In the Developing World, Robots Are Short-Circuiting Economic Growth
We began noticing this a few years ago about the time a large manufacture of tongue depressors, and ice cream sticks made the decision to move manufacturing from China to Canada.
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America's Mistake Over Chinese Steel: Imposing Tariffs Makes Americans Poorer
Tariffs are a terrible idea for Americans, and they create the ground work for international conflict, and in the past have been sufficient reason for wars. More below the fold. Timeless wisdom about free trade and protectionism. . . . Trump, Sanders, and Clinton get this one wrong. "Given all of the political hysteria and misguided mercantilist thinking recently about international trade (especially from Trump, Hillary Clinton, and Bernie Sanders), I thought it would be a good time to re-post Milton Friedman’s 1978 lecture above at Kansas State University (posted previously on CD back in September of 2012), where he discussed free trade, and explains why trade protection and interference in international trade are so widespread, despite the almost universal condemnation of such measures by the economics profession. Professor Friedman also addresses the political obsessions with: a) increasing exports (remember President Obama’s goal in 2010 to double exports by 2015, which failed miserably by the way — real exports of goods and services have increased less than 24%) and b) achieving a “favorable balance of trade.” Here’s a quote from Friedman’s lecture, demonstrating the timeless nature of his economic wisdom, which is as relevant today as it was in 1978 almost 40 years ago (at about 20:40 in the video above): In the international trade area, the language is almost always about how we must export, and what’s really good is an industry that produces exports. And if we buy from abroad and import, that’s bad. But surely that’s upside-down. What we send abroad we can’t eat, we can’t wear, we can’t use for our houses. The goods and services we send abroad, are goods and services not available to us. On the other hand, the goods and services we import, they provide us with TV sets we can watch, automobiles we can drive, with all sorts of nice things for us to use. The gain from foreign trade is what we import. What we export is the cost of getting those imports. And the proper objective for a nation as Adam Smith put it, is to arrange things, so we get as large a volume of imports as possible, for as small a volume of exports as possible. This carries over to the terminology we use. When people talk about a favorable balance of trade, what is that term taken to mean? It’s taken to mean that we export more than we import. But from the point of view of our well-being, that’s an unfavorable balance. That means we’re sending out more goods and getting fewer in. Each of you in your private household would know better than that. You don’t regard it as a favorable balance when you have to send out more goods to get less coming in. It’s favorable when you can get more by sending out less. MP: Here’s a formula summarizing Milton Friedman’s insights: 1. The stuff we importMINUS 2. The stuff we export = 3. Our standard of living In other words, in economic terms, our standard of living is highest when we maximize imports and minimize exports, which is exactly the opposite of the political thinking, rhetoric and mercantilist policies we about from Trump and Sanders, which generally seek to maximize exports and minimize imports." The US Has The Best Rail System in the World, and Matt Yglesias Actually Pointed Out the Reason | Coyote Blog
. . . the US of A! More below the break. Dear China Korea will have missiles unless you cure the cancerous tumor which is North Korea . . .4/30/2016 Beijing and Moscow Object to U.S.–Korea Missile Defense Collaboration
. . . don't call us, we'll call you, don't let the door slap your ass on the way out. Pikers! Dear US government, more please, and faster! This is how to negotiate with China over the South China Sea issue. Now let's do a second verse of this song with the Philippines. Yes, we need to remain in control of this technology, but still, expanding it to the others in the anti-China coalition in the South China Sea will put pressure on China to act in a mature, reasonable manner. We need to have Congress hold hearings on whether we should end the Chinese Most Favored Trading Nation status as well. We don't need to go to the trouble actually cutting China loose, but they could use some pressure. As for Russia, I don't much care, it is a dying nation with a truly tiny economy, which has ensnared itself in Ukraine, Georgia, Chechnya, Syria, among other places. It's actions are making it a pariah among pretty much every other nation bordering it, and among the first world nations. Putin is settling into dictatorshiplite nicely. And it is entering an existential recession/depression due to its economy being all but entirely reliant on energy. The Hollow Men Smile and wave, it might be your last chance. China Blocks U.S. Navy Flotilla’s Visit to Hong Kong
Boom, China implodes in a puff of smoke. "WASHINGTON — The Chinese government on Thursday denied a Navy flotilla access to the port in Hong Kong, Pentagon officials said Friday, the latest sign of escalating tension between the United States and China. The rare refusal to allow the aircraft carrier John C. Stennis, and several other vessels accompanying it, to visit the port comes two weeks after the Stennis hosted the defense secretary, Ashton B. Carter, on a visit to the South China Sea, where the United States is challenging what it sees as excessive maritime claims by China. During the trip, Mr. Carter criticized the Chinese and said the United States would work with its allies in the region." Cut the status, then work with the antiChinese elements in the South China Sea. Congress can do much of this without actually changing the status by simply holding hearings on whether they should change the status. It is time to put China on notice. The President was golfing and did not return our smoke signals requesting a comment. Expect nothing and you will never be disappointed. It's Now Cheaper To 'Buy' A Dry Bulk Freight Tanker Than A Starbucks Coffee
. . . and you really can buy one for a buck, well actually 6 for a buck, so can you spare 17cents? "Goldenport, one of the last shipping companies left on the London Stock Exchange, has delisted from the market and sold off six of its remaining eight vessels for $1... The giveaway reflects the most dismal shipping conditions in decades, caused by economic slowdown in China combined with an oversupply of vessels due to a building spree during a previous boom and the fact that "average daily hire rates have fallen below even a vessel’s daily operating expenses." The Greek owners are looking for buyers for two remaining vessels and are taking Goldenport off the stock market, saying it no longer makes sense to list shares which have dropped from highs of $100 in 2007 to less than 2c now. John Dragons, the chief executive of Goldenport, said “Dry bulk vessels generally have fallen in value by around 60% over the last year partly because of extreme oversupply and partly because of low demand for coal as China moves towards renewable energy to curb [carbon] emissions," adding that “The prevailing market conditions are probably the worst of the last 30 years.'" The canard I've heard most recently is the Baltic Dry Index doesn't matter. Well, it does if you are in shipping, or are interested in the state of worldwide shipping, or the health of the shipping industry. It probably means nothing, never mind, move along, move along. Why It's Too Late to Scrap the Iran Deal
. . . including the Republican Presidential candidates. More below the fold! |
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