admin wrote: ↑
Fri May 31, 2019 8:05 am
I din't think black swan is the right term. More like yellow Albatross.
This is a fundemental misscalculation regarding the importance and integration of the mexican economy in to the u.s. economy.
China, although important, mostly produces cheap junk for the u.s., with a few exceptions. The u.s. got along fine without china.
Mexico however would be like putting tarrifs on the entire production of the midwest and south west united states; which are likly to get wacked the most by this. mexico is also a gateway / final value added production to the u.s. for a lot the rest of latin America's goods.
also I would seriously question if this does not inject a massive amount of inflation, especially related to food. You simply can not have the already imploding agro industry pickup the slack for the imports coming out of mexico. 25% increase at the grocery store may be just the start.
Mexico has also been a sort of labor / inflation valve for the u.s. for decades. hot labor market in the u.s., bigger flows of cheap labor, both mexican and other countries to fill the demand. yea, there might be some shor-term wage bumps in the states, but that has its limits in a strong dollar world. who you going to sell to?
at some point, hopefully, the world says, 'enough of this shit, stick your free trade agreements up your ....'.
that is the message he is sending to the world too. you can sign a free trade agreement with the u.s., and they can just opt out of it, in whole or in part, at any time. so why bother?
I think things are going to get a lot worse before they get better, because of the bafoon in the White House.
You right admin, countries are going to band together without the US, and tell them to take a jump with a free trade agreement. Possibly China (who are starting to actually look rational despite all they have been accused of compared to trump) is going to step in a lot more cementing new relationships and strengthening existing ones.
The US is like a rich successful person who is in self destructive mode (through drugs or alcohol) and is pushing those close to them away and into the arms of others, there is only so much you can be there for someone like that until you say , you know what ? Sort your own shit out we have had enough of you, no matter how succesful and rich you maybe we will find a way.
It's not until they sort their own shit out and hit rock bottom that they have some self reflection that do things start to improve again .
Same with the US of A., Trump could be the thing that needed to happen to send the USA down the tubes so that people realise globalisation and TRADE and specialization has been a good thing and has improved hundreds of millions of peoples living standards over the last few decades .
Probably not though, MAGA what a joke, cant even drown you sorrows in beer or snack foods now without it costing more, thanks to orange face .