Nice summary. Only point you might have missed is the likelihood of insider trading, although in a sense Trump’s tweet about now would be a good time to buy might have been a public announcement. Still, lots of people lost money selling (some who had to for various real reasons, some just for trading purposes) and of course some people made a lot of money “buying on the dip”, and finally lots of small businesses are completely flummoxed.
Sam Pooley: You noticed that, too. Your and my minds have run the same track: Who -- especially with cut regulatory staff -- will investigate top administration officials, to say nothing of Trump -- from making bigger fortunes on insider trading, including short sales.
As this trumped up tragedy unfolds we should all acknowledge that whatever changes occur between the U.S. and other governments, intimidation and false accusations did not need to come into play to settle trade concerns, even those that exist only in Trump's imagination.
Imagine determining beforehand what could smooth trade with the cited nations to be followed by offering negotiations in good faith .
But, then such an approach would "cut the drama" and avoid the crisis actions taken within stock markets and bond markets and so on, and would, therefore, be beyond Trump's reckoning that everyone else on the planet is out to get him.
I imagine your students in Switzerland are basically fluent in English, but did they already know the word "clusterf*ck" or did you have to teach it to them?
Sorry to be a buzz kill, but I have to point out a tiny misusage of language. I bumped on the word "picaresque," when I think you meant "picturesque." Thanks. I am a new subscriber and enjoying your work!
picaresque novel, early form of novel, usually a first-person narrative, relating the adventures of a rogue or lowborn adventurer (Spanish pícaro) as he drifts from place to place and from one social milieu to another in his effort to survive.
It looks like the remaining tariffs, if we imported at 2024 volumes (we won't) the new China tariff tax would be $537B/yr. Just using 10% on the rest of the world (the 25% tariffs are still in place on Mexico and Canada, but using 10% to calculate) would be another $350B/yr, so $887B/yr or ca. on average a $6,000 tax increase for every US household. It is still far bigger than the $600B/yr Navarro was discussing before April 2. China naturally has been preparing for this since Trump 1 and has tools it can use to really hurt the US companies still in China. They have critical minerals that mostly come from China that US manufacturing needs which they can cut off. Ignoring all the rest, this massive trade war with China will be damaging for the US. As Wall Mart noted today, and Amazon has been acting on, the Chinese tariffs will help them increase market share. Bessent is wrong on Main Street vs. Wall Street. If you look at the history of economic downturns/recessions we have lost manufacturing workers and small businesses at higher rates.
"Exports have been a rare bright spot in an economy struggling with a property market slump, high youth unemployment and domestic spending that is so weak it threatens to turn into a deflation crisis."
See "Trump’s tariff blitz could hardly have come at a worse time for China" (The Washington Post, April 11, 2025)
The PRC was born in civil war and revolution. In the second half of the 1960s the Red Guards mobilized in Mao's Cultural Revolution.
Xi Jinping has enemies in the Politburo. He cannot be certain the PLA and PLAN will do as he orders.
Widespread unemployment will hit the PRC very hard. For fear of what may follow, the Politburo may depose (or worse) Xi. If that course of action is delayed, he might yet be deposed in another civil war or revolution.
The PRC does not have a consumer-led economy. The PRC must export to sustain itself. Xi has precious little time to resolve this.
Does it matter whether the tariffs are 34%, 84%, 125% or (now) 145%? Business gross margins are maybe 30% (monopolists aside) so any tariff above that is just symbolic sadism ... nobody short of mandated price controls will accept a chronic loss, they'd just stop importing, find a substitute.or in extremis smuggle.
Looking at historical parallels, the opium wars (framed as trade barrier by British and health disaster by Qing) shows the Chinese mentality:
> , had long sought a variety of Chinese products (including furniture, silk and tea), but found there were few products that China wanted from the West. American trade with China began as early as 1784, relying on North American exports such as furs, sandalwood, and ginseng, but American interest in Chinese products soon outstripped the Chinese appetite for these American exports.
If economic coercion triggers indignities from unequal treaties and a mindset of resistance/swallowing bitterness, it becomes a matter of which country can bear the pain the longest. Reducing the deficit by imposing a proto-GST/VAT (consumption tax) will reduce demand but do nothing to improve household savings. With inflation (on US side) and unemployment (PRC factory closings) it becomes a marathon as to which side can keep the lid down on future civil discontent.
What is your take on Daniel Pinchbeck’s thesis that the current “chaos” created by Trump and his cronies is actually the implementation of a plan to sabotage the US economy in order to acquire public goods at “fire sale” prices when the federal government goes into default? I hope I paraphrased his point accurately.
If the chaos is actually a plan to bring about such a result how would it control for such predictable but undesirable results like global economic collapse and international armed conflict?
There are answers out there …in the UK, Wales is in the process of legislating to prevent autocracy with a very simple but quietly radical legal solution to enforce honest facts in politics...
Nice summary. Only point you might have missed is the likelihood of insider trading, although in a sense Trump’s tweet about now would be a good time to buy might have been a public announcement. Still, lots of people lost money selling (some who had to for various real reasons, some just for trading purposes) and of course some people made a lot of money “buying on the dip”, and finally lots of small businesses are completely flummoxed.
Sam Pooley: You noticed that, too. Your and my minds have run the same track: Who -- especially with cut regulatory staff -- will investigate top administration officials, to say nothing of Trump -- from making bigger fortunes on insider trading, including short sales.
As this trumped up tragedy unfolds we should all acknowledge that whatever changes occur between the U.S. and other governments, intimidation and false accusations did not need to come into play to settle trade concerns, even those that exist only in Trump's imagination.
Imagine determining beforehand what could smooth trade with the cited nations to be followed by offering negotiations in good faith .
But, then such an approach would "cut the drama" and avoid the crisis actions taken within stock markets and bond markets and so on, and would, therefore, be beyond Trump's reckoning that everyone else on the planet is out to get him.
I look forward to reading your picaresque story of travel adventures.
What a wonderful typo, “with picaresque views”
I imagine your students in Switzerland are basically fluent in English, but did they already know the word "clusterf*ck" or did you have to teach it to them?
Sorry to be a buzz kill, but I have to point out a tiny misusage of language. I bumped on the word "picaresque," when I think you meant "picturesque." Thanks. I am a new subscriber and enjoying your work!
picaresque novel, early form of novel, usually a first-person narrative, relating the adventures of a rogue or lowborn adventurer (Spanish pícaro) as he drifts from place to place and from one social milieu to another in his effort to survive.
It looks like the remaining tariffs, if we imported at 2024 volumes (we won't) the new China tariff tax would be $537B/yr. Just using 10% on the rest of the world (the 25% tariffs are still in place on Mexico and Canada, but using 10% to calculate) would be another $350B/yr, so $887B/yr or ca. on average a $6,000 tax increase for every US household. It is still far bigger than the $600B/yr Navarro was discussing before April 2. China naturally has been preparing for this since Trump 1 and has tools it can use to really hurt the US companies still in China. They have critical minerals that mostly come from China that US manufacturing needs which they can cut off. Ignoring all the rest, this massive trade war with China will be damaging for the US. As Wall Mart noted today, and Amazon has been acting on, the Chinese tariffs will help them increase market share. Bessent is wrong on Main Street vs. Wall Street. If you look at the history of economic downturns/recessions we have lost manufacturing workers and small businesses at higher rates.
For and explanation of this I would look to a government version of insider trading. Think some family members had some options?
I think you mean picturesque (like pretty, quaint), not picaresque (a style of fiction)
"Exports have been a rare bright spot in an economy struggling with a property market slump, high youth unemployment and domestic spending that is so weak it threatens to turn into a deflation crisis."
See "Trump’s tariff blitz could hardly have come at a worse time for China" (The Washington Post, April 11, 2025)
The PRC was born in civil war and revolution. In the second half of the 1960s the Red Guards mobilized in Mao's Cultural Revolution.
Xi Jinping has enemies in the Politburo. He cannot be certain the PLA and PLAN will do as he orders.
Widespread unemployment will hit the PRC very hard. For fear of what may follow, the Politburo may depose (or worse) Xi. If that course of action is delayed, he might yet be deposed in another civil war or revolution.
The PRC does not have a consumer-led economy. The PRC must export to sustain itself. Xi has precious little time to resolve this.
Does it matter whether the tariffs are 34%, 84%, 125% or (now) 145%? Business gross margins are maybe 30% (monopolists aside) so any tariff above that is just symbolic sadism ... nobody short of mandated price controls will accept a chronic loss, they'd just stop importing, find a substitute.or in extremis smuggle.
Looking at historical parallels, the opium wars (framed as trade barrier by British and health disaster by Qing) shows the Chinese mentality:
> , had long sought a variety of Chinese products (including furniture, silk and tea), but found there were few products that China wanted from the West. American trade with China began as early as 1784, relying on North American exports such as furs, sandalwood, and ginseng, but American interest in Chinese products soon outstripped the Chinese appetite for these American exports.
If economic coercion triggers indignities from unequal treaties and a mindset of resistance/swallowing bitterness, it becomes a matter of which country can bear the pain the longest. Reducing the deficit by imposing a proto-GST/VAT (consumption tax) will reduce demand but do nothing to improve household savings. With inflation (on US side) and unemployment (PRC factory closings) it becomes a marathon as to which side can keep the lid down on future civil discontent.
What is your take on Daniel Pinchbeck’s thesis that the current “chaos” created by Trump and his cronies is actually the implementation of a plan to sabotage the US economy in order to acquire public goods at “fire sale” prices when the federal government goes into default? I hope I paraphrased his point accurately.
If the chaos is actually a plan to bring about such a result how would it control for such predictable but undesirable results like global economic collapse and international armed conflict?
Did you mean "picturesque"? Autocorrect issue?
There are answers out there …in the UK, Wales is in the process of legislating to prevent autocracy with a very simple but quietly radical legal solution to enforce honest facts in politics...
https://open.substack.com/pub/justhinkin/p/has-wales-found-the-solution-to-autocracy?r=3cs2wr&utm_campaign=post&utm_medium=web&showWelcomeOnShare=true