chinese central party can keep a lid on social cohesion, they can out-compete the western world by ignoring everything other than the main chance. The West needs to understand that chasing profit is not the only objective; the western commercial sector has forgotten that, the Chinese never did.

I agree with Jeremy996 that "Centralised direction for the communal good reduces personal automny but speeds up change desired by the central party." Given that theft of intellectual property is part of the Chinese business model, it is powerful indeed. Copying others leapfrogs the failures that the western innovators endure to get to the point where their innovation is worthy of theft.

But, excluding theft of intellectual property from Western innovators, the central party makes decisions based upon its judgments. In other words, "change desired by the central party" is informed by its observations but is uniformed by market mechanisms, such as pricing signals. Moreover, its judgment may reflect extraneous factors like the party's earlier commitments or the interests of the decision makers. So, as workmanlike as its judgments may be, the communist system leads to stagnation and continued erosion of individual rights.

The current Chinese model is vastly more effective than the Great Leap Forward. But it shares the same DNA.

 

[nuclearbeef]

I cannot know whether tariffs will be the catalyst of greater US wealth, higher middle class incomes and so forth. But it is plausible, has precedent in pre-Civil War US economic development and is, as far as I know, the best idea on offer.

I suppose no one can truly KNOW; but, i has been tried before...

View: https://www.youtube.com/watch?v=yuOHbyuanbY

 

[CrazyOldMan]

I suppose no one can truly KNOW; but, i has been tried before...

View: https://www.youtube.com/watch?v=yuOHbyuanbY

I am having the same reaction to this whole discussion - and I have a MBA from the University of Chicago. Nerdery aside, it still puts me into a coma.

 

[Gaffer]

I suppose no one can truly KNOW; but, i has been tried before...

View: https://www.youtube.com/watch?v=yuOHbyuanbY

My eyes are glazing over too. But the environment during the Great Depression was a combination of a post WWI speculative bubble fueled by easy money, plus excess capacity. That is not the same our environment and an initiative to overcome and combat the effects of decades of trade barriers.

 

[Tazzieman]

"Sometimes I wonder whether the world is being run by smart people who are putting us on or by imbeciles who really mean it."

Mark Twain

 

[DaveB]

Yep.....any day now those Tariffs are going to kick in and save the economy

 

[Gaffer]

I would look for benefits to take place, if they do, beginning in 3-5 years. It may take that long for factories to be built and distribution to be reconfigured. The stock market (S&P 500, above) will anticipate it about nine months prior.

 

[Tazzieman]

I would look for benefits to take place, if they do, beginning in 3-5 years.

So after China invades Taiwan?

 

[Zimm]

I would look for benefits to take place, if they do, beginning in 3-5 years. It may take that long for factories to be built and distribution to be reconfigured. The stock market (S&P 500, above) will anticipate it about nine months prior.

 

[DaveB]

I would look for benefits to take place, if they do, beginning in 3-5 years. It may take that long for factories to be built and distribution to be reconfigured. The stock market (S&P 500, above) will anticipate it about nine months prior.

Nobody will be building any significant factories in 3-5 years or anytime soon.
If they did and then the tariffs were changed, removed or increased the factories would no longer be viable.
Uncertainty in a market is the most dangerous thing and takes away any confidence needed to invest heavily.

I am afraid that the damage being done will cause factories to close, not open.

 

[Gaffer]

Nobody will be building any significant factories in 3-5 years or anytime soon.
If they did and then the tariffs were changed, removed or increased the factories would no longer be viable.
Uncertainty in a market is the most dangerous thing and takes away any confidence needed to invest heavily.

I am afraid that the damage being done will cause factories to close, not open.

Perhaps. I suppose you know that BMW, Corning, Intel, Nucor and Samsung among others have announced new plants since the beginning of the year, right?

 

[DaveB]

Perhaps. I suppose you know that BMW, Corning, Intel, Nucor and Samsung among others have announced new plants since the beginning of the year, right?

• BMW only assembles vehicles in the US, so will get hit with component tariffs heavily.

• Corning is great and produces very high quality products for medical industry on robotic lines.

They also do auto glass so........

• Intel produce some of the world's best computer chips and are modernising existing factories and building new fully automated factories thanks to a $7.86 Billion government grant.

Their workforce will not increase as they modernise, their main customer will be US defense industry. (US Government eventually)

• Nucor is large but not financially stable. It imports iron ore from some pretty dubious sources (Honduras) so will get hit by tariffs also.

It needs government funding to build new plants and it is doubtful it will be profitable without significant price increases.

• Samsung has also been given a huge $6.4 Billion government grant to build a fully automated computer chip factory in the US.
  • their main customer will be US defense industry. (US Government eventually)

I might add that all of these were announced before Trump

 

[Gaffer]

• BMW only assembles vehicles in the US, so will get hit with component tariffs heavily.

• Corning is great and produces very high quality products for medical industry on robotic lines.

They also do auto glass so........

• Intel produce some of the world's best computer chips and are modernising existing factories and building new fully automated factories thanks to a $7.86 Billion government grant.

Their workforce will not increase as they modernise, their main customer will be US defense industry. (US Government eventually)

• Nucor is large but not financially stable. It imports iron ore from some pretty dubious sources (Honduras) so will get hit by tariffs also.

It needs government funding to build new plants and it is doubtful it will be profitable without significant price increases.

• Samsung has also been given a huge $6.4 Billion government grant to build a fully automated computer chip factory in the US.
  • their main customer will be US defense industry. (US Government eventually)

I might add that all of these were announced before Trump

These companies say they're investing more in U.S. manufacturing as tariffs go into effect

President Trump wants to bring manufacturing back to the U.S. These companies say they're investing in domestic factories.

www.cbsnews.com

The above might be a more appropriate list. Assuming that I can copy and paste a link.

 

[DaveB]

These companies say they're investing more in U.S. manufacturing as tariffs go into effect

President Trump wants to bring manufacturing back to the U.S. These companies say they're investing in domestic factories.

www.cbsnews.com

The above might be a more appropriate list. Assuming that I can copy and paste a link.

The biggest problems to this is that moving production from one country to another doesn't just happen.
The components and supply lines are already in place and they are not from America, so tariffs will still impact.
Food and pharmaceutical production machinery etc are all made in Italy, Germany, Switzerland etc and are purchased as a complete ready to go line.
They would then need to be imported and so tariffs again.

The other issue is that "announcing" something and following through are two very different issues.
A company may "announce" to appease Trump and his supporters and then just keep delaying until Trump is replaced.
Assuming he doesn't just appoint himself as King Donald.........which is a very real possibility.

 

[DaveB]

Here is the main problem....
There is no way he will back down....they will kiss his arse.... 24 hours later......

 

[Zimm]

This is going to be a huge success. It’ll be like the foxcon deal x 100. All the guys MACK just benched will be back in a week or two plus a couple hundred. And the NIH and CDC disease researchers can start assembling heavy trucks. They can’t wait to do something different. Just you wait and see.

 

[DaveB]

This is going to be a huge success. It’ll be like the foxcon deal x 100. All the guys MACK just benched will be back in a week or two plus a couple hundred. And the NIH and CDC disease researchers can start assembling heavy trucks. They can’t wait to do something different. Just you wait and see.

Or they can start building solar panels.

 

[Tazzieman]

The whole tariff thing is a dog's breakfast.
May as well consult Baba Vanga to foretell the market future.