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Tenchu's Thoughts - Wrong Policy, Wrong Data, Wrong Implementation by the Wrong Man
As the markets are proving, Trump's "Liberation Day" tariffs are the wrong policy based on the wrong data implemented the wrong way by the wrong man.
This truly is the perfect storm of everything that could go wrong under Trump 2.0, and it only happened a couple of months into his four-year term.
Wrong Policy
This is debatable. Surely there are plenty of proponents of tariffs out there, and they have various reasons why tariffs, if implemented the right way with the right goals, can be good policy.
But in general, tariffs are a tax. They represent a drag on free market capitalism. Free trade is a win-win for the players involved, so to screw that up with arbitrary tariffs based on lies and manufactured grievances is just plain wrong.
I could talk more about the lessons learned from the past, including Smoot-Hawley, but there are plenty of resources already online discussing how they turned out to be mistakes. Hence the reason why most economists don't believe in general tariffs.
Wrong Data
Trump produced that dumbass chart claiming that countries are imposing up to 50% "tariffs" on us. This is the justification behind Trump's "reciprocal tariffs."
But in that chart, the "tariffs" aren't even tariffs. Instead, they're based on some weird formula that counts trade deficits as part of "tariffs," because in Trump's mind, trade deficits are bad bad bad.
But trade deficits do NOT represent a "draining of wealth" from America. Nor can they be countered by "reciprocal tariffs." I guarantee you that Taiwan, for example, will never be able to import enough American goods to reduce the trade deficit down to zero, which is a key requirement for Trump to remove "reciprocal tariffs" from that country.
Hence the data is just plain wrong. They are not "tariffs" nor should they ever be considered as such.
Wrong Implementation
Now despite how people may feel about policy and whether it is based on sound analysis of sound data, the markets are incredibly resilient. They can adapt to any change in policy no matter how wrongheaded it may be.
Which makes Trump's implementation of his tariffs all the more harmful, because the way he implements them is completely arbitrary and based on his ever-changing emotions. This leads to inconsistency, instability, and uncertainty, and one thing the market HATES is uncertainty.
This absolutely freezes investment. This absolutely freezes the flow of goods. How the F is Apple, for example, supposed to comply with the new tariffs when Trump changes his mind every single fukkin' week? Either Apple will have to set aside funds to pay tariffs after the fact, or Apple will have to stop shipments of goods manufactured in China. At least Apple can afford such disruptions, but can smaller companies?
Wrong Man
Which brings me to the final wrong, which is the so-called "man" himself behind these tariffs.
He, quite frankly, is the wrong man for the job. He is a complete and utter narcissist with an ego that needs constant fapping.
But even his ego and narcissism would be OK IF he knew how to do his fukkin' job. Which he doesn't despite years of experience.
Instead, his ego is leading him to believe that ONLY HE can "save our economy" and "save America."
And that brings me to his ultimate reason why he's implementing his tariffs.
He wants to bully other countries into providing more favorable terms of trade to America. He gets a thrill out of this. Anytime some country (e.g. Vietnam and Israel) capitulates and drops tariffs on U.S. exports, he declares victory and basks in the praise of his MAGA cucks.
Is this going to make U.S. exports to other countries rise substantially? Very doubtful. Vietnam and Israel collectively only represents about $23B worth of exports from the U.S.
But to Trump, just hearing that those two countries capitulated is music to his ears.
This is why he is the wrong man for the job, because he is only motivated by his own fat-ass ego. He lives in a bubble of alternate reality, which he has built up with nothing but a bunch of yes-men who have sold their souls.
Conclusion: The Markets WILL Adapt Away from the U.S.
So yeah, the fact that Trump is the wrong man pursuing the wrong policy with the wrong data, implemented the wrong way, leaves VERY little room for optimism.
As I mentioned before the markets are strong and resilient, and they can adapt to any changes in policy no matter how bad they are.
But the markets cannot adapt to Trump's "reciprocal tariffs" EXCEPT by moving away from the U.S.
This can represent a big opportunity IF you're China or some other major geopolitical player such as the E.U., Japan, Korea, Australia, maybe even Türkiye.
But for us in America, we're up Shits Creek, all because Trump took the strongest economy on the global stage and turned it into a weapon of mass destruction, all under the guise of Making America Great Again.
