Well it makes for interesting discussion certainly. Curious to see if the market just gobbles this up in a few days, or not.

So Tooth, when do we start doing stuff like shorting Asian car makers etc...?

Yea good perspectives to keep in mind. Here's a nice quote from Dalio's recent piece on the tariffs:

"...both US and China will have rattled their sabers without actually inflicting much harm... I wouldn’t expect it to amount to much anytime soon. If on the other hand we see an escalating series of tit for tats, then we should worry."

(though it's a shame that Dalio, in his attempt to pierce through the propaganda, resorts to clickbait-y language like "Trade War Would Be a Tragedy")

I'm surprised by the level of strength here this morning (-0.75% on the futures), although there was strength just when bonds started crashing too before the vol blowup. I feel this major shift in what is going to happen in the future is worth a few percent. Escalating trade wars are bad for everyone in the short term, and Trump has signaled he intends to change China's behavior, which they won't do unless pressed (all of their growth and power as a nation - and Chinese aims are intensely nationalist - requires continued theft of Western knowhow, which they do by forcing companies to share all their know how in order to to get approval to sell products in their country). So it'll get worse before it gets better - and I think Trump is serious and intends to see this through. That's the main message the Cohn going sends.
I think targeted trades are the way to go, based on impending news. Morishta bought Boeing puts yesterday for example (I didn't join). China's tit for tat will be in attacking high visibility US companies that make up a substantial part of their sales or growth in China, to cause Trump domestic political pain and spur the fake news media to create hysterical headlines and misattribute this as Trump being anti free trade and a protectionist (the opposite is true - it's China that's anti free trade and Trump is trying to correct the huge errors of his predecessors by forcing China more towards free trade).

Thanks Obama

"Thanks computer modelling and the economic collapse of communism", I think you mean. Physicists designing improving computer chips, and communism's own inevitable economic failures, are the reason we are we are today in terms of safety and prosperity and know-how. Individuals are largely irrelevant. In fact Obama handled everything about as badly as one could in terms of letting future geopolitical risks fester and grow.

No offense man, but you're a moron.
No offense man, but you're a moron.
No offense man, but you're a moron.
No offense man, but you're a moron.
No offense man, but you're a moron.
No offense man, but you're a moron.

I don't know what the hell is going on with this right wing - left wing nonsense it has never been so overblown. Trade wars are horrendous for the economy and Trump is literally ruining the only good thing coming out of his presidency.

Its sad to see that he managed to push out Cohn because of it.

Short term, yes. Long term, no. Why do you think US growth has been so sluggish, and wages flat to going backward, since China started needlessly duplicating US factories? There are square miles of factories making everything from computer chips to steel that was once made perfectly well in the US, with enormous capital and debt costs (to the US) in losing the output of those productive factories and having to retool and reskill rather than reaping the profits of that knowhow for a good period of time.

There is no reason, except for China's theft and anti-free-trade practices, that the US couldn't grow at 90s levels or better and have much lower debt today, given its huge lead in knowhow and capital. That's real economic damage that's happened in real time. A bit of short term pain to cut out that cancer is worth it. It should have been done in 2005 or 2010.

The idea that Trump is protectionist, that he's anti free trade, that a trade war will be bad for everyone (long term), is a bull**** narrative. The opposite is true. We're already in a huge trade war where we're bending over and letting others plunder our wealth. Trump is wanting to increase free trade and stop trade wars. When US companies are hit with large tariffs and targeted laws to stop them selling in China or Europe, but European and Chinese goods can just be dumped here with no restrictions, that is the US being killed in a trade war. Much of US debt has been the papering over of that loss of wealth.

I guess it's lol politics, but if it's bad short term and good long term, it gets tough to win your second term. He needs some sort of short term win, somewhere.

I think the market assumed, and maybe still does, that he won't go full trade war for purely political reasons, especially with mid terms coming up. Cohn going was a pretty big blow to that view.

You are babbling incoherently. China is the 5th biggest importer of steel to the US. Canada imports almost 3 times as much steel as China. China imports too low a percentage to the US to effectively dump steel. The Tariff also isn't very tareted. Its just a general tariff. Its ultimately only going to raise prices on US steel products, making the US less competitive. It also completely misses the real issue with jobs being lost, which is automation.

In terms of theft, it's definitely an issue, but a trade war isn't going to solve it. That is a cybersecurity issue.

Protectionism only works for infant industries. If we truly have a technological edge free trade is the best way to exploit that. You have clearly been cucked by Trump quite badly.

Thanks for the fake news talking points, but you're a ****ing idiot. I'm not talking about theft of US trade secrets by hacking, although China does a lot of that.

Do you even know what forced technology transfers are? Let me explain.

If Boeing wants to sell planes in China, they have to:

1. Set up a joint venture with a Chinese company, which is government owned, in which China has the controlling share in everything.

2. Transfer all of their decades worth of intellectual property and hard-won knowhow on how to build planes to the Chinese government, for free

3. Make some of the planes in China

If you don't do this, you run into huge legal and tariff and structural barriers that effectively stop you from selling your products in China.

If you don't see how this is a huge problem, you're functionally ******ed. Most of the media barely reports this, so I don't blame you too much for being ignorant, but this is the nature of the world and doing business with China, an it's horribly anticompetitive, horrible for US businesses and wealth, and horrible for US national security in the long run. It is the dead opposite of free trade. China is in a massive trade war with the US, and Obama bent over and said "please sir, may I have another", while trillions drained out of the US to a creepy dictatorship.

This is not some hypothetical thing. Bipartisan Congress has done reports on how terrible this practice is. No one before Trump has had the will to do anything about it, however, because of morons like you who are ill informed.

Here's an article from the Washington Post about this practice and how it could destroy Boeing and US technological advantages, robbing us of the profits of decades of research and massive costs associated with getting that hard-won knowhow.

Here's testimony before Congress on the nature of the problem.


Sure, unless someone is stealing it - forcing companies to give up their technological edge to access the Chinese market in flagrant violation of free trade rules has cost the US trillions in hard-won wealth already.

You've been cucked by the fake news media and haven't the faintest clue what you're talking about.

Do you understand now, moron, why Trump is doing what he is doing despite the short term pain and risk?

The thing is that's a false narrative it hits Canada the most. He could easily target Chinese imports specifically if he would care about that.

Yes and he talked about doing just that yesterday (hit Chinese imports hard if they keep up their flagrant anti free trade violations, which they will unless pushed). At present the rest is just posturing with Canada while NAFTA is renegotiated. I've got no read on where that's heading. I think this is all ultimately aimed at China and getting others to play along.

I'm aware of the practice, but misunderstood what you were referring to when saying they were stealing. Either way, I don't see how steel tariffs will doing anything to stop the practice. The point of the tariffs is to appeal to voters in swing states (specifically Ohio and Pennsylvania) where the jobs will be saved temporarily.

My issue with Trump isn't that he is necessarily wrong in his thinking, but that his plans tend to be half-baked. An example of that is getting other NATO members to spend more on military. He could have done that much more effectively behind closed doors and without the US giving up soft power. Getting other NATO countries to spend more on military is also pretty pointless if we are going to continue to increase our military spending. When he has good ideas he executes very poorly.

Brian, has anyone ever made any money on anything you've posted? Or does anyone even care period? The fact that you act so smug on your viewpoints yet seem to add nothing of value is cute. Constant waste of time.

God, I hope not

By your logic, Apple should move back their phone production to the US and problem solved?

You conveniently forgot to mention the capital holders in the US got the lion shares of the benefit having production, lower cost, located in China.

I think you are misinterpreting what I said. I was simply stating that steel tariffs against China won't do anything to solve issues with IP.

Sorry. I was referring to the post by TS when he stated the following......

Short term, yes. Long term, no. Why do you think US growth has been so sluggish, and wages flat to going backward, since China started needlessly duplicating US factories? There are square miles of factories making everything from computer chips to steel that was once made perfectly well in the US, with enormous capital and debt costs (to the US) in losing the output of those productive factories and having to retool and reskill rather than reaping the profits of that knowhow for a good period of time.

There is no reason, except for China's theft and anti-free-trade practices, that the US couldn't grow at 90s levels or better and have much lower debt today, given its huge lead in knowhow and capital. That's real economic damage that's happened in real time. A bit of short t

navarro out of the running so i guess the world isn't gonna end today.

if we had a combo of trump/navarro/bolton thats a real hold onto your butts for 3 years kinda moment.

I didn't know TS was a conspiracy theorist. Would rather have Kudlow as economic advisor to Trump over ToothSayer.

Digging the talk in here though. Don't mind the extremes because the truth is somewhere in the middle. Worth hearing it all out.

Frankly I wish I had even the start of a background in economics so I could profit from all this. I simply don't have the background. But I guess I know which industries in Canada are going to suffer from this. That's a start.

How do you get conspiracy theorist from China's deliberate policy of forced technology transfer (this is not in any way controversial -science.house.gov report) and well-known expansive Chinese nationalism?

There is literally zero controversial here. I guess people like bigt2k4 are just stupid/ignorant, fed a diet of left wing Fox News and too stupid to think for themselves or actually read anything other than TrumpIsSatan.com.

Someone who I consider very intelligent actually thought I was being sarcastic with this stuff until they looked into it...that's how deep the ignorance goes. No wonder you think Trump is a loon going on about China if you'e too ignorant to even know what's happening on a large scale, or too narrow minded to follow a link to a Washington Post article or Congressional report.

Bolton seems like a lock to be a part of this administration in some capacity, so we're 2/3 of the way to Armageddon.