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Showing posts with the label trade war

The World In Which We Live: Fun And Easy To Win Edition

I had hoped that by summer's end there would be no more trade war posts to write but there appears to be no end to the ongoing struggle. Fears of a recession are increasing, so much so that Bank Of America is offering advice on how to navigate the impending slow down, the price of everything continues to march upwards,  retailers are failing in droves , and even a Republican lawmaker is calling for a tax cut due to tariffs . This last point should prove once again that a tariff is a tax passed on to consumers, but try to explain that to the true believers who support the fun and easy to win economic policies of the current administration. At least things aren't boring. The market reaction to the Fed's announced rate cut (which flies in the face of all logic) followed almost immediately by a tweet announcing more tariffs on Chinese products sent the VIX off the charts and VIX traders into a rapture or rupture, depending on which side of the trade they were on. And yet,

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 me