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Wow.
I can see doing something like that to get an idea of what the total trade barrier might be.
That’s because the best trade models we have suggest trade should tend to be balanced, in the absence of barriers.
The big problem with that assumption is that America exports its inflation to the rest of the world, which creates a trade deficit.
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But the whole world devalues its currency one way or another.
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It's more about reserve currency status than devaluation. Other countries' domestic populations absorb more of the impact of their devaluations than Americans do because so much of our currency is held by foreigners.
Stated differently: the rest of the world demands dollars, which essentially makes dollars an uncounted export of the US. Foreigners buy dollars with their exports. There's no symmetric US demand for foreign currencies to balance that out.
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21 sats \ 1 reply \ @BlokchainB 23h
But why do they demand dollars?To me it means the USA has a constant buyer of its currency no matter what. We keep hearing China and everyone is dumping the dollar but are they really? Dumping it for what?
I think the market sets what the world reserve currency will be.
Think about the people who own $37T of t-bills earning their risk free interest. What is stopping the world from dumping this paper? The feeling of getting something for nothing is intoxicating to humanity. This why Bitcoiners get so involved/interested in the price talk and talk about the tech doesn’t draw the amount of attention the price does.
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Most of the large foreign holders have been reducing their US Bond holdings, which is what “dumping” refers to.
The market does set reserve currency, but it’s a very sticky quality that can’t change very quickly.
As long as we have it, there pretty much has to be a trade deficit.
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Here is another interesting link with all the countries calculated - so seems it's confirmed https://x.com/typesfast/status/1907600619420147833
Trade between countries should not be balanced in monetary terms. That is bullshit.
First, all trade is balanced because if you buy something from someone you value that thing more than the other person values it, and you both benefit.
Second, if some country makes a lot of bananas and you import those bananas and pay for them, you’re not worse off by having a trade deficit with that country.
The whole idea of trade deficit in surplus is just totally stupid.
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It’s retarted to tariff Cambodia and Vietnam at 40%+ because those countries are inherently cheap manufacturing hubs that aren’t rich enough to buy USA made goods resulting in 90% of trade being exports
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Trump is an enemy of free market capitalism
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