Putting Rubber On The Road

“The U.S. dollar is losing ground against major currencies in the wake of President Donald Trump’s inauguration.
 
“President Trump’s inaugural address has been interpreted as a retreat from America’s global leadership role,” said Paul Donovan, global chief economist at UBS Wealth Management.
 
“The vehemence in his address is causing markets to reassess other parts of the campaign rhetoric as it seems candidate Trump is occupying the Oval Office with little moderation of tone.””
 
See Premarket: 4 things to know before the bell – Jan. 23, 2017
Folks were thinking, “He can’t be this crazy, can he?” previously but here we are at inauguration day and Trump is as crazy as ever. So, the optimism brought on by empty promises is being replaced with the reality that Trump is a bull in the china shop. That’s no way to get new china. It’s certainly not likely to be good for the economy of USA or the world where people are investing their hard-earned money into already risky businesses. A business can be wrecked just by the words of this demagogue. That’s no way to run a government and it’s not good for business.

Trump is serious about wrecking the world’s trading system. After all, his business largely doesn’t import or export, so what does he care? Here is the first evidence of a critical conflict of interest. While he’s actively sabotaging world trade and global businesses, he’s more concerned that the press report extravagant claims about attendance at his inauguration than dealing with important issues, like running the government.

Got a 401K? Does it depend on trade? Expect to lose. Got a job? Does it depend on trade? Expect to lose. Buy stuff? Is it imported? Expect to lose. Sell stuff? Is it exported? Expect to lose. So, because Trump has verbal diarrhea, can’t maintain a coherent thought, can’t do maths and thinks the end justifies the means just like an economic terrorist, you lose. Glad you voted for him still? Enjoy it until you lose.

Six months ago, I took steps to steer my pension annuity away from business that buys and sells and moved to stuff people want when the “end times” are nigh, gold. I’m doing fine. Are you? Chuckle. Despite knowing how bad things can get with Trump at the helm, I’m going to enjoy the short-term benefits of chaos while I can. I could put down a deposit on my little red electric car this week… and pay for it, cash, with the profits in my accounts. I’m going to live the good life despite Trump. It sure does help not being in USA, but I’m still too damned close, being on the same planet.

About Robert Pogson

I am a retired teacher in Canada. I taught in the subject areas where I have worked for almost forty years: maths, physics, chemistry and computers. I love hunting, fishing, picking berries and mushrooms, too.
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7 Responses to Putting Rubber On The Road

  1. dougman wrote, “Thank you for confirming what has been happening with other countries for the past twenty years.”

    Have you even read NAFTA? It’s all about each country treating the other as it treats itself. It’s all about free trade.

  2. dougman says:

    “If USA did those things and Canada kept tariffs on everything, it would not be free trade.”

    Exactly my point. Thank you for confirming what has been happening with other countries for the past twenty years.

  3. dougman wrote, “If the establishment truly wants free trade, all it has to do is to repeal our numerous tariffs, import quotas, anti-“dumping” laws, and other American-imposed restrictions on trade. No foreign policy or foreign maneuvering is needed.”

    That’s incorrect. If USA did those things and Canada kept tariffs on everything, it would not be free trade.

    I noticed Sean Spicer just held a news conference. Apparently, what Trump wants to do is to switch to a gazillion bilateral trade agreements instead of multilateral agreements like NAFTA so that he can bully smaller countries into giving USA huge advantages. I ask, “What if the world is not that stupid and doesn’t play that game?”

    For a guy who wants to have smaller weaker government Trump certainly has ideas that make government larger and more complex. Just think. Instead of businesses arranging deals where every item has zero duty on crossing borders every business will now have to arrange a different deal with every country and buyer according to some additional random number in the sum. That just makes more work for business and customers and governments and accomplishes nothing. Further, it will take many years to negotiate dozens/hundreds of bilateral trade agreements instead of perhaps modifying a few existing multilateral deals. Meanwhile business, investors and workers will live on in uncertainty for years to come. Gold’s up 1% today… Businesses that want certainty in their environment may well add Trump to their reasons to leave.

  4. dougman says:

    Genuine free trade doesn’t require a treaty (or its deformed cousin, a “trade agreement”; NAFTA is called a trade agreement so it can avoid the constitutional requirement of approval by two-thirds of the Senate). If the establishment truly wants free trade, all it has to do is to repeal our numerous tariffs, import quotas, anti-“dumping” laws, and other American-imposed restrictions on trade. No foreign policy or foreign maneuvering is needed.

    https://mises.org/library/nafta-myth

  5. dougman wrote, “Trump will be the downfall of Trudeau, as Canadians will see the greatness of USA.”

    HAHAHAHAHA!!! ROFL! The pain! HAHAHA! I just watched Trump withdraw from the TPP, an organization designed to block China from taking over the world… China, you know, the Great Satan of Trumpism? You know, the country to which jobs are exported by the million? You know, the country run by smart people? So, you can laugh at Trudeau all you want but he can actually throw a punch and he looks good…

    As the USA rapidly imposes trade-sanctions on itself we shall see it sink for years to come into irrelevance.

  6. dougman says:

    The FED has more power over the US dollar, then does the president. All the FED has to do is raise rates, and POOF the market tanks along with US dollar.

    You must realize that there are other countries that are tied to the US dollar, so in essence if we go down a few points they ride along with us.

    I am willing to bet that the Canadian dollar achieves a 2:1 ratio to the US dollar during Trumps reign.

    But may I remind you, that the Canadian dollar dropped nearly two percentage points after Justin Trudeau was elected prime minster and I suspect that Trump will be the downfall of Trudeau, as Canadians will see the greatness of USA.

    https://www.youtube.com/watch?v=D21LMjw_ano

  7. dougman says:

    Pogsey, you have a hard-on for Trump don’t you?

    You do not understand the universal law of life, as if you did, you would not place so much attention for that which you dislike.

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