Economic and market musings / 2025

[Divorced w 3]

Get your money right in the year ahead.

Personal sufficiency is the ultimate confidence booster in all aspects of one’s life.

Some things (themes) to think about from a high level (aka macro) view to influence positioning in monetary and professional and personal affairs. Feel free to jump in.

Tariffs:

External supply inflation is the intended outcome, force supply chain logistics internally via inflation on imports to a point where the market will adjust, either with us manufacturing reignite or foreign suppliers and adversarial government economic forces will submit to American intended policy changes.

It’s far better to have the cost of imports become prohibitive long enough to reignite internal production as it becomes a much more permanently viable solution to be self reliant. Your political and liberally minded social scientists don’t want this, because self sufficiency is the ultimate negotiating mechanism and inversely is the enemy of global integration.

Internal rates will do the opposite of what most think as a result of this; if the internal economy suffers in the short run as the supply chain restructures , the natural rate will adjust downward to accommodate the transformation

Random thought: What did Jay Powell see and anticipate months ago in respect to monetary easing that traditional economic data seemed to entirely suggest against? Is he maybe a more pro American, neutral minded banker than originally credited by either political camp?

 

[Plinco]

Personal sufficiency is the ultimate confidence booster in all aspects of one’s life.

Mind and body are one. What affects one affects the other.

 

[BackInTheGame78]

It will be interesting to see how far into tariffs we go...some think it's more likely just a negotiating tactic, and any tariffs would be far less than what's being bandied about.

 

[Bible_Belt]

It will be interesting to see how far into tariffs we go...some think it's more likely just a negotiating tactic, and any tariffs would be far less than what's being bandied about.

The cost to re route goods through another country in order to avoid a tariff is only about 10 to 15%, so that is the actual effect of any tariffs higher than that.

The worst position to be in is selling a product to China that would be the victim of retaliatory tariffs, like Washington state cherries. Only larger crops like soybeans and corn typically qualify for grants to offset losses charged by tariffs.

 

[Divorced w 3]

The cost to re route goods through another country in order to avoid a tariff is only about 10 to 15%, so that is the actual effect of any tariffs higher than that.

The worst position to be in is selling a product to China that would be the victim of retaliatory tariffs, like Washington state cherries. Only larger crops like soybeans and corn typically qualify for grants to offset losses charged by tariffs.

I don’t know enough about the subject to know if it’s so easily feasible to mask the origin of a good from a country with a tariff. I would think that it would be possible to identify the item and I’m also pretty confident in the monetary systems ability to find the nexus of the shell company being used to shield it.

Supposedly, one of the key reasons he invited Xi to the inauguration was to personally discuss his perception of failure of the Chinese to import adequate American agricultural products.

 

[Divorced w 3]

It will be interesting to see how far into tariffs we go...some think it's more likely just a negotiating tactic, and any tariffs would be far less than what's being bandied about.

I am really interested to see how this plays out. Given that he’s constitutionally incapable of running again, he may be more inclined to push for wholesale manufacturing reemergence. Would it not be wild if Trump became the driving factor in the renewal of collective bargaining in the American labor force?

 

[Solomon]

Get your money right in the year ahead.

Personal sufficiency is the ultimate confidence booster in all aspects of one’s life.

Some things (themes) to think about from a high level (aka macro) view to influence positioning in monetary and professional and personal affairs. Feel free to jump in.

Tariffs:

External supply inflation is the intended outcome, force supply chain logistics internally via inflation on imports to a point where the market will adjust, either with us manufacturing reignite or foreign suppliers and adversarial government economic forces will submit to American intended policy changes.

It’s far better to have the cost of imports become prohibitive long enough to reignite internal production as it becomes a much more permanently viable solution to be self reliant. Your political and liberally minded social scientists don’t want this, because self sufficiency is the ultimate negotiating mechanism and inversely is the enemy of global integration.

Internal rates will do the opposite of what most think as a result of this; if the internal economy suffers in the short run as the supply chain restructures , the natural rate will adjust downward to accommodate the transformation

Random thought: What did Jay Powell see and anticipate months ago in respect to monetary easing that traditional economic data seemed to entirely suggest against? Is he maybe a more pro American, neutral minded banker than originally credited by either political camp?

Export stocks about to go through the roof?

 

[FlirtLife]

Export stocks about to go through the roof?

The market doesn't wait to adjust prices. A fraction of the tariff impact has already been priced in, but a lot of uncertainty remains over the amount and duration of each tariff. Last time, most tariffs lasted about a year.

Trump has announced 25% tariffs for Canada and Mexico. A quick online search shows 1 in 5 cars sold in the U.S. are made in Mexico, so expect dramatic price jumps.

Predicting the level and duration of tariffs is the key question, but I don't have the answer. I expect a risky and volatile year for stocks in 2025.

 

[Reincarnated]

Random thought: What did Jay Powell see and anticipate months ago in respect to monetary easing that traditional economic data seemed to entirely suggest against? Is he maybe a more pro American, neutral minded banker than originally credited by either political camp?

At the very least he's more pro-American than his wretched predecessor. I think more than anything the Fed realized the neutral rate (R-star) is probably higher than 2% per annum, maybe 2.5%, meaning they perceive more wiggle room in reaching that target (I don't think they can get to 2% in this cycle given the short-term tariff pressures).

 

[Divorced w 3]

Export stocks about to go through the roof?

There’s any number of ways the thesis can play out, most valuable is the thought process as it forms a conviction and framework, and then you position, pivot or simply do nothing which is an important position that many forget is possible also.

 

[jhonny9546]

Personal sufficiency is the ultimate confidence booster in all aspects of one’s life.

There are rankings and statistics of cities, countries, costs of living and salaries.
Salaries. There is never any talk of earning potential, and the power of that earning compared to the world.
I can earn 1 apple in Italy with 1 hour of work, or 10 in Switzerland, or work 10 hours in Bangladesh and have 1 apple.

This is just an example to understand, that the cost of living does not matter, but "the opportunity to earn a sum that gives me international purchasing power".

Having said that, I could have a drill company in Italy and make 100k in turnover and 20k in net profit.

Have the same company in Switzerland and make 1m in turnover and 200k in net profit.
It would be interesting to hear other people's perspectives on this area.
"Purchasing power" and not "cost of living / salary ratio"

 

[SW15]

The stock market is catching up to the economy. Stock market is seeing all the major layoffs and the weak white collar job market. That's a part of why it is selling off.

 

[Clockwerk50]

The stock market is catching up to the economy. Stock market is seeing all the major layoffs and the weak white collar job market. That's a part of why it is selling off.

And the uncertainty of the trade wars makes businesses hesitant to invest, for various reasons.

 

[FlirtLife]

The stock market is catching up to the economy. Stock market is seeing all the major layoffs and the weak white collar job market. That's a part of why it is selling off.

If the U.S. has "major layoffs" and "a weak white collar job market", why is the unemployment rate 4.1%?

Civilian unemployment rate

www.bls.gov

Also, layoffs don't cause market drops. Financial conditions cause both the market drop and layoffs.

And the uncertainty of the trade wars makes businesses hesitant to invest, for various reasons.

That's accurate. Consumer sentiment can also be self-fulfilling. If consumers are fearful of the economy slowing, they may spend less, and cause the economy to slow.

 

[BackInTheGame78]

It's all designed to transfer money from the average American to the rich.

There is no political war going on in the US, only people who are too distracted fighting amongst each other to realize it is a financial war.

And if you have to spend time wondering what side of it you are on, rest assured it is the losing one.

 

[plumber]

the past model has favored top 10% for some time. lowering labor, even skilled white collar. better returns on investments. gini coefficient increasing.

tariffs, immigration restriction and the other similar moves will reduce gini, and start to level wealth. only start, very very far to go.

if your working and barrowing its going to get better(worse for the short time). if your above the 10%, its going to be harder to stay there.

lots of wealth is going to change hands in the next few years.

 

[jhonny9546]

the past model has favored top 10% for some time. lowering labor, even skilled white collar. better returns on investments. gini coefficient increasing.

tariffs, immigration restriction and the other similar moves will reduce gini, and start to level wealth. only start, very very far to go.

if your working and barrowing its going to get better(worse for the short time). if your above the 10%, its going to be harder to stay there.

lots of wealth is going to change hands in the next few years.

What do you mean?

 

[BackInTheGame78]

the past model has favored top 10% for some time. lowering labor, even skilled white collar. better returns on investments. gini coefficient increasing.

tariffs, immigration restriction and the other similar moves will reduce gini, and start to level wealth. only start, very very far to go.

if your working and barrowing its going to get better(worse for the short time). if your above the 10%, its going to be harder to stay there.

lots of wealth is going to change hands in the next few years.

It will only increase the disparity. Average American's will be forced to sell their assets to the rich for pennies of the dollar.

 

[plumber]

What do you mean?

much in this couple sentences. the slave/master model is one where the wealthy look for the cheapest labor and assemble them. at the same time they cut out any or most of the wealthy/poor (the richest of the poor). Those are the ones in the 50 to 85 percentile. possibly many of our viewers. this model dramatically will increase gini, just look up gini coefficient on wiki. its a big deal...

if we are in the top 10 percent or above the 90th percentile it is good. think financial alpha.

working hard at a trade or mid tier white collar used to provide the american dream with a nice house, summer house, boat, sports car, and so on. even a comfortable retirement. tariffs can return that. but at a cost to those of us in the 10%. pretty much no one likes to give to others... its not being dominant... and women don't like it generally. so the 10% will fight any way possible.

now we will have to pay steel workers for example; much for that very hard work instead of the owners of import business. the next problem would be that the immigrants will work for much less in the steel mill, if they can not come then will have to hire existing at a higher rate. this will raise prices, but the steel worker will be better off as they once again can join the competition, most of the 10 percenters will be fine but not as fine as before.

lots more about this, but probably you get the idea already.