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Thread: The Trade Deficit Keeps Growing. 3 More Data Points Showing Trump Is Losing His Trade War

  1. #1

    The Trade Deficit Keeps Growing. 3 More Data Points Showing Trump Is Losing His Trade War

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    Investment in American businesses has fallen sharply since the start of the trade war, and American exports are way down too.


    Less than 24 hours after President Donald Trump announced an escalation of the trade war with China, he got some predictable news: America's trade deficit has hit a new high.

    The gap between how much America exports to China and how much it imports from the Asian nation grew to $30.2 billion in July, up from $30.1 billion the previous month, according to Commerce Department figures. The widening gap was due to a decrease in the value of American exports, Bloomberg notes.

    In normal circumstances, this wouldn't be a big deal. Economists generally agree that trade deficits don't matter, for the same reason that you wouldn't worry about running a "deficit" with a grocery store. But Trump has used America's trade deficit as a key justification for his trade policies, and he has repeatedly promised that tariffs on China would reduce that deficit.

    Instead, the opposite has happened.


    Trump's tariffs are having an impact. During the first six months of 2018, U.S. exports to China fell by 18 percent relative to the same period last year. Imports from China slipped by 12 percent. Both sides are doing less trading, but the trade deficit persists.


    Here are three more recent data points that show problems with Trump's trade war:


    1.BUSINESS INVESTMENTS


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    According to the Commerce Department, investment in American businesses has fallen off sharply since the start of Trump's trade war in mid-2018. Nonresidential domestic investment was buoyed by the tax cuts Trump signed in December 2017, but during the second quarter of 2019 investment dipped into negative territory. That's a sign that businesses are holding back on hiring or expanding in the face of the uncertainty created by the president's trade policies.

    Equally significant is the recent sharp drop in American exports. This is an expected but perhaps underappreciated consequence of Trump's policies. "Exporters can be successful only if they are viewed as reliable suppliers," writes C. Fred Bergsten, a senior fellow at the Peterson Institute for International Economics. "But Trump's trade policies have rendered US firms among the most unreliable in the world."


    2.GOODS-PRODUCING JOBS DECLINING


    GRAPH:
    https://twitter.com/marthagimbel/sta...s-trade-war%2F


    Trump has also tried to justify his bellicose trade policies by citing the importance of American manufacturing jobs . Trump talked about "an extraordinary resurgence of American manufacturing" during a photo op at the White House last month.

    But as the chart above indicates, goods-producing jobs have been declining steadily since last summer. The drop-off begins almost exactly when the trade war began.

    The latest jobs report continues this trend.

    https://twitter.com/byHeatherLong/st...s-trade-war%2F


    3.THE TRADE WAR HAS BEEN A NET LOSER FOR THE TREASURY


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    Another of Trump's favorite defenses for the trade war is the claim that tariffs are generating billions of dollars for the U.S. Treasury. He's right about that much—though it's Americans who are paying, not China.

    But the tariffs have also failed as a revenue-generating strategy. As of May, they were on pace to generate about $20 billion in revenue by the end of 2019. By comparison, Trump's bailouts to farmers hurt by China's retaliatory tariffs totaled over $25 billion.

    Those bailouts, meanwhile, have been a complete mess. A report released this week by the Environmental Working Group, a agricultural policy watchdog, found that 54 percent of those payments went to just 10 percent of all farmers.

    With more Chinese tariffs set to take effect in September, it's possible that Trump's tariffs and bailouts might balance each other out by the end of the year. If so, an 18-month experiment in economic nationalism will have been, at best, a wash for the Treasury while serving as a massive transfer in wealth from America's manufacturing and agricultural sectors to a small sliver of farmers. Great success!


    https://reason.com/2019/08/02/the-tr...his-trade-war/
    “The right to life is the source of all rights—and the right to property is their only implementation. Without property rights, no other rights are possible. Since man has to sustain his life by his own effort, the man who has no right to the product of his effort has no means to sustain his life. The man who produces while others dispose of his product, is a slave.”

    Read the RPF trolls' playbook here (post #3)



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  3. #2
    Comprehensive, damning, sure to be totally ignored by Trumpsters.



    You must spread some Reputation around before giving it to PAF again.
    "Democracy is the theory that the common people know what they want, and deserve to get it good and hard."

    -H. L. Mencken

  4. #3
    Quote Originally Posted by r3volution 3.0 View Post
    Comprehensive, damning, sure to be totally ignored by Trumpsters.



    You must spread some Reputation around before giving it to PAF again.
    Cherry picked, out of context and ridiculous.
    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

  5. #4
    The trade deficit is a temporary aberration cause by the rush to beat the tariffs, the reduced investment has to do with the global downturn and most of the reduction came from Chinese investment which was a danger to our independence, was primarily purchasing assets as opposed to creating wealth and was caused more by the troubles China caused itself than by the trade war.
    The jobs numbers again have more to do with the global downturn than anything else.
    The Chinese have been absorbing most of the tariff costs but the farm subsidies aren't good.


    It is far too early to be proclaiming the trade war a loss, it took decades of trade treason to get us where we are and you can't expect to turn it around in a year or two, trade negotiations and leveling the playing field are both ongoing and China is rightfully taking much more damage than we are.

    TReason magazine is misleading you.
    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

  6. #5
    Quote Originally Posted by Swordsmyth View Post
    Cherry picked, out of context and ridiculous.
    Quote Originally Posted by Swordsmyth View Post
    TReason magazine is misleading you.

    Since you disagree with Ron Paul, and do not like RonPaulInstitute, RonPaulLibertyReport, Ben Swann, and other sources that I use, I figured what the hell.

    BTW, did you see the new addition to my sig?
    “The right to life is the source of all rights—and the right to property is their only implementation. Without property rights, no other rights are possible. Since man has to sustain his life by his own effort, the man who has no right to the product of his effort has no means to sustain his life. The man who produces while others dispose of his product, is a slave.”

    Read the RPF trolls' playbook here (post #3)

  7. #6
    Quote Originally Posted by PAF View Post
    Since you disagree with Ron Paul, and do not like RonPaulInstitute, RonPaulLibertyReport, Ben Swann, and other sources that I use, I figured what the hell.

    BTW, did you see the new addition to my sig?
    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
    The trade deficit is a temporary aberration cause by the rush to beat the tariffs
    There was a preemptive inventory build* before the tariffs, but that was many months ago.

    What we see now is post-tariff reality.

    *which also artificially boosted GDP; oddly, I don't recall Trumpsters pointing that out at the time

    the reduced investment has to do with the global downturn...

    ...The jobs numbers again have more to do with the global downturn than anything else.
    Maybe the tariff had something to do with causing the global downturn?



    and most of the reduction came from Chinese investment which was a danger to our independence
    So, yes, investment's down, but it's okay, because investment's bad.

    The Chinese have been absorbing most of the tariff costs but the farm subsidies aren't good.
    So, yes, it is a fiscal loser.

    Quote Originally Posted by Swordsmyth View Post
    Cherry picked, out of context and ridiculous All true, but here are some Trumpsplanations
    FIFY
    Last edited by r3volution 3.0; 08-04-2019 at 05:04 PM.
    "Democracy is the theory that the common people know what they want, and deserve to get it good and hard."

    -H. L. Mencken

  9. #8
    Quote Originally Posted by r3volution 3.0 View Post
    There was a preemptive inventory build* before the tariffs, but that was many months ago.

    What we see now is post-tariff reality.

    *which also artificially boosted GDP; oddly, I don't recall Trumpsters pointing that out at the time
    The tariffs were applied in phases and it was obvious more were coming, the effect hasn't ended yet.


    Quote Originally Posted by r3volution 3.0 View Post
    Maybe the tariff had something to do with causing the global downturn?

    Nope, there are lots of other major factors causing it.


    Quote Originally Posted by r3volution 3.0 View Post
    So, yes, investment's down, but it's okay, because investment's bad.
    In this case it was, letting an avowed enemy buy up your country is very bad.



    Quote Originally Posted by r3volution 3.0 View Post
    So, yes, it is a fiscal loser.
    Defensive tariffs good, subsidies bad.



    Quote Originally Posted by r3volution 3.0 View Post
    FIFY
    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
    Reality and hard data - 1

    Swordy - 0

    But hey, all that reality and data $#@! doesn't really matter 'cause, well, you know?,

    Orange man G od

    SMDH
    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



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