Trade Wars and Tariffs

[Orange_Crush]

It's the only thing propping up the value of our dollar. If it wasn't the worlds reserve currency it would be worth little more than the cloth it's printed on.

Petrodollar: Backed by the waning military might of the United States.

 

[McDad]

They're money is tied to how many US dollars they hold.

Read the Creature from Jekel Island.

You and both know I am not reading anything.

So their money is tied to ours. How was money able to have value before there was a reserve currency?

 

[jmacvols1]

America has been losing the trade war badly for decades

 

[hog88]

Maybe we should kill the tariifs, take the $6 trillion in planned tax cuts and cut it in half, and use the other $3 trillion to subsidize factory building here.

My goodness that is an ignorant plan.

 

[LSU-SIU]

America has been losing the trade war badly for decades

Evil wants to do more of the same than when it falls apart you have nothing, kind of like what Europe is going to look like.

 

[EasternVol]

Can you imagine what you would have to pay an American to sew a pair of Levis together in today's world?

Like in a sewing factory? Probably less than you think.

 

[Orange_Crush]

Wrong thread...

 

[McDad]

America has been losing the trade war badly for decades

That's over 30 years, correct?

The stats look bad without any comparison or context but I am not sure the numbers are concerning at all.

 

[Thunder Good-Oil]

Reserve currency and its positive / negative affects to American is not something I understand.

An overly simplified answer is that when Vietnam trades with India, neither party wants to settle in the rupee or the dong. So they hold the stable US dollars which gives us a lot of power and influence in geopolitics.

 

[evillawyer]

I watched him on CNBC this morning. Simply put, something is wrong with him.

He likes being on TV. Serving under Trump gives him that opportunity.

 

[McDad]

An overly simplified answer is that when Vietnam trades with India, neither party wants to settle in the rupee or the dong. So they hold the stable US dollars which gives us a lot of power and influence in geopolitics.

Makes perfect sense.

Why would our currency be worthless if countries decided to use Gold, or Swiss Francs instead of the dollar?

 

[hog88]

You and both know I am not reading anything.

So their money is tied to ours. How was money able to have value before there was a reserve currency?

Our dollar became the world reserve currency at the end of WWII and it was backed by gold (not entirely but that's a long story). When Nixon ended the international convertibility of the US dollar the only thing backing the dollar was our military, fractional reserve banking and of course the "full faith and credit of the US". I know, laughable.

 

[Velo Vol]

1) It's nuts that a single person can, at a whim, impose hundreds of billions of dollars of taxes without any vote in Congress. We've effectively embraced taxation without representation.

2) Even if you did believe that a golden age could indeed be reached through a government-managed economic policy to bring back the underwear looms to South Carolina, this policy is crazy because it takes a few years to get plants up and running. In the mean time Americans are paying thousands in extra taxes while we await those high paying underwear-making jobs.

What would make sense toward that objective would be to announce a gradually escalating schedule (say 0.5% added each month) so companies would have time to respond before everyone got slammed.

But that's not what we got.

 

[hog88]

Makes perfect sense.

Why would our currency be worthless if countries decided to use Gold, or Swiss Francs instead of the dollar?

They wouldn't be buying US dollars and paying interest.

 

[hog88]

1) It's nuts that a single person can, at a whim, impose hundreds of billions of dollars of taxes without any vote in Congress. We've effectively embraced taxation without representation.

2) Even if you did believe that a golden age could indeed be reached through a government-managed economic policy to bring back the underwear looms to South Carolina, this policy is crazy because it takes a few years to get plants up and running. In the mean time Americans are paying thousands in extra taxes while we await those high paying underwear-making jobs.

What would make sense toward that objective would be to announce a gradually escalating schedule (say 0.5% added each month) so companies would have time to respond before everyone got slammed.

But that's not what we got.

What do you suggest be done to correct the trade imbalances and unfair practices of our allies?

 

[McDad]

Our dollar became the world reserve currency at the end of WWII and it was backed by gold (not entirely but that's a long story). When Nixon ended the international convertibility of the US dollar the only thing backing the dollar was our military, fractional reserve banking and of course the "full faith and credit of the US". I know, laughable.

understood. I am on the same page with you.

Why would our currency lose 'full faith and credit of the US' (and its value) between American citizens if it were no longer the reserve currency?

 

[LSU-SIU]

1) It's nuts that a single person can, at a whim, impose hundreds of billions of dollars of taxes without any vote in Congress. We've effectively embraced taxation without representation.

2) Even if you did believe that a golden age could indeed be reached through a government-managed economic policy to bring back the underwear looms to South Carolina, this policy is crazy because it takes a few years to get plants up and running. In the mean time Americans are paying thousands in extra taxes while we await those high paying underwear-making jobs.

What would make sense toward that objective would be to announce a gradually escalating schedule (say 0.5% added each month) so companies would have time to respond before everyone got slammed.

But that's not what we got.

Why? Most likely parties will come to an agreement.

 

[EasternVol]

Canada better listen to him.....he is a representative of Canada.

he represents Canada like Newsom represents the US

 

[tvolsfan]

People still convincing themselves the emperor is wearing fine silk.

 

[McDad]

They wouldn't be buying US dollars and paying interest.

Other countries pay America interest on the money they use as reserve currency??

 

[hog88]

understood. I am on the same page with you.

Why would our currency lose 'full faith and credit of the US' (and its value) between American citizens if it were no longer the reserve currency?

Where would the US govt get it's money if foreign countries, banks and other entities quit borrowing US dollars and paying interest to the US banks (federal reserve) who lent it to them?

 

[LSU-SIU]

Other countries pay America interest on the money they use as reserve currency??

Foreigners pay for the exported inflation.

 

[LSU-SIU]

Other countries pay America interest on the money they use as reserve currency??

Foreigners pay for the exported inflation. Foreigners in mass have no choice (U.S. dollar) unless they want to go directly to reset, the U.S. is still in an okay position to come out the other side.... other countries and Asia... not so much, imo. Europe is toast either way.

 

[hog88]

Other countries pay America interest on the money they use as reserve currency??

Yes, they borrow it for the most part. Much of it is done through private banking backed by guarantees from the federal reserve.

 

[n_huffhines]

So effing dumb. If I, Poland Springs, was charging $2 a bottle and my foreign competition now has to charge $3 a bottle because of tariffs, does Lutnick really believe I'm going to stay at $2 because "America First"? No, Poland Springs will raise its prices too because there's now less competition. This isn't hard.

I can do you one better. It's almost a certainty that Poland Springs will have its supply chain impacted by tariffs, ipso facto, they have to raise prices just to minimize the losses.