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Thread: Trade Wars Begin: Commerce Dept Recommends 23.5% Tariff On All Imports From China, Russia +

  1. #1

    Trade Wars Begin: Commerce Dept Recommends 23.5% Tariff On All Imports From China, Russia +

    Global Trade Wars Begin: Commerce Recommends Major Tariffs On Steel, Aluminum Focusing On China, Russia
    https://www.zerohedge.com/news/2018-...uminum-reports


    Specifically, focusing on Aluminum, Wilbur Ross's department will:

    Recommend 7.7% tariffs on all aluminum imports from all countries.
    Recommend about a 23.5% tariffs on aluminum imports from China, Russia, Venezuela and Vietnam
    Recommend quota on imports from all countries up to a maximum of 86.7% of their 2017 exports to the U.S.

    As for Steel, the commerce department will:

    Recommend a global tariff of 24% on all imports
    Recommend a tariff of at least 53% from Brazil, China, Costa Rica, Egypt, India, Malaysia, Korea, Russia, South Africa, Thailand, Turkey and Vietnam
    Recommend a quota of 63% of 2017 exports for the countries listed above.

    A former senior government trade official quoted by Axios, said that without major exemptions, these recommendations would represent: "[T]he opening shot in a trade war... a declaration of war against the world on aluminum and steel... These are some of our closest treaty allies... These are some serious numbers."

    And another quote from a trade expert: "This would be beyond a trade war. You're talking about blowing up the WTO."
    Last edited by goldenequity; 02-16-2018 at 11:03 AM.



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  3. #2
    1930 Smoot Hawley here we come!
    Truth forever on the scaffold, Wrong forever on the throne,--
    Yet that scaffold sways the future, and, behind the dim unknown,
    Standeth God within the shadow, keeping watch above his own.
    ‫‬‫‬

  4. #3
    Aluminum isn't "all imports". Misleading headline.

    Trade Wars Begin: Commerce Dept Recommends 23.5% Tariff On All Imports From China, Russia +

  5. #4
    Quote Originally Posted by Zippyjuan View Post
    Aluminum isn't "all imports". Misleading headline.
    my bad

  6. #5
    I would have made it 30

  7. #6
    Quote Originally Posted by axiomata View Post
    1930 Smoot Hawley here we come!
    I don't know whether this is good or not but we had a trade surplus in 1930, we have a giant deficit now so it is totally different.
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankind…it’s people I can’t stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  8. #7
    Quote Originally Posted by Swordsmyth View Post
    I don't know whether this is good or not but we had a trade surplus in 1930, we have a giant deficit now so it is totally different.
    Is a trade deficit a good thing or a bad thing? Is a country better off having a surplus? Depends on the reason for the surplus. If you are a wealthy country and your trading partners are relatively poor, you can run a deficit because you can afford to import more things than they can. If you have more resources than they do, they may have to import those resources from you. If you lack resources, you may have to import more. If you can get thing cheaper from someplace else than you can produce them at home, is it a good thing to import them- lowering costs for people in your country? Or should you protect the local producers and their jobs by limiting imports and raising costs for people in your country?

  9. #8
    Quote Originally Posted by Zippyjuan View Post
    Is a trade deficit a good thing or a bad thing? Is a country better off having a surplus? Depends on the reason for the surplus. If you are a wealthy country and your trading partners are relatively poor, you can run a deficit because you can afford to import more things than they can. If you have more resources than they do, they may have to import those resources from you. If you lack resources, you may have to import more. If you can get thing cheaper from someplace else than you can produce them at home, is it a good thing to import them- lowering costs for people in your country? Or should you protect the local producers and their jobs by limiting imports and raising costs for people in your country?
    I'm generally a low tariff guy but if other countries start a trade war we have to defend ourselves.

    In any case my point is that nations with a deficit have little to lose in a trade war and and nations with a surplus have a lot to lose.
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankind…it’s people I can’t stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment



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  11. #9
    Quote Originally Posted by Swordsmyth View Post
    I'm generally a low tariff guy but if other countries start a trade war we have to defend ourselves.

    In any case my point is that nations with a deficit have little to lose in a trade war and and nations with a surplus have a lot to lose.
    They can lose jobs. If a tariff war starts. We raise tariff, then they do. Our imports become more expensive and we sell fewer exports. Higher prices, fewer jobs (exports are about 12.5% of our total GDP).

    but if other countries start a trade war we have to defend ourselves.
    In this case, it is the US starting to raise tariffs.
    Last edited by Zippyjuan; 02-16-2018 at 02:39 PM.

  12. #10
    Quote Originally Posted by Zippyjuan View Post
    They can lose jobs. If a tariff war starts. We raise tariff, then they do. Our imports become more expensive and we sell fewer exports. Higher prices, fewer jobs (exports are about 12.5% of our total GDP).
    Did I say "nothing to lose"?

    The export jobs we might lose in the trade war that everybody else started are outnumbered by the jobs that might come back to replace the imports that get reduced.

    Trade wars are no fun, I wish the other countries hadn't started one, if we finally fight back they might think twice in the future.
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankind…it’s people I can’t stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  13. #11
    Quote Originally Posted by Swordsmyth View Post
    Did I say "nothing to lose"?


    The export jobs we might lose in the trade war that everybody else started are outnumbered by the jobs that might come back to replace the imports that get reduced.

    Trade wars are no fun, I wish the other countries hadn't started one, if we finally fight back they might think twice in the future.
    You did say "little to lose". I guess jobs and higher prices are "little".

    The net result is fewer jobs. Higher prices means people have less money available to spend on other items. Lower sales- fewer workers needed. The people selling the imported items (or using them to produce other goods and services) have fewer customers and cut labor (jobs). And it takes time to move production to the US from another country- they won't move right away. They will move after (and if) they see enough cost increases to warrant the move. Then they need to build new factories (more costs) and hire workers. Trade wars hurt both sides involved.
    Last edited by Zippyjuan; 02-16-2018 at 03:09 PM.

  14. #12
    Quote Originally Posted by Zippyjuan View Post
    The net result is fewer jobs. Higher prices means people have less money available to spend on other items. Lower sales- fewer workers needed. The people selling the imported items (or using them to produce other goods and services) have fewer customers and cut labor (jobs). And it takes time to move production to the US from another country- they won't move right away. They will move after (and if) they see enough cost increases to warrant the move. Then they need to build new factories (more costs) and hire workers. Trade wars hurt both sides involved.
    So it is exactly like I said:

    Originally Posted by Swordsmyth

    Did I say "nothing to lose"?

    The export jobs we might lose in the trade war that everybody else started are outnumbered by the jobs that might come back to replace the imports that get reduced.

    Trade wars are no fun, I wish the other countries hadn't started one, if we finally fight back they might think twice in the future.


    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankind…it’s people I can’t stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  15. #13
    Quote Originally Posted by Swordsmyth View Post
    I'm generally a low tariff guy but if other countries start a trade war we have to defend ourselves.

    In any case my point is that nations with a deficit have little to lose in a trade war and and nations with a surplus have a lot to lose.
    So if one country starts a war where they shoot their own citizens we have to defend ourselves by shooting our own citizens?
    Truth forever on the scaffold, Wrong forever on the throne,--
    Yet that scaffold sways the future, and, behind the dim unknown,
    Standeth God within the shadow, keeping watch above his own.
    ‫‬‫‬

  16. #14
    Quote Originally Posted by axiomata View Post
    So if one country starts a war where they shoot their own citizens we have to defend ourselves by shooting our own citizens?
    When one side starts a war people on both sides die.
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankind…it’s people I can’t stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  17. #15
    US is starting this one.

  18. #16
    Quote Originally Posted by Zippyjuan View Post
    US is starting this one.
    Nope, it's been on going for decades, everybody else started it and we either collaborated or ignored it while our economy was gutted, it's long since time to fight back.
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankind…it’s people I can’t stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment



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  20. #17
    http://www.latimes.com/business/la-f...628-story.html

    Tariffs always have unforseen consequences beyond their targets. The big problem with steel prices has been huge global production (a lot coming from China) leading to a surplus supply and driving down global prices. Tariffs will not address that problem. It will make things more expensive for companies using steel and aluminum though. Imports from China only account for about three percent of US steel imports so again, it won't have any significant impact on that. It could make US steel more expensive compared to say China and cost the US business steel export sales to other countries.

    Trump's plan to slap tariffs on steel imports carries big economic and political risks


    President Trump was standing on the banks of the Ohio River, and as barges loaded with West Virginia coal floated by, he noted that half the United States' steel is produced within 250 miles and told the crowd that soon "the steel folks are going to be very happy."

    Within that same distance lies the bulk of the U.S. auto industry, which the president also has promised to protect. But carmakers are dreading what Trump apparently was alluding to: plans to impose significant punitive tariffs or quotas on steel imports.

    Trump has promised to crack down on unfair foreign traders and restore the fortunes of American manufacturing. Few industries are as important as steelmaking, and Trump sees steel as an emblem of industrial power as well as being vital to the country's national security.

    But the president faces a conundrum: Making good on his Cincinnati pledge earlier this month may help domestic mills by restricting foreign steel and boosting U.S. steel prices. But that same action almost certainly will mean higher costs for American makers of cars, appliances, machinery and construction materials, and for many other manufacturers that cut, bend and otherwise fabricate steel. That could lead to higher prices for consumers and job losses.

    "I'm sympathetic to American steel mills, but if they protect domestic steel, they're going to be hurting steel fabricators, which employ a hundred times more people," said Drew Greenblatt, chief executive of Baltimore-based Marlin Steel Wire Products, which buys only U.S.-made steel. Greenblatt has been paying more for the metal since Trump's election, as prices have risen partly in anticipation of coming measures.

    Others, such as Fontana-based California Steel Industries and the Port of Los Angeles, have voiced opposition to blanket restrictions on steel imports, saying the kinds of slab steel that are important for their businesses and employment are not readily available from domestic producers. Nor do analysts think tariffs will address the key problem — excess steel output in China that has caused a global glut and downward pressure on prices.
    Today American farmers, among others, worry that any new steel tariffs will spill over to them. U.S. Wheat Associates, in written comments to the Commerce Department, said it was "extremely concerned" and urged the Trump administration to "consider the fallout if other countries follow suit and impose restrictions on U.S. wheat or other products as a result of their own national security concerns, whether real or imagined."

    U.S. wheat growers, like producers of corn, soybeans and other farm goods, are heavily dependent on exports and are considered particularly vulnerable in a trade war.
    Disruption of critical food supplies would have ripple effects globally, Wheat Associates said, suggesting that in protecting steel, the Trump administration could threaten the flow of food shipments that may be as integral to national security as steel production.
    The U.S. already has in place some tariffs on various steel from China and some other countries, for selling products below cost or with the unfair benefit of government subsidies. As a result, steel from China accounted for just 3% of total U.S. steel imports last year, although that does not tell the whole story. Steel shipments to the U.S. from Turkey, for example, have doubled since 2013, and the American steel industry says Turkey has been buying cheap Chinese steel billets, turning them into products and then loading them onto boats to America.
    "We're doing this at the same time we're trying to get Korea to make operational the U.S. anti-missile system," he said. "We're going to push them on steel at the same time we're trying to get Japan to negotiate a free-trade agreement, and EU the same thing." There will be consequences, he said.

    Greenblatt, the CEO of Marlin Steel Wire, said it's hard enough already competing with European rivals. If Trump imposes tariffs, he reckons he will be paying even more for American steel, while Germany and others may continue to buy China-made steel at a cheaper price, making it even tougher to win business in the global market.

    "My heart bleeds for the steel mill guys," he said. "But the steel fabricators are going to get their heads handed to them if everybody else buys from China."
    Last edited by Zippyjuan; 02-16-2018 at 04:26 PM.

  21. #18
    Quote Originally Posted by Swordsmyth View Post
    When one side starts a war people on both sides die.
    If governments fought real wars like they fight trade wars, here’s how the transcript of the communiqués between the leaders of two warring nations would read:

    Leader of Absurditopia (A): I say, leader of Stupidia – we demand that you stop occupying that contested strip of land. If you refuse, we’ll have no choice but to shoot our own citizens.

    Leader of Stupidia (S): You don’t scare us! That land is ours. And if you do kill some of your own people, make no mistake that we will immediately – and just as cruelly – commence to killing our own people. Courage is our national motto!

    (A): Ha! You’re bluffing. But I’m not. I’ve just courageously ordered my troops to mow down in cold blood ten percent of my fellow countrymen. Take that!

    (S): How dare you attack you like that! You leave us no choice but to attack us. I am ordering the Stupidian army to slaughter 15 percent of innocent Stupidians here in Stupidia. How do you like them apples?!

    (A): You are cruel and inhuman to damage us by killing your people. I hereby instruct all of my fellow Absurditopians to commit suicide! Only then will you nasty Stupidians get your proper comeuppance and we Absurditopians the justice that we are due!

    (S): You can’t beat us, you Absurditopian you! Listen up. I’m ordering all of my fellow citizens – Stupidians all! – to commit suicide. We’ll see who emerges victorious!
    ….
    Then a long, long silence.

    http://cafehayek.com/2010/10/if-trad...real-wars.html
    Truth forever on the scaffold, Wrong forever on the throne,--
    Yet that scaffold sways the future, and, behind the dim unknown,
    Standeth God within the shadow, keeping watch above his own.
    ‫‬‫‬

  22. #19
    Quote Originally Posted by axiomata View Post
    If governments fought real wars like they fight trade wars, here’s how the transcript of the communiqués between the leaders of two warring nations would read:

    Leader of Absurditopia (A): I say, leader of Stupidia – we demand that you stop occupying that contested strip of land. If you refuse, we’ll have no choice but to shoot our own citizens.

    Leader of Stupidia (S): You don’t scare us! That land is ours. And if you do kill some of your own people, make no mistake that we will immediately – and just as cruelly – commence to killing our own people. Courage is our national motto!

    (A): Ha! You’re bluffing. But I’m not. I’ve just courageously ordered my troops to mow down in cold blood ten percent of my fellow countrymen. Take that!

    (S): How dare you attack you like that! You leave us no choice but to attack us. I am ordering the Stupidian army to slaughter 15 percent of innocent Stupidians here in Stupidia. How do you like them apples?!

    (A): You are cruel and inhuman to damage us by killing your people. I hereby instruct all of my fellow Absurditopians to commit suicide! Only then will you nasty Stupidians get your proper comeuppance and we Absurditopians the justice that we are due!

    (S): You can’t beat us, you Absurditopian you! Listen up. I’m ordering all of my fellow citizens – Stupidians all! – to commit suicide. We’ll see who emerges victorious!
    ….
    Then a long, long silence.

    http://cafehayek.com/2010/10/if-trad...real-wars.html
    Sorry to be the one to break it to you but politicians are not that stupid, just as with shooting wars there is a tangible benefit that may be obtained by the side that initiates the war and there is damage done to the target that can be reduced if the target fights back.

    Just like with real wars most are futile and only result in damage to both sides but history records examples where the aggressor benefited and everybody thinks they will be one of those exceptions, also just like with other kinds of war the target must defend themselves in order to limit the damage or they will be destroyed/conquered and exploited.
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankind…it’s people I can’t stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  23. #20
    Jan2017
    Member

    Hmmmm . . . Bush 41, Bush 43, Clinton 42, Clinton 45



    Quote Originally Posted by Jan2017 View Post
    #20 – Barbara Wise – Commerce Department staffer. Worked closely with Ron Brown and John Huang.
    Died November 29, 1996. Her bruised, naked body was found locked in her office at the Department of Commerce.

    COLD CASE:
    Cause of death: Unknown.

  24. #21
    Quote Originally Posted by Swordsmyth View Post
    Sorry to be the one to break it to you but politicians are not that stupid, just as with shooting wars there is a tangible benefit that may be obtained by the side that initiates the war and there is damage done to the target that can be reduced if the target fights back.

    Just like with real wars most are futile and only result in damage to both sides but history records examples where the aggressor benefited and everybody thinks they will be one of those exceptions, also just like with other kinds of war the target must defend themselves in order to limit the damage or they will be destroyed/conquered and exploited.
    Politicians are self interested and recognize the political benefits of small but concentrated benefits to protected industries at the expense of larger but distributed costs to the general public.

    The politician can get donations from the steel industry for enacting protective tarriffs but can't get donations for pointing out the truth that if a foreign country taxes it's citizens to dump cheap steel in the US, then those foreign citizens are essentially paying for US infrastructure and products made of the raw steel material.
    Truth forever on the scaffold, Wrong forever on the throne,--
    Yet that scaffold sways the future, and, behind the dim unknown,
    Standeth God within the shadow, keeping watch above his own.
    ‫‬‫‬

  25. #22
    Quote Originally Posted by Swordsmyth View Post
    I don't know whether this is good or not but we had a trade surplus in 1930, we have a giant deficit now so it is totally different.
    Do you even econ, bro?

    There is not such thing as a trade deficit. When you trade, both side win. They may get a surplus of dollars, but we get a surplus of goods.

    Ron Paul has often said that we should just drop ALL of our barriers to trade, regardless of what other countries may or may not do. Tariffs are like cutting yourself to make your neighbor bleed.
    "And now that the legislators and do-gooders have so futilely inflicted so many systems upon society, may they finally end where they should have begun: May they reject all systems, and try liberty; for liberty is an acknowledgment of faith in God and His works." - Bastiat

    "It is difficult to free fools from the chains they revere." - Voltaire

  26. #23
    Quote Originally Posted by CaptUSA View Post
    Do you even econ, bro?

    There is not such thing as a trade deficit. When you trade, both side win. They may get a surplus of dollars, but we get a surplus of goods.

    Ron Paul has often said that we should just drop ALL of our barriers to trade, regardless of what other countries may or may not do. Tariffs are like cutting yourself to make your neighbor bleed.
    So I can take that approach to my own finances then?
    It doesn't matter if I empty my bank account and go into debt just as long as I get goods in return for my money?
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankind…it’s people I can’t stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  27. #24
    Quote Originally Posted by Swordsmyth View Post
    So I can take that approach to my own finances then?
    It doesn't matter if I empty my bank account and go into debt just as long as I get goods in return for my money?
    The trade deficit is paid with actual goods and money traded- not debt. A budget deficit means you don't have money to spend on everything. With a trade deficit, you do have the money (usually- you could in theory borrow). What you do with your own money is your own business.



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  29. #25
    Quote Originally Posted by Zippyjuan View Post
    The trade deficit is paid with actual goods and money traded- not debt. A budget deficit means you don't have money to spend on everything. With a trade deficit, you do have the money (usually- you could in theory borrow). What you do with your own money is your own business.
    The point is that when you don't have a job (industries) you will run out of money and go into debt and you can't just recreate your job (industries) overnight, it doesn't end well.
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankind…it’s people I can’t stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  30. #26
    Quote Originally Posted by Swordsmyth View Post
    So I can take that approach to my own finances then?
    It doesn't matter if I empty my bank account and go into debt just as long as I get goods in return for my money?
    So, I think remedial economics is in order for you. You're crossing your wires trying to make this analogy. But in theory, if what you are getting is more valuable to you than your money, then yes! Because you'd have goods to sell for more money later. You only trade to INCREASE your wealth - not to decrease it. What you seem to be suggesting is that we are trading more dollars than the value we are getting in return - but that is obviously not true. If it were, the trade wouldn't happen.
    "And now that the legislators and do-gooders have so futilely inflicted so many systems upon society, may they finally end where they should have begun: May they reject all systems, and try liberty; for liberty is an acknowledgment of faith in God and His works." - Bastiat

    "It is difficult to free fools from the chains they revere." - Voltaire

  31. #27
    Quote Originally Posted by Swordsmyth View Post
    The point is that when you don't have a job (industries) you will run out of money and go into debt and you can't just recreate your job (industries) overnight, it doesn't end well.
    Dude, just give it up. You're out of your depth here. It would be wise to recognize it.
    "And now that the legislators and do-gooders have so futilely inflicted so many systems upon society, may they finally end where they should have begun: May they reject all systems, and try liberty; for liberty is an acknowledgment of faith in God and His works." - Bastiat

    "It is difficult to free fools from the chains they revere." - Voltaire

  32. #28
    Quote Originally Posted by Swordsmyth View Post
    So I can take that approach to my own finances then?
    It doesn't matter if I empty my bank account and go into debt just as long as I get goods in return for my money?

    So, that would be a "no" then to his question?
    Chris

    "Government ... does not exist of necessity, but rather by virtue of a tragic, almost comical combination of klutzy, opportunistic terrorism against sitting ducks whom it pretends to shelter, plus our childish phobia of responsibility, praying to be exempted from the hard reality of life on life's terms." Wolf DeVoon

    "...Make America Great Again. I'm interested in making American FREE again. Then the greatness will come automatically."Ron Paul

  33. #29
    Quote Originally Posted by CaptUSA View Post
    So, I think remedial economics is in order for you. You're crossing your wires trying to make this analogy. But in theory, if what you are getting is more valuable to you than your money, then yes! Because you'd have goods to sell for more money later. You only trade to INCREASE your wealth - not to decrease it. What you seem to be suggesting is that we are trading more dollars than the value we are getting in return - but that is obviously not true. If it were, the trade wouldn't happen.
    We trade for many consumables and items with zero or limited resale value.
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankind…it’s people I can’t stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  34. #30
    Quote Originally Posted by CaptUSA View Post
    So, I think remedial economics is in order for you. You're crossing your wires trying to make this analogy. But in theory, if what you are getting is more valuable to you than your money, then yes! Because you'd have goods to sell for more money later. You only trade to INCREASE your wealth - not to decrease it. What you seem to be suggesting is that we are trading more dollars than the value we are getting in return - but that is obviously not true. If it were, the trade wouldn't happen.
    In simple terms, if I have more money than you do, I can buy more stuff from you than you can buy from me. If we agree to trade, I am going to end up with a trade deficit and you will have a trade surplus. Am I worse off because I was able to buy more stuff than if I was limited to what I have on hand? Are you worse off because now you have more money to buy even more things with than if we didn't trade?
    Last edited by Zippyjuan; 02-16-2018 at 05:37 PM.

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  5. Russia ready to abandon dollar in oil, gas trade with China
    By youngbuck in forum Economy & Markets
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    Last Post: 10-18-2009, 12:32 AM

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