Sunday, February 2, 2025

Get Ready for a Trade War

WSJ Editorial: The Dumbest Trade War in History
https://www.wsj.com/opinion/donald-trump-tariffs-25-percent-mexico-canada-trade-economy-84476fb2
Trump will impose 25% tariffs on Canada and Mexico for no good reason.
 
Canada, Mexico Want America to Feel the Pain of Tariffs Too
https://www.wsj.com/economy/trade/canada-mexico-want-america-to-feel-the-pain-of-tariffs-too-f8119ccd
Both countries are planning precision strikes against U.S. exports in response to Trump’s unilateral tariffs.
 
Trump signs executive orders to place tariffs on Canada, Mexico and China
https://www.telegraph.co.uk/world-news/2025/02/01/trade-war-latest-trudeau-trump-canada-facing-difficult-time/ 


‘A trade war on steroids’: Trump ushers in new age of US protectionism
https://www.ft.com/content/32bedf88-cf5d-494e-ae45-4f94a3cec6f9
Trump now wants to use tariffs to generate revenue to pay for the extension of trillions of dollars of tax cuts, which can only be achieved through carefully calibrated but hefty levies that could be hard to reverse.
“When it comes to raising revenue, if the tariff is too low it won’t raise enough money, if it’s too high it will stop trade and then you won’t make any money. They will need to find the sweet spot,” said Bill Reinsch of the Center for Strategic and International Studies.


Related:
The Case for Reglobalization: Turning Inward Won’t Secure America’s Interests
https://www.foreignaffairs.com/case-reglobalization-america-roger-ferguson-maximilian-hippold

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A Strange and Controversial Defense of Trump’s Trade Policies:
Trump’s trade war isn’t as mad as it seems
https://www.telegraph.co.uk/news/2025/02/02/trumps-trade-war-isnt-as-mad-as-it-seems/

Inflation is Still a Problem

Inflation Is Down to 3%. Why That Isn’t Good Enough.
https://www.wsj.com/economy/inflation-is-down-to-3-why-that-isnt-good-enough-884c1136
Even inflation this low could feed consumer frustration, workplace friction and an inflationary psychology.

My Take: There’s still a real threat that inflation makes a comeback

https://thehill.com/opinion/5119872-trump-era-inflation-debate/
 
Tariffs Are Nearly Here. The Price Hikes Coming for These Items May Surprise You.
https://www.wsj.com/economy/trade/tariffs-are-nearly-here-the-price-hikes-coming-for-these-items-may-surprise-you-99cba7a4 

Saturday, February 1, 2025

Shifting Fortunes in Europe

The revenge of the Mediterranean
https://www.ft.com/content/7613b33f-f09e-4fad-a8c1-39dd11b662a9
The future of the continent will be shaped in the once-mocked south

Reversal of fortunes: Europe’s thriving south and stagnant north
https://www.ft.com/content/3eaa4534-6593-467b-877b-3a18e0a30181
With Germany’s economy stalling, tentative growth in Portugal, Italy, Greece and Spain is some good news for the Eurozone. Will it last? 

Double Standards at Credit Rating Agencies?

Will the credit rating agencies stand up to Trump?
https://www.ft.com/content/f5ceb7b6-1d9f-444d-bfbb-f5110d737e03
Debt rankers appear to have been more coy in recent years on risks of developed economies than emerging markets
 
Related:
Fitch’s downgrade of US debt wasn’t a mistake — it was long overdue by VIVEKANAND JAYAKUMAR, The Hill - 08/07/23
https://thehill.com/opinion/finance/4138215-fitchs-downgrade-wasnt-a-mistake-it-was-long-overdue/ 

When Banking is Not About Lending

Wall Street Is Booming, but Banks Are in a Lending Rut
https://www.wsj.com/finance/banking/wall-street-is-booming-but-banks-are-in-a-lending-rut-2b4f4a64
Weak loan growth is a worry, particularly for regional lenders. 

The Case for Roth IRA

The Retirement Maneuver More People Should Be Making
https://www.nytimes.com/2025/01/31/opinion/retirement-roth-conversion.html 

India Tries Tax Cuts to Stimulate Demand