Trump, E.U. announce deal to avert escalation of trade tensions

[JasperL]

A closed economy is a situation where the economy is self-sufficient; it doesn't need to trade with anyone.

No ****; 0 - 0 = 0

LOL, comrade, you should have done the Google search FIRST before posting ignorance. :lamo

And we all know what would happen if the U.S. were to become a closed economy - the immediate effect would be depression (not recession) as farmers, auto companies, clothing companies, electronics, all manner of retail simply collapsed, in days or weeks, for starters. Then years and years to gear up to make 10s of thousands of items no longer made here, then long term a permanently lower standard of living, because of the benefits to everyone of trade.

 

[Hedgology]

LOL, comrade, you should have done the Google search FIRST before posting ignorance. :lamo

And we all know what would happen if the U.S. were to become a closed economy - the immediate effect would be depression (not recession) as farmers, auto companies, clothing companies, electronics, all manner of retail simply collapsed, in days or weeks, for starters. Then years and years to gear up to make 10s of thousands of items no longer made here, then long term a permanently lower standard of living, because of the benefits to everyone of trade.

Why don't you model it if you're so certain that it will happen.

 

[JasperL]

Why don't you model it if you're so certain that it will happen.

Nah, thanks though!

 

[Hedgology]

Nah, thanks though!

So why should anyone take you hypothesis as a valid?

 

[JasperL]

So why should anyone take you hypothesis as a valid?

To model it properly would take weeks of work, at least. If you'd done one, you'd know something about how much work goes into them.

And even if I had the time to prove the obvious, why would I bother when you don't even know what a closed economy is, and can't distinguish a table talking about components of a change in GDP versus levels of GDP, and somehow think the net trade balance (X - M) represents anything, really, about a given country's reliance on trade, when that's laughably nonsense.

 

[SheWolf]

https://www.washingtonpost.com/busi...-name_hp-breaking-news:page/breaking-news-bar


Look like a win for Trump. Hats off to him.
Now if he goes ahead with his rumored 25 % tariff on autos, then the crap will hit the fan.

This happened with China too. They promised to buy more from the US, then the trade wars escalated for some reason.

 

[Hedgology]

To model it properly would take weeks of work, at least. If you'd done one, you'd know something about how much work goes into them.

My firm does it in a matter of hours.

And even if I had the time to prove the obvious, why would I bother when you don't even know what a closed economy is, and can't distinguish a table talking about components of a change in GDP versus levels of GDP, and somehow think the net trade balance (X - M) represents anything, really, about a given country's reliance on trade, when that's laughably nonsense.

You're the one who made the unsubstantiated claim. Support your nonsensical assertions.

 

[JasperL]

My firm does it in a matter of hours.

If you think that sounds impressive, you're wrong. If it produced a "model" of the effects of a $5.5 trillion shift in supplies and sales in hours, it would be garbage and anyone who relied on that analysis an idiot. Just for example, the car manufacturing and assembly industry would collapse because it depends on hundreds of suppliers in dozens of countries. How long does your model assume it takes for U.S. firms to do the retooling necessary to produce those 1000s of products?

And when manufacturers have to replace $3 trillion in products now imported, how many firms are capable of producing the machine parts to make those product, what will be demand for their services, how fast can what little in machine tooling is left ramp up to meet an explosion in demand, and what would it cost? If you guess that in hours, your product is garbage.

Etc....

You're the one who made the unsubstantiated claim. Support your nonsensical assertions.

LOL.

 

[Plus Ultra]

For those who think Trump’s tariffs are a wrongheaded mistake:

The U.S. and China just can't seem to bridge their differences on trade, even as the world's largest economy's discussions with Europe and its North American neighbors appear to be making progress.

This week, President Donald Trump stood side by side with European Commission President Jean-Claude Juncker to announce talks and a truce on tariffs. The administration also met with Mexican negotiators, and officials are planning more talks aimed at wrapping up a deal for a revised North American Free Trade Agreement (NAFTA) by September.

Canada, Mexico and the EU got bullied?

But when it comes to China, there are no talks underway. Within the next few days, the U.S. is expected to release a final list of another $16 billion of Chinese goods that will subject to a 25% tariff, and China is expected to retaliate in kind. These tariffs are part of a bigger, $50 billion package that had been put in place earlier this month.

Washington has sent several signals this past week that the stalemate with Beijing won't be resolved quickly. Top White House economic advisor Larry Kudlow told reporters to look for discussions to bear fruit in the next "six to 12 months."

Treasury Secretary Steven Mnuchin suggested China still had yet to make the type of qualitative offer that would satisfy the president. "There continue to be some quiet conversations, but we're prepared if they're going to make serious moves to negotiate," he said.

"The U.S. has no incentive to do this until after midterms. China has no incentive to do this until after the midterms," noted Daniel Clifton, head of policy research at Strategas Research.

But if the U.S. economy starts to suffer from the trade dispute with China, Strategas ' Clifton said that would motivate Trump to restart talks. In the case of China, it too might come to the table sooner, if it suddenly appears as though Republicans would make a strong showing in the November mid-terms, retaining both houses of Congress, he said.

The U.S. has so far slapped tariffs on $50 billion worth of Chinese products, and aluminum and steel. China has taken similar actions on U.S. goods. Tariffs on the first $34 billion of the $50 billion went into effect earlier this month by both countries, with the rest yet to be implemented.

One of the intractable problems with China trade is over intellectual property protections.

However, there are bigger threats in the balance, with Trump proposing $200 billion more in an effort to get China to ease its position on U.S. intellectual property and tariffs. Clifton said that revamping the World Trade Organization (WTO) would be an important step that could resolve some U.S. concerns.

"The WTO reform is the essence of what Trump is trying to fix with China," said Clifton. China is the world's second-largest economy, but is considered a developing nation, a status that gives them more leeway to impose trade restrictions, the analyst explained.

"They're allowed to have tariffs on average of 9 percent," Clifton added, while a developed country would only be able to have tariffs in low single digits.

Meanwhile, Canada on Friday said it plans to host a meeting of trade ministers to discuss how to reform the WTO, but it left the U.S. and China out of the meetings for now. A spokesman for Canadian trade minister Jim Carr said the meeting would take place in Ottawa in October, and invitees include Japan, the European Union, Mexico, South Korea, Australia, Brazil, Chile, Norway, New Zealand, Switzerland, Kenya and Singapore. https://www.cnbc.com/2018/07/28/us-...-appears-to-worsen-as-trump-finds-potent.html

Maybe this is all part of that “art of the deal”, instead of putting WTO reform on the G7 agenda where members will need to be won over with different deals, Trump demands concessions directly from the responsible party, the WTO is a world body, has plenty of members with developing economies allowed to impose higher tariffs who don’t want to give the US more market access.

The problem with China is worse because they benefit from both the higher tariffs as a mislabeled “developing economy” and from breach of intellectual property protections which isn’t such a big issue for other much smaller economies.

 

[Lord Tammerlain]

For those who think Trump’s tariffs are a wrongheaded mistake:

Canada, Mexico and the EU got bullied?

One of the intractable problems with China trade is over intellectual property protections.

Maybe this is all part of that “art of the deal”, instead of putting WTO reform on the G7 agenda where members will need to be won over with different deals, Trump demands concessions directly from the responsible party, the WTO is a world body, has plenty of members with developing economies allowed to impose higher tariffs who don’t want to give the US more market access.

The problem with China is worse because they benefit from both the higher tariffs as a mislabeled “developing economy” and from breach of intellectual property protections which isn’t such a big issue for other much smaller economies.

China is a developing country. The further west you go the poorer it is. The rural villages even in the east is still very poor. The issue is that about 20% of China is not but that 25% accounts for around 300 million people.

 

[Plus Ultra]

China is a developing country. The further west you go the poorer it is. The rural villages even in the east is still very poor. The issue is that about 20% of China is not but that 25% accounts for around 300 million people.

Indeed, it is also a nuclear power, seated as a Permanent Member of the UN's Security Council, has an active space program, high speed passenger rail lines, an old Russian aircraft-carrier and a booming economy.

 

[Hedgology]

If you think that sounds impressive, you're wrong.

You think producing an economic model takes months; it's pretty impressive compared to your inefficiencies.

If it produced a "model" of the effects of a $5.5 trillion shift in supplies and sales in hours, it would be garbage and anyone who relied on that analysis an idiot. Just for example, the car manufacturing and assembly industry would collapse because it depends on hundreds of suppliers in dozens of countries.

Government agencies such as the BEA, Commerce Department, BLS, and many others provide of the data and their metrics... for free. Since this is economics at the macrolevel, you don't need thousands of products; all you need are the nominal value of trade less the value of any goods or services eliminated from the model.

How long does your model assume it takes for U.S. firms to do the retooling necessary to produce those 1000s of products?

It doesn't take any time at all because statisticians will already adjust for these factors. There is a reason why economic data has what we call "seasonal adjustments."

And when manufacturers have to replace $3 trillion in products now imported, how many firms are capable of producing the machine parts to make those product, what will be demand for their services, how fast can what little in machine tooling is left ramp up to meet an explosion in demand, and what would it cost? If you guess that in hours, your product is garbage.

We already know or have a good idea of how many because firms already tell us these things on a monthly basis. Manufacturing surveys (such as Chicago PMI, Philly PMI, and many others) provide us with information that is currently affecting their industry, as well as factors that can potentially affect their industry. This allows economist who adjusts their models in real time so they don't need to wait months.

We're professionals; we know what we're doing.

 

[JasperL]

You think producing an economic model takes months; it's pretty impressive compared to your inefficiencies.

Government agencies such as the BEA, Commerce Department, BLS, and many others provide of the data and their metrics... for free. Since this is economics at the macrolevel, you don't need thousands of products; all you need are the nominal value of trade less the value of any goods or services eliminated from the model.

If you're not very smart that's all you'd need. Eliminating trade would require remaking a third of our economy. There is no precedent, or data, for that. It's an unknown affecting $6 trillion in economic activity.

It doesn't take any time at all because statisticians will already adjust for these factors. There is a reason why economic data has what we call "seasonal adjustments."

OK, now you've got to be trolling. The task of retooling and creating plants to replace $3 trillion in products per year has NOTHING to do with "seasonal adjustments."

I'll quit here.

We're professionals; we know what we're doing.

Don't know who "we" refers to, but you don't have a clue.

 

[Hedgology]

If you're not very smart that's all you'd need. Eliminating trade would require remaking a third of our economy. There is no precedent, or data, for that. It's an unknown affecting $6 trillion in economic activity.

Well, I'm not really interested in what you think will happen. I only care about the data.

OK, now you've got to be trolling. The task of retooling and creating plants to replace $3 trillion in products per year has NOTHING to do with "seasonal adjustments."

Automotive retooling is very much a seasonal factor. Jobless claims always increase during the months of June and July because of it.

We just learned initial jobless claims plunged to 284,000 , their lowest level since 2006. Unfortunately, the data really does not tell us that much about the true health of the jobs market. That's because July is traditionally a time when automakers shut down their plants for retooling.

https://www.businessinsider.com/jobless-claims-due-to-retooling-2014-7

I'll quit here.

Don't want to reveal how much actually don't know about the subject matter, eh?

Don't know who "we" refers to, but you don't have a clue.

By saying "we are professionals; we know what we're doing", I'm obviously excluding you from that category.

 

[trouble13]

All tariffs are protectionist and no tariff war has ever "solved" trade deficits or improved economies. Trump has plenty of ways to address grievances that don't involve insulting our allies and punishing them with tariffs. He is creating uncertainty in world markets and hurting the U.S. areas that voted for him worse than anywhere else. It's nothing more than a bullying schoolboy's prank that has worldwide repercussions. It's almost as if our enemies are calling the shots......

Do you have any objection with their tariffs on our products?

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[iguanaman]

Do you have any objection with their tariffs on our products?

Sent from my SAMSUNG-SGH-I467 using Tapatalk

We have always had tariffs on various products too. They are part of the diplomacy of modern trade. What Trump is doing is just plain bullying. That is his method of negotiating and it sucks big time especially when aimed at our long time allies.. Meanwhile our trade deficit is not the horrible thing Trump paints it as. Our currency is the #1 place for the world to park their money (even when interest was negative) and that is due in a large part because of our trade deficits. Like most of what Trump does it is simplistic and wrong headed. It appeals to those with little knowledge on simplistic visceral level and that is it's only appeal. Creating shadow enemies to blame for complex economic situations is a favorite tactic of authoritarians and it has nothing to do with the peoples REAL problems.

 

[JasperL]

Well, I'm not really interested in what you think will happen. I only care about the data.

Great, so we import $3 trillion per year. That $3 trillion in demand will need to be met entirely by U.S. producers without trade. It's math, what the data show. Same thing on the export end. We have domestic producers shipping $2.5 trillion to overseas markets. They'll need to retool in some way to find domestic markets for what they produce. Lots will go out of business, etc.

Automotive retooling is very much a seasonal factor. Jobless claims always increase during the months of June and July because of it.

But eliminating trade, then the entire U.S. economy shifting to 100% domestic production and 100% domestic consumption hasn't ever happened, ever, in our history. There is nothing "seasonable" about once in our entire history events.

And seasonal adjustments are possible because the same thing happens every year. You can't "seasonably adjust" black swan events like we are discussing. There is no precedent for them, so no recurring events, seasonal events, benchmarks to establish a pattern necessary for the adjustments.
With a trade disruption, everything would be new, novel, unprecedented in U.S. history, at a time when the world economy, including the U.S. economy, has never been more reliant on trade between dozens of countries.

Bottom line is you don't even understand seasonable adjustments and what makes them possible. It's like you're trying to say ignorant things.

Don't want to reveal how much actually don't know about the subject matter, eh?

The irony meter just pegged and then shattered.

By saying "we are professionals; we know what we're doing", I'm obviously excluding you from that category.

And yourself, with your comments.

 

[Hedgology]

Great, so we import $3 trillion per year. That $3 trillion in demand will need to be met entirely by U.S. producers without trade. It's math, what the data show. Same thing on the export end. We have domestic producers shipping $2.5 trillion to overseas markets. They'll need to retool in some way to find domestic markets for what they produce. Lots will go out of business, etc.

Except that is not how aggregate demand works; imports are deducted from calculation of GDP. Without it, the economy is $3 Trillion larger.

And seasonal adjustments are possible because the same thing happens every year...

Bottom line is you don't even understand seasonable adjustments and what makes them possible. It's like you're trying to say ignorant things.

Auto-retoolings occur every year, so economist adjusts for them seasonally. It's that simple.

The irony meter just pegged and then shattered.

And yourself, with your comments.

At least I know economic models don't take models to develop.

 

[Parrish]

Can someone invite Juncker to sign up at DP and present the flash cards with the simple concepts he used to school 45?

 

[trouble13]

We have always had tariffs on various products too. They are part of the diplomacy of modern trade. What Trump is doing is just plain bullying. That is his method of negotiating and it sucks big time especially when aimed at our long time allies.. Meanwhile our trade deficit is not the horrible thing Trump paints it as. Our currency is the #1 place for the world to park their money (even when interest was negative) and that is due in a large part because of our trade deficits. Like most of what Trump does it is simplistic and wrong headed. It appeals to those with little knowledge on simplistic visceral level and that is it's only appeal. Creating shadow enemies to blame for complex economic situations is a favorite tactic of authoritarians and it has nothing to do with the peoples REAL problems.

So their tariffs are diplomatic and trumps are bullying is what your believe

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[JasperL]

Except that is not how aggregate demand works; imports are deducted from calculation of GDP. Without it, the economy is $3 Trillion larger.

Gibberish. Trade disruptions, i.e. trade going to zero, are much bigger problems than changes in aggregate demand. You must know this - you can't be this ignorant.

Auto-retoolings occur every year, so economist adjusts for them seasonally. It's that simple.

Not nice to clip my comment like that. It's trolling behavior. I just addressed this and you ignored it. Try again:

"You can't "seasonably adjust" black swan events like we are discussing. There is no precedent for them, so no recurring events, seasonal events, benchmarks to establish a pattern necessary for the adjustments.

With a trade disruption, everything would be new, novel, unprecedented in U.S. history, at a time when the world economy, including the U.S. economy, has never been more reliant on trade between dozens of countries. "

At least I know economic models don't take models to develop.

You don't understand what kind of model would be necessary, so you can't possibly grasp how long it would take to develop.

 

[Hedgology]

Gibberish. Trade disruptions, i.e. trade going to zero, are much bigger problems than changes in aggregate demand. You must know this - you can't be this ignorant.

Except you haven't proven it. The economy will be larger without trade by simply calculating aggregate demand. If you'd like to show how the economy would collapse without trade, that is up to you to solve.

Not nice to clip my comment like that. It's trolling behavior. I just addressed this and you ignored it. Try again:

"You can't "seasonably adjust" black swan events like we are discussing. There is no precedent for them, so no recurring events, seasonal events, benchmarks to establish a pattern necessary for the adjustments.

With a trade disruption, everything would be new, novel, unprecedented in U.S. history, at a time when the world economy, including the U.S. economy, has never been more reliant on trade between dozens of countries. "

I only clipped the part that was irrelevant. I am referring to how economist includes the effects of auto-retooling in their economic models, which you said would be difficult. Economist also knows which data in the economy is noisy and which parts are not. We also know which factors in the economy are subject to seasonality and which factors are not. And maybe everything would be "new, novel, and unprecedented." However, just because something is new or difficult doesn't prevent statisticians from doing it. We simply roll up our sleeves and do it.

You don't understand what kind of model would be necessary, so you can't possibly grasp how long it would take to develop.

Economic model is merely a mathematical representation of an economic relationship. The equations used in the mathematical representation are usually either stochastic or identities. If you can understand the econometrics in the models, you can understand the model in general, but most people just use the DRI model...

 

[Parrish]

Except you haven't proven it. The economy will be larger without trade by simply calculating aggregate demand. If you'd like to show how the economy would collapse without trade, that is up to you to solve.



I only clipped the part that was irrelevant. I am referring to how economist includes the effects of auto-retooling in their economic models, which you said would be difficult. Economist also knows which data in the economy is noisy and which parts are not. We also know which factors in the economy are subject to seasonality and which factors are not. And maybe everything would be "new, novel, and unprecedented." However, just because something is new or difficult doesn't prevent statisticians from doing it. We simply roll up our sleeves and do it.




Economic model is merely a mathematical representation of an economic relationship. The equations used in the mathematical representation are usually either stochastic or identities. If you can understand the econometrics in the models, you can understand the model in general, but most people just use the DRI model...

:lamo

 

[Hedgology]

:lamo

The point-------------------------------------------------------------------------------------------------------------------------------------------------------> You

Only missed it by that much.

 

[Parrish]

The point-------------------------------------------------------------------------------------------------------------------------------------------------------> You

Only missed it by that much.

A mind is a terrible thing to waste. My condolences to you.