The Economy

[Waltzing]

 Should NZ super charge its tourism? 

looks like the US just lost its tourist destination hot spot...

https://www.bbc.com/travel/article/20250328-the-people-boycotting-travel-to-the-us

[BlackPeter]

Looks like Dumb and his team didn't even run the numbers before trying to break the world economy with their tariff threats.

Nobody knows, how expensive it will be for US consumers (and yes, I am sure, the rest of the world will pay for it as well) - but $6b tariffs (which always the consumer needs to pay) divided by 300m people is on the back of an envelope $2000 for every US consumer. This is a start. Obviously US suppkiers will react by increasing their prices (less competition) and our genius well might double the cost to the US consumers. Any benefits for job are unclear. Take people 10% of their income, and they are unlikely to buy more allowing job creation.

Here are two recent articles from the NY Times (paywalled, but the first 10 articles per month are free if you register):

https://www.nytimes.com/2025/03/27/us/politics/trump-car-tariffs-trade-strategy.html

Ah yes, and apart from the tremenduous costs to US consumers - the broken alliances will come as a fringe benefit for Putins lackey.

https://www.nytimes.com/2025/04/01/us/politics/trump-tariffs-nato-allies.html

Lose - lose all over the place, this is what populists like Dumb are standing for.

[Waltzing]

Chumps but not Chump change....

[Waltzing]

Imagine if the NZX 50 went down 17 percent since feb....

well the NZX 50 is not EQU with the SP 500...

but...

The US has calculated TF's on deficits and they cant be used for TF's since smaller per capitia countries are likely to have a DF with the DIXIE where there are 300 million people....

its nuts stuff...

17 percent since feb... D CHUMP just crashed global trading markets...

this poor guy who trades the US is now down 7 million in his portfolios...

boy ...

[BlackPeter]

Yep, one couldn't make this stuff up.

Rare to see economists agreeing, but there is consensus that tariffs damage the economy. It looks like that even the smart money agrees - just looking at any US index.

Democrates call this already now the "probably dumbest and most avoidable recession ever".

https://www.huffpost.com/entry/democrats-make-gop-pay-trump-tariffs-recession_n_67eea459e4b0c989cefdf544

Republicans can't explain the strategy either, but given that they are spineless creatures and anybody contradicting Trump gets fired, they say "You have to trust in the presidents guts".

https://www.youtube.com/watch?v=ajfrpaa783U

That's how the worlds largest and most powerful nation is run - not based on analysis, but based on the gut content of an angry and senile old man. Well, at least we will know where it comes from when it all turns to s**t.

[Waltzing]

Good article by interest...  very interesting weeks ahead... real world history being made...

actually for once having china as a trading partner might work out ok , lets not forger the PM's visit to india...

In this type of world where numbers count having a boring CEO as PM might actually be ok...

lets face it no one in the labour party nor the greens can count...

https://www.interest.co.nz/public-policy/132735/error-white-house%E2%80%99s-maths-may-have-overstated-reciprocal-tariffs-announced

[Waltzing]

GERMANY is about to pull its GOLD out of the US storage....

[BlackPeter]

GERMANY is about to pull its GOLD out of the US storage....

Let's hope its still there, shall we? I would not trust Dumb further than I can throw an elefant.

[Plata]

I've been thinking about this whole tariff sitch a bit more recently and I'm struggling to see how this broad ranging tariff strategy is going to bring jobs back. Who is going to put capital into a business case that requires these tariffs to work out when trump himself is super unreliable and most likely the next president will wind them back? Sure it will be a good tax grab but the cost to the economy will probably negate most if not all of it.

The question for us is how to play it? They add to recession risk so could lead to lower interest rates, but it will likely be inflationary (at least in the US) so higher rates? Might we see cheaper goods here in NZ as Chinese producers try to offload goods in friendlier places?

[BlackPeter]

I've been thinking about this whole tariff sitch a bit more recently and I'm struggling to see how this broad ranging tariff strategy is going to bring jobs back. Who is going to put capital into a business case that requires these tariffs to work out when trump himself is super unreliable and most likely the next president will wind them back? Sure it will be a good tax grab but the cost to the economy will probably negate most if not all of it.

The question for us is how to play it? They add to recession risk so could lead to lower interest rates, but it will likely be inflationary (at least in the US) so higher rates? Might we see cheaper goods here in NZ as Chinese producers try to offload goods in friendlier places?

Good question. I guess the problem is that nobody can predict what happens tomorrow or next week.

Will an economically illiterate Trump surrounded by incompetent yes men push his delusioned plan to the very end? US did that before - and yes, they heard year after year from POTUS that the plan will work but it needs to get worse before it gets better. Sounds familiar? Started in 1930 and ended towards the end of WW 2 (1944). So - do we need to prepare for say 15 very painful years, a long term depression and the mother of all wars to end it?

Or can we hope for a friendly bomb blowing Dumb and his lackey's up next week and a more sensible US government moving back to evidence based policies?

Maybe the US democracy survives the current autocratic onslaught - and next year brings a landslide win for the Democrates, able to impeach Trump in 2027 and bring him for good behind bars, be it prison or a mental institution? I hear they have outstanding institutions in El Salvador. This would mean just say 3 years of suffering (allowing for due process).

Maybe it doesn't, Trump does a Mugabe 2 and reigns as autorcrat and disconnected from reality until age 110? Are 30 years enough to kill the human race?

Maybe a revolution in the US sweeps the reigning billionaires away, and the Americans are more successful than the French in turning a revolution into something which is good for the people (and not just the next strongman).

Maybe all countries join into a big Kumbaya session with Trump, praise his wisdom, remove some spelling mistakes in the existing trade framework and rename it to "the best trade framework ever courtesy to D. Dumb, the saviour of the world."

Impossible to predict - but obviously requiring quite different investment approaches.

So - what are you doing in times of high uncertainty?

Diversify.

Hold enough cash to be able to survive for at least several years without the need to touch your investments.

Invest into stuff people always need: Food, energy, basic transport and housing (no luxuries), health (again, no luxuries), defence.

Diversify.

I know I wrote that twice.

Diversify.

Think about correlations between yor investments and make sure enough of them are uncorrelated.

Anyway - just my 2 cents.

[Waltzing]

well since China makes all the toaster and kettles in the world... vacuum cleaners .. and some British firms have manufacturing in singapore...

your all good to go... and NZ makes its own bread and butter!!! Milk and Kiwi fruit...

when you get up for brekie tomorrow it will cost the same.. and oil us goinh down...

YOUR ALL SET!

there is nothing much you need from the US is there?

most cars here arnt US Made... Holland has the IP for all the chip making machines...

https://www.bbc.com/news/articles/c4g2089vznzo

[Waltzing]

looks like DUMP just made a fortune from smashing the market and then walking it back as the bond market went south...

BUY said DUMP...

https://www.youtube.com/watch?v=BjoJtd3-vew

[Mr Cashflow]

[Waltzing]

again.....