With all the talk of tariffs, I’ve seen more or less this argument:
“Once the tariffs go in place, companies will start manufacturing in the USA and that’s good thing.”
However, when I think about being able to manufacture something like a laptop computer, or a car, these are both operations that require a lot of things:
- the input components to build the thing
- skilled labor that can manufacture the thing
- supply-chains that are in place from initial build all the way to retail
The premise seems to be: “OK, tariffs go in, someone INSTANTLY sets up a company that manufactures X, then USA wins”.
However, for someone to want to take the “bet” on setting up a really expensive factory, they’d have to believe that the tariff will be in place a long time, because if it is NOT… then they have made a terrible investment and the new factory will be instantly non-viable.
Am I crazy? Am I missing something? I understand that it would be great if we had domestic manufacturing but it seems like the people that are behind tariffs think you just snap your fingers and there is a factory cranking out laptops, when in my understanding this is a process that requires a huge amount of money and time.
My thinking is that the amount of people / companies in the USA that have enough capital to start up a manufacturing company like this want to make sure it’s a relatively safe bet before pulling the trigger, and if past tariff behavior from Mr. Trump is any indication, we can’t count on these tariffs being present for a long time.
IMO there is something more at work here. I believe he is collapsing the economy on purpose and evaporating everyone’s savings, forcing them back into the labour force under any means. They want to go back to factory towns where workers have zero agency and are at the mercy of their employers. That is the end goal here, the rest of it is just the hand waving show to keep everyone distracted.
It’s the tech oligarchs. They’re doing their own gilded age. Their empires exist in the tech domain. Mostly IT services. They’re going after the whole pie. They want the entirety of American industry.
What they have in mind exactly is anyone’s guess. We’re not going back to the times of railroad or oil barons. We’re not necessarily going back steel and auto manufacturing. The future is in things like robotics, renewable energy, semiconductors, or whatever the future holds.
I think crashing the economy just to buy stock is old news too. The saying has become rather mindlessly echoed. They have relatively little to gain from this. The rich hold 90% of stocks. There’s little to extract from the remaining 10%. Plus I think people have believed too much in the idea that stocks are a shell game. It’s not as much as people think. The markets are still based on tangibles meaning actual industry. That is what the oligarchs are after. What’s better than owning stock in the industry is owning the industry itself. Complete total monopolies just like the gilded age and just like they’ve monopolized IT services sector.
Fun fact: the top 10% now account for approximately half of all consumer spending which equates to about 30-35% of US GDP. First time since we started tracking it and first time in a long long while that’s happened. Wealth inequality has indeed matched the guilded age. Maybe even surpassed it but it doesn’t quite seem like it yet. Just matched.
Also the stock crash isn’t about stocks. It’s about capital and labor investment. When things go bad, the small to medium sized businesses struggle the most which then Blackrock and the like swoop in to buy them all at steep steep discounts. That is ultimately a smarter long term play than buying “slightly” discounted stocks. IE the stock play is as you said. It’s mostly rich folks that own it but the rich don’t own all businesses yet. Recessions are a chance to do just that which from looking around we already seem to be in with the amount of layoffs and small to medium sized business struggling mightily. The internet omni-presence and ability to earn money sitting at home is too strong for a standard recessionary environment and indicators to show up to the same degree as before. Or at least that’s what I think.
You can make money on the stock market when it goes down
It’s not that complex or Machiavellian.
Look at what rich people have done after every recession of the past 40 years and how what’s happened to their wealth after the recovery. The economy crashes forcing middle-class people to sell off what scant assets they own. Even people on the lower end of upper-class tend to sell off assets when the stock market crashes. Super rich people who have enough money to weather the economic downturn buy the dip, gobbling up all those assets people are selling. Then when the economy recovers the rich people make out like bandits (which they are).
That’s all that’s happening. He’s tanking the economy so Musk and his other rich friends can buy the dip and increase their wealth even more when the economy improves.
I don’t get it. Why would anyone be forced to sell their assets? Do they invest with money they actually need? They shouldn’t. Just wait out the storm.
Time will tell. It’s all about the layers, but if you look at the current situation at face value, it makes very little sense, ergo something more sinister is a foot 3-4 steps down the road.
It makes complete sense if you are looking at it from the perspective of an oligarch. They are just trying to tank the economy to hoover up even more assets. They’re banking on an eventual recovery, after which they’ll be even richer and more powerful than they are now.
As with most things in life, assuming some grander Machiavellian scheme is usually wrong. People don’t think and plan like that outside of movies and TV. Most people, especially the very rich and powerful, only plan for the short term.
There is no 3-4 steps down the road. They’re just trying to repeat exactly what they did during/after the COVID recession. And the Great Recession. And the '01 dot-com recession, etc, etc, etc.
Except he is using a playbook built by other people that we’ve only seen the gist of. This is manufactured, not eventual. He is also removing all consumer and worker protections. There is more too it, but keep turning a blind eye to just “more of the same” and see where that gets ya. I am saying the same thing as you, but I am alluding to it being a byproduct and not the simple end goal. They want housing under their thumb as well as worker protections and healthcare. There is malicious intent there, I’m sure of it. It is more than the accumulation of wealth.
I’m not turning a blind eye to anything. I’m just not making up conspiracies where there’s clearly none. There isn’t some hyper intelligent grandmaster planning everything out 15 moves in advance. This isn’t Lex Luthor or Doctor Doom running the show. It’s a bunch of morons whose understanding of economics ended with mercantilism asking ChatGPT how to run an economy.
I think you’re right that he’s collapsing on purpose, but I think it’s because it’s what’s best for Russia and it’s profitable for the wealthy long term, being able to buy back into the crashed market. But also the control thing too. Just a bunch of shitty things.
I find it increasingly hard to tell the difference between a mastermind playing 7D chess with the world, and someone just acting randomly and implementing all kinds of policies at a whim.
Putin is doing the planning, Trump can’t think
Trump was so proud of himself for using the word “reciprocal.” He likely didn’t know what it meant earlier this week.