No, the issue is that the way the tariffs were set is very, very stupid. Like, no rational person with even a basic understanding of economics or international trade would set tariffs that way.
More importantly, on a personal level, I'm not online as much as I used to be, so the opportunities for serious owns are few and far between, so thank you, man, for teeing one up for me. Next time, read the articles you post.
Going around Derek for a bit, this equation and the results it produces are really bonkers.
Consider a couple of examples. First, Cambodia, which was given a 49% tariff rate. Cambodia is very poor, which means: a.) it doesn't buy much stuff from wealthy nations, including the U.S., because it can't afford to, and b.) its workers have very low wages, so they can make stuff cheap, which means they can sell a lot of stuff to us because we like to buy cheap things. So, according to Trump's data, Cambodia exported 12.66B worth of stuff, and imported around 0.32B. Using Trump's equation above, you'd do (.32B-12.66B)/12.66B, which gets you .975, which they presumably rounded to .98, then divided that by two, to get the "reciprocal" tariff rate of .49. In other word, because Cambodia is really poor, and can't buy stuff from us, but can sell us stuff cheap, we've imposed an almost 50% tariff on their goods. Will this compel Cambodia to become rich and start buying as much stuff from us as they sell to us? Only time will tell. Also, so much for buying cheap stuff from Cambodia.
It gets worse. Recall these are called reciprocal tariff rates, with the equation in Derek's link (which he hasn't read) actually supposed to show the tariff rate that we're reciprocating. But it's just a calculation of the trade deficit. So, using the silly equation, we're told that St. Pierre, a tiny island of fewer than 6k inhabitants with no actual tariffs has a 99% tariff rate on U.S. goods, meaning, because we divide that rate by two (see Derek's article, which he should read), our reciprocal tariff is 50%:
But wait, what is the source of the trade deficit? Inhabitants bought some sort of equipment from the US, and wasn't working and needed to be replaced or repaired, so they returned it, the Trump administration used that return as an export to the U.S., and now they get a 50% tariff.
I was not joking when I said this is hardly better than using AI. Really, I think they'd have produced less ridiculous results if they'd just used AI instead of their silly little equation (from Derek's article, which he really should read before commenting about it).
No, the issue is that the way the tariffs were set is very, very stupid. Like, no rational person with even a basic understanding of economics or international trade would set tariffs that way.
More importantly, on a personal level, I'm not online as much as I used to be, so the opportunities for serious owns are few and far between, so thank you, man, for teeing one up for me. Next time, read the articles you post.
The lesson of St. Pierre is that we just need to return all of the Jordan's to Cambodia, and we'll be all even.
Going around Derek for a bit, this equation and the results it produces are really bonkers.
Consider a couple of examples. First, Cambodia, which was given a 49% tariff rate. Cambodia is very poor, which means: a.) it doesn't buy much stuff from wealthy nations, including the U.S., because it can't afford to, and b.) its workers have very low wages, so they can make stuff cheap, which means they can sell a lot of stuff to us because we like to buy cheap things. So, according to Trump's data, Cambodia exported 12.66B worth of stuff, and imported around 0.32B. Using Trump's equation above, you'd do (.32B-12.66B)/12.66B, which gets you .975, which they presumably rounded to .98, then divided that by two, to get the "reciprocal" tariff rate of .49. In other word, because Cambodia is really poor, and can't buy stuff from us, but can sell us stuff cheap, we've imposed an almost 50% tariff on their goods. Will this compel Cambodia to become rich and start buying as much stuff from us as they sell to us? Only time will tell. Also, so much for buying cheap stuff from Cambodia.
It gets worse. Recall these are called reciprocal tariff rates, with the equation in Derek's link (which he hasn't read) actually supposed to show the tariff rate that we're reciprocating. But it's just a calculation of the trade deficit. So, using the silly equation, we're told that St. Pierre, a tiny island of fewer than 6k inhabitants with no actual tariffs has a 99% tariff rate on U.S. goods, meaning, because we divide that rate by two (see Derek's article, which he should read), our reciprocal tariff is 50%:
https://x.com/a60483647/status/1907845183762268378?t=2fDogTqNqbKsncntRHVoYg&s=19
But wait, what is the source of the trade deficit? Inhabitants bought some sort of equipment from the US, and wasn't working and needed to be replaced or repaired, so they returned it, the Trump administration used that return as an export to the U.S., and now they get a 50% tariff.
I was not joking when I said this is hardly better than using AI. Really, I think they'd have produced less ridiculous results if they'd just used AI instead of their silly little equation (from Derek's article, which he really should read before commenting about it).
Strange to have a self-described billionaire as president, and the richest man on the planet as, er, co-president, and ask where the oligarchs are.
I mean, I get the joke, but the oligarchs are in the fishin' building.
OK, you didn't read the article you posted.
Did you read the article you posted?
Yes, using exports-imports divided by imports, then dividing that by 2, is much more scientific than using AI.