US biggest trade deficits are with
China
Mexico
Vietnam
Ireland
Germany
Since the trade war started
China’s stock market up 20%+
EU up 15%
Mexico up 10%
Canada up 5%
IF US markets are going down on tariff’s but the trading partner market is going up?? Doesn’t make much sense. In a tariff war both parties should be affected.
We had so many indicators showing that last week may be the bottom. We will come to know whether Fed is going to give any relief today, if it does, I think in due course we may have a strong bounce back, even otherwise I expect a bounce.
If the other country(ies) do NOT impose countervailing tariffs, they have no price increases. The other country(ies) exports will find other buyers–and those buyers will be sympathetic to them and against whoever is imposing tariffs. The country(ies) without tariffs will likely see minimal changes in their overall economy(ies) while the tariff-imposing country(ies) will see their economy(ies) decline due to far less money being available to spend on goods-and-services and more on non-productive higher taxes (i.e. tariffs). Reduce deficit? LOL !! Buying more bridges in Brooklyn (again !!).
If the other country(ies) do NOT impose countervailing tariffs They are.
The other country(ies) exports will find other buyers US trade deficit with top 3 countries alone is $600 B. There are no other country or countries to absorb this. If US is not buying then the trading partners will be doing a fire-sale, and there are no sympathetic buyers, who have $1 T couch change.
If you have a philosophical view, the data is not supporting, then data is not going to change your view. Only time can say whether you are right or not.
Most of Ireland’s exports are US companies making drugs there and shipping them back to us US to charge Americans 5 times the price it costs for the drug in Ireland. It’s a corporate income tax dodge.
Yes, I am aware of it. It is not just drug companies, it is tech companies too, I have implemented ERP system changes to accomodate double-dutch, etc. Until “dubya” allowed bringing the cash without paying penalty, the markets used to track the cash sitting in Ireland.
Tariff is a a tax, so if it is applied to nullify or mitigate a tax dodge, it is understandable. Again, this reinforces my view that there will be negotiations and some deals cut.