Ok, Im ready for the trade war.

[caligas]

---

Members don't see this ad.

I’ve pulled back a sizable chunk out of equities, ready to pounce after the trade war crash. Trumpers are about to get what they voted for, hope they are ready too.

 

[Mman]

I’ve pulled back a sizable chunk out of equities, ready to pounce after the trade war crash. Trumpers are about to get what they voted for, hope they are ready too.

while I agree a trade war would be bad for corporations (and their profits), I also firmly believe market timing to be a mostly futile exercise that detracts from long term profitable investing. I see no reason to make major changes to allocations right now. Besides, anybody that takes Trump at his word is pretty gullible and he's been known to make massive changes to his policy statements in a short time frame.

 

[caligas]

while I agree a trade war would be bad for corporations (and their profits), I also firmly believe market timing to be a mostly futile exercise that detracts from long term profitable investing. I see no reason to make major changes to allocations right now. Besides, anybody that takes Trump at his word is pretty gullible and he's been known to make massive changes to his policy statements in a short time frame.

Wise words. we shall see how my choice plays out.

 

[BigRedBeta]

I’ve pulled back a sizable chunk out of equities, ready to pounce after the trade war crash. Trumpers are about to get what they voted for, hope they are ready too.

Can't say I haven't thought about it, and the flatness in my portfolio since about February is making me think now's the time to pull out at the high point and put more into bonds...
But POTUS is at best brash and unpredictable, at worse a raving lunatic - doesn't really provide much credible information to make a decision, and so we're left with dollar cost averaging, ho hum.

 

[Arch Guillotti]

while I agree a trade war would be bad for corporations (and their profits), I also firmly believe market timing to be a mostly futile exercise that detracts from long term profitable investing. I see no reason to make major changes to allocations right now. Besides, anybody that takes Trump at his word is pretty gullible and he's been known to make massive changes to his policy statements in a short time frame.

Time to short Mednax though!

 

[sigrhoillusion]

How much can I sell my Trump-Kim Peace Summit coin for...?

 

[facted]

I'm a big believer in passive investing, but the flattening bond curve has me worried...

 

[Mman]

Time to short Mednax though!

I don't short stocks and Mednax is a much bigger business than just anesthesia services.

 

[thinkorswim]

I haven't sold anything, mostly for tax avoidance purposes. I have instead been hedging my portfolio with S&P puts on every run up since our February flash crash. I am rolling them further out to September now.

 

[stepone2015]

Unless you're job is in financial services, trying to time the market like you're an expert generally is a bad idea. There's a reason stock brokers don't provide medical care.

 

[Status Sciaticus]

Unless you're job is in financial services, trying to time the market like you're an expert generally is a bad idea. There's a reason stock brokers don't provide medical care.

And its also the reason why passive index funds have outperformed actively managed funds (mutual funds) time and again.

 

[deleted697535]

Unless you're job is in financial services, trying to time the market like you're an expert generally is a bad idea. There's a reason stock brokers don't provide medical care.

There's also a reason a lot of them jumped out a window in 2008!
Very few can time the market.
Why would any Stock broker who is worth his salt have a day job trading other people's money?? Because he can't trade

Timing the market isn't a hugely big deal. Doubt and inability to control ones emotions and reacting to potus etc are reasons why people fail.

It's the same paralysis by analysis that happens us sometimes in the OR or ICU. Fluids or lasix, pressors or diuretics, blood or restrictive... Sell or hold, it's all the same

 

[urge]

I’ve pulled back a sizable chunk out of equities, ready to pounce after the trade war crash. Trumpers are about to get what they voted for, hope they are ready too.

Tax cuts, record employment numbers and a booming economy. Plus, if anyone stands to gain from a trade war it is American businesses since they have been on the losing side for years.

I don't see any reason for a crash. But please keep selling so I can buy cheaper.

Best of luck to you.

 

[facted]

Tax cuts, record employment numbers and a booming economy. Plus, if anyone stands to gain from a trade war it is American businesses since they have been on the losing side for years.

I don't see any reason for a crash. But please keep selling so I can buy cheaper.

Best of luck to you.

Haha. Yes, because when companies like Harley Davidson get their goods taxed at 20%, that's a surefire win.

The issue with trade wars is NO ONE wins. It's a vicious cycle of retaliatory tariffs. Prices rise for everyone and exports fall for everyone.

But to answer your question about market indicators, check out the flattening bond yield curve. There is a reason why 2 year treasuries are now yielding nearly as much as 10 yr...

What’s the Yield Curve? ‘A Powerful Signal of Recessions’ Has Wall Street’s Attention

 

[urge]

Haha. Yes, because when companies like Harley Davidson get their goods taxed at 20%, that's a surefire win.

The issue with trade wars is NO ONE wins. It's a vicious cycle of retaliatory tariffs. Prices rise for everyone and exports fall for everyone.

But to answer your question about market indicators, check out the flattening bond yield curve. There is a reason why 2 year treasuries are now yielding nearly as much as 10 yr...

What’s the Yield Curve? ‘A Powerful Signal of Recessions’ Has Wall Street’s Attention

I don't think Harley Davidson encompasses the whole economy. I'm sure there are winners and losers to any policy enacted.

As to the yield curve I'm well aware of the correlation with recessions. I don't think it will invert any time soon but time will tell.

 

[caligas]

I don't think Harley Davidson encompasses the whole economy

The founder/CEO is an idiot.

 

[GA8314]

The foundation of many of our trade "deals" were set during the post-WWII period where the US was essentially the last man standing. Europe and Asia were decimated. The US sort of HAD to allow others to eat our lunch. We allowed for them to issue tariffs, taxes, and subsidies in exchange for free access to our markets. But, those basic tenets have not been reevaluated. They are unsustainable and are totally obsolete in today's world.

The US simply can not tolerate the unbalanced trade we have with much of the world. A rebalancing is in order. How markets respond to that in the short term is anyone's guess. But, it is long overdue.

Just because you hate the messenger does not mean you should dismiss the goals of what this administration is trying to do on this front.

Americans suffer from a weird form of Stockholm Syndrome. But, it's not your fault, the beneficiaries of the status quo have worked very hard to obfuscate the situation and have put together any number of reasons "why we can't and shouldn't" work to even the playing field. Not least the use of FEAR (the old stalwart).

Look into the heavy tariffs which other countries impose on our products. Then tell me how on earth you think this is a good deal, and importantly, sustainable.

 

[Mman]

The US simply can not tolerate the unbalanced trade we have with much of the world. A rebalancing is in order. How markets respond to that in the short term is anyone's guess. But, it is long overdue.

A trade deficit isn't necessarily a bad thing. When you say the US cannot tolerate importing more things than we export, you are also saying that US consumers need to buy less stuff and save more money. The US has run a trade deficit and Americans have benefited from it by having more things than we'd have if we imported less stuff. Now is that saying a deficit is good? No, there are other costs associated with it. It impacts things like currency valuations and interest rates and all sorts of other things. Kind of a complicated topic. But let's not pretend that Americans have not enjoyed some immense benefits from global trade in it's current state the last several decades and given the US dollar's status as an international reserve currency, we haven't paid the prices you'd expect from economic models in regards to trade deficits so ultimately it has probably been a positive to us.

Personally I'm far more concerned with the government not running such a huge deficit and piling up debt. But that's a separate issue from a trade deficit.

Trade wars are bad. Nobody wins. Increasing global trade leads to more efficient allocation of capital and resources and increases productivity and standards of living for everybody.

 

[GA8314]

Trade deficits, year over year, over year, after year lead to account deficits. They amount to a net outflow of wealth. Our economists have been the voice of this nonsense to a large degree but that's understandable given that they often work for "think tanks" financed by the true beneficiaries of the unbalanced trade.

Sooner than later, however, we need to address the net outflow of wealth out of the American economy. And, you should know well that the average American could probably consume less sh.t and save more......

 

[Mman]

Trade deficits, year over year, over year, after year lead to account deficits. They amount to a net outflow of wealth.

No, they don't not lead to a net outflow of wealth. They lead to a net outflow of cash in exchange for a net inflow of stuff. I don't know about you, but when I think of wealth in the personal sense, $100 in my wallet is no more or less valuable to me than an item valued at $100 in my house.

If I go to Best Buy every week and spend $100 on something electronic, I'm not transferring wealth to Best Buy, I'm exchanging cash for goods. Same thing happens on an international scale. The US paying dollars to another country for stuff they ship us isn't giving them wealth, it's giving them cash in exchange for stuff. And whether or not Americans should buy less stuff is a personal issue, not an international policy decision.

 

[urge]

No, they don't not lead to a net outflow of wealth. They lead to a net outflow of cash in exchange for a net inflow of stuff. I don't know about you, but when I think of wealth in the personal sense, $100 in my wallet is no more or less valuable to me than an item valued at $100 in my house.

If I go to Best Buy every week and spend $100 on something electronic, I'm not transferring wealth to Best Buy, I'm exchanging cash for goods. Same thing happens on an international scale. The US paying dollars to another country for stuff they ship us isn't giving them wealth, it's giving them cash in exchange for stuff. And whether or not Americans should buy less stuff is a personal issue, not an international policy decision.

Don't you think they come back to America and buy stuff like real estate and companies with the cash you gave them for the TVs?

 

[pgg]

I don't know about you, but when I think of wealth in the personal sense, $100 in my wallet is no more or less valuable to me than an item valued at $100 in my house.

Surely there's a difference between exporting $100 of cash in order to import one barrel of oil (2014), four barrels of oil (2016), or some patio furniture.

25 years ago, 90% of the US trade deficit was oil. Now, oil is only about 10%. I don't really understand all the ways that matters, except that cheap energy is better than expensive energy, and the less money we give to oil producing dirtbags like Russia Venezuela and the entirety of the Middle East the better off the world is.

But the flip side is that compared to 25 years ago, it appears we're buying a lot more goods and services from the rest of the world instead of US companies.

In the grand scheme of things we're running the biggest scam in history, since we can print / digitally invent dollars to give to others in exchange for actual stuff, but surely that can't last forever. Aliens watching this planet are probably confused why the North American tribe is getting so much tribute from the rest of the tribes.

 

[Mman]

Don't you think they come back to America and buy stuff like real estate and companies with the cash you gave them for the TVs?

how a person or a country spends their cash is kinda up to them. If you don't want foreigners buying American real estate or companies, enact some law about it. But I'm pretty sure the US citizen or corporation looking to make a sale enjoys their higher sale price they get from having foreigners engaged in that market.

 

[Mman]

In the grand scheme of things we're running the biggest scam in history, since we can print / digitally invent dollars to give to others in exchange for actual stuff, but surely that can't last forever.

Whether or not it can last forever is a function of the US dollar being used as a reserve currency by other nations. The US still offers the largest stable market in the world and is one of only 2 legal systems that foreign corporations trust to enforce their rights. It's certainly not a scam.

 

[vector2]

Don't you think they come back to America and buy stuff like real estate and companies with the cash you gave them for the TVs?

If you got a problem with foreigners buying US real estate then boy do I have some news for you about Jared Kushner and Donald Trump.

 

[GA8314]

No, they don't not lead to a net outflow of wealth. They lead to a net outflow of cash in exchange for a net inflow of stuff. I don't know about you, but when I think of wealth in the personal sense, $100 in my wallet is no more or less valuable to me than an item valued at $100 in my house.

If I go to Best Buy every week and spend $100 on something electronic, I'm not transferring wealth to Best Buy, I'm exchanging cash for goods. Same thing happens on an international scale. The US paying dollars to another country for stuff they ship us isn't giving them wealth, it's giving them cash in exchange for stuff. And whether or not Americans should buy less stuff is a personal issue, not an international policy decision.

The difference is that nobody values your wealth based upon the number of cheap electronics your household accumulates.

Also, we've allowed entire industries to be decimated. Formerly high paid industries replaced by, well, either nothing or low wage service sector jobs. The social ramifications (and cost) can not be ignored. The effects have been myriad with huge real world financial ramifications.


The bottom line is that our trade imbalances mean we have been able to "allow" to some extent the exodus of major industries with relatively little pain. The pain has been postponed out to the future. This is not sustainable.

 

[urge]

how a person or a country spends their cash is kinda up to them. If you don't want foreigners buying American real estate or companies, enact some law about it. But I'm pretty sure the US citizen or corporation looking to make a sale enjoys their higher sale price they get from having foreigners engaged in that market.

Are you saying that trading Real Estate for TVs is sustainable in the long run then? Because the way we got into this topic was by you saying that a trade imbalance was silly since we just give them useless benjamins that we print like monopoly money. But now you are backtracking and saying we actually trade hard assets for TVs.

 

[Mman]

Are you saying that trading Real Estate for TVs is sustainable in the long run then? Because the way we got into this topic was by you saying that a trade imbalance was silly since we just give them useless benjamins that we print like monopoly money. But now you are backtracking and saying we actually trade hard assets for TVs.

actually I never said a trade imbalance is silly, I said it's a complicated topic and not necessarily bad.

 

[Mman]

The difference is that nobody values your wealth based upon the number of cheap electronics your household accumulates.

Also, we've allowed entire industries to be decimated. Formerly high paid industries replaced by, well, either nothing or low wage service sector jobs. The social ramifications (and cost) can not be ignored. The effects have been myriad with huge real world financial ramifications.


The bottom line is that our trade imbalances mean we have been able to "allow" to some extent the exodus of major industries with relatively little pain. The pain has been postponed out to the future. This is not sustainable.

Not being sustainable doesn't mean it's necessarily bad.

I feel like the people that want to rail about this the most are unwilling to undertake any serious complicated discussion of the matter. It isn't black and white. And while you may only value wealth by the dollars in your bank account, that isn't really how it works.

 

[GA8314]

Not being sustainable doesn't mean it's necessarily bad.

I feel like the people that want to rail about this the most are unwilling to undertake any serious complicated discussion of the matter. It isn't black and white. And while you may only value wealth by the dollars in your bank account, that isn't really how it works.

Come on man. Every country with a longer term strategy to grow their economy and create wealth and further their ability to fund important infrastructure and social programs focuses on exports not imports. A positive balance of trade is always preferable.

It may not be black and white but it's also not rocket science.

 

[nimbus]

Come on man. Every country with a longer term strategy to grow their economy and create wealth and further their ability to fund important infrastructure and social programs focuses on exports not imports. A positive balance of trade is always preferable.

It may not be black and white but it's also not rocket science.

Two Problems With the Trade Deficit
An ongoing trade deficit is detrimental to the nation’s economy because it is financed with debt. The United States can buy more than it makes because it borrows from its trading partners. It's like a party where the pizza place is willing to keep sending you pizzas and putting it on your tab. This can only continue as long as the pizzeria trusts you to repay the loan. One day, the lending countries could decide to ask America to repay the debt. On that day, the party is over.


A second concern about the trade deficit is the statement it makes about the competitiveness of the U.S. economy itself. By purchasing goods overseas for a long enough period of time, U.S. companies lose the expertise and even the factories to make those products. Just try finding a pair of shoes made in the America. As the United States loses competitiveness, it outsources more jobs, and its standard of living declines.

But Americans have a high consumption lifestyle. We wouldn’t have to import all that foreign steel but we love our trucks! We live in bigger houses, own multiple and larger cars, have more TVs, eat more food, use more energy, use more disposables and utilize Medical Care at higher rates than other developed countries, let alone 3rd world countries. We will always have a trade deficit unless we undergo a transformation in terms of what “the good life” means. For now we are the gluttonous pigs of earth.

 

[Mman]

Come on man. Every country with a longer term strategy to grow their economy and create wealth and further their ability to fund important infrastructure and social programs focuses on exports not imports. A positive balance of trade is always preferable.

It may not be black and white but it's also not rocket science.

It's probably far more complicated than rocket science.