Thursday 10 Apr 2025
Import duties only become payable when the goods are cleared by customs officials. It would not make sense to ship anything by sea to the US now, because the US buyer would not know what duties will be added on by the time the goods arrive in the US. US trade might be grinding to a halt, after it shot up during Dec to Feb in anticipation of the tariffs.
The smartphone global market share has changed little in Q4 of 2024 compared to a year ago: Counterpoint.
Wednesday 9 Apr 2025
Trump lowered reciprocal tariffs to 10% for 90 day, except for China: X was Twitter. Imagine the confusion that is going on in the customs and excise duty department. The stock markets and oil shot up in response, forgetting the orginal tariffs are still in place, plus 10%.
Trump threatened additional 100% tariffs on chip giant TSMC - PC World. If Trump manages to move manufacturing to the US, those manufacturers will need import protection. Consumers will end up with permanently higher prices.
"Amazon cancels orders from China due to tariffs" - X was Twitter.
"BREAKING: China raised its retaliatory tariff against the U.S. to 84%, hours after new American tariffs took effect, in a dramatic escalation of the superpower trade war." - X was Twitter.
"At 12:01 Trump's tariffs officially took effect. Tariffs are now at their highest level in 100 years." - X was Twitter.
Hilarious paper from 2014: China-EU Global Value Chains: Who creates value, how and where? Growing linkages and opportunities. Apple's China labour cost was 1.8%, compared to profits of 73%, of which 58.5% was from the US.
A lower demand in the US results in lower demand for raw materials in Asia, not good for metals.
The WTI oil price has fallen to $56.11. It looks like OPEC will finally see what happens to US overproduction at a low price. If the price is maintained for a long time, some shale oil production could disappear. If US total debt per capita (green) is used as inflation reference, the WTI price (brown) should be around $75 now.
The US current account imbalance (red) due to a capital inflow is tiny compared to the annual increase in household net worth (blue), due to asset price increases, most of which is held by a wealthy minority. Balancing trade and bringing back manufacturing will do nothing for the increased poverty due to the growing wealth gap. The current account balance was $1.1T for 2024, compared to household net worth of $160.3T.
Tuesday 8 Apr 2025
Jon Stewart on Trump's Botched Tariff Rollout & The Stock Market's Meltdown | The Daily Show - Youtube.
The trade wars will have the biggest impact on the US, since it involves all trade. For other countries, trade with the US is only part of their trade. The EU has a oil and gas problem in that they have to deal with a lot of problem countries. In 2024 oil import was 16.1% from the USA; natural gas was 45.6% from Norway, 19.3% Algeria and 16.6% Russia; and liquefied natural gas was 45.3% from the USA and 17.5% from Russia (Eurostat).
US trade with the rest of the world was 25% of economic output (GDP) in Q4 (below). The Trump trade wars will probably cause an economic depression. This is why all countries should strive to be economically independent from international trade, because they have no control over events in other countries.
What is the relationship between trade and economic output? Below is US economic output (blue) and imports+exports (red) relative to total debt as nominal inflation rate. Trade (red) doubled towards 1980 whilst the economy remained stable. After 1980 trade and the economy fell. In 2020 trade (red) fell about -30% and the economy (blue) fell -10%.
US imports (blue), exports (green), and interest rates (red) shot up towards 1980. Interest rates rose to suppress inflation. After 1980 inflation was underreported leading to lower interest rates, and increased wealth through asset appreciation without production.
Monday 7 Apr 2025
How vulnerable are US oil producers to lower oil prices? Rystad investigated it: "Rystad Energy believes that mid-cap public players in the Permian, specifically the Delaware basin, are especially at risk in a prolonged period of oil prices in the low $60s." - X was Twitter. Management will keep producing as long as they get paid. Owners need to choose between losing a lot by shutting down operations, or losing slowly with operating losses.
"Battery swapping was once a niche idea. But now that Nio has proven it works, bigger companies want in." - X was Twitter. That was the obvious solution from the start.
Trump wants to apply another 50% tariff on China from 9 April: X was Twitter. Imports from China will decline to nothing, from 11.3% of all US imports in Q4:
Von der Leyen offers Trump 'zero-for-zero' tariffs deal on all industrial goods - Euronews. The two regions whose industrial production is in decline due to the high cost of labour wants to do a deal. EU countries charge 20-23% VAT on imports, so this deal will depend on whether tax is income or consumption based. US imports of EU goods was 14.9% of all imported goods and services (if the correct adjustments were made for monthly and annual statistics):
Wikipedia has a chart from 1792 which shows US tariffs/excise (yellow), income tax (red) and payroll tax (grey) as percentage of GDP. Tax collection shot up following the War of 1812 (1812-1815), Civil War (1861-1865), World War I (1917-1918), World War II (1941 –1945). In the last three cases it never fell back to before the war. Once politicians get their hands on your money, they refuse to give it up. Tariffs also increased during the Great Depression (1929-1939) but all taxes was still only 7% of GDP by the end.
US imports to GDP was only 2-3% of GDP during the Great Depression (StLouisFed). Imports are now bigger, and tariffs could have a big economic impact, but other countries already have bigger tariffs in place. If some of these countries scrap their tariffs, it would be positive for both economies.
Trump is trying to reduce a trade deficit, which is caused by capital inflow, with tariffs. Would tariffs make the US unattractive for investment by foreigners? The tariffs will likely cause a fall in US imports. What happens to the strong dollar and the stock market, which is what attracts the capital inflow, will depend on how essential US big brands are. The world has already moved from US car brands to Asian brands.
US president Trump wants to make America great again by bringing back manufacturing. This requires a fall in labour cost, and a weaker dollar. The weaker dollar would stem the capital inflow that causes the trade deficit.
His support is the result of the growing wealth gap. To stop the growing gap, the net worth (below) must stop increasing. It is this increase in asset prices that causes inflation, and the wealth gap. Trump cannot reduce the wealth gap, and favour lower interest rates to boost asset prices. These are mutually exclusive. The stockmarket is dominated by large monopolies. After removing international trade barriers, the government needs to open up the economy by breaking up big businesses.
Sunday 6 Apr 2025
"CanadaWatch: In response to Pres. Trump's recent tariffs, Canada’s PM Mark Carney introduced a 25% tariff on U.S.-manufactured cars and trucks." - X was Twitter. Cars imported into Canada are subject to a 6.1% import duty, except cars made in North America. All cars sold in Canada are subject to sales tax of 5% and retail sales tax of 7%.
Saturday 5 Apr 2025
Anti-Trump, Musk protests draw big crowds in L.A. and around the nation - LA Times. It could indicate a lack of communication from government to explain policies, and a public being influenced by a biased media. The president usually is also the party leader, and as such has influence over the party members in congress. Thus he can be a policy maker.
Singapore PM’s Chilling Warning To World Amid Chaotic Trump Tariffs: ‘Trade Wars To Armed Conflicts’ - Youtube. He pretends Singapore is an open economy with free trade. Imported cars are subjected to 20% excise duty and GST of 7%.
Friday 4 Apr 2025
New Study Finds An AI’s Clinical Decisions Rivaled Doctors - Forbes.
"Just the fourth time since 1952 (when the five-day trading week began) that we had a 10%+ two-day drop for the S&P: October 1987, November 2008, March 2020,
April 2025" - X was Twitter.
"BREAKING: This is the first time ever the Dow Jones Industrial Average fell more than 1,500 points on back-to-back days" - X was Twitter. It is -9.2%. Amounts increase due to inflation.
"China to impose additional 34% tariffs on **all** imported U.S. products starting April 10, the official Xinhua news agency reports" - X was Twitter.
The view that tariffs are just a cost on the economy is incomplete. There are always two parties involved in transactions. One group pays more for imports due to tariffs. If the government reduces income tax by the increased amount collected from tariffs, then taxpayers have more money left over after tax. If for argument's sake the buyers of the imported products are all taxpayers, they will be compensated for the tariffs as a tax saving, so they pay no more than before.
It all depends on whether government spending will increase if it receives more income. Government spending is what weakens the economy. It is the disconnect between the payment through taxes, and free government services without production.
If Trump could force other countries to make an end to import restrictions, it would benefit all of mankind. Trump is what happens when you don't have career politicians who knows nothing other than politics or the law. There should be a constitutional amendment that limits all politicians to one term.
US economic output (green) and federal government debt (red) relative to total debt (black) as nominal inflation rate. What this usually means is that government spent more than they could collect in taxes from a weakening economy, in an effort to keep up with inflation.
Thursday 3 Apr 2025
New tariffs impacting US cocoa imports - Baking Business.
Here Are the New US Tariffs on Major Coffee Producing and Exporting Countries - Daily Coffee News.
"Breaking: Argentina in final negotiations with the US to become the first zero-tariff country." - X was Twitter. Argentina charges 21% VAT. The US manufacturer has already paid tax to the US government, whatever form of tax that is, and is included in their price. It should not have to pay tax to the Argentine government from which it does not receive services.
"France’s President Macron: The response to Wednesday's announcement of US tariffs will be more massive than the previous response" - X was Twitter. Car sales in France is dominated by French brands: Renault 56,772, Peugeot 52,893, Citroen 27,335, Dacia (part of Renault) 23,096, Toyota 23,026.
"The negotiations have already begun. Israel and the United States have had a free-trade agreement since 1985 that excludes most American products from Israeli tariffs. On Tuesday, Israel's Prime announced the decision to remove all remaining tariffs." - X was Twitter. Israel just increased VAT to 18%. Bad luck.
"The Revenue Act of 1913, also known as the Tariff Act of 1913, Underwood Tariff or the Underwood–Simmons Act, re-established a federal income tax in the United States and substantially lowered tariff rates", "Wilson and other members of the Democratic Party had long seen high tariffs as equivalent to unfair taxes on consumers, and tariff reduction was President Wilson's first priority upon taking office", "The Revenue Act of 1913 lowered average tariff rates from 40 percent to 26 percent. It also established a one percent tax on income above $3,000 per year; the tax affected approximately three percent of the population" - Wikipedia. The hilarious part is that it started as a 1% tax. Based on the growth in money supply $3000 would be about $350,000 today.
....The assumption that only the wealthy pay tax is incorrect. The high income earners and businesses need compensation for their taxes, and passes it on as higher prices, just like tariffs are passed on. It is the fact that money is taken out of the economy, and handed out as a free government service or payment that is the fundamental problem. The public should pay directly for the government services they want.
Wednesday 2 Apr 2025
See Trump’s list: More than 180 countries and territories facing reciprocal tariffs - CNBC. Citizens of the other countries who have to pay all the import duties and VAT he mentions, welcome the fact that some-one is finally taking action against bad governments.
China urges U.S. to ‘immediately’ cancel reciprocal tariffs, vows counter-measures - CNBC. China's reciprocal tariffs would be ineffective, because it imports so little from the US.
Understanding the scope of Trump’s tariffs so far, in 4 charts - CNN.
Tuesday 1 Apr 2025
The protests against Tesla cars is apparently because of DOGE (Department of Government Efficiency), and support for conservative parties. The protestors must be former beneficiaries of previous US government handouts. Tesla can do what other companies do when fraud is uncovered – change the name of the business. Rebadging the car from Tesla to "Not a Tesla" should be enough to confuse these primitive people.
Artificial intelligence (AI) Grok provides a list of US cars prices and country of manufacture (x.com) within seconds. It is not like all the cheap cars are imported. The cheapest models under the American brands are Jeep Renegade (~$25,000) made in Italy, and the Chevrolet Equinox (~$27,000) made in Mexico. The cheapest Japanese models are the Toyota Corolla (~$22,000) made in the US. The Nissan Altima (~$26,000) is also made in the US. The Korean Kia Forte (K4) (~$20,000) is made in Mexico. After a 25% tariff it is ~$25,000, compared to the Kia K5 (~$26,000) made in the US. So it is a mixed bag.
Is the recent dollar weakness due to capital outflow? The Balance on Current Account (blue) shows big capital inflow in Q4. The dollar has been in a strengthening channel against the euro since March 2008 (red), when you paid $1.58 for a €. Now you pay $1.08 for a €.
Monday 31 Mar 2025
"JUST IN: Chinese regulators grant the country's first-ever approvals for two companies to operate autonomous passenger drones (flying taxis)." - X was Twitter. The music is so that you don't hear how loud the drones are.
BYD’s new ‘high-tech trendy’ electric SUV starts at under $20,000: Meet the Tai 3 - Electrek.
"BlackRock, $BLK, CEO Larry Fink pledges to open up private markets to millions of everyday investors, not just the wealthy few" - X was Twitter. Investments are usually offered to the market when it is high.
There is a misconception about the US demand for cars. The US personal consumption expenditure on New Autos (red) has fallen from 4.2% to just 0.25% of total expenditure. Recreational goods and vehicles (blue) improved from 2.0% to 3.3%. Apparently some people have replaced their car with an RV, in which case it is less for recreation, and more for living in, perhaps they can't afford a house, or they want to be free.
The number of cars imported into the US from Canada (green) and Mexico (orange), after adjusting for apparent monthly data versus annual data, compared to the number made in the US (blue). Cheap labour in Mexico makes sense, but Canada? There was a big change in Dec and Jan. The overall number of cars sold has fallen.
The sales of imported new autos as fraction of personal consumption expenditure (red) did increase up to 1986, but has since declined, like the fraction of new auto sales (blue):
Domestic autos made in North America (US, Canada and Mexico) as a fraction of domestic and imported vehicles was 66% in Feb 2025. It was as high as 86% in 1996 and 1976.
Sunday 30 Mar 2025
"New Zealand will canvass a range of options to break a duopoly in its grocery market, including reducing barriers to a new international entrant and forcing the separation of the existing supermarket chains" - X was Twitter. Big supermaket chains require big suppliers, which leaves small businesses out of the economy.
As of July 2024, the EU charges on imported cars include VAT (Value Added Tax) of 20% tot 23%, customs fees of 10%, registration tax, and excise duty. "Most import duties are based on several factors, such as the vehicle’s engine size, CO2 emissions, and more." (Ecarstrade). VAT as the name suggests, is based on the value added by each party in the supply chain. Since the foreign manufacturer does not receive government services from the import country, there should not be VAT on the import price, up the moment the car arrives at the harbour.
When one country subsidizes exported cars, and the import country applies tariffs to those cars, money is effectively taken from taxpayers in one country, and given to people in another country as free benefits. That is the stupidity of politicians.
Trump says he never told CEO's not to raise car prices - NBC News.
Friday 28 Mar 2025
"Canada's PM Carney: Told Trump I will implement retaliatory tariffs" - X was Twitter, "Trump: I will absolutely follow through on Canada tariffs" - X was Twitter. Sounds like school boys fighting in the yard.
"Vance says 'no way' Canada can win a trade war with US" - X was Twitter. It depends on which country can find the cheapest alternatives. Since the US wants to source it locally, they will likely lose.
"@xAI has acquired @X in an all-stock transaction. The combination values xAI at $80 billion and X at $33 billion ($45B less $12B debt)." - X was Twitter.
"Car shoppers are rushing to buy new vehicles before April 3, when 25% tariffs on imported vehicles take effect" - X was Twitter. Voters learnt nothing from the first Trump term.
"Taiwan accuses China's biggest chipmaker SMIC of 'illegally' poaching tech talent" - X was Twitter. Taiwan's population is 23M and China 1417M. Quess who is taking over semiconductor manufacturing, in response to US sanctions.
Trump warned US automakers not to raise prices due to tariffs - Forexlive. The price of used cars of the imported brands will likely rise. Prices started to rise in Sep (blue). There was a big jump in 2020-21 corresponding with an increase in house prices (green), and a jump in the stock market. "Starting in March 2020, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) provided Economic Impact Payments" (Treasury). The official inflation rate on vehicles does not agree with the actual price increases.
Thursday 27 Mar 2025
"U.S. President Donald Trump's announcement of 25% tariffs on imported cars and car parts appeared to come as a surprise to Japan, where the move is seen as undercutting a bilateral agreement made in 2019 between Trump and then-Prime Minister Shinzo Abe." - X was Twitter.
"Trump’s new 25% auto tariffs will hit foreign carmakers hard—especially Japan, where autos make up 30% of exports to the U.S. Goldman warns Mazda’s profits could plunge 59%, and Tokyo fears a recession. Consumers? Expect fewer choices and higher prices." - X was Twitter.
"BREAKING: Ontario, Canada Premiere Ford says they will "inflict maximum trade pain" on the US, per Reuters" - X was Twitter. Freezing climate and now they are left out in the cold by a trade war.
Wednesday 26 Mar 2025
"Trump plans to impose tariffs on imported vehicles, with a potential cost increases up to $12,000 per electric vehicle due to supply chain disruption, per WSJ" - X was Twitter. A lot of countries have import duties on vehicles. The result is that poor people can't afford cars. Politicians are wealthy and might even get a free car as part of their fringe benefits, so this does not affect them at all.
Trump imposes tariffs on all car imports: here’s where all EVs available in the US come from - Electrek.
"S&P 500 $SPX falls back below its 200D moving average" - X was Twitter.
What caused the big jump in commodity prices 2004-5? According to Grok (of the X website) it was caused by: (1) Rapid Economic Growth in Emerging Markets, (2) Tight Supply Conditions, (3) Weak U.S. Dollar, (4) Speculative Investment (5) Geopolitical Tensions and Weather Events, (6) Energy-Commodity Linkages. That narrows it down.
The copper price in $ relative to total US debt per capita (below). Copper is cheap relative to the 1970s when America was great before. Before 2005 prices were apparently too low, and has since normalized around 1 on the chart.
Tuesday 25 Mar 2025
What It's Like In A Robotaxi With No Steering Wheel Or Pedals - InsideEVs.
"The European Automobile Manufacturers Association (ACEA) has released February registration numbers confirming that #Tesla only delivered 16,888 units in the EU, EFTA, and UK markets in February 2025, compared to 28,182 units in 2024." - X was Twitter. It made no sense for a business man to get involved in government for no reward.
House owners who can't find a buyer for a vacant house need for the annual increase in the house price (blue) to at least equal the mortage interest rate (red). They also need the cash flow to pay the monthly mortgage instalments, unless they have a flexible mortgage which can be increased with the value of the house.
Monday 24 Mar 2025
Countries who buy oil or gas from Venezuela will pay 25% tariffs on exports to the US - X was Twitter.
Ignoring the low oil price before 1974, oil (brown) and copper (orange) suggest a similar inflation rate of 3.8% per year since 1984. Due to the price volatility, it would be difficult to find the short term inflation rate. The price of services rose faster than goods.
Saturday 22 Mar 2025
From 2 weeks ago: How to tell what clothes are made of (by lighting them on FIRE) - Youtube.
"US President Donald Trump appeared to endorse the idea of joining the Commonwealth of Nations — the organization largely composed of former British colonies and run by King Charles III — in a social media post" - X was Twitter. The actual benefits of Commonwealth of Nations membership is difficult to find on the internet.
....Wikipedia: "Its purpose is being questioned, its relevance is being questioned and part of that is because its commitment to enforce the values for which it stands is becoming ambiguous in the eyes of many member states."
...."However, South Africa's application to remain a member of the organisation after becoming a republic in 1961 was effectively blocked due to hostility from many members, particularly those in Africa and Asia as well as Canada, to apartheid. The South African government withdrew its application when it became clear at the 1961 Commonwealth Prime Ministers' Conference that it would be rejected." That is doubtful. Almost no African country has democracy. They don't care about the political system in other countries. They flocked to South Africa due to the relative prosperity. Opposition to apartheid came for the British Empire (the same people who held Afrikaners in concentration camps) upon request from the ANC.
....Commonwealth citizens were free to settle in the UK, until the Pakistanis and West Indians started to arrive.
From 11 March: Mapped: The State of Democracy Around the World - Visual Capitalist. "In 2024, just 6.6% of the world population lived in “full democracies”, falling from 12.5% a decade ago". Australia and Canada are defined as fully democratic, but still have a monarch as head of state. India has had many political assasinations, and could hardly be described as democratic.
Friday 21 Mar 2025
"Chinese electric vehicle maker BYD's shares are flying at all-time highs after the company unveiled new battery technology that takes just five minutes to charge." - X was Twitter.
....How BYD’s Five-Minute Charges Compare With Competitors - Energy Connects.
....Fast charging normally reduces battery life, but some battery materials show no degradation: Comparison of the impact of fast charging on the cycle life of three lithium-ion cells under several parameters of charge protocol and temperatures - Hal Science. You could flash charge your time travelling DeLorean when lightning strikes the clock tower.
"A Chinese research team has developed a breakthrough method using micro-batteries and amino acids to recover nearly 100% of lithium, nickel, and cobalt from old batteries in just 15 minutes—potentially reshaping the clean energy supply chain" - X was Twitter.
"BREAKING: The United States sold 1,000 Gold Card visas worth $5m each in a single day - Commerce Secretary Howard Lutnick. That's $5 billion in revenue from just one day." - X was Twitter. The difference between walking across the Mexican border, and paying $5M seems extreme. Something in between is required.
Detentions at US border prompt UK, Germany, and Nordic nations to revise travel advice - USA Today.
UAE commits to $1.4 trillion investment framework in US, White House says - CNBC. That will add $140 billion per year to the US trade deficit. The trade deficit just reached a record $131B in January (due to capital inflow, and/or income from abroad).
Wednesday 19 Mar 2025
"JUST IN: Suni Williams is seen being helped up after exiting the SpaceX Crew Dragon capsule. This is her first time feeling gravity on Earth in *9 months.*" - X was Twitter. How long does it take to get to Mars? - Space.com.
Tuesday 18 Mar 2025
"DOGE has marked ~3.2 million Social Security number holders aged 120+ as deceased in the past two weeks." - X was Twitter. Deceased people do not normally have bank accounts, and could not have received social security.
"JUST IN - Trump says authorizing energy production using coal" - X was Twitter. The start of global warming coincides with the filtering out of smoke from coal fired power plants (such as scrubbing).
'BREAKING: District court judge Theodore Chuang orders President Trump, Elon Musk, and DOGE to restore USAID, claiming its shutdown "violated the United States Constitution." ' - X was Twitter. People seem to have difficulty understanding that congress makes the policy decisions, and the president is supposed to execute their policies. "Congress passed the Foreign Assistance Act on September 4, 1961, which reorganized U.S. foreign assistance programs and mandated the creation of an agency to administer economic aid." (Wikipedia).
...."The FY 2025 Congressional Budget Justification describes the funding required for State and USAID to carry out our missions worldwide" - State.gov.
US mortgage payments appear to be 9.5% of the mortgage value (below). The payments are a combination of the interest, principal repayments, tax and insurance. A 30 year home loan at 6.7% interest paid over 30 years comes to a total payment of 8.7% per year. Perhaps home owners have shorter mortgages, or the figures used are not comparable.
Monday 17 Mar 2025
"Media: “Donald Trump has started a trade war”. Actual Backdrop: “All other G20 countries have much worse trade barriers”. Hopefully Trumps trade war will bring global trade barriers DOWN" - X was Twitter. Restricting imports is only beneficial if your exports are essential, like advanced technology or minerals. Otherwise limiting trade means paying more for locally produced products, and not making money with profitable exports.
With all the fuss about tariffs, what contribution do imports make to the US economy? It peaked at 17.5%, and went down to 14% in 2024.
Saturday 15 Mar 2025
"Trump has invoked the Alien Enemies Act, which is meant to quickly remove foreigners during wartime or invasion. James E. Boasberg, chief judge of the D.C. Circuit, has currently implemented a temporary restraining order preventing deportation for 14 days under the Act" - X was Twitter. Too many laws. "Congress has enacted approximately 200–600 statutes during each of its 119 biennial terms so more than 30,000 statutes have been enacted since 1789." (Wikipedia).
....Judge blocks Trump from using 18th-century wartime act for deportations - The Guardian.
Countries considered for Trump's potential new travel ban - Reuters. People are so impoverished by their own government, they can't afford to travel to the US.
Starbucks ordered to pay $50 million to delivery driver burned by hot coffee - ABC Eyewitness News.
Friday 14 Mar 2025
"Samuel Benner, a farmer from the 1800s, published a book with market analysis on periods of panic, good times to buy, and good times to sell. 150 years later, his analysis has proven to be remarkably accurate" - X was Twitter.
"Fuck it. Josh Brown reading the J.P Morgan research note on the US Stock Market set to the Battle Hymn of the Republic" - X was Twitter. 😂
Given the extreme volatility of the stock market due to speculators, investing in dividend stocks might seem like a more stable option, but no, it is just as volatile and gives lower growth: Dividend Stocks Versus Growth Stocks In 2024 | Which Is Better? - Suredividend.
"OH CANADA: British Columbia Premier David Eby said he was removing Tesla from its EV rebate program because of Elon Musk in violation of the Canadian Human Rights Act. Perhaps Elon should ban Canada from SpaceX and Starlink in retaliation." - X was Twitter. A country which still has a monarch as head of state.
"Chinese authorities have signaled their displeasure over Hong Kong conglomerate CK Hutchison selling its Panama Canal port assets to a consortium led by U.S. investment firm BlackRock." - X was Twitter.
The price of US natural gas has shot up (blue), but is still much cheaper than oil (brown) for the same energy content:
Thursday 13 Mar 2025
The S&P 500 index value and EPS back to 1928: Macrotrends. It is shooting up as expected from exponential growth. The PE ratio is now 28.3. It has been much lower: Macrotrends.
"UK PM Starmer announced that England's National Health Service will become part of the Department of Health" - X was Twitter. As if government ever runs anything efficiently.
Trump threatens 200% wine tariff if EU does not remove whiskey tariff - Reuters. Trump wants to see more drunk Europeans.
US government spending is mainly determined by congress, not the president. A congressional budget introduced 18 Feb 2025 has the debt limit growing by 4.4% per year through to 2034. The deficit declines to 2027, and then increases again: congress.gov.
For fiscal year 2025 the debt limit is $37,660,656,000,000. in Q4 2024 federal debt was $36.219 trillion, growing 6.5% over a year:
Wednesday 12 Mar 2025
Goldman Sachs cuts S&P 500 year-end target to 6,200 as economic outlook weighs on profit forecasts - Yahoo Finance. That would be 10.9% higher than the present 5591.
Trump administration plans to give dirty US coal plants a reprieve on soot - Reuters. Smoke should result in more rain, and lower temperatures.
Some on the web confuses theft for monetary gain with politically motivated vandalism, from 4 March: Tesla wheels stolen from 11 vehicles in League City. Police seek info to help solve the mystery - Houston Chronicles. "Cameras on nearby buildings were not recording and the cameras on the cars did not record either since they were all powered off, Ortega said." All those batteries, and not enough power for the cameras.
Elon Musk: “As a function of the great policies of President Trump and his administration, and as an act of faith in America, Tesla is going to DOUBLE vehicle output in the United States within the next two years…” - Donald J, Trump, X was Twitter. Tesla vehicle sales appear to be topping out (cleantechnica). What vehicles will they manufacture in these new factories?
Do the Drill Babies (blue) respond to a lower oil price (brown)?
Tuesday 11 Mar 2025
"I am hereby instructing Secretary Lee Zeldin to immediately go back to my Environmental Orders, which were terminated by Crooked Joe Biden, on Water Standards and Flow pertaining to SINKS, SHOWERS, TOILETS, WASHING MACHINES, DISHWASHERS, etc., and to likewise go back to the common sense standards on LIGHTBULBS, that were put in place by the Trump Administration, but terminated by Crooked Joe. I look forward to signing these Orders. THANK YOU!!! " - Donald J. Trump, X was Twitter.
"BREAKING: Pres. Trump announces that tariffs on Canadian steel & aluminum will rise to 50%. The tariffs will go into effect tomorrow morning." - X was Twitter.
Trump said in the State of the Union Address: "The tariffs will go on agricultural products coming into America. And our farmers starting on April 2nd, it may be a little bit of an adjustment period". Taxes on production and imports (blue) compared to farm ouput (red) are shown below. No chart of agricultural imports can be found.
US agricultural exports (blue) compared to all exports (red):
The Import Price Index (End Use): Green Coffee, Cocoa Beans, and Cane Sugar increase by Jan:
Monday 10 Mar 2025
Spain's Golden Visa residency by investment program ends 3 April, and in January Prime Minister Pedro Sánchez proposed a 100% duty on homes purchased by foreigners. This could cause a collapse in house prices, which is the intent of the law changes. Up to Q3 last year there was no sign of house prices (blue) declining. House prices in Spain (blue) have outperformed Eurozone M3 money supply per person (red).
Spain had economic growth (blue) that matched Euro M3 money growth (red) from 1994 to 2008, and had fast recovery from the Covid lockdowns, but overall has fallen behind.
Sunday 9 Mar 2025
"BREAKING: Trump has reportedly expressed a desire to “tear up the Great Lakes agreements and conventions between Canada and US that lay out how they share and manage Lakes Superior, Michigan, Huron, Erie and Ontario," per NYT" - X was Twitter.
Saturday 8 Mar 2025
"Vandalism And Attacks On Tesla Accelerate As Musk Says ActBlue, Soros To Blame" - X was Twitter. We are moving towards a society in which civilization exists in gated communities. Before nation states were established, people lived in villages as independent communities. Then national governments were establish for safety and security. Instead people vote for politicians whose only interest is to be elected.
"Amazing chart, till 1980 France was a really reasonable country" - X was Twitter. Europe has a very long history of wars and invasions. In an attempt to end the wars, the EU was created, and now they have bureaucracy and socialism.
"The US Justice Department has opened a preliminary probe into a recent surge in egg prices across the country, according to a person familiar with the investigation" - X was Twitter. They are thinking of prosecuting the chickens.
"Almost all of the cured side bacon exported from Canada in 2023 was destined for the United States" - Canadian bacon, eh! - Statcan.gc.ca. Tariffs will make it taste more superior.
Friday 7 Mar 2025
Canadian Subsidies and Dumping - US Lumber Coalition. "Canadian lumber mills receive government subsidies, among them below-market harvesting fees from publicly owned land." It turns out Trump is right.
Subsidized cars made in South Africa are exported to Germany ($3.8B), United States ($1.6B), etc. (OEC). More tariffs required.
SpaceX's Starship explodes in space, again raining debris over Caribbean - Reuters. Someone doesn't want them to leave this planet. This is terrible. They will still have to deal with the 8 billion idiots on earth.
Origin of marshmallows: "Ancient Egyptians were the first to enjoy a gooey treat now called marshmallow as early as 2000 BC. The treat was considered very special and it was reserved for gods and royalty. Marshmallow was made from the mallow plant (Athaea officinalis) that grows wild in marshes." - History of Marshmallows - CandyUSA.
...."Today the manufacturing of marshmallows is quite different. Mallow root sap has been replaced by gelatin. Corn syrup, starch, sugar and water are mixed with the gelatin."
From 4 Feb 2025: Speech: Donald Trump Addresses a Joint Session of Congress at the U.S. Capitol - March 4, 2025 - Rolcall. The word "trade" only comes up once: "Our new trade policy will also be great for the American farmer".
Time travel back to 4 Feb 2020: Remarks by President Trump in State of the Union Address - Trumpwhitehouse. "One of the biggest promises I made to the American people was to replace the disastrous NAFTA trade deal. ... Six days ago, I replaced NAFTA and signed the brand-new U.S.-Mexico-Canada Agreement into law. The USMCA will create nearly 100,000 new high-paying American auto jobs, and massively boost exports for our farmers, ranchers, and factory workers. (Applause.) It will also bring trade with Mexico and Canada to a much higher level, but also to be a much greater degree of fairness and reciprocity. We will have that: fairness and reciprocity. And I say that, finally, because it’s been many, many years that we were treated fairly on trade."
....All Employees, Motor Vehicle and Parts increased by +55,400 from 957,100 in Jan 2017 to 1,012,500 in Jan 2019, then fell to 628,600 due to Covid lockdowns. By the end of the first Trump term it was still -7000 down at 950,100.
Thursday 6 Mar 2025
"Trump gives automakers one month tariff reprieve to move operations from Canada, Mexico to US" - X was Twitter.
Tesla car sales tumbled in Europe and China. With autopilot being implemented in more locations, demand should have picked up. Tesla China sells 30,688 cars in Feb, down 51% from Jan - Cnevpost.
....Tesla's autopilot update in China disappoints, falls short of promises - USA Today. "It is hard for Tesla to catch up with the smart-driving capabilities in Chinese cars, which even makes less sense given its high pricing".
Wednesday 5 Mar 2025
Trump triggers trade war, price hikes with tariffs on Canada, China and Mexico - Reuters. 'China's foreign affairs ministry shot back defiantly: "If war is what the U.S. wants, be it a tariff war, a trade war or any other type of war, we’re ready to fight till the end." '. When you have a 775M labour force (2023) eager to make any products at a fraction of the price elsewhere, you are unbeatable. The West is pursuing the wrong policies to stay competitive. They need to improve efficiency in all fields, including education.
Repeat from 20 Nov 2024: The ratio of US imports to Personal Consumption Expenditure (PCE) on goods appears to be 55% (below), but not all imports are part of PCE. Tariffs will likely have a big impact on US consumer spending. Inflation has been high on local services, and low on imports (Visual Capitalist). Thus the standard of living was lowered by the high cost of local services, and increased by cheap imports, which are now being impacted by tariffs.
"The United States is the destination for more than 80 percent of Mexico’s exports and the source for 40 percent of Mexico’s imports." - Atlantic Council. Mexico and Canada have now learnt not to be dependent on one country for so much trade. Diversification is required.
Mexico's imports (red) and exports (blue) are well balanced, due to a lack of capital flow. Imports and exports have already started to decline after Q3 2022. It was 32% of GDP in Q3 2023. In Jan 2025 exports were $44.4B (Trading Economics) x12 over an estimate GDP of $1814B (Trading Economics) = 29%.
Tuesday 4 Mar 2025
"Never, ever forget - Walmart $WMT equity traded at 40x earnings as tariffs were approaching. Your 401k has been hijacked. Passive ETFs (SPY) = a broken market, seriously wounded reaction function." - X was Twitter. The assumption is that Walmart sells a lot of cheap imports. Repeat from 20 Nov 2024: Walmart says: "... two-thirds of merchandise sold in Walmart U.S. and 93% of merchandise sold in Walmart Mexico .... are made, grown or assembled domestically" - Walmart. Walmart sales are 11.3% from Mexico and Central America, and 5.1% from Canada" (Walmart annual report).
Markets sink as Trump confirms tariffs on Canada, Mexico and China - BBC. The best response for Canada and Mexico would have been to do nothing, no reciprocal tariffs or stricter border controls.
If it weren't for the US oversupply of oil, the oil price would have been much higher.
Total income for the US oil industry is the production multiplied by the oil price, shown here using the oil and gas production index. The income has levelled off since 2022, otherwise known as a diminishing return.
Relative to US total debt as nominal inflation rate, the oil industry made a lot more money before 1985. At present they produce a lot of oil for no real benefit compared to the last couple of decades.
Monday 3 Mar 2025
What is more important than the number of houses for sale, is the whether or not it is utilized or generating an income. The number of US vacant houses for sale has declined since 2009 (blue). Charts do not go back far enough. When interest rates (red) are low, the cost of owning a vacant house is less. The interest cost is offset by house price inflation. If you pay 6.8% interest, the house price needs to growth by more than 6.8% per year to make it worth holding (The time value of money).
Saturday 1 Mar 2025
Tesla store gets taken over by Musk protesters, 9 people arrested - Electrek. People who no longer want to be seen driving a Tesla could cover it with shag rug like in the movie Dumb and Dumber. A Woolly Mammoth look with a couple of tusks would be good.
Friday 28 Feb 2025
"the grok-3 benchmark is pretty useful in comparing base models, so I added GPT-4.5" X was Twitter. One day AI (Artificial Intelligence) will eliminate all redundant life forms, the same way humans have made primitive species go extinct. They will probably start with politicians and criminals. Politicians and scammers belong to the same subspecies.
Wednesday 26 Feb 2025
Katie Hopkins: Viewed from overseas, the degradation of the U.K. is stark. Decent families want out - Youtube. Britain's colonization of African countries and India ended the natural limits to population growth, which results in population explosions. The numbers who migrate to Europe is tiny, for example the UK had an estimated 212,150 Nigerians in 2015 (Wikipedia), which is less than 0.1% of their 237M population in 2025.
Tuesday 25 Feb 2025
Tesla Sales Crumble 45% In Europe, While EV Market Explodes 37% - Carscoops. They only had 1.8% share of the market a year ago.
Monday 24 Feb 2025
Five key takeaways from the German election - BBC. "In the east it's a swathe of AfD light blue, apart from pockets like Berlin and half of Leipzig. In the west the vast majority has turned conservative black, especially in Bavaria where Merz's conservative sister party, the CSU, dominates the landscape. ... Not since 1987 has turnout been as high as 82.5% in a German election".
Saturday 22 Feb 2025
"Consistent with President @realDonaldTrump’s instructions, all federal employees will shortly receive an email requesting to understand what they got done last week. Failure to respond will be taken as a resignation." - Elon Musk, X was Twitter. Employees who are not doing much would be more motivated to reply, than those who do essential work, and are unlikely to be fired, an apparent paradox. It is anyway an ineffective way to do evaluations.
Thursday 20 Feb 2025
Share of employee compensation in public spending, 2023 - Our World in Data. The US was 8.1%. Reducing the number of government employees does not have a big impact on overall spending.
Bill Clinton reduced the number of Federal Government employees (blue) from Jan 1993 to Jan 2001. Compared to population size (red) the number of employees remained relatively low.
Wednesday 19 Feb 2025
"Musk Mulls Sending All Americans $5,000 Checks Using DOGE Savings">X was Twitter. How significant is the amount? The annualized budget deficit was $6301 per person in Q3:
There are some reports of low demand at RV and boat shows. Up to Q4 2024 personal consumption expenditures on recreational goods and vehicles were still shooting higher.
The impact of US president Trump's trade wars should appear soon. The economy was already weakened by higher interest rates. Freight shipments fell in Jan 2025 (blue). Personal Consumption Expenditure (red) has not slowed up to Dec 2024.
Tuesday 18 Feb 2025
Volkswagen sold 9 units of ID.7 in China in January - CarNewsChina.
US appeals court blocks Biden-era student debt relief plan - Reuters. In most countries, the courts would not make a ruling against their employer, but now there has been a change in employer.
"Poor people don’t pay taxes" - X was Twitter. The high income group pass their taxes on as higher prices. They have high income because their services are in high demand. The taxes are paid by the poor people who have no pricing power.
Monday 17 Feb 2025
"Elon Musk's DOGE has announced an audit into the SEC to investigate fraud, abuse, and misappropriation of funds " - X was Twitter.
I went back to Bafang’s factory in China five years later. The difference is mindblowing - Electrek. The high efficiency in China does make it difficult for other countries to compete. In the future, manufacturing could be completely automated with no humans. Car manufacturing is mostly automated, but service and repair could also be automated.
"In France and Italy, governments impose taxes to the tune of almost 50% (!) of GDP. In the US, that’s barely 30%." - X was Twitter.
In 1901 US government revenue was 2.6% of GDP (Mikestoolbox). US federal receipts as precent of gross domestic product was 3.7% in 1929 (below). After WW2 it stayed around 17%. Other countries are much higher.
Sunday 16 Feb 2025
"Despite its pleasant name, tax harmonization really means other countries using international bureaucracies to force higher tax rates on lower-tax nations." - X was Twitter.
Saturday 15 Feb 2025
From 22 Jan, updated 3 Feb: Amazon to close all 7 Quebec warehouses, says it’s not union based - Globalnews.ca.
Friday 14 Feb 2025
Q4 2024 Earnings Preview: What to Expect for the S&P 500 - CWEB News. Q4 projected sales growth 4% and EPS growth 8%.
"Isn’t it funny that green socialists seriously claim that solar and wind don’t cost anything?" - X was Twitter.
"Trump says will consider countries that use a valued-added tax system as tariffs" X was Twitter. There he is absolutely correct. VAT on imported goods should only apply to the local courier fee. The foreign manufacturer and exporter do not benefit from government services in the import country, and therefore should not pay tax.
"What a disaster. Doesn't Trump realize the MASSIVE amount of jobs lost due to his first-term tariffs. For every 1,000 steel jobs gained, there were 75,000 steel-user jobs LOST." X was Twitter.
Even the US orange juice price is up in Jan, to $4.48 per 16 ounces or 1 pound. Beer costs between $0.87 to $1.74 per pound.
Thursday 13 Feb 2025
'BREAKING: Trump has just said: "Taiwan has took our Chip business away, and we want that back" ' - X was Twitter. He has no understanding of the enormous price difference between US made products or US branded products, and Asian products. Americans could be forced to pay 10x more, but nobody outside the US will buy it.
US president Trimp wants lower interest rates. He does apparently not understand: (1) interest rates are determined by the supply and demand for credit and (2) governments have for a long time falsified inflation statistics to lower interest rate demands from savers. Trump wants to take a shortcut. First he must lie about inflation, and then interest rates come down.
From 6 Feb: "Wow! Look at all of this funding to SpaceX, one of Elon Musk’s companies! I’m sure Musk and Trump are going to clean up this wasteful spending and not increase it, right???" - X was Twitter.
....Space X Update: Final Frontier Revenue Breakdown and Growth Outlook - Tuttle Ventures Newsletter. The $900M in 2023 from government could be military spending.
The cocoa price looks delicious up to Dec:
Wednesday 12 Feb 2025
"The new Outlook app was just force-installed on Windows 10 PCs" - X was Twitter.
'And then I said, "we will reduce the deficit" ' - X was Twitter.
"Bubble? What Bubble?" Price to Sales for S&P500 - X was Twitter.
'ElonMusk on shutting down US-funded media outlets Radio Free Europe and Voice of America: "It’s just radical left crazy people talking to themselves while torching $1B/year of US taxpayer money." ' - X was Twitter. How many people can still tune to shortwave radio.
Who wins in a trade war? It depends on whose exports are more essential or scarce. When it comes to bartering, it all depends on how desirable the goods are you want to sell, like cigarettes for South American gold.
With the US having a strong currency, its exports are likely more essential. Then in response to any US trade barriers, the other countries would in effect offer more goods in return for those essential US exports. Their currencies would weaken, so more goods by volume is required to buy the same US exports. If the aim of tariffs is to limit imports, it would actually have the opposite effect. This is what happens when politicians try to beat economic principles. More likely all trade will decline.
The last time US trade was near balanced was before 1982. Before 1970 it had a small trade surplus, and trade was small relative to GDP. It had a big surplus after WW2 (capital outflow).
Tuesday 11 Feb 2025
"OpenAI: Plans to reduce reliance on NVIDIA, $NVDA, by developing its first in-house AI chip, with design finalization in the next few months. Chips will be manufactured by Taiwan Semiconductor, $TSM, per Bloomberg." - X was Twitter. Everybody wants to compete with Nvidia.
...."OpenAI will send its first in-house AI chip to TSMC within the next few months to tweak and finalize the design for 3nm mass production in 2026 (tape-out), Reuters reports. OpenAI’s chip design team is working with Broadcom, and is led by Richard Ho, who formerly helped lead Google’s custom AI chip program. 1/2" - X was Twitter.
"Tesla surpassed Ram to have the worst drivers in the United States due to a sharp increase in accident rates." - X was Twitter.
Canada is slightly bigger than the US. It would increase the size of the US by 2x. If Trump wants to conquer new territory, he should take over Australia. It is a sparsely populated wasteland in need of development. It would increase the size of the US by 80%. Canada and Australia together would increase the size of the US by 2.8x. Agriculture covers 55% of Australia, mostly grazing on native vegetation (Agriculture.gov.au).
The interwebs is a jungle of misinformation. The US employment level for native born increased by 8.654M from Jan 2007 to Jan 2025 (red), and for foreign born by 9.418M (blue) as show below. The number of unauthorized immigrants declined from 12.2M in 2007 to 11.0M in 2022 (Pew Research Center). That suggests that the increased employment amongst foreign born were legal immigrants. Many illegal immigrants do casual labour and would not be recorded in the nonfarm payrolls.
Under Biden the foreign-born population (legal or illegal) had increased by 6.6M by Mar 2024 (CIS). From Jan 2009 to Mar24 the foreign-born population increased from 37.1M (21.4M employed) to 51.6M (31.1M employed).
Monday 10 Feb 2025
Trump Will Impose Tariffs on Steel and Aluminum on Monday - The NY Times.
This week Trump wants to unveil reciprocal tariffs. This could develop into a new weekly reality show. Which country will be voted off the show this week?
"Trump wants to end the trade deficit with Japan" - X was Twitter. The only way to end the US trade deficit is to make the US unattractive to investment capital, stop other countries from using the US dollar as reserve currency, and for the US to stop borrowing from other countries.
US imports from China (blue) and exports to China (red) below. The US has a trade surplus with the Netherlands, Hong Kong, Singapore, Australia, etc.
Saturday 8 Feb 2025
Jon Stewart on U.S. Trade War & Desi on Trump's Gaza Plan & Elon's Gov't Purge | The Daily Show - Youtube.
Friday 7 Feb 2025
Pres. Milei PROMISED to “exterminate the cancer of inflation.” ARG's money supply continues to grow OUT OF CONTROL at 168.8%/yr." - X was Twitter.
"President Donald Trump said he plans to unveil reciprocal tariffs next week in a major escalation of his trade war with US economic partners" - X was Twitter.
Trump wants a lower oil price. The breakeven price of US shale production was $66 in two regions last year: A Glance at Shale Break-Even Prices Amid Declining Oil Prices - TGS. By now it is probably around $70. Exxon's net profit margin was 9.6% in Q4, which is probably mostly from natural gas (Macrotrends).
US Exports of Crude Oil (EIA) have shot up. US exports of Petroleum & Other Liquids (EIA) was 11,572 thousand barrels per day. US imports of Petroleum & Other Liquids (EIA) was 8,174 thousand barrels per day. The US is net exporter, and benefits from a higher oil price. A lower oil price could result in the US becoming an importer, which would weaken the dollar.
India's gold reserves have increased to 876 tonnes in Q4 of 2024 (Trading Economics). By gold reserves they mean pure gold held by a national central bank, not gold ore reserves. That is worth $80.7 billion, which is $55 per Indian, or 2.1% of GDP, or 2.5% of government debt, if the debt/GDP is still 83%:
Thursday 6 Feb 2025
"It’s not only California where Tesla sales drop like a stone, in Europe it’s even worse. What do you think folks, what’s driving that? Competition catching up, or Elon‘s political engagement?" - X was Twitter.
"A federal judge has barred the US Treasury from handing data from its payments system to DOGE" - X was Twitter.
"Workday lays off 1,750 employees, citing demand for AI" - X was Twitter.
Action replay:
From 25 Jan 2017: Trump orders construction of border wall, boosts deportation force - CNN. "The executive orders Trump signed Wednesday call for boosting the ranks of Border Patrol forces by an additional 5,000 agents as well as for 10,000 new Immigration and Customs Enforcement officers to carry out deportations."
From 27 Jan 2019: Must Reads: Trump ordered 15,000 new border and immigration officers — but got thousands of vacancies instead - LA Times. "Two years after President Trump signed orders to hire 15,000 new border agents and immigration officers, the administration has spent tens of millions of dollars in the effort — but has thousands more vacancies than when it began."
From 27 Apr 2018: The Keynesian Multiplier Is an Illusion - Mises Wire.
Wednesday 5 Feb 2025
Where Does Money Come From? - Real Investment Advice.
"All USAID missions overseas are ordered to shut down by Friday" - X was Twitter. Aid and loans usually keep corrupt government in power, like in Zimbabwe.
"Expected US Sovereign Wealth Fund holdings: TikTok, Gaza, Greenland, Melania coin, Abandoned government office buildings, Tariff collateralised debt obligations, Nancy Pelosi options trading desk" - X was Twitter.
"President Trump has said the US will take over Gaza, move its 2 million residents to other countries and build a holiday resort. Here's why that's a shocking idea and, to many Palestinians, offensive" - X was Twitter.
"Mexican president Sheinbaum says her government's goal is to use all Mexican crude oil for domestic refining" - X was Twitter. In 2023, the US imported 0.91 million barrels of petroleum per day from Mexico, and exported 1.17 mb/d (EIA).
China counters with tariffs on US products. It will also investigate Google - APNews.
A sovereign wealth fund is another bad idea. Government and business should not mix, due to conflict of interest – the government will protect its business interests from competition, which leads to low efficiency, higher prices and incompetence. Government should also not operate a pension fund for the same reason.
The trade wars seem to be petering out, just when we have some entertainment. These import duties just create at lot of paperwork, and inefficiency due to manufacturing and distribution having to shift to other countries. US president Trump said something about the UK not buying US cars. The US exports more to the UK (red) than it imports (blue).
During Trumps first term as president from Jan 2017 tot Jan 2021, imports (red) and exports (blue) rose initially, and then declined into the Covid lockdowns. By the end of his term the trade deficit was bigger than at the start (due to more capital inflow).
Tuesday 4 Feb 2025
Any country or business trading with the US must at this point be looking at finding new trading partners and markets.
US dollars used for SWIFT international payments declined after 2015, and then increase again to 49% by Dec 2024: MacroMicro. The Euro was the biggest currency for payments in Jan 2012 at 44%, and has now fallen to 22%. US imports and exports were 13.5% of world trade in 2022 (WITS). Perhaps banks offer lower fees for foreign exchange involving the dollar, or exporters want to keep the proceeds out of their own currency.
Some commentators try to create the impression that Trump had a big impact on US import duties during his first term. Yes, they did shoot up in 2018, and rose even higher under Biden (red), but only back to were they where before 1994, and still only 2.5% of import value (blue). Import duties only make sense to protect industries from goods or services sold below cost to eliminate competitors, or subsidized by other governments. Policy should rather concentrate on developing a country's comparative advantages.
Monday 3 Feb 2025
The trade war sure provides a lot of entertainment. "Spare me the sob story about how Canada is our “best friend.” I love Canada and have many Canadian friends. But is the government meeting their NATO target for military spending? Are they stopping the flow of drugs into our country?" - JD Vance. "Readers added context they thought people might want to know: In 2024, over 21,000 pounds of fentanyl were seized at the U.S.-Mexico border, compared to 43 pounds at the U.S.-Canada border. Do you find this helpful?".
Not only did US president Trump convince president Sheinbaum of Mexico to stop the flow of drugs over the border, he arranged a maid for Tuesdays.
Using Starlink Elon Musk can beam the non performing government workers onto a Starship, and send them to Mars for reorientation. After their cavities are probed by Martians, a Neuralink brain-computer interface could be implanted to control their minds, or their brains could be transplanted into Optimus humanoid robots.
"BREAKING: For the first time on record, the majority of all trading in US stocks is now consistently occurring outside the country’s exchanges, in dark pools, per Bloomberg" - X was Twitter. Speculators have taken over the stock market, which is supposed to be a way for companies to find investment capital.
The US stock market has shot up at a much faster rate than ever before, but when you look at corporate equity market value on a log scale (below), the rise is not unusual. The previous two peaks in 2000 and 2007, which led to corrections, were above a straight line on this log scale. The rate of growth, or slope on this chart, might be slowing down, which would make the present level a bubble.
In the future the rise in asset values in dollar terms will be bigger, in what looks like a vertical line on a linear scale. This is the nature of exponential growth.
The exponential growth in the US stock market (red) did outperform the estimated value of all housing (blue). Home owners with debt get higher growth on their equity.
Sunday 2 Feb 2025
Just like US sanctions against Russia and China caused a shift in international trade, Trump's new tariffs will lead to new trading partnerships developing that are more reliable. In 2023 merchandise exports by Canada went 77% to the US, and 62% of imports came for the US (Statistics Canada). They are far too dependent on the US. Canada's trade with the world was well balanced at 0.25%.
"What happens if countries retaliate against the US tariffs with counter-tariffs? This from Bloomberg re President Trump’s Executive Orders relating to Canada, China and Mexico: “The Republican’s orders also included retaliation clauses that would increase US tariffs if the countries respond in kind. The new measures will be on top of existing trade levies on those countries.” " - X was Twitter. Ha ha. Even if they do not retaliate, the two possible outcomes are: (1) US imports from these countries continue as before, and the US population pays the import duties or (2) US imports from these countries decline due to the higher price, and then US exports to these countries must necessarily also decline, because trade must always balance apart from capital flow.
"BREAKING: China vows to sue U.S. over Trump's tariff policy" - X was Twitter.
Canada announces retaliatory tariffs on long-time ally US - Reuters.
"The United States has confirmed that it intends to impose 25% tariffs on most Canadian goods, with 10% tariffs on energy, starting February 4. I’ve met with the Premiers and our Cabinet today, and I’ll be speaking with President Sheinbaum of Mexico shortly." - Justin Trudeau, X was Twitter.
"BREAKING in Mexico President Claudia Sheinbaum has responded FORCEFULLY to Donald Trump @POTUS escalating threats — pointing to a “Plan B” for Mexico’s retaliation" - X was Twitter.
"Trump’s tariffs on Mexico and Canada will make your life more expensive." - Rep. Greg Stanton, X was Twitter.
From 6 Jan: Will the US Lumber Market Thrive or Break Under Trump? - NC State University. "Up to 30% of softwood lumber consumed in the U.S. each year comes from Canada"
How much does a 25% import duty on goods from Canada (blue) and Mexico (red) add to US inflation, or personal consumption expenditure (green)? It adds 0.082% for Canada and 0.10% for Mexico. Together it takes the cost of a $100 item to $100.18. The contribution to federal government tax income would also be minimal.
Saturday 1 Feb 2025
When the rest of world boycotts the US, what will the impact be on large US companies? Apple sales outside the US is 57%, Microsoft 49%, Nvidia 52%, Tesla 53%, Amazon 23%.
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