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Wall Street stocks tumble as investors fret over US economic slowdown

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Re: Wall Street stocks tumble as investors fret over US economic slowdown

#281

Post by intended »

yieldcrv wrote: post #270
intended wrote: post #256

Earlier quoted context omitted.

Tariffs don’t achieve this, and it misdiagnoses the problem in the first place. Manufacturing is now increasingly automated, so it doesn’t employ as many people anymore. This is an issue India faces as does every developing economy. Economic growth is increasingly dependent on service sector growth. Moving supply chains also requires weaker labor laws, and lower salaries for workers, than minimum wage, to be competit…

America has many American workers at minimum wage and above. (and below) In this specific sector, the entire industry including retail has shown they will pay many multiples of a higher price for GPUs and cloud services. So if a US grown supply already cost that much out the gate, there is already examples of the market being able to bare that.

I get your point - but when I see what you are saying, the focus is on the demand side and price elasticity.

There is definitely an unserved market. Even now, there’s many people who want to purchase the service and can’t afford to.

However, even if we concede your point in its strongest sense - the revenue is a different beast from the profit margins.

Higher labor and compliance costs mean that making things in america is more expensive.

The solution is usually to not pay people that much

In the end a company is measured by its stock performance. Their incentive is to maximize profit.

If the solution is to pay people less, most voters balk.

Re: Wall Street stocks tumble as investors fret over US economic slowdown

#282

Post by gadders »

iAMkenough wrote: post #277
gadders wrote: post #203

Earlier quoted context omitted.

The tariffs are for different purposes. Canada's tariffs were to prop up their automotive industry. America's tariffs are to encourage nations to so more to stop importing illegal drugs into the US.

That doesn't make sense. How does charging American consumers and businesses an additional 25-50% tax on purchases and imports accomplish that?

Because people will stop buying products imported from those countries, and buy from their competitors instead.

Re: Wall Street stocks tumble as investors fret over US economic slowdown

#283

Post by andrewla »

intended wrote: post #280
andrewla wrote: post #276

Earlier quoted context omitted.

It sounds like you're making a principled argument against tariffs. That's great, and whether you're right or wrong is independent of the stock market reaction. And there's a fine discussion to be had on the merits of tariffs and tariff uncertainty on economic activity. But attributing short-term market movement to a specific phenomenon is, to put it bluntly, plain foolishness. Ex post facto reasoning is almost alway…

This is not a principled argument. This is the actions people I know are taking to manage investments. Look - I can’t help you if you wish to believe something. That’s an issue of faith. I have no idea why you believe that this is ex post facto reasoning. Tariffs cause recessions, it’s not even correlation. Let me elaborate - the moment Trump was elected, I knew that he was going to impose tariffs, and that it was go…

It is a principled argument -- even if the stock market had gone up you would still believe that tariffs are bad. If your claim is that it is impossible for the stock market to go up in the face of tariffs, then you're making a real proposition which can be tested and (let's face it) easily shown to be false.

Blaming the current stock market movement on a reaction to the tariffs is not a valid argument. Saying that tariffs have a negative economic impact is totally valid, and has a lot of evidence to support it.

Trying to offer narrative explanations for market movements is a suckers game; it's just the bloomberg headline generator "Markets on news of ", with no predictive value.

Re: Wall Street stocks tumble as investors fret over US economic slowdown

#284

Post by SlightlyLeftPad »

intended wrote: post #281
yieldcrv wrote: post #270

Earlier quoted context omitted.

America has many American workers at minimum wage and above. (and below) In this specific sector, the entire industry including retail has shown they will pay many multiples of a higher price for GPUs and cloud services. So if a US grown supply already cost that much out the gate, there is already examples of the market being able to bare that.

I get your point - but when I see what you are saying, the focus is on the demand side and price elasticity. There is definitely an unserved market. Even now, there’s many people who want to purchase the service and can’t afford to. However, even if we concede your point in its strongest sense - the revenue is a different beast from the profit margins. Higher labor and compliance costs mean that making things in amer…

Exactly, rather than evolve our economy and support high paying jobs which often require high education, the strategy seems to be revert to past things that made our economy successful and neglect the education system. Why? I think it’s because it guarantees votes and is an easy movement to get behind but it’s not /better/. I don’t think it will actually work either because you have to compete with your aforementioned labor costs which isn’t sustainable.

Re: Wall Street stocks tumble as investors fret over US economic slowdown

#285

Post by intended »

SlightlyLeftPad wrote: post #284
intended wrote: post #281

Earlier quoted context omitted.

I get your point - but when I see what you are saying, the focus is on the demand side and price elasticity. There is definitely an unserved market. Even now, there’s many people who want to purchase the service and can’t afford to. However, even if we concede your point in its strongest sense - the revenue is a different beast from the profit margins. Higher labor and compliance costs mean that making things in amer…

Exactly, rather than evolve our economy and support high paying jobs which often require high education, the strategy seems to be revert to past things that made our economy successful and neglect the education system. Why? I think it’s because it guarantees votes and is an easy movement to get behind but it’s not /better/. I don’t think it will actually work either because you have to compete with your aforementione…

Right!

I say take it a step further - not everyone is excited by sitting in front of a computer and doing intellectual exercises. People like different things and are suited to doing different things as well.

But if there is only one way forward, which is Engineering, Medicine and Law - then you have essentially recreated 1970s India and China.

But this is 2025 - not only do we have automation we have GenAI, which threatens to take away tons of low level service work. Education is something that takes years to result in blooms. Decades of nurturing.

(Hey - thats a useful analogy. Societies plant and harvest crops of trained professionals.)

Can people discuss these difficult topics? Nope. Besides, if you do - people start becoming more “liberal”, “disconnected” from ground reality. Code for people not voting the way leadership would like.

Re: Wall Street stocks tumble as investors fret over US economic slowdown

#286

Post by intended »

andrewla wrote: post #283
intended wrote: post #280

Earlier quoted context omitted.

This is not a principled argument. This is the actions people I know are taking to manage investments. Look - I can’t help you if you wish to believe something. That’s an issue of faith. I have no idea why you believe that this is ex post facto reasoning. Tariffs cause recessions, it’s not even correlation. Let me elaborate - the moment Trump was elected, I knew that he was going to impose tariffs, and that it was go…

It is a principled argument -- even if the stock market had gone up you would still believe that tariffs are bad. If your claim is that it is impossible for the stock market to go up in the face of tariffs, then you're making a real proposition which can be tested and (let's face it) easily shown to be false. Blaming the current stock market movement on a reaction to the tariffs is not a valid argument. Saying that t…

I am ex-finance. I didn't get paid for intellectual arguments:

> Saying that tariffs have a negative economic impact is totally valid, > narrative explanations for market movements is a suckers game

So let me be clearer - I knew in November, that Trump's style of tariffs, were going to tank the economy, which would tank the stock markets which reflects the stock market.

The causatory force (not correlatory) of tarriffs is well known, and I've lived in the era where tariffs were commonplace. I've seen an entire economy rise from the ashes when tariffs and protectionism was removed.

You are hiding behind an intellectualism in a world where these kinds of blind spots mean someone else is taking your money.

Re: Wall Street stocks tumble as investors fret over US economic slowdown

#287

Post by iAMkenough »

gadders wrote: post #282
iAMkenough wrote: post #277

Earlier quoted context omitted.

That doesn't make sense. How does charging American consumers and businesses an additional 25-50% tax on purchases and imports accomplish that?

Because people will stop buying products imported from those countries, and buy from their competitors instead.

If the goal is really to increase law enforcement along the borders, this still does not make sense.

There aren't really domestic competitors for much of the imported materials used to create American products, so the foreign suppliers have the upper hand in the "deal" since Americans are reliant on them and do not have their own competitors in place.

To me this appears to be more about the federal government charging the majority of Americans more in taxes, to pay for the deficit being created by tax cuts for the few ultrawealthy Americans.

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