The part I find interesting is how little strength of conviction they have in their plan.
The Trump admin started off a “go big or go home” approach. But they rapidly started making concessions, like the 90 pause and carve-outs for consumer electronics. Now both Trump and Bessent have signaled tariffs against China can come way down. The Wall Street Journal reported that the White House is considering cutting tariff levels to as low as 50% on Chinese imports in a bid to lower tensions.
Note: All the rhetoric coming out of China (at least the part we get to see) is bellicose. They say they aren’t budging. Why would they? They are getting concessions from Trump without giving up anything in return.
If I were Xi, I would stand pat as long as possible. I’m sure he has his own domestic interests to take care of, but even without moving any of his pieces his negotiating position continues to improve.
As you point out, we haven’t really started to hit the pain points yet. The longer he holds out, the more painful it will be for the US. It will be painful for China too, but China is a dictatorship.
Nope. I posted the link before. When TIG imposed a tariff on Korean laundry washers, during the last go around, Whirlpool did not hold it’s prices and take share away from the Koreans. Whirlpool raised prices.
Here is the CEO of Ford, two years ago, talking about how he wants to increase the company’s profit margin, by abandoning the smaller SUV segment, which will reduce the company’s market share.
“So I’m very optimistic about our eight percent because we are not going to be playing in the two-row commodity crossover market because that’s – because Ford’s tried that in the ICE business and it didn’t really work out for us,” Farley said when asked about the company’s profit margin target. “We want to play our hand, our strength, commercial, truck, larger vehicles on the category side.”
Management is all about fattening profit margins to the max, not making an “adequate” profit. It used to be that an 8% margin was luxury car territory. Now, a commodity car maker like Ford wants that sort of margin, and will “high grade” it’s product line to get there, while closing factories and laying off workers, to “right size” the company as it’s market share shrinks, due to abandoning one segment after another.
No. No he didn’t. He paid workers $5 a day so they would stay. His turnover was 400%, and it took time to train the new ones who came in on average every 13 weeks. The work was hard, repetitive, boring, and loud. Workers HATED it. To get them to stay he doubled the pay, and yes, suddenly he had people banging at the gates to get in.
(Even so, his turnover only fell to 100% per year, on average, the work was so monotonous. Enter the unions, whose first issues were working conditions, not money.)
In 1914 when he announced the $5 daily wage, he had 13,000 employees. Also during that year the Ford company produced 310,000 cars. You can see that there was little incentive for him to give employees a wage that would - at best, if every single one bought a car - soak up 4% of production.
It was a Turnover issue. Henry Ford did nothing for the love of his employees.
There are roughly 15 million people working in the tourism industry in the US. Early reports are that airline and hotel bookings are off significantly from both Europe and Canada.
There are roughly 15 million people working in the manufacturing sector in the US. Early reports are…inconclusive.
Do you think the gains in manufacturing will make up for the losses in tourism? Or said another way:
I don’t think this is true. My grocery store (Publix) has a few suppliers for tomatoes, but when tomatoes are $1.49/lb, they are $1.49/lb regardless of which supplier delivered that batch. And last week at Costco, they literally had 10 lb bags of potatoes in the bin from two different suppliers (the bags were entirely different), but the price is the same.
Noodles are different. Some people prefer Barilla over the other brands (maybe because it is the “Italian brand” and perceived to be better somehow), so they are willing to pay a bit more. So Barilla might be $1.89 for a box, while the equivalent Ronzoni or Muellers pasta might be $1.69, and the store brand might even be lower at $1.29. But those aren’t “the same”, they have different customers with different preferences.
Spending down, Tariff revenue coming in. Negotiations on.
Cognitively impaired Biden left the financials in a disaster and open borders.
Now, many are crying about shot term but US needs to take the medicine for a better long term. $36T in spending and $1T in interest payment is unsustainable. $1T in trade deficits is also disastrous in the long term. There is no free lunch.
Take the medicine. Get on the tread mill. Get in shape. Then dominate.
Not necessarily forgotten, maybe the market forces have changed. What would happen if incomes outpaced costs? Demand would grow faster than supply and there would be no need to subsidize demand. No evil devils required, just economic forces, supposedly the central theme of this board. But MacroPsychology has overtaken MacroEconomics. TouchyFeely is the new King.
Continuing the “How’s it going down on the rich powerful and more and more schizoid plantation?” discussion, let’s look at Mickey Mouse’s lllustrative travails and moves (a gifted NYT article):
A fascinating article on Disney as an Imperium dependent on selling revolution…?
Trump is claiming tariff revenue of $2B a day is coming in. CPB, the division in charge, says that as of a week ago, the total was $500m. That’s a triviality next to the amount lost in the stock market since tariffs were announced.
And negotiations? Let me laugh. Maybe the penguins on that deserted island have come to the table, otherwise: no announcements - although Trump has already given plenty of concessions. The great negotiator. What a joke.
Any idea of what percentage of tourism revenues are from visitors from Canada and Europe? I would guess that for a country the size of the US the large majority of tourism is domestic. Sure, you see “a lot” of Canadian snowbirds in Florida each winter but they are swamped by visitors from the East Coast and Midwest.
At the same time, tourism in the US is about 1% of GDP. At the same time manufacturing is, what, 10x that. Big difference.
The downturn in tourism in the US has effects elsewhere.
Fewer Europeans in the US means fewer stopovers in Iceland
Another issue is the situation at US borders and the dissatisfaction among Europeans with Donald Trump’s presidency — factors that may be discouraging European residents from travelling across the Atlantic.
European tourists often make stopovers in Iceland on their way to the United States. If transatlantic travel declines, this could also impact Iceland. Such an effect, at least in the short term, may be felt in the country’s tourism sector.
“In the longer term, if tourists decide not to travel to the US, they might opt for a longer stay here instead. Our recent forecast suggests that despite a projected decline this year, tourism is expected to pick up again in 2026 and 2027,” he adds.
Hjalti emphasises that there is no reason for serious concern, but the situation should be closely monitored.
Previous administration spent your money which is being reflected in the books. They racked up.$2.5T in deficits and gave away $100s of Billions in last few months.
