The problem here isn't that the government gets involved in businesses. That has always been something they do.
The problem is that these days they do it capriciously, without any sort of plan or intention.
The government played a foundational role in supporting the early stage research that enabled companies like Intel to emerge. Underwriting that sort of long-term investment that wouldn't easily attract commercial capital is a great place for them to be.
Meanwhile, is it even the case that the American chip industry is declining? Apple, Nvidia, and Google all have significant chip manufacturing operations. And this isn't an industry I even follow particularly closesly.
> Apple, Nvidia, and Google all have significant chip manufacturing operations
No, they all (as well as AMD) all have significant chip designing operations. Not one of them can actually fabricate their own chips. Every single one of them must speak to TSMC or Samsung if they want to take their designs from the whiteboard to the physical world.
Thanks for clarifying! I misspoke there, but from my standpoint (portfolio manager/equities investor) that's better.
Wafer fabs are capital intensive, complex, and need constant retooling. The bulk of the commercial value lives in the stuff you do on your whiteboard.
From a geopolitical standpoint, I'll concede there's value in having the ability to actually make the stuff without acceding to the duopoly. But I'd still rather see the capital invested in basic research which might change the capital dynamics of the industry in the intermediate to long term.
> Thanks for clarifying! I misspoke there, but from my standpoint (portfolio manager/equities investor) that's better.
From a national security point it really, really isn't. Like, I'm not a fan of the Trump administration, but having basically all chip manufacturing in Asia is not a good idea if you think there'll be a war with China in the next few decades.
Another commenter already noted the CHIPS[1] act, which was a deliberate act to try and specifically bring fundamental high value chip manufacturing and science to the United States.
It is extremely relevant to this conversation. Regardless of whether you think China engages in a war with Taiwan, it is a crucial resource the US will want developed locally (similar to any critical resource like farming, steel, or rare earth metals).
CHIPs seemed more well thought out than simply taking control of 10% of Intel.
>but having basically all chip manufacturing in Asia is not a good idea if you think there'll be a war with China in the next few decades.
I see this a lot, but I’m not smart enough to understand it.
The US still has immense military power. Is the suggestion China/Asian is going to make the US so desperate for lack of chips that they use this power? Whether the manufacturing plants exist in Texas or Taiwan, the US military basically ensures they exist. And if that supply is cut off and that is forecasted to be the turning point of a war, then with a figurative push of a button, the US military makes sure that other countries also don’t have chip manufacturers (i.e. blows them up). Similarly, other countries can target plants on US soil if war breaks out anyways.
I don’t see a war coming to that point or to the US losing access to chip manufacturing because of one. What don’t I understand from this angle?
That said, I do think it’s important for the US to have their own chip manufacturing on shore. Not as some protective measure over some combat war, but (1) to ensure less possible influence from foreign governments and decrease likelihood of possible backdoors or intentional sabotage and (2) to protect against other factors from shutting down the facilities, like natural disasters.
This is quite a naive take, sorry to say. It is absolutely true that a war is brewing in East Asia, part of the explicit intent being to control other countries' chip usage. This is the same sort of argument that was used during World War I when the major powers said there'd never be a war on the continent because every country was interconnected in commerce and culture, and well, it turns out that reasons for war aren't always rational.
What happens if the PRC annexes Taiwan without bloodshed?
The options available to the US are: attack the PRC to blow up the chip manufacturers and probably start WW3, or frantically try to replicate the capabilities of the Taiwanese fabs before the PRC decides to cut the US off.
In the meantime, the PRC will have immense leverage over the rest of the world, and there is no scenario where they don't extract as much as they can from that advantage.
I’d rather prepare for life with China in total control of Taiwan than try and defend Taiwan from China. I believe they will take Taiwan without bloodshed, anyway. Which is why it is critical to build up the US advanced manufacturing base. It will take a long time and cost a lot of money.
I believe the US government agrees with you, which is why they are investing in domestic alternatives to TSMC (including encouraging TSMC to build a plant in the US).
I don't think it's likely to happen, but it's certainly an option I would prepare for if I were the US government.
As to why the US would allow it to happen, the PRC could take steps that would make the defense of Taiwan politically undesirable to the US (threatening biological warfare is one example that comes to mind).
I am not sure what you are trying to say? That the US can simply press a button and end a conflict with China? China has been posturing forever on Taiwan being a part of China. They love to show of bridges and boats that would be able to facilitate a land invasion. We have already seen how quick China integrated HK. It is not a nonzero chance that China makes a move on the US. If that happens, where are the chips coming from. It’s smart to want to increase geographical diversification for something that is used in almost all tech products.
>China has been posturing forever on Taiwan being a part of China.
And yet they continue to just posture instead of doing it.
The US does maintain a small military presence in Taiwan already.
Answer me this: if the US is so heavily dependent on Taiwan _not_ being part of China, then why would they let them take it?
US bringing chip manufacturing in country weakens Taiwan’s position and only then will China take it, when it feels safe from retaliation from the US.
They maintain a small military presence? Not really, there are no bases and last report in March was 500 US military trainers. I would not really classify that as a military presence.
If China wanted to take Taiwan today? Honestly not sure what would happen. Maybe the US intervenes, maybe not. I am not even sure how I feel about either side. What I do feel strongly about is that it’s best both for the world and the US to reduce chip concentration from Taiwan. I believe in comparative advantage but also believe sometimes it’s useful to guide the invisible hand when there are crucial industries. I don’t even know how I feel about China. They have done amazing things in lifting their country, especially when compared to close neighbors like India but also I never can get a good feeling for their intentions as they play a much longer game than most of the West.
War with an actor like China would not be pretty. Their country has seen no real conflict so there is question about battle readiness but missles and drones don’t need much training and I personally don’t want to test it. So while yes I don’t think China is making a move today, I also believe it’s a highly complicated problem for its concentration risk, maybe they make a move tomorrow and the world is reliant on China for chip manufacturing.
There is a 0.00% chance that the US does not intervene. That’s why we have a small presence there and a large presence in Japan. And that’s why China has not yet taken Taiwan.
I think this is where youre missing it
> The US still has immense military power.
Because this isnt true anymore and its been proven over and over in the past few years. As industrial power goes so does military and the US military is showing huge cracks while facing 3 massive wars in the pacific, ukraine, and middle east. Its already admitted it cant protect all 3.
The chinese just this week shut down the entire US auto industry because of rare earth if they blockade taiwan how long until they win that.
You explained the issue perfectly we are moving past a age and time where we care what portfolio mangers/equity investors want. The point is to do things those investors hate but benefits the US government which you explained they wont do without force.
If you can't manufacture your chips while your only geopolitical rival is pumping infinite money to homegrow their own fab business, it probably should cause some concern.
If the only source of high quantity and high quality chips is located in your competitor's backyard, and they spent several decades repeating how it's their wayward province that they fully intend to reclaim one way or another, it's pure stupidity to sit around and do nothing.
Let's not pretend that the money would be spent on basic research instead, by the way. US pumping some money into chip production is a rare spark of intelligence amidst an avalanche of stupidity and grift.
If I don't know something, I don't make statements such as "Apple, Nvidia, and Google all have significant chip manufacturing operations..." a bit of humility goes much longer way than this.
Which American companies manufacture chips on the latest node? Certainly not Texas Instruments, Global Foundries and one might even argue Intel, compared to Samsung and TSMC. It is a matter of national security that Intel not fail.
What government or military things use anywhere near the latest node chips though? I thought all that stuff usually uses really old chips, because that stuff only changes like once every couple decades.
The government wants to build AI data centers and I'd assume they're not using decades old nodes to do so. There is always a use case and therefore national security interest for the latest nodes.
It is a matter of national security that state-of-the-art fabs exist within the nation and that the expertise to operate them also exists within the nation.
As you point out, it is questionable whether Intel has either of these.
It might be argued that it is critical to national security that Intel be replaced by HP. Or Nvidia. Or Sun, or Motorola, or Micron, or TI, or...
What's that you say? Most of those companies had their chance and failed? None of those companies are really in the game?
Why among all the list of failed or current fab owners is it so important that Intel be declared sacred?
Why not recognize that Intel is getting its clock cleaned by a company that doesn't design chips? Why not look outside of the chip design industry to save the chip fab industry?
The bet seems obvious - Intel has been failing for a while, but they're still much better positioned to produce what the US government wants than some random companies like HP or TI. Their fabs aren't quite on the bleeding edge and the yields aren't quite what they'd like to have but it's still much more advanced than TI's 45-250nm fabs.
If HP, or Nvidia, or Sun, or Motorola wanted the bag maybe they should've tried building their own modern fabs.
Because Intel is the only player left. What do you mean look outside the chip design industry to save the chip fab industry? It takes a very long time and lots of money to spin up a new state of the art fab, while Intel already has it mostly set up.
> Why among all the list of failed or current fab owners is it so important that Intel be declared sacred?
Has TI ever made anything nearly as complex as CPUs? Has NVIDIA? (Hint: the answer is "no"). Intel is pretty much the only option, though ChatGPT suggests GlobalFoundries as a potential other option (spun out of AMD).
Intel is definitely special in that it's the only truly American fab.
I don't have a problem with a US government owning a stake in Intel given its massive strategic importance, but I have a problem with this government owning a stake in Intel given its brazen corruption.
the corporate credit rating scale is different from the sovereign one. That said, msft credit has traded through govt bonds multiple times. So arguably the market-based rating system agrees with you (even though the ratings agencies dont neccessarily)
This is the way that foundations and endowments should operate.
Too many well-intentioned organizations wind up milquetoast tax-exempt hedge funds aimed primarily at self-preservation because the received wisdom is that they should focus on building endowments and keep their withdrawal rates below 4% in order to achieve immortality.
I'm a big believer in research-driven philanthropy and mission-driven organizations. But i've seen the institutional desire for self-preservation supersede essential purposes at a few of them, with disastrous implications for their effectiveness.
The Gates foundation probably controls ~5% of the ~$2T that charitable foundations have in endowments globally. If the majority of these organizations adopted these sorts of depletion goals, their program budgets could probably more than double.
Ha ha, well here's mine. First, I'm way ahead of Mr Gates: I'm already worth almost nothing.
But if I had billions to give, I would be supporting Science Education, Democracy and Journalism. Scholarships for bright, motivated students.
With all due respect to Mr G, I don't believe any of his objectives is possible with stable, educated, science-orientated social progress. Humanity depends on it.
>Too many well-intentioned organizations wind up milquetoast tax-exempt hedge funds aimed primarily at self-preservation because the received wisdom is that they should focus on building endowments and keep their withdrawal rates below 4% in order to achieve immortality.
Which charities are giving away less than 4% a year? Charitable foundations in the US are required to give away at least 5% of their endowment a year:
All money spent is voting for allocation of resource. Sometimes there is too much money fighting the same goods in which case it may not be a good allocation of resources. That money can sit to become more money.
At a societal level, immortal wealth is incredibly bad.
At a personal level, because wealth sitting still, having 4% pay for the overhead of maintaining the 96% and then using the pennies left doesn't accomplish much of significance.
Nobody allows money to sit. People deposit the money into banks. Due to fractional reserves, that's equivalent to loaning the money out so that others can efficiently allocate it instead. That's how money becomes more money.
Charities that aren't actually spending money to do good are just banks in disguise. Banks that don't pay out interest. Why would anyone donate even one cent to banks?
You can always wait another year. And then another. When is it time? 50 years? 100 years? "We will maximise good by donating it all in 1000 years" is questionably not a charity at all; it's just a massive pile of money that isn't used for anyone but paying the people sitting on it.
Even if you trick-feed donations to charity over 100 years, the sums may be insufficient to reach a usable scale.
- A big investment in research.
- A concentrated push to vaccinate against a Disease so it goes away for good.
- An infrastructure investment that lifts a community out of poverty.
These themselves produce "good over time," perhaps even faster than the money in the fund rises in value. It's a balance, but immortal trickle donations are likely quite far off to one direction of that scale.
> my first thought is "my favorite store is having a sale."
This gets repeated a lot, but unless you already had most of your portfolio in cash it’s not actually a net win to see a drawdown like this.
The course of the global economy was just altered. The best case scenario would be if the proposed tariffs go away completely, but even then the markets will be cautious for the next 4 years at minimum.
The market is down because the future prospects for those businesses just got much worse. Yeah you can buy them at a cheaper price, but their corresponding future output remains down as well.
It’s like seeing a thing you wanted to buy go on sale, but upon closer inspection it’s on sale because it became damaged and you’re buying damaged goods.
The best case scenario is that the administration pulls the “just kidding” card, reverses course, and claims some sort of victory while returning to the previous status quo. If that happens, stocks were briefly on sale even though they’re not rebounding back right away. However, if the administration digs their heels in and tries to push forward then the market is going to continue downward.
This isn’t a normal drawdown. This is a crisis with the leadership of the United States.
> The market is down because the future prospects for those businesses just got much worse. Yeah you can buy them at a cheaper price, but their corresponding future output remains down as well.
It should be noted that these moronic "buy the dip" claims are happening when Dow Jones is in a freefall, so the poor people who bought the dip on Friday will today wake up with a portfolio loss of >5% without the market even reopening.
It's funny when these chants take place when prices start to plummet. It's like investors are screaming for unwitting people to buy the bag off their hands.
> will today wake up with a portfolio loss of >5% without the market even reopening.
That's pretty much irrelevant unless you opt out next reopening. If you have your portfolio down 15%, 20% or 30% it does not matter. That's the short term picture. If you're investing and looking at how those numbers fluctuate to make decisions and panic you will lose money for sure. No different like going to the casino. You're supposed to buy and hold forever, regardless the market crashes or rises. That's Bogle's advice and I believe is sound advice. So, there could be an opportunity to buy lower now if you are playing the long game.
> That's pretty much irrelevant unless you opt out next reopening.
Not really. If your goal as an investor is to maximize your returns. Obviously, buying a security when it's value is cratering is the worst time to buy simply due to the fact that, in a scenario of an unavoidable bounce back, waiting out while doing nothing is more profitable. Buying earlier in the crash simply means the profitability of your hypothetical scenario is lowered.
> If you have your portfolio down 15%, 20% or 30% it does not matter. That's the short term picture.
I don't think you fully grasp the implications. Even assuming a simplistic interpretation of an unavoidable bounce back, if you postpone buying after the price craters 30% then you're guaranteeing your investment will be more profitable. Remember, the trick is to buy low and sell high, not buy high and hope it will somehow get higher.
Problem is that no-one knows when that's going to happen and it can bounce back as fast as it went down, meaning in that situation you would be missing the opportunity too. The investor strategy as per Bogle is simple: buy regularly, regardless the market and hold it forever (until you retire). I don't want to speculate, because that is known to be a losers game. I read some time ago "The Little Book of Common Sense Investing" and to me that seems to be good enough advice to stick with. It's simple and as for what I read from other sources it works.
> Remember, the trick is to buy low and sell high, not buy high and hope it will somehow get higher.
If you take a look at the historical S&P500 (1926-2016) trend even taking into account market crashes the curve always goes up in the long term. That's why Bogle's strategy works.
We can fall a lot more, and people who are buying the dip on credit aren't necessarily taking a long term view of the market. Who is keeping a few hundred K in their bank account just in case the market crashes so they can take advantage of it?
Also, 2008 you needed 5 years to recover if you bought at peak (buying as it was lower of course means less time to recover). In 1930, you were looking at 20 years. You could also lose your job if the market really tanks, and buying the dip just means you are less liquid at a time when you need money for living expenses.
You're assuming something like all or nothing. As I mentioned I do investing regularly, just as if you were saving money after you paid your bills and you have spare money that otherwise would be sitting in your bank account. Even if I had the amount you mentioned it would be at least for me too risky to do that move. I would do it regularly. If people are taking credits to do that, well they are making an extremely risky move as well. Just because the market could go down doesn't mean that you have to make an all-in move.
I'm assuming worst case, which is what you have to prepare to survive through.
> As I mentioned I do investing regularly, just as if you were saving money after you paid your bills and you have spare money that otherwise would be sitting in your bank account.
You are supposed to have 3-6 months of living expenses in your savings account just in case you lose your job. Is that what you are talking about using to invest in a dip?
> Even if I had the amount you mentioned it would be at least for me too risky to do that move. I would do it regularly.
Yes, but you are also saving money for events where you need liquidity right?
If the tariffs go on for awhile and consumption becomes expensive, we can always just cut back on consumption and invest that money instead (Americans consume a lot anyways), that is what the Chinese have been doing all along at least (although they wished their consumers would start consuming more). We are basically going to swap places with the Chinese, the writing on the wall is clear.
To be honest, “buy the dip” is generally cope that people tell themselves.
The average investor isn’t sitting on a pile of cash just waiting to move it into the market. People investing periodically over decades have far more in the market than out. The “buy the dip” stuff ends up being a little bit here or there so they can convince themselves not to worry, not an appreciable swing in their portfolio.
> "Buy the dip" is just code for "stay invested." Obviously most people aren't sitting on piles of cash.
Not really. It's literally a call to action to counter what the market is doing, in hopes that it can prevent and recover trends. They are literally telling others to buy when everyone around them is selling.
My two favorite trading terms: “catching a falling knife” and “dead cat bounce”. You don’t want to buy until you’re sure it’s reached bottom. So you look for signs of rebound, but you can be fooled by a dead cat bounce. Because if dropped from high enough, even a dead cat will bounce before coming to rest.
Being able to do the opposite of what others do is a useful quality to have as an investor.
I don't tell random people to "buy the dip" because I don't want to be responsible for the myriad dumb ways people interpret that advice, but it's not at all an unreasonable thing to say to someone who knows what they're doing.
> To be honest, “buy the dip” is generally cope that people tell themselves.
I don't think so. "Buy the dip" is a call to action to third parties to irrationally invest their resources in a way that benefits you personally. It's a call to not believe what they are seeing, and that doing the opposite of what would be prudent or reasonable is somehow something that is in their best interests.
You already hear fantastic claims like "buying the dip is what rich people do to get rich". Yeah, buy low-sell high is good business. But that only works when you actually buy low. If you buy in when the freefall starts, aren't you buying high? How is that good business?
To buy the dip you need liquid cash sitting around earning very little, hoping the market goes down.
Reallocate portfolios if that makes sense, but much of the “buy the dip” stuff implies good market timing: To do it in meaningful amounts you’d have to pick the right times to not invest, accumulating cash at a lower rate, then you’d have to know precisely when to invest it again, switching it back into the stock market.
Yes. This is one of the reasons 80 stocks / 20 bonds is a common strategy. The rebalancing "forces" you to buy low and sell high.
When stocks dip, your portfolio might become unbalanced at 70/30, so you reallocate funds to buy stock bringing you back to 80/20. Conversely, if stock market soars, you might get to 90/10, and selling stocks would bring you back to 80/20. Performing this balancing is, in effect, "buying the dip"
This opinion is even worse ^; Literally nobody can predict what the bottom is (except magically the group with strong political opinions /s), but what amazes me is people are willing to give out bad advice in an attempt to create a realization of the ideology.
>This isn’t a normal drawdown. This is a crisis with the leadership of the United States.
The same thing happened just 4 short years ago when covid hit. Mass panic and then intervention kicked in. The intervention could have been taken away at any time but the market went extremely risk-on anyway and you would have gotten left behind if you sold out.
>but even then the markets will be cautious for the next 4 years at minimum.
You are overestimating the cautiousness of the market. Unless there are better returns offered in some other investment, the capital is going to pile back in if something like tariff deals start getting announced.
>>This isn’t a normal drawdown. This is a crisis with the leadership of the United States.
>The same thing happened just 4 short years ago when covid hit.
If by "same thing" you mean the market crashing, then yes, it's similar. But the cause of this isn't the "same thing" at all. For the next 4 years, the USA will have a president who wants to annex Greenland and Canada, who hates most (all?) US traditional allies and trading partners, who doesn't believe in free trade. The effects on the world economy are going to be slower to take effect compared to COVID, but they're going to be much deeper and long lasting.
The effects of covid were literally being talked about as the entire world economy grinding to a halt overnight. It was mass panic beyond high tariffs for a foreseeable future.
The market was in straight free-fall until all of the major govts stepped in to print trillions. It was like a light switch made the “end of capitalism” disappear in a day.
> The same thing happened just 4 short years ago when covid hit.
COVID was a natural disaster. Leadership responded to it.
This is the opposite. Markets were going well. Leadership intervened to crash them.
Do you see the difference? It’s not the same.
> You are overestimating the cautiousness of the market.
You are underestimating the impacts of risk premia.
This administration just showed that they don’t know what they’re doing, but they’re willing to go all-in on disastrous economic policy. They’ve already waffled on previous policy and then came back and doubled down. They’re still talking about more tariffs.
This isn’t a little “oopsie” any more. It’s a pattern. It’s going to be a long 4 years until we can get back to stability.
> Unless there are better returns offered in some other investment
You are so close. It’s not just returns, it’s risk. Trump just made the market hyper risky.
Yeah, I think it’s worth emphasizing: we are in Month 4 and there’s already been an enormous amount of chaos.
We haven’t even seen the effects of the agencies getting cut. Sure they’re running for now, but burnout can set in quick for the remaining employees and some YC investor-clown’s delusional dream of an “AI” workforce isn’t going to save us.
I’m just one fish in the sea of retail investors but I won’t be in any rush to convert cash savings into investments with this current trajectory.
Besides, cash is infinitely more useful for my mortgage payments — especially if layoffs in the private sector start.
The covid crisis was an actual event in physical reality not caused by admin policies.
This crisis is the admin taking a sledgehammer to international capitalism. No obvious intervention other than "stop doing that".
I'm sure at some point the fed would have some kind of response but inflation of tariffs is a huge risk and that limits what the fed can do unless they have co-ordination with the admin.
> The covid crisis was an actual event in physical reality not caused by admin policies.
Sortof yeah, but also sortof not. Basically any non-Trump president would have been briefed about Covid in January 2020, and most of the previous ones invested a bunch of resources into making sure that the disease was contained far away from US shores.
Even Bush II would have done that (and did, I believe for SARS).
It's a possibility. SARS II was much harder to contain though. The first SARS actually made it to North American hospitals, but was contained. It didn't spread in the populace.
Once SARS II made it out of China, only globally coordinated net 0 case policies could have stopped it. I think it would have been worth trying for but there was no appetite for it.
> It's a possibility. SARS II was much harder to contain though. The first SARS actually made it to North American hospitals, but was contained. It didn't spread in the populace.
Totally fair, but as I recall he didn't even try to keep it away from US soil (which had always been the CDC approach).
Let's remember that it was much worse than it had to be, because the same President actively causing this current catastrophe thought he could just ignore the problem and it would go away.
> (...) the capital is going to pile back in if something like tariff deals start getting announced.
What leads you to believe that scenario is realistic?
I mean, the list of US trading partners is dominated by less than a dozen trading blocks: EU, Mexico, Canada, ASEAN, China. That's it. Trade with India is as significant as trade with Italy alone, and a massive deal with them would barely move the needle in this trade war.
Unless the US somehow makes it's own trade war go away with the likes of Canada and the EU, there is no bright outlook for the market and economy. Trump's administration is repeatedly threatening both with annexation.
To make matters worse, do you really believe any trading block will move back to preserve economic ties with the US after this mess? Not a chance in hell.
The EU, which thanks to the Trump administration is already scrambling to prepare for a war with Russia, is excluding the US from supplying them arms. This is the extent to which these trading blocks are going to shed ties with the US.
Do you think things will just go back to how things were 6 months ago? The Trump administration ensured this is impossible.
> the list of US trading partners is dominated by less than a dozen trading blocks: EU, Mexico, Canada, ASEAN, China. That's it.
ASEAN countries are eager to make a deal. The USMCA deal is still in tact with Mexico and Canada.
> The EU, which thanks to the Trump administration is already scrambling to prepare for a war with Russia, is excluding the US from supplying them arms. This is the extent to which these trading blocks are going to shed ties with the US.
Germany is in an energy crisis and a few other members are close to a sovereign debt crisis. Domestic production of weapons will be tough and expensive. The EU’s plan to sell bonds to pursue war with Russia looks horrid. They’re in no position to be in a trade war. In a few months time when this reality sinks in, they will have to make a trade deal and remove US tariffs.
> Germany is in an energy crisis and a few other members are close to a sovereign debt crisis. Domestic production of weapons will be tough and expensive. The EU’s plan to sell bonds to pursue war with Russia looks horrid. They’re in no position to be in a trade war. In a few months time when this reality sinks in, they will have to make a trade deal and remove US tariffs.
This really, really depends on how things evolve this week. Like, the EU will 100% tarriff the US (and probably China to prevent dumping) this week.
The big question is whether or not they use the Anti-Coercion Instrument, and hit US tech and financial services. Selfishly, I hope they don't (as I work for a US fintech while I am based in the EU), but this will probably happen if Trump retaliates to this week's sanctions (which he probably will).
This is gonna get a lot worse before it gets better, unless there's a unilateral pullback on the part of the US (which seems very unlikely).
> But why does the EU even want a manufacturing sector, don’t you all realize that no sane person wants those jobs?
Why do you equate responding to Trump's tariffs with "want a manufacturing sector"? Trump is pushing the US to isolate itself from the world, not the EU. A few years ago the likes of Volkswagen were investing in auto factories in Morocco.
> Indeed. That's especially true on the NATO side. This is a historical event on the scale of the breakup of the USSR.
Exaggeration isn't helpful. Whatever "this" is, you can't possibly make an assessment of that kind until years after the fact.
In March 2020, people were convincing themselves that the global economy was flying straight into the ground, but people who didn't lose their minds made a lot of money, quickly.
IMO, there was a better case for that panic, given the context (they were partly right! the lockdown stuff was incredibly costly!), than there is that this particular spasm is meaningful. Only time will tell.
> Exaggeration isn't helpful. Whatever "this" is, you can't possibly make an assessment of that kind until years after the fact.
I don't think you fully grasp the gravity of Trump's actions.
For the first time in its history, NATO is excluding the US from arms purchase programs. This takes place at a time where the EU is scrambling to prepare for a war with Russia, which is also caused by Trump's action of abandoning it's allies,
The Trump administration is also heavily invested in annexation rhetoric targeting multiple NATO members.
Then there's the whole tarrif absurdity.
These sequence of moronic steps individually represent world-changing events. They all took place in a couple of months into the Trump administration's takeover.
This goes well beyond the suspicion that Trump is a Russian stooge. This changes the way the world was structured after WW2. The fall of the soviet union might even have a smaller impact in world history.
> I don't think you fully grasp the gravity of Trump's actions.
I "grasp the gravity", to the extent that anyone is actually able to do so at this time. I am unwilling to engage in hyperbole in order to create the illusion of a nearby black hole.
This is a non-partisan reaction. I am opposed to tariffs; I am also opposed to panic and exaggeration.
> This goes well beyond the suspicion that Trump is a Russian stooge.
Your choice of neutral, unbiased language is compelling.
The first man on the moon, the breakup of the Soviet Union, September 11 - these were all things that people predicted would be monumental world-changing events at that point in history, and also proved to be after the fact. Maybe history will prove us wrong, but this feels like one of those moments to me.
I mean we correctly estimated that the breakup of the USSR was a big deal without hindsight.
People who didn't panic during the covid crash made money not because they understood the situation but rather because the money supply went into the stratosphere.
The closest modern analogy might be Liz Truss’ short tenure in the U.K. Her actions paled in comparison to this absurd tariff situation but the only way to resolve it and restore confidence was for her to resign.
The problem in the US is that the tariff situations is bonkers insane, was clearly not thought out at all, and the person controlling the strings is talking about ways to run for a 3rd term instead of considering resignation.
This is a political crisis. The best we can hope for is that the Senate pushes forward with attempts to reign in the president’s tariff powers and the House actually goes along, which is unlikely right now.
I think we’re going to start seeing Republicans test the waters with breaking rank with Trump soon though.
Yeah really, Truss really is the most salient yardstick, with the complication that any analogous action in the mechanisms of american politics feels slightly unfathomable. And I was shocked enough at Truss' ouster.
It's all so divisive, but it frustrates me to no end that likely the biggest end that people trying to defend this, without any admission this is a crisis of confidence waiting to happen if it's not already there.
The amount of political capital immolated for the sake of this course of action is flatly embarrassing.
It doesn't really matter what they want or how long they think it's going to take to get it, the damage is already done.
> I think we’re going to start seeing Republicans test the waters with breaking rank with Trump soon though.
This is already happening. The snag is, until the break adds up to a 2/3 majority in both House and Senate, a presidential veto of a bill reversing the tariffs cannot be overridden. And to get to 2/3, a lot more pain is going to have to be felt in Trumpland.
If people start turning against Trump, Congress will follow. Look what happened after the 2022 terms. Dems over performed and everyone immediately tried to make Ron Desantis a thing.
Sharks will always be in the water around Trump waiting for him to slip. The question is, will Independents(maybe even some of the base) shift hard away when they start feeling the pain of the tariffs.
Loss of trust and finding other sources for the things they used to buy from the US, perhaps even producing those things themselves and becoming a new competitor the US didn't have before.
If it's reversed faster than alternatives are in place, then it won't matter too much if the trust is there because what alternative is there? The logistics and stuff take time to change. If it persists long enough, then the trust piece will be more of a factor.
Mone of that really has to do with the tariffs. Consumers will continue to buy what they can afford. This won't reduce that much, probably by about 5% is my guess based on multiple factors. Most healthy companies will continue to operate just fine. Market confidence is down, but it's been fragile due to it's overvalued state for a while. Aside from tariffs, policy outlook is very business friendly.
This mostly a market overreaction or correction from being overvalued if we look at the past. This Chinese trade war has been going on since Trumps first term (at least). The rates on the top import/exports have been around or over 25% for a while. It's also interesting how much China is hurting itself with pork. The Chinese own Smithfield and are a huge importer of pork from the US, yet they slapped an 80% tarriff on it?
It will affect if people buy a Honda they don't 100% need right now, or keep emergency money in case things go worse. Which on larger scale will still affect prices of everything.
Every time this happens people say it’s different. See: COVID pandemic. And we know the V shaped recovery that came after that. Of course that shouldn’t be interpreted as a predictor of what’s to come next (because it’s not), my only point is to say that the same rhetoric pops up frequently during downtowns since forever.
This is different. It was entirely avoidable. Entirely predictable. Entirely preventable.
Hell, it’s mostly reversible if the administration would own their mistake. But they won’t.
That’s the problem: This is not a natural disaster or even a reaction to a market-created crash. It was orchestrated by the people who were supposed to be doing the opposite.
I don’t believe claims that the United States is doomed or other hyperbole. I do believe that this is firmly different than anything we’ve seen in our lifetimes though.
After the initial COVID phases nothing major really changed long term as far as the world balance goes though. Everyone got affected, everyone started recovering. Things may have been uneven, but not like now, right?
Up until WWII happened I doubt many people would have believed that sort of death and destruction was right around the corner. They'd just had WWI and weren't expecting that settling the unsettled business from that would be around 3x worse, break the European colonialists and ... I don't know how wiped out Jews in Europe were, but it was a painful experience although I assume some survived. The property damage was also extensive.
High tariffs isn't going to be the end of the world & this particular stage of crisis doesn't look very important. But the overall geopolitical crisis we're in as everyone realigns certainly could end the world as we know it. Both in the literal and worst case senses. Few went in to WWII chuckling and saying that they were going to break their own power permanently, but that is what a lot of participants ended up doing.
Just a comment, every catastrophe has victims, survivors, and lasting consequences. I didn't mean to trivialize that in my response. Regardless, life goes on.
In the sense that members of the human race will survive, sure. That Woodward book out recently was suggesting a double-digit chance for a nuke to get used in Ukraine. Hopefully he is prone to making things up - seems possible that life would not have been going on in at least some regions.
I simultaneously take comfort from the fact that no-one else seems as worried as me and dread from the fact that it'd be the 3rd world war that people just walked into because they weren't taking the threat seriously enough. We appear to have been watching insane policy come out of the US diplomatic establishment for a good decade now. And the crisis is still escalating.
A disease did that. Nobody knew the details, there was fear it wouldn't stop. The markets groaned and creaked under the weight of the fear and uncertainty. But with the vaccine and the reduced lethality of new strains, a disease becomes a nothing. Recovery began because nothing was in the way, the bad thing was gone.
The people in charge of the government did this. The people who will still be in charge of the government. The bad thing is not gone. The bad thing has no end in sight. And the bad thing is doubling down.
The bad thing is saying it’s no problem to stick around for a third term and beyond, and that it wants to go to war to annex territories from the closest trading partners who might be able to mitigate the impact of the trade war.
The cause really was not the disease and even loss of life from it. It was actual real world disruptions shutting down normal operations. Lockdowns, quarantines and so on. Goods stopped moving. So it is obvious that trade would slow down and thus profits would be hit, directly leading to stock prices correcting.
At the time, there was trust that the government wanted to assist the recovery. They have lost the benefit of the doubt. This actually feels malicious.
With Covid, recovery came as Covid was removed. With Trump, recovery can come with…
Did anybody actually “trust” other countries to start with? I’m reminded of the cynical yet accurate quote that nations don’t have friends, they have interests. I expect the American feds to pursue the best interests of Americans (though these policies aren’t in those best interests, it seems admin doesn’t know?) and foreign nations to do the same.
This point is especially hollow because it is true that many countries have maintained asymmetric tariffs on us. Trade deficit aside, we shouldn’t let others collect a larger % of their imports from America than we collect of our imports from them. I’d take their cries of “lost trust” more seriously if they hadn’t shown with their actions they will pursue their own advantage too.
US has been very successfully exporting its debt (quite literally, almost no other country can run such high deficits for so long) and services.
What do you think happens with all that money if Americans can’t buy those cheap imported goods anymore?
Also other countries like China or Japan won’t be able to continue buying US bonds. Basically Americans are getting free stuff funded by debt they are never going to pay back and still you have people whinning…
> larger %
US decided to charge e.g. 15 times higher tariffs on the EU than the EU does. You believe that’s even remotely reasonable?
Or do you actually trust Donald’s table that they made to confuse clueless idiots?
Successfully? We blew 3.1% of our GDP on debt service alone in 2024. This is insane, irresponsible, and unnecessary. We are mortgaging our children and grandchildren’s futures. Just like young folks like me correctly complain that old people are leeches sucking America dry - social security, medicare, housing price subsidies, decade after decade, despite a what, $1.7mm average net worth - my generation shows no signs of doing anything differently. “Screw them kids. Boomers got theirs, I’ll get mine.” If our interest burden keeps growing from 20% of federal revenues we could end up spiraling into more and more debt. Or worse we could get to a place where the fed can’t feasibly raise rates to level out the economy and moderate inflation because that would balloon interest payments to a ridiculous degree.
Where Trump is fundamentally correct is that a trade imbalance means selling pieces of your country off to compensate. Equities, bonds, land. All a claim against future money that sucks those returns out to go to foreigners. America has been lucky in the past, in that the huge market for dollars helped us avoid some of this, but that’s not a limitless solution.
Obviously the answer is not that we must make Nikes here. It’s also not that we must have zero trade deficit with any single nation. But we probably should focus on exporting more advanced goods and more services to bring our overall trade deficit down, focusing on a net zero or overall trade surplus outcome.
> We blew 3.1% of our GDP on debt service alone in 2024
As long as GDP growth outpaces (or is even) the increase in debt it’s not a big issue. Some spending cuts and mild tax increases (maybe not so mild for the higher brackets) would solve that.
> focusing on a net zero or overall trade surplus outcome.
If you looked at the countries pursuing such policies like Germany or Japan they haven’t been doing that well at all over the past 20 years. Basically no real growth and they are permanently stuck in the early 2000s. US on the other hand has been doing extremely well (lack of redistribution is another issue).
Debt growth is massively outpacing growth in GDP. You're right that it's less of an issue if we grow quickly and effectively keep leverage the same but that's not what's happening.
Germany and Japan haven't focused super heavily on achieving a trade deficit. As you said, Germany has huge problems with her welfare state and Japan has huge demographic issues. I'm not saying we should achieve a trade balance by tariffing everything to death; I am saying we should focus on faster growth to get there and reduce our insane level of consumerism. I don't have an issue with a temporary trade deficit for growth-oriented reasons, but I have little save contempt for people ordering packages of chinesium temu crap.
> Germany and Japan haven't focused super heavily on achieving a trade deficit
They have. For Germany maximizing their trade surplus was one of their primary goals for many decades. Amongst other things that’s why they accepted the Euro (easier than devaluing DM).
> As you said, Germany has huge problems with her welfare state
I never said that.
And Germany specifically has quite low government debt and a very high trade surplus. Yet.. it’s not doing better economically than the US. Welfare hardly has much to do with that.. e.g. US government excluding all private spending spends about the same as Germany as % of GDP on healthcare. Total social spending is not that massively higher either (~23% vs ~28%).
> ordering packages of chinesium temu crap
Sure, but that’s by and large insignificant. If we look up US imports by category consumer goods don’t really make up that much.
Also, I don’t really see how can tariffs do much besides lowering productivity and increasing prices.
Like that complete nutjob Lutnick said they want “millions and millions of people in America screwing in little screws to make iPhones”. That just makes no sense, you want to minimize the amount of easily outsourcable low productivity jobs in your country.
The “reciprocal” tariffs are nothing close to reciprocal. I hope you know by now that the numbers Trump presented were not actual tariff numbers that other countries put on us.
The trust issue is domestic, too. Businesses just got slapped with the largest tax increase in history at home. Pointing fingers at other countries is a distraction. It’s ridiculous to think that this will encourage companies to start building factories here when even the raw materials are now heavily taxed on their way in to the country. Any sane company is going to pause US factory investment until there is some clarity and predictability.
I think I miscommunicated my support for some trade policy change as support for Trump’s “liberation day” tariffs. Here are things I think we should fix:
- America and Hypotheticalstan each export $1T to each other with a bunch of tariffs on various things. America raises $50B in tariff revenue on Hypotheticalstan’s imports while Hypotheticalstan raises $100B on American imports.
- America doesn’t make enough defense-critical stuff: steel, solar panels, chips, aluminum, rare earths, etc.
- America has a ~$918B trade deficit.
Things I do not care about:
- Vietnam makes our Nikes.
- We have a trade deficit with specifically Vietnam.
> Why should you care how much another country charges its residents to import stuff from the US?
Because tariffs hurt trade — if you charge someone an extra $4 on a $20 bottle of French wine, they _may_ still buy it, or they may buy different wine.
Or they could go, everything's gotten so expensive these days, I'll buy wine less often altogether.
> Because tariffs hurt trade — if you charge someone an extra $4 on a $20 bottle of French wine, they _may_ still buy it, or they may buy different wine.
Sometimes it's hard to tell if the US public is even aware of this. I mean, what is the point of tarrifs other than raising the prices in the domestic market of imported goods and services? That's all they do.
The rationale from the perspective of the central government is that this will finally make foreign goods and services uncompetitive with regards to domestic alternatives, and thus will finally render them viable. But that childish assumption is based on so many absurd notions that are plainly unrealistic. The only thing that's real is the direct impact of tarrifs: increase the price of goods and services in the domestic market.
I think the problem is that because of the huge disparity between the cost of imported and domestic goods which has developed over decades, the choice that people face is not 'oh, now imported goods are a little more expensive, I will instead buy American', it's 'now I can't afford to buy anything at all.'
You have to get more money into the hands of the consumers in order to be able to implement something like this.
Wine is a good example because it’s not fungible: one bottle of red wine is not like any others. If you have a domestic wine industry, it likely can’t compete on quality with French wine.
So if France can export wine at a price that’s reasonable enough, your domestic wine industry will fail, undercut completely by cheap French imports.
Tariffs in and of themselves are not all dreadful. They help level the playing field and support domestic industry.
But you can’t go from decades of offshoring manufacturing to suddenly charging punitive tariffs without making imported goods (which were the only ones your citizens could afford) much more expensive, and therefore, yes, folks might buy wine less often altogether.
IMHO it’s pretty fungible at least outside the high-end stuff. Most people would hardly notice where the wine comes from (aside from specific types of grapes and such)
I'm surprised to hear that. In my experience, most people tend towards the other end (believing themselves to be connoisseurs, etc.) rather than 'just give me the house red'.
Because tariffs aren’t actually a good thing. If you hurt my producers by $1, I should hurt yours by $1 to maintain some level of credibility in our repeated game. If I don’t punish foreigners for tariffing my guys they have no incentive to reduce or remove those tariffs.
I don’t actually care about t-shirts being made in china. That’s not an industry that matters at all. I do care about china closing her entire market to American tech, for instance.
If you start looking for justice in the world economy, you've already lost the game. The only thing that matters is money. You can stick tariffs on left, right and centre, and all you'll end up doing is pushing goods out of the hands of your consumers.
You can try to 'hurt' another country's producers, but they're likely to just go and find another market for their goods.
I'm not really looking for "justice", I'm looking to uphold our interests. I don't particularly care if we raise more revenue than some other country does from our imports. I don't think tariffs are the best or only weapon to fix our problems. I do think they have a place, that selling off more and more of our country via trade deficit is unsustainable, and that our priorities as a nation are beyond screwed up.
> I expect the American feds to pursue the best interests of Americans (though these policies aren’t in those best interests
I think that's the thing — you plan in business for people to operate in _their own_ best interests. If people stop doing that & their behaviour is volatile, then you're going to put your own mid-term plans on pause until you know what's what.
> Trade deficit aside, we shouldn’t let others collect a larger % of their imports from America than we collect of our imports from them.
Is that happening, trade deficit aside, & when you factor in services as well as goods?
You could start making stuff we're willing to buy. I'll give you a qick rundown of what Europeans might want:
* no junk food, no weird GMO garbage.
* road-legal automobiles, no EPA-workaround trucks with shoulder-high hoods.
* advanced tech hardware gadgets.
* entertainment
* no, we're not particularly interested in guns.
Tell me what exactly what aren't we already buying from the US, when it's competitive: quality food we have our own, sorry; cars, well you've gone down a crazy path since I can remember; hardware, well we do, except you chose to offshore manufacturing; entertainment, we do... a lot; guns, be honest, you know you have a problem, not us.
To be fair, the US exports a lot of services to the EU. For some reason these weren't included in the calculations shrug. As an aside, it's hilarious to see loads of Europeans saying that they never use any US products on a bunch of US owned products.
Also, last weekend my son had some weird intestinal flu we couldn’t figure out and ended up visiting the weekend GP. You think we had to pay anything (besides the slippery-slope-ish, pice-controlled, Dutch health insurance system)?
So yeah, I might earn 1/3 an SF developer, and yeah — the startup scene can be frustratingly sterile — but I can afford to not need a Tesla Juniper, though I really love it when I lease it for travel.
And yes, we do do innovative and cool stuff, we just don’t exit with billions.
cali is the butt of half the jokes in America for a reason. i'm glad you like your view though. i'm glad you like your government insurance but my private health insurance is also very good and i don't have to pay much (if anything) for things like that. i'm also alive today thanks to good private insurance and the level of care it afforded, the range of specialists i could see, which most government-run systems would not have covered.
if y'all are content, fine i guess. but it is true that the current european model is sustainable. the FT ran a good piece recently discussing how America reducing or ending the indirect european defense subsidy, combined with slowing growth and an ageing population, means that model must come to an end. i don't begrudge you the years you enjoyed it but certainly not for me.
you were saying you think no GMOs, smaller vehicles, banned guns, and less money are worth this. i think that's a terrible way to live and would hate doing so. my objection was precisely to you applying your lens and values to America, American values, and our way of life.
I’ve had to shut my mouth hard the past week. I went heavily short right before the “liberation day” announcement and doubled my port. My buddies in finance, or my buddies who work elsewhere but whose accounts look rough, don’t want to here me enthuse about the nutty multiple expansion finally reversing so I can take my cash and buy at sale prices.
"Be greedy when everyone else is fearful" isn't just a recipe for profit; it also acts to reduce the size of market crashes and thereby make people get hurt less. Give in to your lizard brain!
The caveat being if you have even a coarse-grained sense of market timing, this works strongly against your own pnl. The optimal strategy is to long the bubble, short the correction, then long the recovery. It’s not possible to do perfectly but you can often sell for part of the way down and skip some of your losses before buying back in. This generally would increase vol but is personally advantageous if you can do it.
It is incredibly to “follow your lizard brain” and destroy your returns. Selloff? “Time to be greedy!” Whoops, caught that falling knife with your hand. Maybe it’s a V-shaped recovery a la corona. Maybe it’s a decade plus like the Nasdaq post-dot-com. Rally? “Time to be fearful!” Wait, it keeps going up? Do you get more fearful? Do you sit in cash for years amidst inflation and high returns?
Where does the cash come from if you’re invested? Are you just keeping huge piles of cash around in low interest accounts in the hopes that a black swan event comes along?
If you had a balanced portfolio a week ago, you're almost certainly overweight bonds today. Rebalance to your target weights and you'll be buying equities.
Wow! Even with the crash, wouldn't you have been better off getting the last five years of gains, especially given interest rates didn't match inflation?
I was curious, so checked - $500,000 in VOO 5 years ago would have been 1.18 million today - already accounting for the crash so far. The market would need to crash an additional 60% starting with the next open to get you back to your $500,000 break even. Maybe this will happen, but that's quite a fall.
You make a personal evaluation that differs from the market and you act on it. You need a model of the world and to believe it is more accurate than the average. A lot of people felt the market was overvalued and would correct during the Trump presidency.
You of course sold all your stocks beginning of November because you knew a deep crash was coming and wanted to be ready to buy into it. And now you have a lot of cash.
Makes me really think what is being sold. A significant discount in stock that continues paying dividends would be actually be reasonable. More return for same money.
But many stocks are more so collectibles... Value going up for sake of it...
The market can keep falling until Trump pulls the lever back or enough of his pet legislators are willing to override him. As a long-term investor, I'm not selling. But we have no idea where the bottom is.
The market is still pricing in the optimistic scenario of tariffs being repealed, either by supreme court (e.g. on the non-delegation doctrine), by congress veto (13 more Republican defectors), by impeachment, or by Trump changing his mind.
If none of these four scenarios come to pass, the market will keep dropping as these possibilities get priced out and the remaining scenarios (escalation or maintenance of the tariffs) become more likely.
> The market is still pricing in the optimistic scenario of tariffs being repealed
"The market" has no idea what the impact of the proposed changes are. Setting aside the obvious questions about whether or not this stuff will even happen, it's just not possible for something this complex to be evaluated so quickly.
This is panic. People are wildly guessing about the "worst case scenario", without any detailed understanding (or even data) on what might happen [1,2]. It's all speculation, but lots and lots of people love to write horror stories for clicks and points.
[1] Just for example: what does it even mean for an "X% tarrif on all products from country Y" to be imposed? The Harmonized Tariff Schedule is hundreds of thousands of line items, each with a different rate. Are they all being replaced with a single number? Is that line item number being multiplied by a factor? Something else? I guarantee that almost nobody knows the answer to that question right now. I'm not even sure an answer exists.
Working through that changeset is a non-trivial operation, and then, working through the impact on something as detailed as a supply chain for any non-trivial product is immensely complicated. Now do it for every product.
> "The market" has no idea what the impact of the proposed changes are. Setting aside the obvious questions about whether or not this stuff will even happen, it's just not possible for something this complex to be evaluated so quickly.
This is just false. Countless people were busy running scenarios based on the expected range of tariffs. It wasn’t a surprise that tariffs were coming. It was a shock that they were so insanely high and that the people putting them forward were so clueless about it.
> [1] Just for example: what does it even mean for an "X% tarrif on all products from country Y" to be imposed? The Harmonized Tariff Schedule is hundreds of thousands of line items, each with a different rate. Are they all being replaced with a single number? Is that line item number being multiplied by a factor? Something else? I guarantee that almost nobody knows the answer to that question right now. I'm not even sure an answer exists.
You’re projecting your own lack of understanding on to everybody else. The changes have been out already and any company that does business has already read through the documents.
Just because you don’t know or understand doesn’t mean that nobody does.
> This is just false. Countless people were busy running scenarios based on the expected range of tariffs.
Appeal to authority ("the experts did the math!"), but OK...
> It wasn’t a surprise that tariffs were coming. It was a shock that they were so insanely high and that the people putting them forward were so clueless about it.
Right. So...they didn't do these scenarios. Which means (repeat after me): everyone is guessing.
Even if I accept your appeal to authority, and even if I assume that their "models" are sufficiently good to predict the future in a chaotic unfolding scenario involving dramatic changes to a complex global trade system [1], I basically guarantee that the average market player is "vibe trading" right now, not working from these models.
I'm not saying that it's impossible to work out the answer. I'm saying that takes time.
Also, no one seems to be taking into account that most countries are in active negotiations to reduce or eliminate the tariffs. So the US may end up getting something else in exchange for them being partially or wholly lifted on countries where a deal can be made.
I'm don't understand the disagreement because it's not like I'm saying that markets perfectly price all available information.
Even if securities are not priced perfectly accurately, it's still a fact that investors know that Trump might change his mind. It's still a fact that investors know that the Supreme Court might strike down the tariffs. These optimistic possibilities reduce the amount of panic and reduce the magnitude of the drop.
If the Supreme Court ruled against the lawsuit brought by New Civil Liberties Alliance tomorrow then the market would drop even more than it otherwise would, because it makes it even more likely that the tariffs will remain.
> I'm struggling to understand the disagreement because it's not like I'm saying that markets perfectly price all available information.
You're being sanguine about the power of markets to react to short-term change. Basically, "all available information" consists, at this time, of what I posted above. Be honest: what can you infer from it regarding the "correct" level of price change in the S&P500? But that's too ambitious: what's the correct level of price changes in, say, machine screws?
You can't know the answer. Nobody can. The best any particular expert analyst might be able to do, right now, is to speculate about the impacts of the top-line tariff rates on a given company's product prices. But they cannot:
* know if those prices are correct
* know how the pricing of other products (which they don't analyze) will materially affect those pricing models.
* know what compensating strategies the company might employ
* know the costs of those compensating strategies
* know the impacts of the price change on the market demand for the product(s)
* know the impact of the price and demand changes on margin
...and so on. There are so many unknowns here. Even the most informed analysts are just wildly guessing based on headlines and vibes. I have 0% faith the "market" is currently providing a useful estimate of the impact of these changes, and I have 100% certainty that the people confidently asserting things (like a market projection) are fools, or simply talking their book.
Keep track of where it has been; you don't need to buy at the absolute lowest point, if it creeps back up you can slowly buy in again.
Have a look at trackers like the S&P 500 after previous crashes, it takes 3-6 years for the market to return to its previous highest value. Or six months in the case of the panny-D crash.
> As for people getting hurt, yeah, that sucks.. but you should never invest what you can’t miss..
You do understand that pension funds are financed through these investments, don't you? This means that the people who will be hurt the most are those who didn't invested. It's not the billions that Bezos and Musk lost that's painful. It's the old mom or pop who worked their whole life and now can't retire because their pension doesn't allow to survive.
And you do realise these are long-term investments by pension funds and governments right?
You aren’t actually getting paid with the actual money invested, they usually already calculate with 108-110% coverage, and already assume life-long coverage with an average far exceeded average lifespan, precisely to take this into account
Honestly, the fact that J.P. Morgan employees are even pondering this credibly enough for it to get picked up by Barron's is a watershed moment for the labor rights movement in the U.S.
Behind our usernames, there's user number. I'm sure dang & co, would let you rename yourself if you asked them nicely.
However adding it as a option, raises the problem of people trolling the site, and then quickly changing their username to dodge the fallout - some sites have icons to show that a user has recently changed their name, some have a username history on the profile - it's not a trivial problem to solve.
Yeah, some places have an unwritten "just write us and we'll do it" policy. It's nice to know they're up for it, but the cognitive load of reaching out is like 100x higher than just putting it in your preferences. I know there's no good solution here though, so I guess i'll just shout at the sky.
This seems to happen a lot when one's experience is statistically unlikely, or when it doesn't neatly mesh with a commercial opportunity.
For instance, I am a transgender woman and I get THE WEIRDEST ads. Makes sense, since an algorithm meshing together my engagement histories from ten years of social platforms must see something quite strange.
The only appropriately targeted advertisements I get are from academics interested in studying me. Like: "are you a trans woman? Take this study and win a gift card."
When platforms attempt to monetize me, they wind up pushing the brooks brothers dress shirt deals and so on that I used to gobble up in my prior life.
I've taken my business local as a result, but the algorithmic rejection of my reality on these platforms takes a pretty consistent toll. I don't know what the solution is, but wanted to underscore that this is a broader problem.
I am coming to the conclusion that the only way to beat the system is to not play in the system. Or play as little as possible. I no longer go on FB, Instagram or Amazon. I do my best to just be anonymous. I don't "need" to hang out on social media. I lived quite happily before these services even existed, and will continue without them. We have control. We can resist their shiny toys. If we are waiting for THEM (or politicians) to fix these problems, we will die of old age waiting. It's antithetical to their business and self-interests. The only way to make them less powerful is to not give them your data. That is the source of their power. Information.
Greetings Professor Falken
Hello
A strange game.
The only winning move
is not to play.
(1983 - Wargames)
This would be a solution if the problem was social media. The problem here is the intrusiveness of advertisement. Personally targeted advertisement exists on the non-social web, on the phone, in your mailbox, at your door. Group-targeted[#] and still intrusive advertisement exists in the public transports, on the radio, in newspapers, in the streets, on most "things" in your house (as branding), on your clothes. I think by now it's clear that we cannot realistically avoid substantial amounts of ads by simply changing our personal behavior. Just like for ecology, it is a common mistake to depoliticize the problem by advocating only individual actions. Defending oneself against ads has to be done in whatever community you are part of using the available power levers (that were put there exactly for that purpose). This can be the state level but also as a union, in a neighborhood. Advertisement should to be (more) socially controlled and regulated.
Advertisement is inherently intrusive, it's goal is to make you listen to some message you didn't ask for. It is strictly one-way communication and as such it's deeply authoritarian: tptb have the right to talk, you are coerced to listen (it goes against fair access to public speech, which goes against the ability to exercise your power on society as a citizen). It is based on ethically questionable methods: psychological manipulation and information gathering; to provide some hindsight, when performed by an individual and not a corporation, we call this behavior harassment or psychological abuse. Yeah sure, you might be stalked by a nice guy with whom you could be friend just like you might see an ad on an interesting product, but no, stalking is oppressive even if done by a nice guy and harassment is a tiny fraction of the possibilities you have to communicate. You want to get a new fridge? Ads will not help you while an independent comparison or buyers guide will. You cycle a lot and would like to keep up-to-date with related products? Subscribe to the newsletter of some cycling community. We don't need ads for anything, they only solve some problems as byproducts and we can always solve them more efficiently and less intrusively.
F ALL ADS
note: i didn't properly define "ads" here but broadening from pure "commercials" we could have mostly the same arguments against all sorts of "public relations" like corporate communication or modern vote-based politics.
[#] there is no such thing as "non-targeted advertisement"
That might be a fun thing to do. Make google and the others pay out the nose by actually clicking as many ads as you can instead of avoiding them. Just have everybody be their own click farm. We could have an international "click to support business day" (hah) where for 24 hours everybody around the globe just clicks ads. That's what they want us to do, isn't it? Maybe we should give it to them.
Basically, it hides and silently clicks on every ad in the background. It even has an archive where it shows you the ads it has hidden and clicked, so you can check in to see what advertisers think you are interested in, and it tries to eyeball the cost of those clicks to advertisers. Lots of fun to load the worst ad-ridden offenders' websites and get a smug sense of satisfaction that you wasted advertisers' money
You probably aren't. That's highly suspicious behavior that isn't hard for the ad networks like Google to detect and they'll just refund any costs as fraudulent activity.
Yeah, I wondered why it wouldn't just choose a random number of currently-visible ads to click, including 0, at random times? Clicking all ads all the time would definitely be conspicuous.
> What is the "click-probability" setting?
This setting lets you control the likelihood that each discovered Ad will actually be clicked by AdNauseam. 'Always' means that every Ad discovered will be clicked, while 'Rarely' means that very few ads will be clicked(10%).
I wasn't meaning to use a plugin, or necessarily specifically target Google. Everybody manually click on ALL ads they see on ALL platforms. Make it so "the ad and tracking system" model just doesn't work and becomes to expensive for them to justify. They claim all of this capturing our data is to "provide better, more relevant, personalized targeted ads." They charge companies for those ads. We can basically make them ineffective by overwhelming them. All of them. I see nothing wrong, legally or morally, with everybody clicking on all of the links that they are putting before us. That's what they are there for, so let's utilize them en masse. If everybody did that on ALL platforms, what would happen? Where would they go? They would quit spending as much on these platforms, which is basically the entire revenue model of the platforms. The platforms would be forced to shift their behavior once it becomes literally ineffective for them to do business the way they have been and profits start to shrink, wouldn't they?
Another thing we can do: when you do a search, perform another search for the opposite. Or perform 2 irrelevant, random searches on things you literally don't care about or have nothing to do with your life. If we give them more crap than actual data, their algorithms would probably become ineffective.
Maybe not really click on all the ads though. Some of them can be shady as hell, or they open a new site with even more ads, and you'll never be done! Clicking on ads opened by other ads, I find that the "deeper" you, the worse it gets. By which I mean my personal feeling of: How likely whatever's being offered is a scam, but also how they are messing with my browser, pop-unders and other weird behaviour.
And most of the time I have uBlock enabled. I'm not entirely sure if messing with the tracking system actually weighs up against having to browse without uBlock.
Anecdote: I've hopped on a pot committed, 5+ device, aggressivly tuned AdNauseum bandwagon several times now, about one to two month spans spread over the past several years. I usually forget/ignore the increased background traffic for a short time then realize during a moment of inconvienient network congestion and flip back to ad-block, pie-hole, Blockada for mobile vpn etc... I have repeatedly observed a very steep increase in spam phone calls for myself (I take great effort to minimize the footprint of my personal emails across random db's) and email/social media spam for both other household members and office collegues, starting shortly after these heavy AdNauseum binges begin. Lot's of uncommon or specialized, high margin, high intent customer markets and service spam floods in. Never understood why they can stay so persistant. They often seem completely unfased, as if Google's prompt and voluntary fraud detection, disclosure and refund issuance can go entirely unnoticed. /s
But I suppose getting banned doesn't mean they stop serving you ads, right? It's more like a shadow-ban in that sense. There's still a win in that they'll have to invalidate a whole trail of tracking data about you.
The budget from advertisers is already credited to Google - if such tactic becomes popular, advertisers would get lower returns (bounces would be way higher than now), and move their budgets elsewhere, harming Google's business.
Here in the real world where that’s not gonna happen, they do benefit though. Adblockers getting popular makes sense, but some sort of ‘screw with google’ plugin (which already exists) is too niche.
This is fascinating. It seems like it would be pretty easy to write a chrome app that runs a window in the background that interacts with every. single. advertisement.
Unfortunately the people to pay the toll would be the businesses running CPC campaigns, not google.
You'd have to run it at such massive scale that google wouldn't be able to collect because advertisers could show that something was wrong with google's model.
Um. Google would make money if you did that. At least short term. I guess if enough people joined in then advertisers would move to FB and google would lose money.
I don't care, I ruined their analytics and more importantly my online profile. The cross platform tracking exists, I'm going to fuck it over regarding my identity. Plus at an incredibly small scale I make it less valuable for advertisers.
I'm sure that by now the ad networks must have figured out that I compulsively lie to them and take that into consideration. Youtube just can't believe that I've mysteriously never heard of a single product they ask about in their surveys... "Wow, this guy has never heard of Starbucks either?!"
Lying to CAPTCHA is getting tougher these days - it takes me a few minutes now before they let me through even though I've identified a plain piece of road as a sign. It's a pain to sit through until they let me go, but I'M NOT YOUR FREE TRAINING DATA!
That is part of why I switched away from Google & containerized Youtube in Firefox, its really easy to end up in CAPTCHA hell it seems. Qwant and DuckDuckGo are sufficient, and actually better when searching specific item names or part #, its pretty impressive how shit Google's results have become as of late for this use case IMO.
The only reason nowadays to use Google search is verbatim error messages for exotic software products.
There it still seems to outsmart DuckDuckGo. Else than that I haver zero reason to look back. As a matter of fact. That little box, containing basics for questions like "shell date operations" is usually sufficient and if not you have a link to (usually) stackoverflow. I really like the concept.
On a side note why does Google offer a captcha service to the public, then for their services use an incredibly shitty one. It takes me 4-5 tries to decrypt the random squiggles on their sites. I don't mind decoding a bit of text or an address, but lately even their public captcha has gone rapidly down hill.
I was recently thinking, I'm not entirely sure if they would still use those photo-CAPTCHA's for ML training data any more. The classification "puzzle" that is offered seems like something deep learning is already capable of today? It seems like such "toy data", considering the images and the task given.
I could be completely wrong though. Is there anyone up to date on modern ML capabilities to comment on whether this data is useful and what for? I used to think it made sense, especially with ReCAPTCHA (digitizing books) but it just doesn't seem that valuable any more?
Getting captcha correct on google is actually difficult. For some reason they use a different one than they provide for third parties.
As for survey/reviews I routinely one star apps that nag me to leave a review. Some apps have two options "review now" or "remind me later" . Those apps get reviewed, "app is great, but won't stop fucking asking me for a review even though I already have."
I’ve been doing the same thing. Originally blindly, now I can actually see my ad interests buried in the settings under account data and all the way at the bottom of the list... but it’s there. And oh how it’s funny to see what changes the list. What’s terrifying though, is the things on the list that I have not engaged in online that only could have been added as result of verbal conversations with people who have not set up even a modicum of privacy on their devices. Specifically flag words I use in conversations for just such a purpose. As a result, I’m collecting evidence for a massive privacy lawsuit that undoubtly will occur sometime in the future which I’m eager to take part and assist in.
That aside and in the interim, a small thing we can all do if you’re concerned about privacy is to inform people when discussing such matters where to go on their devices to learn about what is known about them.
No other conversation has scared indivuals I’ve met more than showing them their ad interests.
Also don't feed the machine. (Or just with the basics)
I just post irrelevant stuff to social media. Keep likes under control. Ad-block/tracking blocker and I'm wary of what I search in search boxes (Google or others. Sometimes DDG doesn't give a good answer so I go back to Google).
Do you use your smartphone? Or dumbphone? Do you use credit cards (including debit cards and every other way of electronic payments)? Do you use browser? Even loaded with anti-spying plugins?
If any of the answers is yes then you are being watched and profiled. And of course those companies you actively avoid would simply buy raw data or "analytics" from the companies you still use.
There is a big difference in letting these companies control your mental well being, as in the letter, and letting them know intimate details about you. The first is well within your control:. don't use Facebook/Instagram/etc., then their algorithms will not affect your mood, because you won't interact with them at all.
In the case of the letter author, I suspect the problem isn't just that stillbirths are rare, but that you can't really monetize a stillbirth. Better to assume the baby was born successfully than miss out on the opportunity to advertise to a new mom.
I'm sure no one in the room of marketing execs has considered personal consequences like this one.
This type of thing is why I do my best to enable privacy settings and disable personalized ads. I don't actually care whether Google knows what I ate for dinner last night, but I don't want constantly see Google's fuzzy judgements of my humanity as I browse the web.
Given the amount of ads for fertility doctors I saw after we lost our son, and the ridiculous claims they were making, I think its safe to say that stillbirths are both lucrative and certainly advertised towards.
Honestly, I'm not sure theres anything to do about it. As awful as losing our son was, I'm not sure taking away others rights is really an appropriate response. While Facebook would be wise to take these things into account to build social trust, advertisers themselves are always going to want to advertise their products.
I doubt people hear this story and say 'Meh, fuck em'.
However, what about (in thought not out loud) 'False positives are hard to prevent, special cases like these are very rare. Instrumenting our platform with exceptions like these is a massive undertaking for which I don't have the political capital. Lets not take action now.'
From outside the company, those are nearly the same reaction. From inside the head of the thinker, they are very different.
I can definitely imagine certain execs being single-minded enough to think "Well if a parent has suffered some tragedy, they're not going to click our ad anyway, so it's costing us nothing to advertise to them"
Serving up ads that are guaranteed to not apply are a negative because it means you're giving up the opportunity to serve up ads that might actually make money.
Are advertisers going to notice that 1% of people in the 'Just had a baby' group actually had stillbirths? I'd guess not, especially because advertisers don't get to know who they advertised to.
Is FB or Google going to change this to improve their conversion rate by ~1%? Probably not, 1% is not a lot.
In the end, as long as the advertising platform gets a decent conversion rate on 'Just had a baby' for the advertisers, everyone is happy.
Heck, advertisers might prefer 10% accuracy and 90% recall over 50% accuracy and 80% recall. If pushing that recall up a bit yields a few more customers, the extra cost of showing that to a lot more non-viable people might just work out.
Serving up ads that are known to be offensive to the user isn't just a lost opportunity to make money, it's also going to encourage that user to start blocking ads, which the advertisers and Google/Facebook don't want.
Still births aren't rare. That makes this all that much worse.
> Stillbirth effects about 1% of all pregnancies, and each year about 24,000 babies are stillborn in the United States. That is about the same number of babies that die during the first year of life and it is more than 10 times as many deaths as the number that occur from Sudden Infant Death Syndrome (SIDS)
>I suspect the problem isn't just that stillbirths are rare, but that you can't really monetize a stillbirth.
And you can monetize transgenderism, so unless the cost of this letter starts to get very expensive, OP's advertising will get better well before mothers of stillborn children.
Can confirm. I actually went and specifically informed a couple of ad-targeting networks that I'm a woman, in the cases where they allow that, around when I was updating many other people and institutions. That helped on some fronts.
So now some of the ad targeting networks have me targeted as "woman who's a successful professional and knows what she's doing in life", which, uh, is correct up until that last part.
The robots are just not expecting a woman in her thirties to still be baffled and overwhelmed by fashion and looking for the basics. I get my most useful recommendations by word of mouth, and yay, that sounds very nice and authentic, but it's a slow process.
So this is a different problem than the original article: we could be targeted _better_ and both we and the advertisers would be happy, for at least a moment.
But. We're trusting the advertisers to use that information responsibly. What if the kind of people who make those anti-trans reply videos on YouTube start taking out deliberately divisive ads, targeted at the trans community? On balance, I think it might be better for the ad networks to not quite understand.
It's really shocking how terrible the selection is for professional clothing for women, it's almost like clothing manufacturers have gotten together to ensure everything fits poorly and doesn't coordinate with anything in order to drive up sales. It seems they can only get it right when it comes to designing yoga pants.
This happens all the time to me. And I'm the most generic type you can find, if you are attempting to classify humans: middle class tech savvy healthy white male 30-39.
All it takes is a really really simple wrench in their system: my wife uses my computer (oh my god can you imagine that?!)
Very interesting perspective. I think stories like yours are why I believe in the ideas behind the diversity effort going on in tech right now. As a black male I've definitely interacted with these platforms and just have been puzzled by the outcomes.
On the other hand I wonder, would you be okay with these ad networks being able to identify you as transgender? And then tailoring ads towards you? I'm sure there are things that are still interesting to you post-transition.
I wonder if it makes sense for ad platforms to enable a "clear history" option just like our browsers do? That way you can say very clearly "the current model is wrong, please restart and try building a new one for me". That might also help this particular case: rebuild the model from scratch including only content going forward rather than backward. Should eliminate the baby ads effectively, right?
Google at least let's you specifically go into ad settings and check/uncheck specific categories of things that you get ads about (that's an oversimplification of the process behind it).
I'm not sure how but one time I started getting a few ads in Spanish about toothpaste. I had also just found out about the ad settings page, and after taking the minute to remove the handful of wrong interests, the incorrectly targeted ads stopped.
Edit: Facebook allows it as well, here are the links for anyone that wants to do it now.
I mean right at the top of the page is a single switch that lets you turn off all targeted advertising if that's what you want.
But personally I like targeted advertising. Ads let me use services for no monetary payment while still providing income for the content creators, and I like seeing ads that are targeted towards my interests more than ads that aren't. And while it's not ideal that you might have to go in and change what your preferences are in cases where they get it wrong, I much prefer it over the alternative of all ads being "wrong" for me.
That'd work in this case, but would destroy lots of value when people like me would go in every few months and reset all my ad profiles. Then again, the total percentage of people who would care enough to go in and do that is probably pretty small.
I'm going to start sounding like I work for them, but Google already allows you to disable targeted advertising entirely, and Facebook at least let's you disable targeting for the vast majority of things (the major exceptions being age, gender, location, and the content of the page if I recall correctly).
I would immediately try to figure out a way to automatically clearing my advertising history as often as possible. So would other people; at least one of us would build an easy-to-use tool for other people to do the same.
It's important to note that this is not an especially unlikely event. Of my 10 closest female friends, who eventually had children, I know that at least 5 of them had a miscarriage at some point in their life. I've a friend who had several miscarriages before having a successful pregnancy carried to term.
Admittedly, if a woman makes it past the first few weeks, her chances improve:
"Once a pregnancy makes it to 6 weeks and has confirmed viability with a heartbeat, the risk of having a miscarriage drops to 10 percent."
ublock origin is a much safer and more effective way to deal with filtering then hosts files, as well it supports the host format and has its own very large lists built in
USA stillbirths occur in about 1% of pregnancies. It may be unlikely for any particular woman. But it is more common than, say, people in the market for a truck.
There's no reason at all, except laziness on the part of marketers, not to handle this case. Marketers who hope for a long-term relationship with young families might be really smart to avoid alienating them by pitching snuggly carriers to women who've just suffered a miscarriage.
Posting in case this may be of use. I've been able to make all the social networks more or less serve me irrelevent stuff or not serve me stuff. Here's how:
* I use Facebook in safari on ios and have ad blockers enabled
* I use the youtube app logged out
* Twitter I generally visit people's profiles directly or in a 3rd party all
Instagram is the only one I can't fix, as I use the app. Maybe if I did more in the web browser, but then I'd lose stories.
Anyway, Instagram consistently serves up ads that are in the ballpark of relevant to me. But other than that, the ads I see are random generic ads for stuff like cars and laundry detergent. The kind of mass market ads you'd see on TV. I get ads in other languages when I travel.
It's nice, I can mostly ignore them. Of course, key to this is that I prefer to ignore algorithms on things like youtube. This method won't work if you need that.
But if you don't mind algorithms not being personalized, you can make the ads irrelevant to you too.
Yeah, that's the one I use as an app. And that's why I actually see somewhat targeted ads there.
I might actually switch to viewing it in browser more. But I think you lose the messaging. And the ability to post as well, but I don't post as much as I watch.
> This seems to happen a lot when one's experience is statistically unlikely,
Aren't still births something like 1%? That's not super common, but unlikely isn't quite the right word either. You're unlikely to die in an airplane crash.
There’s over 3 million miscarriages a year in the U.S. Often time it’s the worst event in your life.
Stillbirths are about 1/45 births.
This reminds me of when engineers were designing the first air bags. They didn’t think about the size difference between women and men. Diversity matters because it gives you different perspectives about life. I suspect that if the ratio of men to women in the tech industry were reversed this wouldn’t be an issues because it would have come up in discussions.
Last time i checked on my mens stillbirth and miscarriage group, 100 percent of still born children had a father.
Trying to frame child loss as something that only happens to women is not only insulting to the equal number of men who have lost children but also furthers the notion that men dont care, when most research on the area shows they care pretty much the same as the mother. Comments that further this notion are what lead to the disproportionately high alcoholism and drug abuse rate for dads of loss
Yes, her reality is that she is no longer the person whom the ads continue to target her as. She claims that the level of misperception she's seeing from her ads is higher than normal, and provides examples of such. She's not claiming that non-transgendered persons never see mistargeted ads.
How does she know what is "normal"? That was my point - nobody is "rejecting her reality". There are simply some ads that don't appeal to her, as happens to everybody else, too.
How can she blame the algorithms for rejecting her, if her past actually contains things that the algorithm happens to pick up on?
Since everybody gets ads that don't appeal to them, clearly it is just a case of algorithms not being smart enough. It's like saying the sky rejects her because it isn't pink. It is blue for technical reasons, not to spite her identity.
There is no malice on part of the algorithms, but I'm sure you can see how it would appear that way and make someone feel bad. Even people unintentionally hurt others feelings all the time, but their not having malice does not invalidate the way they made the other feel.
Would you say the same about the situation in the linked article?
"It would appear that way" - that was my whole point, that the perception is presumably wrong here. There is no rejection, and nobody built anti-trans parameters into their ad server by intent. Sure, the OP feels that way - but feelings can be changed, in theory. They should be amendable by rational thought. Also I suspect it can become a habit to frame everything in terms of "rejection of my identity". I am not blaming that person, just pointing out that it may not be a healthy habit.
Maybe, to sum it up in a more friendly way, this quote is a good summary: "never attribute to malice what you can attribute to incompetence" (don't know who said it).
As for the miscarriage, I likewise wouldn't blame the algorithms or companies. However, I would think that most of them would be happy to learn and improve their algorithms. So pointing out such a flaw should hopefully be received well.
We're working on a chrome extension that blocks the existing ads on a page, and replaces them with privacy-safe ads that reward you with our crypto token for each ad you see.
The problem is that these days they do it capriciously, without any sort of plan or intention.
The government played a foundational role in supporting the early stage research that enabled companies like Intel to emerge. Underwriting that sort of long-term investment that wouldn't easily attract commercial capital is a great place for them to be.
Meanwhile, is it even the case that the American chip industry is declining? Apple, Nvidia, and Google all have significant chip manufacturing operations. And this isn't an industry I even follow particularly closesly.