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exnavynuke · 03-05-2018, 05:53 AM

Wars, of any kind, have no winner. Only those who didn't lose as much. Trade wars tend to have more "innocent victims" than other types of wars though.

The problem with writing a book about your strategy is that everyone knows you're either following that strategy (and ignore it) or don't believe you're bluffing like normal. The markets seem to be responding closer to the former position than the latter imo, as I'd expect a sharper drop if the markets thought wide-scale trade wars were actually impending.

mpeirce · 03-05-2018, 06:16 AM

Quote:

Originally Posted by foxfirev5

Smoot Hawley.

Is that really adding to the conversation?

Smoot Hawley was a broad protectionist bill and doesn't really compare to the current proposals targeted at steel and aluminum.

Free trade is generally a large net positive in the world, but that doesn't mean it's desirable in every case. The theory of competitive advantage (the foundation of free trade policy) doesn't apply when you are trading with an adversary, especially one (China) that has a "socialist market economy" - i.e. far from a "free market".

The French didn't buy steel from the Germans in the 30's. We didn't buy steel from the Soviets in the 60's. We should assure that the US has viable steel, aluminum, and other (semiconductor is another example) manufacturing capabilities.

dtbach · 03-05-2018, 06:43 AM

It's reassuring to know that at least trade wars are easy to win.

flintnational · 03-05-2018, 07:15 AM

I just checked. My DW is running a huge trade deficit with Amazon and Costco.

Clearly they are competing unfairly with their low prices and their refusal to buy from me.

Fortunately I have found the solution. I am going to impose a 25% tariff on everything the DW purchases at Amazon and Costco. Think of all the benefits to the flintnational household.

Hey, I am all for helping displaced workers. But, that means we should actually help displaced workers; job retraining, tax incentives to bring in new industries, etc.

redduck · 03-05-2018, 07:31 AM

Quote:

Originally Posted by foxfirev5

Smoot Hawley.

Quote:

Originally Posted by mpeirce

Smoot Hawley was a broad protectionist bill and doesn't really compare to the current proposals targeted at steel and aluminum.

If I recall correctly, Smoot Hawley was a back-up catcher for the Cleveland Indians in the '40's. Great arm, no hit. Seems odd that he was named after a protectionist bill. (Or, maybe it was just a coincidence).

copyright1997reloaded · 03-05-2018, 07:46 AM

Quote:

Originally Posted by joeea

I understand.

It's the "due to political gamesmanship" (your words) part I find troubling.

To each, his own.

They weren't my words.

growing_older · 03-05-2018, 08:23 AM

There's at least a small cynical, skeptical suspicion that this is market manipulation writ large. We already know there was dumping of stocks before the tariff idea was floated. Some big buys just before the idea is abandoned would profit handsomely. Chaos politics seems unpredictable but maybe not to insiders. Conspiracy theorists should be having a field day.

As a practical investor, I'm simply staying the course and doing nothing. I already adjusted (slightly) my asset allocation to account for being close to retirement and personal risk tolerance in a frothy market. Nothing else to do but wait and watch the show. Markets inevitably fluctuate.

Meadbh · 03-05-2018, 08:45 AM

I am asking the mods to please close this thread now before I say something I regret.

dtbach · 03-05-2018, 09:08 AM

Quote:

Originally Posted by Meadbh

I am asking the mods to please close this thread now before I say something I regret.

Shouldn't they close it on actual content rather than on nonposted thoughts?

joeea · 03-05-2018, 09:24 AM

Quote:

They weren't my words.

Sorry. You are correct. The words came from someone else.

foxfirev5 · 03-05-2018, 09:26 AM

Quote:

Originally Posted by mpeirce

We should assure that the US has viable steel, aluminum, and other (semiconductor is another example) manufacturing capabilities.

And TV's , radios, automobiles, textiles/clothing, drugs, oil/petroleum products, lumber, agricultural products etc.

mpeirce · 03-05-2018, 09:45 AM

Quote:

Originally Posted by foxfirev5

And TV's , radios, automobiles, textiles/clothing, drugs, oil/petroleum products, lumber, agricultural products etc.

While you can argue that a number of products have a strategic significance, may don't. TVs? Not really. Petroleum? Sure and the US has ample production and even a strategic reserve.

This isn't about too many socks being made somewhere, this is primarily about the ability to maintain a strong and independent military capability. Other considerations weigh in of course, but how do you build aircraft carriers or fighter jets without steel and aluminum?

dtbach · 03-05-2018, 09:52 AM

Quote:

Originally Posted by mpeirce

While you can argue that a number of products have a strategic significance, may don't. TVs? Not really. Petroleum? Sure and the US has ample production and even a strategic reserve.

This isn't about too many socks being made somewhere, this is primarily about the ability to maintain a strong and independent military capability. Other considerations weigh in of course, but how do you build aircraft carriers or fighter jets without steel and aluminum?

Both steel and aluminum manufacture could be ramped up very quickly in a military emergency. What is the cost of making allies around the world angry with us? That should be weighed in the balance also.

flintnational · 03-05-2018, 10:28 AM

I believe trade brings more stability not less to the world.
But, if we need to protect the US steel market, I am okay with punishing Canada. I am sure they will understand. Of course, I will need to be reminded how raising prices (tariffs) on US consumers punishes Canada.

Steel imports to the US by Country

1. Canada 16.7 percent

2. Brazil 13.2 percent

3. South Korea 9.7 percent

4. Mexico 9.4 percent

5. Russia 8.1 percent

6. Turkey 5.6 percent

7. Japan 4.9 percent

8. Germany 3.7 percent

9. Taiwan 3.2 percent

10. China 2.9 percent

11. India 2.4 percent

misanman · 03-05-2018, 10:34 AM

Not too long ago we imposed tariffs on Canadian lumber. As far as I know the world hasn't ended yet.

dtbach · 03-05-2018, 11:00 AM

Quote:

Originally Posted by misanman

Not too long ago we imposed tariffs on Canadian lumber. As far as I know the world hasn't ended yet.

Or is it still being held due to legal actions by Canada. The last news briefs I have seen is that Canada has not exhausted appeals and is still in talks concerning NAFTA modifications.

Breedlove · 03-05-2018, 11:13 AM

My honest opinion , we have seen this before on cars and motorcycles . All it did was give us price increases . The International manufacturers are forced to raise their prices , so the U S manufacturers will raise theirs . Nothing changes . The U S steel no longer makes the day to day common steel . All the U S makes is the Hi tech and exotics . We know the formulas for this steel . Similar to what titanium was in the 1980's This is a wage increase for CEO's and a price increase for all of us .

frayne · 03-05-2018, 11:38 AM

If the world international trade were ever perfectly at equilibrium, tariffs imposed tit for tat would be a zero sum game with the only losers being the consumer because of the price increases.

joeea · 03-05-2018, 12:26 PM

Quote:

Originally Posted by mpeirce

but how do you build aircraft carriers or fighter jets without steel and aluminum?

You don't build aircraft carriers or fighter jets without steel or aluminum.

Instead, you either produce the necessary materials yourself, or you purchase them from a trusted ally that has a price-production advantage. Perhaps an ally that has a cheaper source of electricity needed to make those products (such as hydroelectric power).

Off the top of my head here (just spitballin') ... an ally like Canada.

That way, you get the aircraft carriers and fighter jets you need, and save the taxpayers money.