Macro thread - Why is the market up/down?

[Sweet]

7 minutes ago, Gregmal said:

Which hilariously enough was the previous administration and Jerome Powells mission to stop such events from continuing lmfao. The smarty pants considered this a “problem”. Back to normal it seems.

Didn’t you say repeatedly that inflation had little to do with Fed policy because it was a result of Covid?  How can Powell get no credit yet get the blame lol.

[Gregmal]

1 minute ago, Sweet said:

Didn’t you say repeatedly that inflation had little to do with Fed policy because it was a result of Covid?  How can Powell get no credit yet get the blame lol.

Because wage growth isn’t inflation lol Meanwhile Powell specifically targeted the lower income workers wages and job availability as one of the things he wanted to kill. About as rigged as it get.

[rogermunibond]

[rogermunibond]

Real wages have grown but a lot more for women than men.

[Sweet]

Just now, Gregmal said:

Because wage growth isn’t inflation lol Meanwhile Powell specifically targeted the lower income workers wages and job availability as one of the things he wanted to kill. About as rigged as it get.

Yes, it was inflation that Powell was trying to stop, so why did you say wage growth lol?

[Gregmal]

1 minute ago, Sweet said:

Yes, it was inflation that Powell was trying to stop, so why did you say wage growth lol?

Because Powell said he equated wage growth and job availability as the cause of inflation…

Edited 12 hours ago by Gregmal

[Gregmal]

It’s was all clearly supply chain and what wasn’t was housing. Yet how often did this establishment clown talk about seeing “wage growth slow” and “slack in the labor market”. As the haves cheered him on. Disgusting 

[Sweet]

19 minutes ago, Gregmal said:

Because Powell said he equated wage growth and job availability as the cause of inflation…

 

I don’t remember that but if he did that was dumb.  I know there was some concern that inflation would lead to wage growth and the so-called viscous circle.
 

18 minutes ago, Gregmal said:

It’s was all clearly supply chain and what wasn’t was housing. Yet how often did this establishment clown talk about seeing “wage growth slow” and “slack in the labor market”. As the haves cheered him on. Disgusting 

 

Agree most likely cause, although don’t blame Powell from pulling the only lever he had.

[Spooky]

1 hour ago, Gregmal said:

Only if you consider the acceleration of wealth inequality and inflation outstripping wage growth as working. 

 

Agree that these are huge issues - the top .1% of have accumulated so much wealth while most people are getting left behind. Isn't the solution to tax these people more rather than destroy the system? Also, on real wage growth, implementing protectionist policies isn't going to help that - we should be trying to drive the cost of goods and living down as much as possible. Personally, we should let China sell us solar panels, EVs and whatever else at ridiculously cheap prices.

[nsx5200]

IMHO, we should emulate how China bootstrapped/stolen US manufacturing and try to implement it here.  I suspect it wouldn't help as many people as the solution would require a lot of automation that Musk envisioned for his car factory, but at least it would keep a lot of leading edge manufacturing technology in-house/country (at the minimum, the Democratic alliances, similar to what ASML has done).  Straight up tariff probably won't cut it, but tariff with redirection of that fund to invest in technology, along with a hard schedule to wean off the tariff/subsidies might do the trick.  It should provide enough incentives to boot strap those manufacturing sectors again.

 

Well, like it or not, we're just passengers on this wild ride.  Might as well profit off it.

 

Addition: Buffet weight in on this about 20 some years ago.  It's calls for part tariff, but it is not a straight up tariff:

https://money.cnn.com/magazines/fortune/fortune_archive/2003/11/10/352872/index.htm

And again about 10 years ago:

https://fortune.com/2016/04/29/warren-buffett-foreign-trade/

Edited 11 hours ago by nsx5200

[Gregmal]

19 minutes ago, Spooky said:

 

Agree that these are huge issues - the top .1% of have accumulated so much wealth while most people are getting left behind. Isn't the solution to tax these people more rather than destroy the system? Also, on real wage growth, implementing protectionist policies isn't going to help that - we should be trying to drive the cost of goods and living down as much as possible. Personally, we should let China sell us solar panels, EVs and whatever else at ridiculously cheap prices.

Yea I think made in China has been wonderful for lower and middle class America. No better quality of life improvement than Nikes, big screen TVs, and iPhones, all courtesy of the folks in big bad China. 

[rogermunibond]

If you're low/middle class workers in the US in non-tradeable sectors, you've done fine.  HVAC, plumbing, trades, auto mechanics etc.  They can't be competed against by Chinese service sectors.  Govt, healthcare, education - those sectors have done even better.  Finance, insurance, financial technology have all done great.

 

The tradeable sectors have hurt but where the US is competitive globally (highly engineered, high value add) those products are fantastic.  But even here the lead in competitiveness is eroding.

 

The issue is that the HS-educated or less white/black/Latino male or female worker has no chance.  But they have to upgrade their skills or they have to move to a place where they can get work.

 

Putting in tariffs to have a lot of unskilled low value added manufacturing work in the US makes no sense.

Edited 11 hours ago by rogermunibond

[Spekulatius]

6 hours ago, Gregmal said:

Or, best case scenario when things are ripped up and reversed the same as what just happened here after the past 4 years. This is why the system is broken and unfixable.

Biden did not rip up any trade agreements from the first Trump administration. USMCA stayed intact, the China tariffs remained and were even added to later. Tell us any trade agreement implemented under Trump that Biden ripped up.

Edited 8 hours ago by Spekulatius

[Sweet]

3 hours ago, Spooky said:

 

Agree that these are huge issues - the top .1% of have accumulated so much wealth while most people are getting left behind. Isn't the solution to tax these people more rather than destroy the system? Also, on real wage growth, implementing protectionist policies isn't going to help that - we should be trying to drive the cost of goods and living down as much as possible. Personally, we should let China sell us solar panels, EVs and whatever else at ridiculously cheap prices.

 

3 hours ago, Gregmal said:

Yea I think made in China has been wonderful for lower and middle class America. No better quality of life improvement than Nikes, big screen TVs, and iPhones, all courtesy of the folks in big bad China. 

 

Apologies if some the above is sarcasm, I struggle to tell these days.

 

China has been engaged in a a range of unfair trade practices for a long time.

 

These had had the effect of deindustrialising the West.

 

Lower skilled people used to have a solid job working factories and producing goods, much of that was shipped overseas.

 

It’s been good for consumers but its sucked for the lower class.  The lack of wage growth probably can be directly correlated to jobs being offshored.

 

It has other effects too, a feeling of worthlessness most likely in those who can’t get a job.  Fewer people able to afford a home, or a family.  Reduced ability to scale manufacturing in the West.

 

And when it comes to politics, and specifically China, wee have enriched a country which aren’t our friend.  Not exactly wise.

 

 

[Gregmal]

16 minutes ago, Spekulatius said:

Biden did not rip up any trade agreements from the first Trump administration. USMCA stayed intact, the China tariffs remained and were even added to later. Tell us any trade agreement implemented under Trump that Biden ripped up.

lol everything from border security measures to climate accords and even regulations related to how much water comes out of the faucet of your shower…but yea, none.

 

https://www.usnews.com/news/the-report/articles/2021-01-29/biden-spends-first-week-issuing-orders-reversing-trumps-orders

[Gregmal]

4 minutes ago, Sweet said:

And when it comes to politics, and specifically China, wee have enriched a country which aren’t our friend.  Not exactly wise.

Well, for one, it’s largely western elites and the powers that be whom insist on having an adversarial relationship with them? How bout toning that down? Oh no, then we re cozying up to dictators! Until our friends north of the border go “oh wait, dictators are ok if we have to get around tariffs!”, at which point the circle of chaos implodes.

[Sweet]

10 minutes ago, Gregmal said:

Well, for one, it’s largely western elites and the powers that be whom insist on having an adversarial relationship with them? How bout toning that down? Oh no, then we re cozying up to dictators! Until our friends north of the border go “oh wait, dictators are ok if we have to get around tariffs!”, at which point the circle of chaos implodes.

That would be ideal regarding China, but you realise that we have been living that experiment for 40 years?

 

The whole ‘opening up of China’ strategy from Kissinger et al was to do exactly that.  It was hoped that trading with China, opening up its markets, fostering a close trading relationship would over time soften the dictatorship and soften relations.

 

In some ways the relationship has softened, but in other ways the CCP has strengthened its grip on power, and most worrying of all they are bigger adversaries and more capable than before the ‘opening up’ strategy.

 

Regarding the Canadians, you seem to be forgetting who started the fight, so it no wonder you don’t understand why they are pissed off.  Imagine a friend you have been loyal to stabbing your in the back.

[cubsfan]

15 minutes ago, Sweet said:

 

Regarding the Canadians, you seem to be forgetting who started the fight, so it no wonder you don’t understand why they are pissed off.  Imagine a friend you have been loyal to stabbing your in the back.

 

True friends pay their bills equally.  Canada's NATO contribution is 1.3%, the lowest of all.

That's disgraceful.