AndreasHG

The USA has not an export problem. The USA main exports are goods, services (it's where the US excels and has no match, like it or not. They're financial services, but also media, social media, software, etc.) and greenbacks. The greenbacks are the debt the US owes to foreign countries. Sometimes they are dollar bills, sometimes treasuries, sometimes Tesla shares bound to be worth nothing in three years from now.

The dollar devaluation makes Americans poorer and foreign goods more expensive. It is a good thing because poorer Americans will have less leverage to borrow and consequently will consume less. We should thank Trump. He is no "idiot" because of this. The idiots are those among his voters who assumed that MAGA meant they were going to be better off. They are not. MAGA made them poorer, force them to consume less, become more sustainable, and planet Earth has reason to rejoice because of it. Long life MAGA!

I agree with regards to the debt. Americans spend too much in relation to their GDP. This helps the American economy grow but it is not sustainable. However: 1. I never heard that, to remodel his toilet, someone takes down the neighbors' house in the process, nor that 2. someone requires neighbors to pay for the remodeling of his own toilet. There are two ways to orderly deal with debt: a. defaulting b. restructure, spend less and save more. Trump pretending that foreign countries will pay the bill of American largesse can only fool the rednecks living into the depth of the Midwest who voted for him. Educated Americans know perfectly what the ways out of debt are.

This is not about the United States trying to bully China. This is about an incompetent and reckless president trying to fool his voters.

Today's newspapers are all reporting on the front page that China refuses to open any negotiations with the USA until the unilateral tariffs imposed by the Trump Administration are withdrawn in a unilateral manner. China reserves the right to evaluate later whether or not to reciprocate by removing the tariffs imposed on American goods. Donald Trump has put himself in a truly difficult situation. Xi Jinping is not satisfied with winning the trade war. He wants to humiliate him and make him look like a fool. By doing this, Xi Jinping wants to send a direct message to the American voters "You elected a buffoon to the White House: you are now treated like buffoons". Trump has only himself to blame for the dire straits he finds himself in, just three months after Inauguration Day. Himself and the small group of sycophants posing as economists and international trade strategists he surrounds himself with. After threatening to fire Powell for weeks, Trump, under pressure from the markets, had to bite the bullet and backtrack, publicly stating that he never really had any intention of getting rid of him. I wonder if Donald Trump realizes how fortunate he is that Powell has a commendable sense of responsibility to the nation and its citizens. One can only imagine the drama that would have unfolded on Wall Street and beyond, had Powell resigned in contempt for Trump’s public behavior. The US dollar has already lost about 10% of its value against major currencies since Inauguration Day, and the yield on treasuries (the cost of government debt) has already risen even without the farce of Powell's (constitutionally dubious) firing. So here is Donald Trump, once again in the position of having to swallow a bitter pill. He can choose between dropping his pants and unilaterally withdrawing the tariffs imposed on China, or letting Americans be hit with the impossible 145% tariff that would cause immense economic damage in a matter of weeks. And once again I wonder if Donald Trump realizes how lucky he is. China has chosen to reciprocate by imposing its own tariffs on American imports and by penalizing the United States by introducing a ban on the sale of rare earths and metals. It will take some time for American citizens to feel the effects of these sanctions. Just imagine what would have happened if China decided to impose export tariffs on the goods (consumer electronics, shoes, clothing) that Americans need and want most—the very same goods that the Trump administration hastily excluded from tariffs. Not only inflation would have skyrocketed, but companies like Apple, Nike, Walmart and Target (who act both as exporters in China and importers in the USA) would have seen their profits evaporate in a matter of weeks. What would have been unimaginable only a short time ago is now unfolding under our own eyes: China is humiliating the American giant in the person of its (incompetent and reckless) president. And President Trump is about to learn that international relations are not like buying a property in Manhattan, or negotiating a loan with Deutsche Bank, or hammering out the supply of cement from the monopoly hold by the five families of the Italian-American mafia in New York. But make no mistake. After losing face with China, Donald Trump will make up for it by beating, hands down, America's long-time allies: Canada and Mexico are first in line, Europe, Japan and Korea to follow, not to mention the unfortunate penguins of Heard Island and McDonald Island, who will no longer be able to export their precious guano to the United States. Isn't this what true bullies do?

I would but the post is currently locked.

Here are two charts showing the average monthly exchange rate of the US dollar against some major currencies and our beloved Thai baht. The exchange rate is indexed, with 100 being the rate recorded on the day of the inauguration of both Trump's first and second presidencies. During his first term, Trump's obsession with the US trade deficit and his erratic behavior caused the dollar to collapse, losing 16.8% of its value against the Thai baht (THB), 12.3% against the Japanese yen (JPY), 10.7% against the euro (EUR), and 6.9% against the AUD. It did appreciate against the British pound (GBP), but that was due to the incompetence of the conservative governments of the time and Brexit. Four months into Trump's second term, here he is again. Only this time it's happening faster. The dollar has already depreciated by almost 10% against the Japanese yen (JPY) and the euro (EUR), 7% against the British pound (GBP), and 2% against the Thai baht (THB) and AUD. Only the Chinese yuan, thanks to the currency manipulations of the PBoC, has followed the depreciation of the US dollar. Hard times ahead for our American friends who live on income in US dollars and expenses in Thai baht. If you are wondering what happened during Biden's presidency, I add a third chart. Let's focus on the THB: the dollar appreciated by a healthy 13.8% against the Thai currency, evidence that doing nothing is always better than doing the wrong thing. But those good times are behind us now.

In an article published today by the Financial Times, Martin Wolf analyzes the unintended consequences for economic activities of arbitrary decisions imposed by an absolute ruler. Martin Wolf reviews the reasons why the English-speaking world began to do away with absolute rulers 800 years ago, in a long and bitter struggle, from the Magna Carta of 1215 to the exile of James II and the declaration of the Bill of Rights of 1689, through the civil war of the early 17th century, culminating in the execution of Charles I in 1649. Lessons that America should be particularly interested in today. Wolf writes: "What is happening today in the US is of historic and also global significance, because it is about whether constraints on the arbitrary exercise of power will endure." "The trade wars Trump has launched are a demonstration of the dangers. Astoundingly, the FT’s “tariff tracker” lists 25 significant policy announcements by the US and the countries it has been assailing in less than three months. It records seven big trade policy announcements between April 2 and 11 alone. These included “reciprocal” tariffs on all countries on April 2, the subsequent reduction of these, after market turmoil, to 10 per cent for 90 days, along with the retaliation cycle between the US and China, has led to prohibitive tariffs on both sides." "We have also seen falling stock prices, high market volatility and, even more disturbingly, the dollar’s fall even while yields on Treasuries rose. It appeared as though capital started to flee from the US itself. No wonder Trump blinked. While “tariffing” the world, he should have known that foreigners held $8.5tn of US Treasuries at the end of 2024, close to a quarter of total public debt." "Unpredictable despots generate waste, fear and pervasive uncertainty. These are enemies of prosperity. Trump’s constantly shifting trade wars and demolition of the global trading system are currently demonstrating this." "Business, after all, must think in years, not days. With its party bureaucracy, Xi Jinping’s China now provides more predictability for [local] business than the US. That is shocking." This article explains with statistics and clear arguments why the United States will pay a high economic price for choosing to elevate a madman to the highest office in the state. At the same time, we must candidly recognize that there is method in Trump's madness. By making the United States poorer, Trump solves at the root the two problems that America's wealth generates: unchecked immigration and trade deficit. An impoverished America is an America that attracts fewer immigrants but also an America that can no longer afford to import and consume the quantities of goods that it imports and consumes today. A poorer and more frugal America is also a more environmentally friendly America, a good thing for planet Earth, for living beings and for all humanity. Therefore, also the left has reasons to rejoice at Trump's election. The only ones destined to suffer are the true conservatives. Those who believe in the rule of law, reason, science and the material and spiritual progress of humanity.

Whatever is that you smoke, it's clearly bad for your health. Be careful.

Russia is full of energy, it's a willing seller and the EU will soon be a willing buyer, as soon as it gets rid of the American boots. I agree. It has taken over East Germany (former Communist Germans are voting en-mass for the AfD). And it's another example of US nefarious interference in European affairs (see picture below). I think Europeans will decide their future. And the sooner they will be free to do it without yankees interference, the better. Europeans can fend for themselves. It is the USA that is in deep sh*t. And the emergency measures introduced by the Trump administration are proof of that. Only a desperate nation on the brink of a precipice would attempt such drastic solutions. Open your eyes and stick to facts. The facts speak for themselves. .

Sorry: I assumed you knew where to find the data without hesitation. But I am always willing to help others, especially those who demonstrate a willingness to learn. https://ticdata.treasury.gov/resource-center/data-chart-center/tic/Documents/slt_table5.html

This time is different. There are no more empires fenced by high tariffs and Europe is one large free trade are, the world's largest. They will be fine.

I guess pretty well. Looking forward to getting rid of the useless American boots on the continent, a constant source of instability and an annoyance for Putin, who feels obliged to do everything possible to keep them away from the Russian borders, including imposing the Lukashenko regime on the poor Belarusians and staging a criminal war against Ukraine. No Americans in Europe will immediately translate in peace and freedom for the continent.

China. Which accounts for 13.7% of US total imports (does not include indirect imports of Chinese goods from Mexico, Vietnam, Cambodia, etc.). By 2022 the U.S. relied on China for 532 key product categories – nearly four times the level in 2000 – while China's reliance on U.S. products was cut by half in the same period. But China holds 8.9% of the US Treasuries, a big card. Japan holds 12.7%. The UK 8.7%. The EU a staggering 22.7% and it will be on the negotiation table (the EU calls it "the bazooka on the table"). They don't have to sell. They just have to slow down their purchases and the yield will skyrocket (the cost of US debt). The US could respond by declaring (selective) default, as other countries have done in the past (Argentina, Venezuela, etc.). But the problem with default is that it prevents the country from accessing new credit. It would also destroy the U.S. dollar's status as a safe-haven currency. And it's a big issue when the government expenses are out of control: federal spending is $139 billion more in the first three months of 2025 compared to the same period last year, with borrowing over that period $41 billion higher. Without new borrowing, everything is at risk, including Social Security.

Actually, cars and automotive parts are all subject to a 25% tariff, independently from where they are manufactured, including therefore those made in UK. Exceptions are, for the time being, vehicles assembled in Mexico and Canada.