reply on: Let's talk tariffs and (U.S.) domestic commodities \ stacker news ~econ

13 sats \ 0 replies \ @zuspotirko 20 Jul \ on: Let's talk tariffs and (U.S.) domestic commodities econ

the implementation of tariffs is more about putting pressure on domestic producers to produce more and produce better than it is about getting fairer deals in trade

Because this is not necessarily the explicitly stated purpose, producers are more or less tasked with figuring it out

Lol, the gaslighting of framing more inefficiencies as a positive.

Free trade is a good thing. It maximizes competition, and skews every industry into operating at its most efficient place (the place with the highest comparative advantage)

But if we have a robustly productive economy - particularly one that is domestically interdependent - couldn't that be protective of our global status, and couldn't that be protective of the average American citizen?

More efficiency and dynamism comes at the cost of robustness and resilience. That's not a new insight, economists have argued about that since the 1700s.

However, we believe that the superior economic growth and companies explicitly optimizing for resilience (e.g. building warehouses, backup resources etc) is greater in the long term than creating redundant supply chains through tariffs

I wonder, rather optimistically, if there are good bets to be made in U.S. domestic commodities - particularly nondurable commodities such as cotton, paper, and glass. What do you think?

The thing about markets is that the question is never if you have a good trade idea. Because the market probably anticipated it. The question is rather if the market has misspriced something