Market reaction to Trump's China tariffs? DOW crashes over 700 points!!!

That's the way it works mate.

Boil all your fancy words down, examine all your historical examples, consult all your statistics, read all your tea leaves and what you get is..... people change their shopping habits rather than pay extra money.

 

I care about jobs, not cheap Chinese consumer goods they make by destroying their environment and polluting much of the world.

Why do you love Chinese Industrial Pollution?

 

I am not sure I follow. Are you asking me to provide a citation the 200,000 job loss claim? Or are you trying to say that historical example is irrelevant?


Or did you want me to explain why I interpreted the argument of "others lose more" to mean that they are OK with 200,000 US jobs lost so long as "others" lose more than 200,000 jobs?

 

Only to a certain extent. If the bus fare increases 25 cents, people are overwhelmingly going to pay that extra money rather "change their shopping habits" because a bus fare is a relatively inelastic good or service and the substitute (a car) is unobtainable for many.

I heard yesterday the story of a keg company which prides itself on making kegs with American aluminum and steel. They just had to release 10 workers because the cost to make their kegs increased $20 specifically because of the tariffs. People changed their shopping behavior away from a company that EXPLICITLY billed itself as a nationalist company.

 

If you cared about jobs, you would realize that hurting 300,000 US soy farmers just to help 150,000 US steel workers is a bad trade.

Why do you hate US workers and consumers?

 

I was wondering what the historical example you are referring to is please


I am happy for you to make those claims, believe those claims and be able to cite references for those claims.
I am also happy for others to make rival and competing claims. And for them to be equally as believable and referenced.


The nature of economics is such that it is not an empiric science. It does not provide absolute conclusions. No proofs.
Only debate.
Not even with the benefit of hindsight. If for example we were to discuss the causes and the reasons for the end of the Great Depression we would still encounter the same conflicting arguments today as they had at the time. it has not been definitively settled/empirically resolved, nor can it ever be.

As such I am interested in the historical model you were referring to. To get me up to speed with the debate surrounding it. I'm happy to look up the details for myself.

 

Then you have cars, car sharing, mini buses, vans, taxis, rickshaws, motor bikes, mo-ped, bicycle, walking, hitchhiking, rival buses. The train. And... not going out as much.
Everything is very elastic these days. Especially international trade goods. Which are invariably luxury items. Price of Champagne goes up 50p? Don't worry socialists, Australia and California and South Africa make fizzy wines too.
Steel for example. No problem. Aluminium no problem. Domestic supply is readily available and a plethora of foreign suppliers are too.

 

Economist made a lot of claims about globalization that, as one economic historian pointed out turned out to be totally wrong. They changed nothing of their views.

Economics is not an empirical science at the macro level.

 

Pollution and destroying the environment: So you must hate Trump's removal of many of the regulations on coal mining and the lack of regulations on fracking

 

They don't. Nor do they help US steel producers. Just so you know. It started out as a tariff on steel, then not Canada and mexico, then not on most other countries.
A typical Trump deal. Look at how I helped you. Go to sleep. Look what I actually did - nothing.

 

The dow has little to do with the well being of most Americans. It goes down typically when median wage increases are announced.

It represents the interest of business and large investors.

 

China cares very little about US tariffs on China steel. They hardly sell us any.

Value added taxes are like our sales tax. Everyone pays.

I'm sure you must think you have a point here, but obviously GM, for example, thought it was worth it to be able to double their market. You wouldn't be saying you think the government should tell business where they can build a plant.

(BEIJING) — China announced a $3 billion list of U.S. goods for possible retaliation in a tariff dispute with President Donald Trump and girded Friday for a bigger battle over technology policy as financial markets sank on fears of global disruption.

The Commerce Ministry said higher duties on pork, apples, steel pipe and other goods would offset Chinese losses due to Trump’s tariff hike on steel and aluminum imports. It urged Washington to negotiate a settlement but set no deadline.
http://time.com/5213248/china-united-states-tariffs-pork-apple-steel/
If my math is correct we import about 1 billion in Chinese steel. So I guess they responded with a 3X tariff.

Edit:
Well, I'll be. Look where the pork comes from.​

Here are the top 10 states “bringing home the bacon,” according to the latest U.S. Census data.

• Iowa - $4.2 billion.
• Illinois - $1.54 billion.
• Minnesota - $1.47 billion.
• North Carolina - $1.46 billion.
• Indiana - $1.04 billion.
• Oklahoma - $952.7 million.
• Missouri - $791 million.
• Nebraska - $657.5 million.

 

And now we see that Trump knows exactly what he is doing. The threats of tariffs is the start of negotiations from a position of strength. China needs us much more than the US needs China. China has a billion people living on ~ $2000 per year - they must keep their economy growing. It will indeed be ugly for China if they don't reduce trade restrictions on US imports to them.

https://www.wsj.com/articles/u-s-ch...lutions-after-days-of-loud-threats-1522018524

 

Good. No point in them making a big deal out of it then.​

 

Nah. Trump's just returned the situation to where it was for most of Obama's presidency.

 

Well, if it pisses you off, I'm likely for it.

 

Americans don't like stagnating wages. They blame it on trade. If wages do not go up globalization will go away.

In 1980 I probably would have agreed increased trade would have benefited US workers. The numbers have never supported that. It is why I stopped being conservative in the 80's.

 

If it will have that little effect, then it shouldn't be of any concern regarding the economy.

 

So why would China be so mad about the trade restrictions if they barely sell us any steel to begin with supposedly? All that said, I say it's their fault. Stop stealing our intellectual property and military secrets and people won't be so nonchalant about taking actions against you.

 

Free trade is needed for a healthy economy, the problem is that the relationship we have with certain countries is anything but. They get the benefits of free trade with us but also the advantages of protectionism for themselves.

 

They sell us a lot more than steel. A lot more.

 

Exactly. And that is what Trump is using the threat of tariffs to achieve. Those not interested in nothing but attacking Trump know this by listening to what he has said.

 

I have seen no evidence that free trade benefits American workers.

 

It benefits American consumers but not all American workers. Econ 101.

 

So what is the Trump plan?
China will buy it's airplanes from Airbus.
We will start making our own T-shirts.
But wait we are going to deport 10 or 12 million people so we don't have enough people to make T-shirts?
China will have 5 million unemployed people.
Is that our future?
Or will it be like they are predicting for solar after the tariffs?
We will add 2000 jobs to solar manufacturing and lose 23,000 in fab and installation? I guess those guys can learn to make T-shirts.