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Trump exempts phones, computers, chips from ‘reciprocal’ tariffs

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Re: Trump exempts phones, computers, chips from ‘reciprocal’ tariffs

#621

Earlier quoted context omitted.

It's the opposite! A universal tariff is a tariff on all inputs that manufacturers need to be competitive. How will Ford or Tesla ever be competitive if all their inputs are 24% more expensive than Toyota's inputs? Autarky doesn't work. Juche doesn't work. Comparative advantage works, both theoretically and in practice if we study economic history.

Do you really believe in the comparative advantage argument though? Surely it’s only true if comparative advantage is fixed over time. And surely in order to leverage comparative advantage, an economy would need to know how good they would be at producing every possible good. There are good reasons to trade, but comparative advantage doesn’t feel like the correct theoretical underpinning to me.

IMO your logic is all wrong. Comparative Advantage ist just applied "opportunity cost" of time. Humans and resources are unique, everyone has their theoretically "optimal" use of time in terms of economic output.

The invisible hand of the market will let you know what aspect of your output is most valuable for others.

The benefit of this invisible hand is that the "economy" as a whole does not need to know how good they are at producing everything. People just need to know if what they are producing now is more valuable than the next best alternative. Everything else will be sorted out with market forces.

In university lectures we were given the famous argument about olive oil from Greece and that it would never make sense to do our own olive oil because we both lack the natural resources (unique soil + sunshine) which allow olive trees to grow easily and we'd also have much better yields growing other things on the fields.

So to me, both opportunity cost and comparative advantage are really basic building blocks of economic understanding and I'm a bit dumbfounded that someone wouldn't understand these concepts.

Re: Trump exempts phones, computers, chips from ‘reciprocal’ tariffs

#622

The 145% tariff is so absurd I wouldn't be surprised to see cheap chips glued to the item to exploit the exceptions. "Oh yeah, that's not a shoe: it's the protective case for an ESP32 WiFi router".

Perhaps one could say they are "Smart shoes": https://en.wikipedia.org/wiki/File:DonAdams.jpg

Re: Trump exempts phones, computers, chips from ‘reciprocal’ tariffs

#623

Why is no one highlighting how this is repeating history 8 years ago? I don’t get it, there’s this magical reporting gap where all of this is new strategy but it’s the exact same strategy. Why don’t we acknowledge this instead of searching for some new angle? Here are a bunch of links from 2018/2019: https://www.cnbc.com/2019/12/13/apple-dodges-iphone-tariff-a... https://www.kiplinger.com/slideshow/investing/t052-s00…

> Why is no one highlighting how this is repeating history 8 years ago? Because it’s not? The tariffs which are currently in effect or soon to go into effect are so far out of line with anything in modern history that there is no comparison. The reason everyone is panicking is because people expected more of the same as 8 years ago but instead we got something massively worse, without a hint of cohesive strategy, and…

For some reason, it stinks of a none too smart AI making economic decisions without taking psychology or a bunch of real life costs into account.

It is a losing strategy.

Re: Trump exempts phones, computers, chips from ‘reciprocal’ tariffs

#624
post #554

Earlier quoted context omitted.

You still often have one man with all the power in a parliamentary system. The Prime Minister. Take Canada as an example. JT had basically complete power over government. It's as rate for the prime minister party or coalition to go against him as it is for a president in the US to be impeached. I think the trick has to be to just get better people into those positions. Which means better people need to have some ince…

There may be some parliamentary country where what you say is correct, but in general, yeah, no, that’s not how it works. Remember Liz Truss, all 49 days of her? A PM who fucks up on a Truss/Trump scale generally finds themselves very rapidly seeking alternative employment. Truss was forced to appoint a borderline sane chancellor about two weeks after causing the bond yield to go crazy, and was gone within another co…

Unlike UK, US has only impeachment and 25th as procedures. Perhaps a convention. There is no vote of no confidence.

Re: Trump exempts phones, computers, chips from ‘reciprocal’ tariffs

#625
post #338

Earlier quoted context omitted.

Even universal tariffs with no exceptions is a problem. Many things cross US/Canada/Mexico border in the process being manufactured. And tariffs will stack up. Many advanced products (tech/chip, etc) are not entirely made in any single place. Some stuff is imported, and some is exported again, and tariffing the world, will also make the world tariff you. I think this is all around bad. Best case scenario the US has e…

He's already gotten what he wanted from it and bragged about it: so many leaders of different countries calling up and kissing his ass. He's certainly not going to give any of them what they wanted, and now they all have the taste of his ass in their mouths. At least they have something in common with Elon Musk, now.

There's many sayings about diplomacy, though I understand the reality is much more mundane.

One that comes to mind is "a diplomat is a person who can tell you to go to hell in such a way that you actually look forward to the trip" — like all good quotes, attributed to a wide variety of famous people.

Competent governments send arse kissers to those who need pampering, and send blunt to those who need to see bluntness. But (in a competent government) these things are uncorrelated with the actual negotiation position — "speak softly and carry a big stick" etc.

Trump being bellicose to everyone at the same time is a sign of his own incompetence.

Re: Trump exempts phones, computers, chips from ‘reciprocal’ tariffs

#626

Why is no one highlighting how this is repeating history 8 years ago? I don’t get it, there’s this magical reporting gap where all of this is new strategy but it’s the exact same strategy. Why don’t we acknowledge this instead of searching for some new angle? Here are a bunch of links from 2018/2019: https://www.cnbc.com/2019/12/13/apple-dodges-iphone-tariff-a... https://www.kiplinger.com/slideshow/investing/t052-s00…

Because last time the US government required alliances to participate in the trade war. Maybe it is not rational, but the US is the leader, so most countries just thought, 'Ok, if you really need it...'. But this time, the trade war is against the whole world. Everyone is confused.

Re: Trump exempts phones, computers, chips from ‘reciprocal’ tariffs

#627

I’m not seeing anyone discuss this here, so I figured I’d raise an important point: this style of tariffs is crushing for US manufacturing. While a universal tariff with no exceptions incentivizes domestic manufacturing, a selective tariff with specific industry exceptions is absolute poison. You might think, as the authors of this exemption did, “well then we will exempt computer parts.” Then people will simply impo…

Factories, tooling, machinery, etc. must be amortized over a market and production run. If you're making toilet paper, the cost is relatively low and the market is huge. The TP you make today will still be good TP in a decade. No one toilet paper factory can serve the world, so you'll need many of them in many markets. The inputs can be found within the U.S.. Why not build one in the U.S.?

A factory that produces a specific model of phone is only going to be able to run for a few years before it needs to retool for a newer model. That means a huge investment goes into such a factory on a continual basis. If one factory can serve the entire world demand for that model, why build two?

If you're going to build just one factory, are you going to build it in a market that's walled off behind trade barriers, both for outputs and inputs? Only if that market is significantly bigger than the rest of the world combined. If the rest of the world is bigger, than you build outside the trade barriers and people inside of them will just have to pay more.

Tariff's might bring low-end, high-volume manufacturing back to the U.S.. Chip fabs, phone factories, or anything so high-end/low-volume that it must be amortized over a global market is not going to return to the U.S. because of tariff's. An administration that changes their minds every few hours only makes matters worse. Whether Trump has recognized this and is conceding defeat or he's bowing to pressure from companies like Apple is immaterial. That kind of factory is not coming to the U.S. anytime soon.

Re: Trump exempts phones, computers, chips from ‘reciprocal’ tariffs

#628
post #338

Earlier quoted context omitted.

Even universal tariffs with no exceptions is a problem. Many things cross US/Canada/Mexico border in the process being manufactured. And tariffs will stack up. Many advanced products (tech/chip, etc) are not entirely made in any single place. Some stuff is imported, and some is exported again, and tariffing the world, will also make the world tariff you. I think this is all around bad. Best case scenario the US has e…

He's already gotten what he wanted from it and bragged about it: so many leaders of different countries calling up and kissing his ass. He's certainly not going to give any of them what they wanted, and now they all have the taste of his ass in their mouths. At least they have something in common with Elon Musk, now.

I belief his story about dozens of countries calling him about as much as his story of him taking a cognitive test and having every single answer correct. Or his doctors statement that said that there has never been a healthier president than Trump.

Re: Trump exempts phones, computers, chips from ‘reciprocal’ tariffs

#629

Has the Proton CEO acknowledged just how farcically off base he was when he said the GOP was the party of small businesses?

The thing that’s really been getting to me, is that, I’m liberal, not pro-Trump, but the MAGA American heartland story has been really getting to me. I want to see small business, manufacturing, small town American succeed. And there’s some part of me that thought maybe Trump, as much as I don’t like him, is the thing that is needed to make that happen, but man it seems like he’s really fucking over the people who su…

What a surprise. Trump fucking over people. He has a history, it's not some mysterious hero who just arrived to town. Why's anybody surprised given the things he's done in past.

Re: Trump exempts phones, computers, chips from ‘reciprocal’ tariffs

#630

Earlier quoted context omitted.

Oh, we don't need tariffs for Russia. But we put them in for Ukraine. - the Republican administration

What about penguins? Are they going to get a tariff exemption?

They need to call Marco: https://www.youtube.com/shorts/PGnx_ij8XOE
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