First Shockwaves of Trump’s Tariffs Are About to Hit the World Economy
First Shockwaves of Trump’s Tariffs Are About to Hit the World Economy
www.bloomberg.com
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17 comments
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Does anyone benefit from this? Was the endgame a couple Trump insiders making a lot of money shorting the economy or something? Like a bank transfer to a dozen assholes at the cost of the world economy?
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I honestly can't see any coherent strategy here. I'm leaning on the side of them having vastly overplayed their hand given how erratic the policy has been and how much of it they ended up rolling back.
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Its like they thought China would cave but severely overestimated the importance of the u.s. market and dollar strength.
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Basically, this all parallels the decision making of Biden admin in their war with Russia. They made a bunch of assumptions that proved to be catastrophically wrong at the outset and then just kept doubling down on them. Seems like we're going to get a replay for that now with China.
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It seems the motivation as likely as anything is that someone just asked chatGPT "how do I assert American dominance through tariffs?"
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This is both the simplest explanation and the dumbest, so it’s probably true
- Occam's Dull Razor
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the trump administration seems to have a genuine goal here of wanting to restore domestic productive capacity, but they're all true believers in their own particular and sometimes conflicting kinds of farts, and trump is well known to be someone who gives a lot of weight to a well reasoned argument coming from whoever happens to be directly in front of him at the time. shorting the economy was a side benefit.
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I think its less so restoring domestic production as it is just trying to ween America off of Chinese goods. If the US were to go to war with China at the same time as they first lose out on all that stuff it would be like losing the war before it started. So i think theyre trying to do a controlled version of it. They might walk these back even more, then do some more next year, just causing random shocks to the supply chain to see how it reacts and do a kind of economic shock therapy.
I really do not think it's going to work, but that does seem to be their plan. I think the whole like shorting the economy thing is the people who aren't really read into the entire plan just doing their typical grift. Its a good cover for it too. Weaponized incompetence and all.
They'd be fine with like Mexico, or Canada picking up the slack production wise. They probably want it to be domestic, but i doubt they'd be that broken up if it was Mexico. It doesnt need to be everything anyway just the basics, and stuff the military needs.
I'm guessing there are certain people observing the exact effects on actual supply chains these tariffs are having, and they are making a list of the things they need to find alternative sources for during a war. If i had to guess on a time table they want to be at war with China by like 2030-2035. China seems to realize this too, and is preparing. Not just to defend themselves, but to defend all of SEA.
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Bit idea: see if you can convince libs that these tariffs are a good thing by making this argument that they're war preparations and appealing to their bloodlust for China.
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I think the insider trading is ancillary. Trump has a nonsense idea about tariffs that he's pushing through. His entire circle (and Congress) just aren't letting a grift go to waste.
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I think it's a bit silly at this point to think this is all just for stock manipulation.
Points:
- Trump has been an advocate and believer in tariffs as a magic solution for decades. There are quotes of him saying this. This isn't something he came up with 6 years ago to make money. Unfortunately (fortunately for us I guess) he doesn't understand what actual intelligent tariff policy would look like, further because he's a a Republican and surrounded with neo-liberal Republican types it's impossible for him to take the steps necessary to actually use tariffs to do what he wants because of the necessity of things like capital controls and state investment and support which are both anathema to his party and advisors and planners.
- US bourgeoisie have been growing increasingly alarmed by China's rise and the fact it hasn't succumbed to liberalism and been overthrown by compradors under their control. They want the ability to maneuver, to wage war, to wage economic war (including things like economic blockade, kicking China out from world banking systems, basically using all the power they have as hegemon while it lasts to crush them). They've been talking in the open of decoupling for years, over a decade for some but it's gotten more serious and urgent. There are those, especially empire planners and domestic industrial bourgeoisie (often arms makers or related) who are especially strident in support of some form of re-shoring or friendshoring to India or other places so they can attack China without China being able to gut punch them and stop their arms making ability or crash the US economy.
- At least one announcement about clarification on tariffs was made on the weekend, if this was all about stock manipulation you wouldn't do something when the markets wouldn't open for another 48 hours because immediate news releases cause bigger dips/jumps than ones which the traders have stewed on for a few days which are easier to profit off of.
- More broadly the bourgeoisie realize it's not good to not have control of the means of production, so as with the second point there is a real feeling that somehow or other we need to move production to countries we can trust or at least play against China like India. The talk of domestic manufacturing is just slop for the hogs, they might move some back but it'll either be automated or they plan to so crash the wage and living conditions for people in the US first that it won't be the kind of boon some people here think it will be.
- That and you have a lot of fail-sons and daughters who have fully bought into the propaganda and don't understand how the world works who think they can change things in a way that aligns with their propagandized view of the world.
- China has retaliated and Trump is arrogant and very proud. He has no real outs, no way to back down without losing a ton of face and making the US look weak. Especially after the Ukraine humiliation can the US afford being owned again? Now maybe he'll make some sort of deal with China when things get bad but they're tired of playing games with the US and especially of the US stirring up hatred for them and gearing up for war. So there's a good chance there's just no way out of this, at least not before prices have hit sky high and the economy crashed.
- Disciplining the proles is seen as an unambiguous good by many at the top. They see the idea of people being forced to sign up for payment plans for an iPhone that last 5 years as a great thing, after all if the phone gets smashed in two years they're now underwater on it and may go into debt. I'm not sure how far away from debtors prisons we are but the bourgeoisie definitely feel that rentierism is a great idea.
We are seeing major movements, changes in the economic and global geopolitical order. The US is making changes, it knows the old path leads to defeat and ruin so it's gambling and lashing out.
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Like a bank transfer to a dozen assholes at the cost of the world economy?
US handling a crisis in 2008 and 2020 was basically just this already, only less blatant
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17 comments