by yeknoda on 4/6/25, 3:45 PM with 83 comments
by nipponese on 4/6/25, 5:16 PM
by ChrisArchitect on 4/6/25, 5:31 PM
(2003)
Discussion a few days ago: https://news.ycombinator.com/item?id=43579908
by throw0101d on 4/6/25, 5:02 PM
In a more recent interview in March 2025:
> Asked about how tariffs will affect the economy, Buffett stated, "Tariffs are actually, we've had a lot of experience with them. They're an act of war, to some degree."
> I asked, "How do you think tariffs will impact inflation?"
> "Over time, they are a tax on goods. I mean, the Tooth Fairy doesn't pay 'em!" he laughed. "And then what? You always have to ask that question in economics. You always say, 'And then what?'"
* https://www.cbsnews.com/news/warren-buffett-on-legendary-was...
by tromp on 4/6/25, 4:34 PM
> The time to halt this trading of assets for consumables is now, and I have a plan to suggest for getting it done. My remedy may sound gimmicky, and in truth it is a tariff called by another name. But this is a tariff that retains most free-market virtues, neither protecting specific industries nor punishing specific countries nor encouraging trade wars. This plan would increase our exports and might well lead to increased overall world trade. And it would balance our books without there being a significant decline in the value of the dollar, which I believe is otherwise almost certain to occur.
> We would achieve this balance by issuing what I will call Import Certificates (ICs) to all U.S. exporters in an amount equal to the dollar value of their exports. Each exporter would, in turn, sell the ICs to parties—either exporters abroad or importers here—wanting to get goods into the U.S. To import $1 million of goods, for example, an importer would need ICs that were the byproduct of $1 million of exports. The inevitable result: trade balance.
by nipponese on 4/6/25, 6:33 PM
The issue may be that sovereignty is hard to measure, but I think we have been complaining about the long-tail effects for a while:
- wealth inequality (as businesses become optimized on foreign labor, execs are paid more and workers less)
- job security (volatility for investor class means sudden job cuts or offshoring)
- asset inflation in real estate (no one can afford a freakin house)
- WAR (we have an obligation to defend our debt owners in the Middle East)
Every time the public trust gets violated, we lose a small piece of our future.
by ComputerGuru on 4/6/25, 4:39 PM
by Luc on 4/6/25, 4:43 PM
by paxys on 4/6/25, 5:08 PM
"Be fearful when others are greedy and greedy when others are fearful".
by BrickFingers on 4/6/25, 6:48 PM
Can someone explain how this translates for average American citizens? What have been the effects, if any, of consistently trading at a deficit since the 80s?
I've been trying to wrap my head around it, but it seems like there are so many factors at play that the effects aren't obvious.
My intuition is that maintaining trade deficits could cause inflation since US often needs to print money to service its debts. But, that only depends on consistent budget deficits. Inflation also depends on Fed rate somehow...Do consistent deficits increase housing prices? I'm lost..
I hardly know anything about econ. But, my gut feeling is that the effects of 40 years of trade deficits should be clearer than they are. It feels like maybe the status quo has been artificially propped up.
by fbn79 on 4/6/25, 5:56 PM
by tim333 on 4/6/25, 7:34 PM
One issue with the story is he suggests the people selling America stuff, say China end up accumulating American land and owning the country but it's not what generally happens in practice. In practice foreigners tend to end up either with US dollar debt, which tends to inflate away, or equity in US companies, of which YCombinator and similar churn out hundreds of new ones each year.
Another thing is foreigners may end up buying some US real estate but the likes of Amazon ends up taking over much of the worlds retail industry as local shops close around the globe.
For reasons like this it's probably not worth worrying too much about the deficit and leaving it to market forces to figure out.
by BJones12 on 4/6/25, 4:02 PM
by legitster on 4/6/25, 6:47 PM
It's a self-correcting problem - if the dollar starts losing value, that strengthens or our ability to export. And if countries want to manipulate their currency to maintain their ability to export, then they are helping pay to maintain the balance.
by lr1970 on 4/6/25, 10:15 PM
by rayiner on 4/6/25, 4:50 PM
> But imagine that the Japanese both want to get out of their U.S. real estate and entirely away from dollar assets. They can’t accomplish that by selling their real estate to Americans, because they will get paid in dollars. And if they sell their real estate to non-Americans—say, the French, for euros—the property will remain in the hands of foreigners. With either kind of sale, the dollar assets held by the rest of the world will not (except for any concurrent shift in the price of the dollar) have changed.
> The bottom line is that other nations simply can’t disinvest in the U.S. unless they, as a universe, buy more goods and services from us than we buy from them. That state of affairs would be called an American trade surplus, and we don’t have one.
> But under any realistic view of things, our huge trade deficit guarantees that the rest of the world must not only hold the American assets it owns but consistently add to them. And that’s why, of course, our national net worth is gradually shifting away from our shores.
by Calwestjobs on 4/6/25, 6:03 PM
Which companies "enabled it". Which companies got fined for brexit? Facebook AND Cambridge Analytica did and did.
Look what for example Cargill UK "assets" were before brexit and what they are now.
Yes sounds like conspiracy theory, but point is most other comments here do not seem to understand that economic war is constant, permanent, global. and wars do need more then one party to be war. in economic war all participants are either attacking or they stop to exist. And USA IS attacker, because it still exists.
globalism means you plunder from longitude 0-10 then you plunder from longitude 10-20... until you are biting your own ass. or russia will stop you at longitude 28, because russia enslaved / robbed their own people so much that there is nothing to extract.
so do you want for USA to rob its own citizens or do you want USA to rob other parts of the world.
or we can globally change economic model and start being sustainable?
by JumpinJack_Cash on 4/6/25, 4:54 PM
I will just give a small example using black leather jackets.
Black leather jackets are indestructible, you can spill any sort of fluid on them, try to light them on fire (they won't catch fire) throw them in the dirt etc.
They never go out of style either, there is basically no reason why an adult should own more than one black leather jacket.
Now think of how many black leather jackets do you own.
See? People have to find within themselves the will to stop their consumerism , not with this sort of central planning idiocy. And it's not granted that doing away with consumerism is desirable either.
Like for example Trump's impact on American society was much better when he was buying planes, yachts, supercars and foreign models than what it has become of him now that he has stopped pursuing those things.
by api on 4/6/25, 5:37 PM
I mean... if we are going to have the EPA and environmental standards, then it stands to reason that we must tax imports from countries that do not. Otherwise we are just moving the pollution elsewhere while burning even more fuel to ship products here. Right? It kind of shows that a lot of environmentalism is just NIMBY-motivated. It's fine if we trash other peoples' back yards. But a lot of our big environmental problems are global, so not only is this hypocrisy but it doesn't work.
It's good that we have workers' rights and OSHA, but the same logic applies. Otherwise we are just exploiting workers elsewhere.
On a somewhat tangent... I find it kind of disturbing that the one area where I have some agreement with MAGA is the least popular and most roundly criticized MAGA policy, and the one most likely to result in an electoral defeat.
Most of the other stuff in MAGA -- isolationism, a love for strongman rule (at home and elsewhere), authoritarianism, cults of personality, misogyny, racism, etc. -- is stuff that I find horrific, but the only thing people really care about is short term economic outcomes.