What's wrong with South American economies?

They were historically volatile. Countries like Argentina and Venezuela are what I was thinking of.

The thing about stagflation, is it is different in different circumstances. Also an inflationary recession is like stagflation, only with a contracting economy. It might contract and then stagnate.

I’m not convinced that a labour shortage can’t happen while an economy is stagnating. In the circumstances I’m referring to the shortage (a limited shortage in certain areas) is happening alongside a so called stimulation of the economy (the purpose of introducing tariffs). So the stimulation will fail due to a labour shortage. Hence a stagnating situation.

That’s worse than stagflation, it’s starting to sound like a South American economy.

What do you mean "down"?

Well in a nutshell, all the measures of success in an economy going in the wrong direction.
I was reading about stagflation, it’s sort of like having long Covid.

From Wiki;

Stagflation presents a policy dilemma, as measures to curb inflation—such as tightening monetary policy—can exacerbate unemployment, while policies aimed at reducing unemployment may fuel inflation. In economic theory, there are two main explanations for stagflation: supply shocks, such as a sharp increase in oil prices, and misguided government policies that hinder industrial output while expanding the money supply too rapidly. The stagflation of the 1970s led to a reevaluation of Keynesian economic policies and contributed to the rise of alternative economic theories, including monetarism and supply-side economics.

In the Keynesian model, higher prices prompt increases in the supply of goods and services. However, during a supply shock (i.e., scarcity, "bottleneck" in resources, etc.), supplies do not respond as they normally would to these price pressures. So, inflation jumps and output drops, producing stagflation.

Now Trump has introduced a supply shock. A sudden end of imports from China and a little from all the other countries facing tariffs. Also he is introducing a labour shortage by sending Latinos back. Both of these are inflationary because demand is not being met.

He intends to increase U.S. production of those products in short supply, which will be expensive, produce more expensive goods and produce another labour shortage. Again both inflationary.

And tariffs are naturally inflationary, as the tariff itself is an increase in cost

So I think I can confidently predict that there will be strong inflationary pressures.

To counter this Trump will need to dampen growth in the areas he wants growth to increase in. Or increase the workforce to reduce wage increase pressures. Both of which work in opposition to what he wants to do. Because, to dampen growth will cause stagnation in the economy and he is ideologically opposed to importing cheap labour.

So he’s going to fail to increase domestic production of the restricted goods (there will be some exceptions), he’s going to cause shortages of lots of consumables, raw materials and minerals. Causing inflation which will be very difficult to stop, while not improving the income of U.S. workers, not growing the economy, which will stagnate and making everyone feel a lot poorer.

A classic case of stagflation, which will be very difficult to break out of.

Not to mention people all around the world boycotting U.S. goods and other countries imposing counter tariffs on U.S. exports.

I can’t see any good news in there apart from those few exceptions where there will be some growth in U.S. production.

Yes and the only way is down from now on. Until he’s kicked out of office.

Yes, I thought that’s what had happened, but it did focus my mind though, and I came out with a response that surprised myself. And I’m sticking to it now.

But here, he's not saying that the point of the tariffs was to make a deal with China. He's saying that China wants to end the trade war. I honestly don't think he has framed the latest tariffs as a method of extortion. I think he truly wants to shut down imports. But I learn something new everyday. :cool:

And a few days later he exempted IT products from the China tariffs. A very stable genius.

Your go-to reaction seems to be "wait and see" and geopolitics is about "potential" instead of well, grounded in fact. If it's not true in 3 years, we must wait 5, if it's not true then it must be 10, but maybe in 20. Not very convincing. To put it differently, if my dad had a vagina he would've been my mother.

I outlined the most direct route to a stable progressive world. I know it’s not realistic, or likely in the near term. But only a few years ago, say 10years, that is what we had. U.S. EU and China cooperating and providing stability and a safe arena for global trade.

Now if we are talking about the geopolitical situation right now. It’s simple in my view. China is becoming the new dominant superpower and the U.S. is turning in on herself having lost that status. The rest is just the pieces falling as they fall around that new reality.

Once that reality is accepted by the world, then we can go back to that. China, U.S. and the EU cooperating and providing global stability.

I heard Trump say both those things, it’s over a week ago now. I wouldn’t be able to find the quotes. That he was going to do a great deal with China and that the high tariffs where to “incentivise”countries, including China, to come to the table.

Trump is going to do a great deal apparently. It was only posturing prior to a negotiation.This is what Trump expects to force China into, while insulting them. This is backing down, but China is not playing ball. I heard a report from the Canton trade fair which opened today, China’s biggest trade fair. Everyone they spoke to said they have already stopped all trade with the U.S.

To return to substantive posts, a nice summary of the folly of this absurd trade war by William Hague. Quoting the Chinese sage Sun Tzu, on how to win a war.
https://archive.ph/o0h9T

That reminds me of Donald Trump’s map. You’re not Russian are you?

That’s 19th century nonsense. At the time it was formulated the greatest nation was Great Britain, an upstart from a little island in rim world.

Anyway, your repeated attempts to paint Russia as great are unconvincing. And your venom for Europe reminds me of Neomac.

Yes, the moves towards greater cooperation on defence are promising. It’s more in terms of trade that I’m worried about the approach of the U.K. government. This is not a new thing, repeatedly U.K. governments have leaned in the direction of the U.S. to try to be a bridge between the U.S. and Europe. A fetishisation of the special relationship.
Now we are out of the EU there is a real possibility that the U.K. could become tied in to U.S. trade demands, driving a wedge between them and the EU. We have not diverged yet and the path to a realignment with the EU is clear. Trump is trying to break and prevent this.

I don’t disagree with what you suggest. Rather I’m thinking of how to arrest the drift towards autocracy, isolationism, fascism, war mongering. Failed states, the breaking of international agreements, conventions etc. Things can easily spiral out of control here.

I’m suggesting moves towards a stabilisation of the situation. global cooperation over pandemic response and climate change are just about holding together at the moment. This could easily reach the point where these things break down and they need to be stabilised, strengthened and restored, to enable our civilisation to ride the storm and fend off the next collapse, or fracturing of civilisation.

For starters, they can stop doing all the stupid shit I'm calling out as stupid.

For the U.S. to remain relevant on the world stage she needs to work with China and Europe to reach stability and pragmatism and restore the global order that was being forged via the UN. This is not a good time due to pandemics and climate change to break the world order.

This fixation with Russia seems a bit outdated. She really is a basket case, a pariah state and run by a tinpot dictator. She is going to become an irrelevance. It was only the money Putin was getting for oil and gas that gave them the ability to start this war. That income stream is largely gone now (apart from what she can trade with China) and what money is left will be poured into this crazy war in which the working age men of Russia are being sacrificed en masse for a vanity project of their tin pot dictator.

The real geopolitics is between the U.S., China and Europe. Which is now being won hands down by China, while the U.S. keeps repeated shooting herself in the foot and Europe is now stepping more onto the world stage. The pragmatism of Europe will balance well with the pragmatism of China and could potentially introduce some stability. Countries like the U.S. and India are too gung-ho at this stage which will push the EU and China closer together.

No, he said he wanted to. He did not say he was going to.

Is that Godzilla in your bio pic?
Trump is like King Kong rattling his cage, looking for weakness. Remember in the movie, there’s a time when he rattles the cage and it opens and out he comes. The guard rails have been removed and you can see people running around, screaming.
What people like Wayfarer are doing is pointing out that he’s rattling his cage, vigorously. If there’s a chance that his cage door can be flung open, oughtn’t we prepare ourselves rather than ignore it and run around in circles, screaming, when it happens.
Also there is the issue of what damage he’s doing and reputations he’s trashing. The U.S. is a laughing stock.

It looks like Israel is the bogeyman here.
As for the blob, every state has a blob. The words state and blob could be interchangeable and still be describing the same thing.

Yes and will the split between the U.K. and the EU widen. The EU will likely side with China, the U.K. looks to be siding with the U.S.(although Starmer seems to be playing the cakism game and sitting on the fence as long as possible).

Surprise surprise.

On Friday, April 11, traders placed large, aggressive bets that Apple’s stock would jump within days.
They bought contracts that would only be profitable if the stock moved up fast.
Hours later, the White House quietly announced a major policy shift.

The memo spared smartphones, laptops, and semiconductors from sweeping new tariffs.
But it wasn’t reported until Saturday.
As of this writing, the market hasn’t reopened.
These trades are still open — and still underwater.

That’s what makes them so striking.
They weren’t responding to a price move.
They weren’t hedges against a broad selloff.
They were narrow, short-term bets — placed just before a major policy shift went public.

Apple isn’t the only company affected.
The exemption touches an entire supply chain — chips, displays, finished devices.
We don’t yet know whether these trades will be profitable.
The contracts likely expire on Friday, April 17.
But the outcome isn’t the point.

Teslas next I suppose.

Had to laugh;

*president is constipated*
markets boo, dow falls 30%
*president took some laxatives*
markets cheer, dow up 50%
*president hasn't left the bathroom in 48 hours*
markets confused, toilet stocks up 5000%
*president emerges, declares bathrooms are battlefields*
raytheon acquires big toilet for $150B

The funny thing about this joke is that it is true;

China-made laptop, tariff-free; US-made laptop (with components that MUST be imported), tariffed at 145%.

What about the inverse situation, if one makes a correct prediction?

NOS is conflating prediction with the identification of risks, or a trajectory. So that the person identifying the risk can be accused of failing to predict correctly, when the “prediction” does not come true. Leaving the ground open for accusations of political bias, activism, intellectual weakness etc etc.

Such approaches are often accompanied by a bullish approach where the person (in NOS’s) position does what they are accusing their interlocutors of doing, but handwaves away any attempts to point it out.

Seems to be a theme on the right at the moment. Accusing their opponents of what they are doing themselves.

Yes, although the U.S. recession will reduce the production of greenhouse gases. Also U.S. military production is likely to go down a similar amount to how much it is going up in Europe.

The important thing to avoid is failed states and states controlled by authoritarians denying climate change. Because they stop moving in the right direction and may go backwards. Also you can’t reason with leaders like Putin and leaders who prioritise their survival in office over everything else.

There is an agreement, the Paris Agreement. A lot is being done, it just happens to be a bit on the late side.

Unfortunately, before we start to feel the full impacts of climate change, we will turn on each other. It’s in our nature.

It occurred to me that following the sub prime financial crisis. The right has seen the writing on the wall and that the people will want/require/demand a move to the left in policy terms. To preserve their standard of living etc. They realise that their free market ideology and policy can’t now deliver that. It’s become top heavy and relies on the impoverishment of the people to inflate the top. So to fend off the left and the adoption of progressive policy, they have to take the populist pill.

This is clearly what has happened in the U.K. Although in the U.K. there is an added class issue, whereby the privileged classes have been fending off the left ever since voter reform gave the vote to all people in 1918. So one can see where this effort developed over the last century and turned toxic.

There is a clear timeline where one can identify when the Tory party(the right) took the populist pill for this reason and then the Brexit saga and the demise of the Tory party followed.

I heard a good analogy today. I could claim that my barber is taking advantage of me. He takes my money every time but doesn’t pay me anything ever. There is clearly an imbalance there, a trade imbalance. He’s ripping me off and I’m not going back until we have a balance of trade.

I heard on live U.K. radio yesterday, a Trump guy say that he had just invested $60million in the stock market and was confident the market would bounce back when Trump negotiated away the tariffs. Well he was right, they were “negotiated” away by the end of the day.

Yes liquidity, I hadn’t got as far as that. I’m not an economist.

Bravo.
I’ve just heard a respected economist explaining how if the bond markets run away the federal reserve will have no choice but to raise interest rates, which may lead to an inability to service U.S. debt and will drive inflation.

Everyone who has the slightest understanding of world economics and the dynamics of politics in China and the US can see this. Trump doesn't have the cards, to use his own rhetoric.

Yes, exactly. China has already won the economic war.

As an aside, I saw an old clip of an interview with Trump in 2003, yesterday. Trump said that China has been ripping the U.S. off for years. “They’re eating our lunch” he said in an angry voice and the interviewer’s repost was, “they paid for your lunch”. After which Trump told the interviewer that he was a very stupid economist and a very bad interviewer. But the interviewer was right and Trump had no idea of the truth of the matter and he’s still labouring under the same misconception. I wonder how many people have told him who paid for his lunch over the intervening years and he ignored every single one of them.

I don’t deny that people are very worried.
The markets haven’t reacted as much as I was expecting, considering the size of the tariffs. It could be disbelief, or they expect Trump to reduce tariffs significantly through negotiation. Which is what Trump is claiming. Last night he said that he want’s a free trade deal with China, that this is just an incentive for them to come to the table. I expect Trump to drop the tariffs dramatically when the economic consequences start to hit.

I heard a report this morning about a fire sale of U.S. government bonds. That the bond yield is up and that China hold a high proportion of these bonds. This is bad news for the U.S. and as you say there are serious economic consequences that will materialise should the tariffs remain.

16% of total imports into the US are from China. Total imports are about 16% of the GDP.

It’s true that what the U.S. takes from China in trade is 16% of the 16%. But this obscures the real impact of what Trump is doing here. He’s pushing China into a position of competing superpowers while shooting himself and his country in the foot and poking himself in the eye. It’s akin to a Laurel and Hardy sketch, where Trump is both Laurel and Hardy and the rest of us are the audience, in hysterics of laughter. People can see through his charade now, which is why the markets are not too worried.

But regarding China, they will not see the funny side of this side show. They will realise that the West is sick, dysfunctional, with a soft underbelly of decadence, entitlement and idleness. Who can’t now be trusted. China is a sleeping giant (a Godzilla), this is not a good time to wake him.

Trump has handed Putin a lifeline as well. This trade war will push Putin and China into a closer embrace. Just when Trump is poking all the U.S.’s allies in the eye. He’s taking his (the U.S.’s) eye off the ball in the global south. China and Russia will be aware of this, they will quickly step into the void in the global south.

If one imagines Putin as an evil mastermind seeking to destroy the west and profit off the chaos. One could not have come up with a better plan than to enable a character like Trump into the White House.

Perhaps philosophy can provide an answer. It will only be factual when a humanoid population is found which has secured its long term survival, beyond the limitations of finite resources and self destruction. Like a black swan event.

The beginning of the end of mankind's childhood has already begun. AI development is like the first signs of puberty in an intelligent, developing society or civilization. We as a whole (not necessarily individually) are like teenagers going through physical changes, confused about who we are, what any of this means.

But surely the issue here is when does the being move out of the brain and into the silicon and is the being still human, or is the human lost as the brain becomes prehensile. Is humanity lost in this fusion, can it somehow be saved, transfigured?

That is a factual question, not a philosophical one. It is just as factual as whether water boils at 100.C.

And the answer is?

There is the philosophical issue of whether humanity has it in itself to survive. We do in theory, but will we act on that and be successful. Or do we just turn on each other and collapse civilisation again like we have done many times in the past.

Are we capable of securing our long term survival and what would that involve.

But won’t there come a point where it will become cost effective to send out swarms of drones to take out the hordes. Some evil genius will come up with the idea that it’s better to just get it over with quickly and without too much fuss. That to reduce the global population to a million or two workers is the way to mitigate.

So, here and there some individuals and communities survive -- probably more because they were lucky than because they pivoted, adapted, and adjusted continually. The title is too optimistic. It should be "How we might POSSIBLY survive in a post-collapse world, but don't bet on it".

I think the survivors would likely be those who happen to be in a favourable micro climate, like a high valley in the Himalaya. Or a mountainous Island away from the tropics.

That poster is a troll, or a bot. That’s what the issue is. I gave up replying, it just sets your head spinning.

Is this a bot?

It's not incoherent. Ceteris paribus, slapping tariffs of imports will tend to reduce a country's trade deficit. Whether this is a worthy goal is another thing. However, it will tend to increase domestic production, particularly in a country with a huge trade deficit. This might very well be a benefit if the country is one in which the top 10% account for over half of all consumer spending, since the people taking jobs in new production and benefiting from increased domestic investment will tend to be part of the 90% who are not consuming most of the goods.

In principle yes, perhaps this is what some of these voters thought when they voted for him. But this isn’t what they got, they got a vindictive trade war which will bring in economic turbulence which will drown out any increase in domestic production and alienate all their allies.
Anyway my use of the word incoherent was probably too nebulous, there is coherence in the message, but when it comes to implementing it in the real world, it’s unhinged. There may well be a way, a policy framework which can address the imbalances highlighted in this thread caused by globalisation etc. But this isn’t it, this is a wrecking ball and now it emerges that this “liberation” wasn’t about what people thought it was about, but rather it was about turning Trump into a demagogue bestride the world stage arm in arm with Putin.

Did these people vote for recession, destruction of the apparatus of state, the alienation of all their allies around the world. To make Russia great again. Contempt for the constitution and the rule of law. I could go on, but I don’t remember this being on the ticket.

At any rate, it's not the worst timing. Apparently, there is a decent likelihood that the next decade will see a tumultuous shedding of white collar jobs due to AI (the looming crisis in academia as enrollment peaks and declines only adds to this) and this will lead to a rapid acceleration in the tendency of wealthy nations to have most of their income come from capital, not labor. Production is certainly liable to become more automated, but not in the sea change way that white color work might soon be getting reduced. So, there is a sort of impetus there for an increased focus on production as well.

Yes, I agree on the direction of travel you describe here. Presumably you’re suggesting some kind of UBI (universal basic income). The trouble with this is that people on the right of politics will never stomach such a thing. They believe that every cent and dime must be earnt with sweat and toil, or genius innovation. For such people UBI is tantamount to communism. Better to have people who can’t earn a living some way to be poor, destitute. In the U.K. this is literally what they want a return to Victorian squalor.

When tundra thaws, it becomes soft and squishy and will produce tons and tons of methane which will add to global warming.

Millions if not billions of tons of methane. This is one of the tipping points, it’s already well under way.