QUOTES OF THE DAY

“The government’s War on Poverty has transformed poverty from a short-term misfortune into a career choice.”

Harry Browne

“Even the Founding Fathers of the U.S., nowadays considered the model of a democracy, were strictly opposed to it. Without a single exception, they thought of democracy as nothing but mob-rule.”

Hans-Hermann Hoppe

“As government expands, liberty contracts.”

Ronald Reagan

“The primary reason for a tariff is that it enables the exploitation of the domestic consumer by a process indistinguishable from sheer robbery.”

Albert J. Nock

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Trump’s Mexico Tariffs Sends Gold Prices Climbing

From Birch Gold Group

tariffs on mexico good for gold

This week, Your News to Know rounds up the latest news involving precious metals and the overall economy. Stories include: Gold climbs as Mexico tariffs show no country is safe, gold is the one constant in an age of eroding trust, and how Vietnam chooses bullion over cashless transactions.

Gold Climbs as Trump’s Mexico Tariffs Show No Country is Safe

After a timid couple of months, gold prices are once again trending upwards after news that President Trump is planning to impose a 5% tariff on Mexican goods, citing financial markets troubled by illegal immigration as the reason, reports Newsmax.

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Tariffs: The Taxes That Made America Great

Guest Post by Pat Buchanan

Tariffs: The Taxes That Made America Great

That the Smoot-Hawley Tariff caused the Depression of the 1930s is a New Deal myth in which America’s schoolchildren have been indoctrinated for decades. The Depression began with the crash of the stock market in 1929, nine months before Smoot-Hawley became law. The real villain: The Federal Reserve…

As his limo carried him to work at the White House Monday, Larry Kudlow could not have been pleased with the headline in The Washington Post: “Kudlow Contradicts Trump on Tariffs.”

The story began: “National Economic Council Director Lawrence Kudlow acknowledged Sunday that American consumers end up paying for the administration’s tariffs on Chinese imports, contradicting President Trump’s repeated inaccurate claim that the Chinese foot the bill.”

A free trade evangelical, Kudlow had conceded on Fox News that consumers pay the tariffs on products made abroad that they purchase here in the U.S. Yet that is by no means the whole story.

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Like Hoover and Dubya, will Trump eat his words about the economy?

Guest Post by Paul Brandus

“The fundamental business of the country, that is the production and distribution of commodities, is on a sound and prosperous basis,” Herbert Hoover said on October 25, 1929.

Oops.

“The basics in the economy are good,” George W. Bush said on Dec. 4, 2007.

Double oops.

Both of these presidents would soon regret their words. Hoover’s comments came after “Black Thursday,” when stocks fell 11% in the morning before clawing back—only to plunge 13% on “Black Monday” (Oct. 28), and another 12% the day after that. It was the beginning of the worst economic downturn the United States had ever seen—the Great Depression, which was made worse by a bone-headed decision to impose tariffs on America’s trade partners.

Continue reading “Like Hoover and Dubya, will Trump eat his words about the economy?”

Mauldin Warns: Trump’s Tariffs Echo US Trade Policy That Led The Great Depression

Authored by John Mauldin via MauldinEconomics.com,

“A conservative is someone who stands athwart history, yelling stop, at a time when no one is inclined to do so, or to have much patience with those who so urge it.”

William F. Buckley, Jr., 1955

I will never compare myself to Bill Buckley, as a writer or anything else. He was one-of-a-kind and a personal hero who I am disappointed to say I never met but who I read a lot. The response to my recent tariff comments gives me a small hint of how it must have felt to “stand athwart history” and launch the modern conservative movement. Many of you support the tariffs. And I understand your reasons. I really do.

Free trade used to be a core belief of the conservative movement. Hayek, Friedman, Mises, Rothbard, and numerous other economists eloquently explained why. Several liberal economists agree. Conservative politicians spent the last few decades moving us in that direction, albeit imperfectly and with some big mistakes along the way. But few disagreed with the ideal.

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US Goods Trade Deficit Surges Near Record High (Don’t Tell Trump)

Tariffs are working miracles. Winning!!!!

Via ZeroHedge

Do not show this to President Trump, he will not be happy…

In the few months since President Trump unleashed his trade war, predicated on managing back America’s massive merchandise trade deficit, things have gone very wrong, judging by the numbers.

Against expectations of a $70.6 billion deficit, August’s goods trade balance plunged to $75.8 billion – just shy of July 2008’s record high deficit of $76.025 billion…

https://www.zerohedge.com/sites/default/files/inline-images/2018-09-27_5-44-48.jpg?itok=k7gWOkfx

Notably, the trade deficit was worse than the forecast range $68b to $73.9b from 36 economists.

Whether this reflects pre-emptive actions ahead of actual tariffs is unclear:

  • Exports fell 1.6% in Aug. to $137.912b from $140.199b in the prior month
  • Imports rose 0.7% to $213.742b in Aug. from $212.246b in July

With exports of food and beverage and Industrial supplies plunging in August (and consumer goods surging).

Imports were dominated by a 3.2% increase in Automotives.

Continue reading “US Goods Trade Deficit Surges Near Record High (Don’t Tell Trump)”

Walmart Warns It Will Be Forced To Raise Prices Due To Trade War

Via ZeroHedge

One of the reasons why the US economic response to Trump’s trade war with China had been lukewarm at best, is that US consumers had not been subject to any of the inflationary consequences of the escalating tariffs between Washington and Beijing. That, however, is about to change: overnight Walmart issued a warning in a letter to U.S. Trade Representative Robert Lighthizer that it may have to raise prices due to tariffs on Chinese imports, CNN Money reported.

“The immediate impact will be to raise prices on consumers and tax American business and manufacturers,” Walmart said, according to the CNN Money report.

The letter came two weeks after Walmart asked the Trump administration to walk back its plan to put tariffs on Christmas lights, shampoo, dog food, luggage, mattresses, handbags, backpacks, vacuum cleaners, bicycles, cooking grills, cable cords and air conditioners.

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Trump’s funny math on tariffs and the debt

Guest Post by Paul Brandis

I’m so old I can remember when Republicans squawked that 1) deficits and the debt were bad and 2) that tariffs were harmful to the economy.

Yet we now have a president who is making the first problem much worse than it already is and seems to think that the second is some kind of magic elixir. Guess who’s already paying for these boneheaded moves—and will pay even more in the years to come? You.

President Trump inherited a monstrous problem: $20 trillion in debt. Sidebar: Before you go blaming one side or the other for this, I’ll irritate you by saying that your side, whatever it is, shares the blame. Yes, Barack Obama was president from 2009-17, but Congress, which controls the pursestrings, has been run by Republicans—both the House and Senate—since 2010. Shared responsibility, shared blame.

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CHINA TARIFF WAR

One of the main reasons our CPI has been so low for so long is because we import cheap computers and electronics from China, among other things. If we import $375 billion more than we export to China and 25% tariffs are charged on these imports, do you think it will impact the price we pay for shit? Won’t the CPI go higher? Won’t that force the Fed to raise interest rates higher? Won’t that cause a recession? Just asking.

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Did Tariffs Make America Great?

Guest Post by Pat Buchanan

Did Tariffs Make America Great?

“Make America Great Again!” will, given the astonishing victory it produced for Donald Trump, be recorded among the most successful slogans in political history.

Yet it raises a question: How did America first become the world’s greatest economic power?

In 1998, in “The Great Betrayal: How American Sovereignty and Social Justice Are Being Sacrificed to the Gods of the Global Economy,” this writer sought to explain.

However, as the blazing issue of that day was Monica Lewinsky and Bill Clinton, it was no easy task to steer interviewers around to the McKinley Tariff.

Free trade propaganda aside, what is the historical truth?

Continue reading “Did Tariffs Make America Great?”

Trade-war tracker: Here are the new levies, imposed and threatened

Via Marketwatch

As rhetoric on global trade ratchets higher, here’s a look at what new tariffs have been imposed and what has been threatened this year, as the U.S. and China each imposed levies on $34 billion worth of the opposing country’s goods on Friday.

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Real Coke and Car Tariffs

Guest Post by Eric Peters

Real Coke – the most American of sodas – comes nowadays from Mexico. I mean of course the stuff made with sugar and put into glass bottles, the way Coke was once made and sold here  – as opposed to the high fructose corn syrup sweetened sludge (in aluminum cans and plastic bottles) currently sold here.

Interestingly, this is the case because of tariffs.

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Trump’s Trade Deals Are a Futile Conceit

Guest Post by Bill Bonner

The rich man’s wealth is his strong city, and as a high wall in his own conceit.

– Proverbs 18:11

POITOU, FRANCE – We are following up on Friday’s discussion by connecting a few final dots. Then, we promise we will never mention “trade” again.

Reader Challenge

Talk about a “ball joint,” a “female end” or a “coupling” in Congress, and they are likely to get the wrong idea.

Half the members of Congress are professional, lifelong politicians. Most of the others are lawyers by trade. Then there is an assortment of dentists, psychiatrists, and car dealers. But not a single plumber.

And yet, some people think that Congress and the administration are, at least, in part responsible for our toilets. That is the assumption built into our Dear Reader Bradley J.’s challenge. He wrote:

The purpose of a nation is to defend the common interests of its citizens. Certainly the ability to earn a living at a standard of living higher than that of the Chinese worker with his family’s bathroom at the end of his block, shared with 50 other families, is part of what our nation exists to achieve.

There is no mention of improving standards of living or increasing wealth in either the Declaration of Independence or the Constitution.

And we know that, in the U.S., the private sector is responsible for toilets.

Continue reading “Trump’s Trade Deals Are a Futile Conceit”

Trump Should Focus on Debt Crisis Rather Than Trade

Guest Post by Star Parker

Trump Should Focus on Debt Crisis Rather Than Trade

Donald Trump achieved the presidency telling the American people he would “Make America Great Again.”

Given that during eight years of Barack Obama’s presidency there was not a single year in which national satisfaction, as measured by Gallup, averaged above 30 percent, tapping into Americans’ general dissatisfaction with the state of the nation was good campaign strategy.

This February, national satisfaction reached the highest its been under Trump, 36 percent. However, in March it plunged back down to 28 percent. And this big drop was fueled by a big drop among Republicans. National satisfaction among Republicans dropped from 67 percent in February to 52 percent in March.

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Trump’s unwinnable trade war with China

Guest Post by Daniel Griswold

China’s imposition this week of tariffs on 128 U.S. export products could be just the beginning of a prolonged and destructive trade war between the world’s two largest economies.

Despite President Donald Trump’s boast that “trade wars are good and easy to win,” this one could impose heavy casualties on both nations and the global economy.

A trade war is a tit-for-tat escalation of tariffs, aimed more at punishing the other country than protecting domestic producers. The Chinese tariffs announced so far are a direct retaliation for tariffs on imported steel that the Trump administration imposed last month on dubious “national security” grounds. If the Trump administration follows through on a threat to impose tariffs on $50 billion in Chinese imports based on a dispute over intellectual property, the Chinese retaliation could be exponentially greater.

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