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The World In Which We Live: Ongoing Trade War Edition

It wasn't supposed to last this long. Or so it was thought.

"Trade wars are good and easy to win!" the tweet read. I'm not seeing much good and no one appears to be having fun.

I suppose a trade war is good when you have no skin in the game, ie your living expenses are covered by taxpayer dollars and you know how to write down losses, but for those of us on the ground in this trade war, real pain is being inflicted. Ask the farmer who is losing money (although in a bit of welfare, there are subsidies being discussed). Ask the customer paying more and more for the same items. Ask the business owner paying more for said items and passing that cost on to the customer you just spoke to.

The current trade war is the economic equivalent of the second Iraq War: a war of choice, led by amateurs. Sure, US-based intellectual property is being stolen, but the companies whose IP is being stolen are multinational corporations who operate in China willingly. I'm yet to meet an independent software developer whose IP is being stolen, and if I did, I"m certain there wouldn't be a trade war to protect it and pursue damages.

"Trump is repricing access to the American consumer," some say. That's a fair assessment, but at what cost? Will there be an easing of price once the dispute is settled and the tariffs lifted, or will prices remain the same because this went on so long that no one remembers a time when costs were 25% lower?

This is the world in which we live. Hedge accordingly.

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