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Non-Tech : Kirk's Market Thoughts -- Ignore unavailable to you. Want to Upgrade?

To: Kirk © who wrote (24190)	5/1/2025 10:44:41 AM
From: Elroy	1 Recommendation Recommended By Kirk © Respond to of 26981

He never explains why the USA buying more from a country than the country buys from the USA is an example of that country "ripping us off". To me it sounds like that country is working for the USA. We the boss, they the worker. ---- On a different note I think it would be interesting (and perhaps persuasive) to see trade impalances expressed as gross profits rather than sales. For example, if we import a $1,000 notebook made in China with a gross margin of 18%, China gets $180 profit. In order to make that notebook the Chinese company needs to buy a $50 Intel processor with a 50% gross margin, perhaps $80 of memory with a 40% gross margin, a $50 NVDA chip with a 60% gross margin, and $80 of Windows with a 90% gross margin. In just those four items China "imported" $260 of components and software with $159 of gross profit. So the trade imbalance in sales is they imported $260 of stuff and then exported $1,000. Seems like a huge imbalance. But the trade imbalance in gross profits is they paid $159 gross margin to US compenent companies and the US paid $180 of gross margin for the assembled notebook. It's about a wash. It's not something that needs dramatic realignment. Profit is what matters. If China buys $50 of components from us, and $50 of components from Taiwan, and sells it to the USA for $100 and no Chinese profit, there's a US - China trade imbalance (they only bought $50 from the US and sold $100 to the US), but the US company is profitable and the Chinese company only breaks even. That's not a problem for us.

To: Kirk © who wrote (24190)	5/1/2025 11:32:33 AM
From: robert b furman	4 Recommendations Recommended By Kirk © Newly sixty2nds toccodolce Read Replies (2) \| Respond to of 26981

Good Morning Kirk, In Trump 1.0, there was little if any inflationary effect. Admittedly Trump 2.0 is far more aggressive. There are two views out there that suggest the tariff impact will not be near as much as what those who lean the Democrat way are fear mongering over: 1) it will be a onetime bump and then plateau. 2) The impact from tariffs is more of a currency adjust where the imposing country's currency increases and the recipient country adjusts their currency down. The latter of which is what happened in Trump 1.0. NOTE TO FILE: So far the big tariff threats have yet to be determined except those that involve national security. Those are the smallest and deal with Aluminum and Steel. I'm OK on that, as they've been out there since Trump 1.0. Their impact has been next to not observable. I remember Wilbur ross holding uo an aluminum beer can an noted the effect to be less than 2 cents. As for the bigger proposed tariffs are concerned, If you have a high tariff and won't drop it to a reciprocal level, we need to find a fairer substitute, make it here, or hammer them with an equivalent costly penalty on another staple export they enjoy to sell us.. I think given time; it will be like the internet has been, "THE GREAT EQUALIZER". The concept that we are the biggest market and are a market you con NOT afford to abandon, is a relentless enforcer, far more powerful than a politician's pride over the continuous screwing of Americans, vs being an ally that respects fair and equal trade. It's not the big deal the Democrat's are bellyaching about. What it truly is, is a fairness to the American consumer and a President who has the CAJONES to take the political fire over it, to get it corrected. At the end of the day, Trump will go down in history as a strong politician who showed leadership over incompetence and the ineffectiveness of past politicians from both sides of the aisle, who opted for personal corruption. As this adjustment to global trade is resolved, we'll be eating more than just a piece of cake, we'll have more industry, lower energy costs, and lower taxes, that will be aimed at resolving the income inequality thru lower or no taxes for those low-income earners. In between, I've been enjoying the discount in stocks that all the DEM'S BOOHOOING has created. So far all of my smaller energy stocks (PR, PUMP, NOG, have all beat their earning nicely vs. the previous quarter (more energy production) and not had a lasting pop, which I've added to. NOG even bumped their dividend to $1.80 a year (7.39% yield) and dropped in price yesterday (closed at $24.30 and is up 96 cents as I type). They are all doing me a favor so far. Bob