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Started by wglassfo - July 8, 2018, 1:16 p.m.

I kinda understand why the tarrif issue and trade balance is important

On the other hand I don't understand

I doubt very much if the trade deficit is changed, it will ever lead to a balanced budget

Maybe a balanced budget is not the goal

I dunno, but if successful what happens to all the trade deficit money that is supposed to go poof 

I might be wrong but the only way I see it possible is if goods produced in the USA lead to a lot higher tax revenue, and that is a lot of tax revenue to have a balanced budget, let alone pay down debt, but like I said, maybe that is not the end game

I give that a very slim chance of happening, as I fail to see the end game

Lets go to one logical conclusion, of which there are many

Politicians just seem to spend money they don't have and will continue IMO

I think the bigger worry than trade deficits is unfunded obligations coming due as the population ages

We really need that robotic age to come sooner than later to produce enough to support the baby boomer retirement demands and those folks vote, in higher %.

The baby boomers [of which I would guess an ever increasing larger numbers of folks on this forum, will join] will soon become a very huge special interest group

Thus my larger concern is for unfunded liabilities, which I don't see the connection with tarriffs as solving a huge problem, as time goes by

That said, we all know the trade deficit is financed by printing money out of thin air

If you can print money out of thin air and in all honesty, you in the USA will likely be able to continue for a long, long time

So why worry, when you can print the money out of thin air to buy from the entire world what ever your country wants or needs

The only connection I see is shifting the demand for fiat printed from thin air from a trade deficit to printing money for unfunded liabilities

Now if that is the goal, I can see the merit

But, I have not heard anything said about this train of thought

All I hear is Trump saying the world is taking advantage of the USA

What do you think the USA did when they set up the petro dollar with ME oil

That and other stuff around the world sounds to me like the USA taking advantage of others

So Trump just forgets all the things that happened in the past, including burning down the white house, a 270% tariff on milk[which truth be known, the americian dairy system system has failed, wilst our system has not cost our gov't one cent]

Which system would a person think is the better one???

So we go on a tit for tat tariff war and the world heads for a recession if not worse

Not saying it is right, but I am saying there are numerous ways to address the problem with out a bull in the china shop approach and recession or worse looming for all of us

So lets regroup and consider

We have a trade war that will not help any person in the whole world pocket book

Many people think it will be short term pain for long term gain

If you have any idea about how china thinks, short term pain will not happen

Int rates that are supposed to be coming for some time

What will that do to millions of people

China who can trade with a large part of the world with the silk road

China offering farmers in china subsidies of $190-$380/acre to grow soybeans

China buying soybeans from anybody except the USA

Soybeans and all grains by default going lower in price

China buys cheap soybeans, even paying SA a premium price, beans are still cheap

Lower prices will continue as long as china wants

China can afford to hurt USA prroducers big time and for a long time

Their willingness to subsidize beans, even though not enough show their plan for long term low USA prices

It cost money to ship beans to razil for re-sale to china

That shipping cost comes from lower producer prices

Toldeo could load USA beans to Canadian ports and re-load to ocean boats to china

We won't receive higher farm gate prices in Canada but the people who source and sell will profit

 a combination of less revenue and higher consumer prices, will cause a recession

A  world depression which is perhaps a smaller risk but is thought  to be possible

World trade shifting away from the USA and leaving the USA with very few trading partners

Rare earth minerals which could become extremely difficult for the USA to access at any price

So there you have it

Just a few tthings that could happen but the bigger risk is the unintended consequences

That part that nobody know IMHO is the biggest risk of all

Sort of like cutting off your nose to spite your face


Maybe this had to happen and dam the torpedos

I dunno

Sorry for the long post but things are complicated when you think about it

You may think differently and you may be correct

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