Wall Street stocks tumble as investors fret over US economic slowdown | Hacker News Reader

Wall Street stocks tumble as investors fret over US economic slowdown

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153 pointsbelter275 comments

Stocks won’t fall as far as the economy, so when people start selling off everything not nailed down just for tomorrow’s food, the wealthy can swoop in and buy it all up for pennies on the dollar.

It’s the whole game plan, after all. Land, especially: generally speaking no-one is really making any more land all that fast, and when it comes down to your family starving or selling off your land for food, the land goes pretty f**king cheap and pretty damn fast.

By this method, the Parasite Class will end up owning all the land and everything in it, and the entire Working Class will become the modern version of tenement farmers or those living in company towns - slaves, essentially.

Yeah, land… you know US CRE is on the precipice of disaster, Chinese RE had some huge disasters. And the best opportunity for RE came and went in 2009. Meanwhile the top S&P500 stocks were not the top in 2009, even Apple had already released the iPhone back then. I understand you are making a colorful comment. But “real estate tycoon” isn’t the antagonist for many people.

That's if they're allowed to force the liquidity hose to stay open. An alternative future is one where everyone's bets get called in (as should happen during a downturn). The richest are far more underwater in an asset bubble pop environment than the rest of us are. Remember who bailed out who in 2008.

Force them to close their existing obligations. People will be able to keep their land (albeit worth phenomenally less).

The standard move is to hunker down for the next 4 years, keep buying low, and wait for Democrats to come back and fix things in their next term. The same cycle has repeated what, 5 times in the last 30 years?

These people are breaking things that cannot be fixed quite so easily. Things like the trust of other nations. Scientific research. There are a lot of things that will take a generation or more to repair, if ever.

They seem to be doing their best to break the American wealth machine so bad that we could see lost decades like Japan did.

To be fair, the sub-prime lending crisis had its roots firmly in Clinton-era repeal of Glass-Steagal, so it’s not all so easy.

No particular love for the Republican Party, but it’s a problem created by the Democrats, which they then patched with the inferior Frank-Dodd. Plenty of stupidity to go around, I would say.

Glass-Steagal was repealed by a GOP Congress. And the 2009 bailouts were Obama’s implementation of a plan devised by the Bush administration.

That said in economic and trade policy there’s not much difference between Reagan/Bush/Clinton/Bush/Obama. All support free movement of goods and labor. The only difference was in how big of a welfare state to have to mitigate the negative effects.

> the sub-prime lending crisis had its roots firmly in Clinton-era repeal of Glass-Steagal

Not really. You'd just have very highly correlated financial entities that would have collapsed the exact same way. AIG received the largest bailout and wasn't even a bank.

> they then patched with the inferior Frank-Dodd.

Dodd Frank is why the finance sector was stable despite all the volatility introduced by the pandemic and inflation. The culture of banking has significantly shifted to being more conservative now, and risk has moved to the buy-side of trading, which is easier to let go of. Trump partially rolled back regulations such that banks under $250 billion no longer had to had to conduct stress tests, and bank collapses occurred all the way up to that threshold.

Hopefully there's still a free and fair election in 4 years. That might be contingent on how well Democrats do in next year's election. We need Congress back.

Or look somewhere else.

I'm not sure i want to stick money in a country that could implode every four years.

The standard relationship with the US is gone, though. I've been moving everything out and it won't be coming back regardless of what happens in 4 years time.

Remember, this is the president that won largely because of people's dissatisfaction with inflation, and his promises to "fix" the economy.

Instead, he's decided to wage a pointless trade war that nobody asked for, and came out yesterday essentially saying he's totally okay with a recession coming out of it.

The only thing more absurd is the fact that some people didn't see this coming. He signalled everything that he's doing now during his campaign, over and over.

I will say I'm pretty happy with how badly TSLA is doing.

> The only thing more absurd is the fact that some people didn't see this coming. He signalled everything that he's doing now during his campaign, over and over.

Right, I think it's less that they "didn't see it coming" and more so a basic lack of understanding around how anything works and a complete trust in perceived wealth and authority.

The vast majority of people I know that fell into the camp of voting this into power follow a basic equational logic of "he is a (presumably) wealthy businessman he must know about how to manage money, therefore he can fix the economy" that's literally the entire depth to which they go. There's zero investigation into the validity of the premises, no question of the (ridiculous) assumption that governance must be exactly like running a business, no concern over the kind of business the person has background in... etc.

I'm sure there are exceptions to this, but I'd also be confident conjecturing that, for a huge number of people, this basic, shallow, completely flawed argument is precisely why they made the choice that they made. That and a pervasive inability to recall what things were like a mere four or so years prior.

I'm in an area of the country in which he won easily in the polls. Whenever I hear the "run the country like a business" line, I always ask "What's the product? And who is the customer?". I haven't received an actual answer yet.

And how does it make a profit and what does it do with a profit?

Perhaps ask if they think we should hire more LEOs to sit on the roads to write more traffic tickets to generate revenue to make profits to pay for more things including salaries and bonuses to our government officials... Like how businesses run (paying bonuses for being more profitable). What perverse incentives and outcomes might that lead to?

and being fed a diet of propaganda from Fox, FB etc

The core base is also given a flawed understanding of how anything around them works. America has been enduring under a self inflicted information and disinformation war for decades now.

Some amount of swing voters may have done so because of inflation - but a large number of voters didn’t show up.

There was also ample evidence that he was going to engage in trade wars. In November, I was already checking with friends in finance and banking what the amount of stress the global financial system could endure.

This is very much like the 2008 crisis, in that low information consumers are being misled by corporations with massive teams, marketing and financial power.

Its an uncompetitive market of ideas, being foisted on viewers and information consumers.

You're not wrong. And yet he's polling well. And as long as people poll surface level questions like "do you like that he's cutting things?" he gets general support.

Drill into specific topics item by item and it's a bleaker picture however. But that's how these things always go, like the ACA for instance.

He's still in the honeymoon period for approval ratings. Even given that, he's barely above water.

https://www.axios.com/2025/03/10/trump-maga-inc-power-fundra...

It looks like there is preparation for low polling numbers. A fund to ensure that senators and lawmakers will toe the line or be primaried.

He did get elected at 49.9% of the popular vote... so there's not exactly a lot of natural approval margin in there for him.

A honeymoon with 40's approval ratings in a then "good" economy says a lot in and of itself. Wonder if he'll set the global record this time by the time he leaves office. He somehow just missed bottom 5 in his first term

This analysis is lacking. People didn't vote for Trump because they analyzed his proposed economic policies and decided they would improve their situation. Almost nobody votes like that. There's general financial anxiety in the US, and he promised to fix it. What methods he proposed using are almost irrelevant, it's the rhetoric around them that sways voters.

The narrative is now one of temporary hardship to excise the supposed rot of the system that is the root cause of the aforementioned anxiety. Pointing out that inflation is bad has no persuasive power over someone bought in on that narrative.

The only way to sway general support away from this self-destructive administration is to offer another path towards alleviating the problems that voters face in their lives. The time when you could run on promises of competent administration alone has passed.

It's not enough to have a plan, as a sibling commenter pointed out. Looks more like straight-up irrational team-based tribalism to me. That and ordinary ignorance. How else do you explain a Republican candidate campaigning on raising taxes and winning?

It's not about the concrete details of a plan, it's the feeling, the messaging and the rhetoric. Kamala did not read that the electorate wanted a promise of dramatic action, and ran on competent administration and minor, incremental improvements while largely staying the course. That does not motivate people upset with the status quo to come out and vote.

This is the wrong question - in that if you spend your time focusing on why Harris lost, you will miss the question of what allowed Trump to run in the first place.

The second question tells you far more about the actual arena within which the electoral narratives are sold. Here the Dems are the Heels, and the meta story is about having the information warfare power to sell these stories.

Focusing on Harris is the mistake of assuming if you are perfect, you can get people in an unfair relationship to treat you better.

Betting on winning in an unfair fight, is bad strategy and tactics. At some point, its far more effective to spend your energy on ensuring the arena terrain is even and not severely slanted against one team.

You are ignoring how trump focused far more on hurting people they don't like(immigrants , trans people and minorities) than on any actual economic policy. He and the Republicans fomented a hate wave and he rode it right back into the White House. So damn shameful for this country

Yep. MAGA is a hate movement.

Making Aging Generations Angry

You're not wrong, but there's more to it than just hate. The tactic is to associate the real problems, economic insecurity, social isolation, etc with groups that are vulnerable to persecution and that people are primed to hate already. Deporting migrants is the proposed solution to economic woes and and a perception of high crime and low trust/alienation. Likewise the queerbashing and trans hate gets associated with the perceived problem of social discohesion and a general lack of control. These associations have been built up over a long time, and those wrapped up in the right wing media sphere view cruelty as both cathartic and effective means to fix what ails society.

Harris also promised to fix it, and had an actual plan for addressing housing, education, medical costs, and prices in general, but we are all now pretending like none of that was a part of her campaign.

Anyways, it's telling that everyone who was anxious over $3.50/dozen eggs in November is deathly silent over what's been happening in the past few weeks. All of a sudden, all of those people are now in the 'we have to be patient and get through the pain, there's definitely a payoff at the end' boat.

(Milk's $11/gallon at my grocery, by the way. Unless I buy 5 gallons at a time.)

> Harris also promised to fix it, and had an actual plan for addressing housing, education, medical costs, and prices in general, but we are all now pretending like none of that was a part of her campaign.

Part of that is because there were tons of ads focusing on taxpayer funded sex changes for prisoners (funded by pro-Trump orgs):

https://youtu.be/kQEMn1yRYVU

I have friends and family in Georgia, supposedly a swing state. They said that they could not escape seeing this add multiple times a day on tv or internet.

Regardless of what one believes about the underlying premise of the ad, it is incredibly narrow in terms of scope, and that narrative stuck.

I have a feeling this is one reason why many folks weren’t aware of her plans.

I mean, sure, if their source of information about her policies is attack ads ran by her opponent, that says more about the media they watch than it does about her.

She doesn't control the press, if it won't cover the policies, what is she to do?

> that says more about the media they watch than it does about her

According to my family member who notices such things (and is not MAGA or conservative), Trump controlled most streaming ads/narratives, while Harris had more of the broadcast ads/narratives, especially for sports (minimally political).

I wouldn’t be so quick to dismiss this as a media silo issue.

It is 100% a media issue, and it’s not even a silo issue.

America has been part of an information war orchestrated by private media entities as part of… the dumbest most successful culture war we have seen.

You do not have a functional market place of ideas - it is not an issue of bias. IT is an issue of a monopolist on one side defining the narrative for everyone else, and ensuring no diversity of thought or narratives exist other than the ones that make political hay for the Republicans.

I know this, because it’s more than studied, it’s been replicated around the world.

That sounds exactly like a media solo issue. Except the fact that it's billionaire new media choose who gets to see what ad. I would be surpsied if part of big tech's choices on ads wasn't based on the leaders' own preferences. Especially in swing states

That would require a massive, massive conspiracy that would be difficult to hide.

Why would they need to hide it? Has anything of consequence happened to Meta from 2016? Their stance is just a private company running ads.

EU probably reacted stronger to them from Brexit, but I've heard nary a peep on the US side over such issues.

> Has anything of consequence happened to Meta from 2016? Their stance is just a private company running ads.

I worked at Meta on ads from 2013 to 2018. Fundamentally, Cambridge Analytica and their "psychographic profiling" was absolute garbage designed to hide their real business model (getting your opponents caught with hookers and blow).

Like, at various times, we tried both using the Big 5 traits and hyper local targeting for ads, and neither of them worked (in terms of things we could measure or optimise for).

Fundamentally, Trump's success on FB in 2016 was a fundraising story, he was able to raise absurd amounts of money from small donors because (presumably) they liked his message.

> EU probably reacted stronger to them from Brexit, but I've heard nary a peep on the US side over such issues.

Again, the likelihood that shadowy propaganda swayed the Brexit referendum is low (I'm Irish and have been following this closely since before the vote). The real driver was twenty years of nonsense from the right wing newspapers, couple with the refugee crisis and austerity.

I get that it's easier to blame outside actors for political things you don't like, but that's rarely the right answer.

I wasn't necessarily saying that FB single handedly manipulated an entire nation into making huge swings on a national election. But it doesn't need to. When an election is decided by some 6-7 swing states with extremely slim margins, targeting ads to those regions can change the result. A few thousand votes swung would barely register in any mass analysis as effective (nor would it be in any other proper ad campaign. It'd in fact be a gross failure of you spent millions to get maybe a few thousand buyers), but still change the result.

I'll admit I haven't researched brexit's margins enough to see if that same theory sticks, so I won't comment much further on that example.

Now even ignoring all that: I feel the intent is the real damming part, not necessarily the success or lack thereof. As a recent example: Musk's campaign in Germany for the afd party failed overall, but it's still very bad taste for an outside party to try an influence a national election that is not representing them.

>I get that it's easier to blame outside actors for political things you don't like, but that's rarely the right answer.

There is very rarely one single issue that affects political things. But I feel it's important to point out all attack vectors and try to at least attempt to make sure policies work as intended.

The ultimate issue in all of this is people ignoring their best interests and falling for lies and misinformation (from all sources), but this chain was focused on media ads, so that's what I discussed.

>I wasn't necessarily saying that FB single handedly manipulated an entire nation into making huge swings on a national election. But it doesn't need to. When an election is decided by some 6-7 swing states with extremely slim margins, targeting ads to those regions can change the result. A few thousand votes swung would barely register in any mass analysis as effective (nor would it be in any other proper ad campaign. It'd in fact be a gross failure of you spent millions to get maybe a few thousand buyers), but still change the result.

OK, if this happened in 2016 (which I honestly don't believe) then how come these techniques haven't become standard across all political advertising? This is a small field, and everyone talks to one another (particularly the data people).

Like, FB's systems were essentially incapable of optimising for this kind of thing, you could have spammed reach ads at people I suppose, but those generally (based on experiments i was involved in) don't tend to move in-person metric.

It's worth noting that Clinton didn't campaign in the Mid West in 2016, which again is a much more plausible explanation of why she lost than Trump's team being uniquely effective on FB ads (and if they were, why didn't the Republicans sweep the 2018 midterms and the 2020 Presidential?).

> I'll admit I haven't researched brexit's margins enough to see if that same theory sticks, so I won't comment much further on that example.

It was a million or two votes, so unlikely (no electoral college in UK referendums).

As I noted above, the fact that almost all print media were printing deceptive takes on the EU for twenty years is more likely to be driving the result.

> Now even ignoring all that: I feel the intent is the real damming part, not necessarily the success or lack thereof. As a recent example: Musk's campaign in Germany for the afd party failed overall, but it's still very bad taste for an outside party to try an influence a national election that is not representing them.

This is definitely wrong, but worth noting that the "West" broadly has been running influence operations like this all over the world for many, many years. While I sometimes have agreed with the goals here, I'd argue that this sort of thing is problematic regardless of said goals. (Amusingly, there's some evidence that the most consequential impact of Musk in Germany was the surge in support for Die/Der Linke (apologies I have always sucked at german grammar).

>The ultimate issue in all of this is people ignoring their best interests and falling for lies and misinformation (from all sources), but this chain was focused on media ads, so that's what I discussed.

Yeah, i too would prefer to live in a world where people voted differently, but ultimately the only judge of someone's best interests in a free society is what they themselves believe. And if they get suckered by a charlatan, then hopefully they'll learn from that. I'm not sure any other approach is compatible with democracy over the longer term.

Why would it?

It's not that people are forced to say things that they don't want to say. It's people who say the things that shouldn't be said don't get hired in roles where they can speak.

Do you really think that, say, CNN, or WAPO will ever pay people to broadcast views that are actually, credibly threatening to the financial well-being of their owners? Or ones that will make their viewers uncomfortably challenged?

The marketplace of ideas in American mass media has always been quite narrow and orthodox in its offerings. Sure, you can say anything you want, but it takes the support of someone with power to be able to say it in a place you will be heard. And the more media consolidates, the smaller and less diverse that field of patrons gets.

> Do you really think that, say, CNN, or WAPO will ever pay people to broadcast views that are actually, credibly threatening to the financial well-being of their owners? Or ones that will make their viewers uncomfortably challenged?

I too have read Manufacturing Consent, so now.

We're talking about social media though, which is mostly smaller independent actors trying to make a buck.

And the ads/ranking systems for Meta are really really large and complicated, and to tune them for or against a particular political candidate would be a huge effort which would most likely be done by a bunch of SF based left wing engineers and data scientists, so it seems unlikely that this would have happened without leaks (given that everything leaks for FB/Meta lately).

What kind of milk and what grocery store? That claim beggars belief.

> Milk's $11/gallon at my grocery

You should shop somewhere else, unless you're in Hawaii or something. That's not a normal price for most of the country.

$5.50 for half a gallon of lactaid at my local QFC. ($5 for it at the Safeway that I'd spend another 25 minutes getting to and back from) https://imgur.com/9rpmfr2

All the sub-$5.50 options were sold out when I went last week. The gallon jugs only hit a good price point at 'buy five'.

I suppose I could move to some flyover shithole where milk is cheaper and I'd get paid one third as much, and my wife would be denied medical care by a government small enough to fit in her reproductive system, but I'm not sure that would be as big a win as one would think.

> The narrative is now one of temporary hardship to excise the supposed rot of the system that is the root cause of the aforementioned anxiety.

OK.

> The only way to sway general support away from this self-destructive administration is to offer another path towards alleviating the problems that voters face in their lives. The time when you could run on promises of competent administration alone has passed.

Disagree. Another three years of this and "temporary hardship" will be exposed as wishful thinking. People will want actual competence.

Faith is stronger than reason. Faith just requires a sign every so often to remind the faithful that the weakness wasn’t in their leader, it was in their zealousness and inability to believe in the greater invisible plan.

You are up against zealots and cult behavior, not being up front about this results in plans for a different reality.

Of course That is how they vote. But their analysis isn't on the impact of tarriffs nor the economic strength of trade.

It's on egg prices and job market vibes and other everyday sorts of stuff. He promised he'd fix those. And it seems the center seokg voters are facing a lot of regret on that right now.

Not to derail here, but yeah, TSLA needed to get out of meme stock territory for a long time now. Its been hurting the underlying business.

Now, the big question is if the meme is gone, or just turned sour. Either way, I'm not seeing people going back to TSLA with Elon's antics.

My guess is that his supporters are so entrenched in their position that they won't care. Trump channelled their anger at how broken the American Dream has become, and they're probably OK getting personally singed if it means the whole thing burns down.

However, it will likely be a rude awakening on the other side for them, especially if they find that some of their entitlements were cut (just as they come to need them most), and meanwhile yet again the rich and powerful not only are fine but the gap continues to widen at an even faster rate.

Even then, I doubt his supporters will turn on him.

Remember, even Hitler had support from the average Germans after the end of the war (at least before the holocaust and other atrocities came to light to them). I'm not saying Trump is Hitler, just showing how you can lose everything and still not accept that your cherished leader wasn't such a smart or great guy...

Making Aging Generations Angry

> they find that some of their entitlements were cut (just as they come to need them most), and meanwhile yet again the rich and powerful not only are fine but the gap continues to widen at an even faster rate

I’m honestly not seeing a way out of this for the die-hard MAGAs other than letting them age out. The problem is less that idiot 20% and more the Obama-Trump crossover voters. They’re the ones we should fight to win back.

Depends on why the crossed over.

I argue a lot of D's are simply Disempowerd. Getting those people back needs a candidate actually fighting for their demands and not just keeping in tow with the establishment

Be careful taking people seriously when they claim to have voted a given way for a given reason; especially a specific reason. They’re usually false claims.

One of the weirdest views of Democrats is thinking that because the market has dropped 2% then individual voters are out there with their head in their hands thinking the world has ended.

If you go back a few years and the government (largely the Fed) was destroying the economy, you never saw this type of comment. It seems to be that Democrats specifically cannot think of politics in any terms other than personal, or (indeed) of government function as anything other than a thing that bestows personal benefit. There is no discussion of content, it is just pure personal vitriol constantly.

You see the same thing with left-wing voters in other countries too. Unsurprisingly, this has led to a situation where government spending is massive, most of that spending is handouts, and actual government function has collapsed. Milton Friedman wins again.

Meanwhile, Republicans are pushing for a $4T debt ceiling increase and $4.5T in tax cuts. Talk about handouts!

After the election I know Canadian and colleagues from other countries thought of moving to US for an easier time building a business. Curious if anyone from the founder / small business crowd has had this feeling and either is still interested/happy with such a move? Or regretting it?

IIRC Culturally it was said by many that the US is much better that EU / Canada for building a business as US rewards ambition. While other countries it’s seen as not as positive of an attribute. Other countries did not let you easily build wealth or grow a business, while it was said US is culturally more welcoming to building wealth.

I’m curious how this will change in this administration.

To be fair, as a Canadian, I think starting a business anywhere else is better than in Canada, except maybe Germany? (Apologies to our dear Germans; my sense of humor isn’t the best.)

Why? I have started two small businesses in Canada with reasonable success (not enough to retire, but a nice payday each time), there was nothing particularly onerous either time.

The US makes startups easier due to easy access to capital from investors. OTOH, I'd be wary of starting a lifestyle business in the US due to the poor social safety net.

Red tape is also a concern, but it depends on what European country you're talking of, some are better than others, and red tape is awful in the US as well, depending on the state.

Those are basically the only considerations, everything else (like culture) is BS.

Be thankful you're not in New Zealand. Our current government claims to be business oriented, but they appear to desire to screw our economy. Partly because of trying to appeal to voters that are generally socialist here (a strong preference to hobble greedy business owners and often little sympathy for anyone who exports something to bring a USD into the country). Short sighted policy goals aiming to sell off anything to overseas "investors". When everything is for sale, we all lose. Eventually there will be fewer productive export businesses left to pay for our free healthcare, our retiree's superannuation or our other welfare benefits. Lose lose. Our socialist policies are good and humane, but they are hard to balance against economic growth.

We lack economic balance over here even though we have MMP voting. Swinging leftwards and less leftwards (NZ is mostly lefty) seems to be the only way we achieve a modicum of compromise over the years.

The US idolises successful business owners (even the notorious are validated).

NZ does have a couple of successful tech companies that list in Australia (e.g. Xero) or moved to the US (e.g. RocketLab). They often keep engineering in NZ because staff are skilled and cheap.

If the economy crashes I hope we can put a stake through the heart of the obsession with founders.

The American economy is a giant magnet right now -- after the inevitable crash I think that innovation would be a lot more distributed and that'll be a good thing.

Kind of already happening with Asian/Chinese chip companies and will happen to European defence

https://archive.is/1ywXe

The Russian Ruble is up 3%. (No joke) https://www.google.com/finance/quote/RUB-USD

Doubt anyone would think it’s a joke.

At this point the Oval Office may as well be redecorated in Soviet red

Thats Soviet Red white and blyat.

Ruble exchange rate is propaganda. It was not possible to freely convert it for a long time. And black market rate was always very different from the official one.

That's not true. I'm sending money to my mother in Russia from time to time and the exchange rate is close to real.

They're going to completely remove sanctions on Russia before long, so that's not terribly surprising.

Trump says he wants to start Nord Stream pipeline which means Europe will buy less American natural gas and replace it with Russian natural gas.

Such a curious dance. About 5 years ago the headline was, "President Donald Trump has signed a law that will impose sanctions on any firm that helps Russia's state-owned gas company, Gazprom, finish [Nord Stream 2]." https://www.bbc.com/news/world-europe-50875935 Of course, Trump isn't the only one to do an about-face. In 2019, Germany supported Nord Stream 2, but now opposes Russian gas imports.

It isn't a curious dance.

The story that the parent is referring to, so far, hasn't actually been attributed to anyone in the govt. A US-based consortium is trying to get it reopened, the FT weren't able to say who this person met with, one of the people thought to be involved (a German) denied meeting with anyone, and there is no actual evidence of anyone in the government saying they are working on this...it is just a story that aligned with something that the journalist thinks the US govt is doing...but was unable to produce any evidence of this.

What is possible is for NS2 to come into ownership of the US who will be able to cut it off when they choose. One of the issues with NS2, as Trump said before the war but the EU literally laughed at him for saying, was that it would make an invasion of Ukraine possible.

In reality, Russia was still paying Ukraine transit fees until earlier this year. So NS2 didn't actually make a difference because Ukraine kept transiting Russian gas through the war. It made a difference before the war because Russia thought Ukraine would cut them off, Germany didn't listen and Putin gambled based on this that Germany would keep NS2 open.

The time to do something was BEFORE the invasion...obviously.

And Germany and other European countries, despite all their tough talk, are spending more on Russian gas than they are on aid to Ukraine:https://www.theguardian.com/world/2025/feb/24/eu-spends-more...

"EU member states bought €21.9bn (£18.1bn) of Russian oil and gas in the third year of the war, according to estimates from the Centre for Research on Energy and Clean Air (Crea), despite the efforts under way to kick the continent’s addiction to the fuels that fund Vladimir Putin’s war chest.

The amount is one-sixth greater than the €18.7bn the EU allocated to Ukraine in financial aid in 2024, according to a tracker from the Kiel Institute for the World Economy (IfW Kiel)."

That's down from 112bn in 2019[1]. That's a huge drop in just a couple of years. Other than optics, I don't see the relevance to simplistic nominal comparisons with Ukraine aid.

[1] 68bn in 2020 and 123bn 2021, but 2019 is better baseline given COVID.

I think it undermines their moral arguments when they are still buying gas off their "enemy".

It's not optics, it's hypocrisy.

Was it hypocritical of Ukraine to permit transit of Russian gas while they were engaged in unadulterated warfare?

If yes, then we have fundamentally different ideas about how to analyze morality in a situation like this.

If no, then you're being inconsistent. The reason Ukraine permitted transit is much the same the EU permitted imports of Russian gas. To shut it off abruptly would threaten support for Ukraine's defense--EU aid in the case of transit, the EU electorate and their support for aiding a foreign nation in the case of imports. You shouldn't cut off your nose to spite your face. This is reality, not a morality play.

The only reason Germany are that dependent is because they turned off their nuclear power plants. It's an unforced error caused by stupidity.

If you don't think funding your enemy isn't a bad move i don't know what to tell you.

I think it proves the opposite: an 81% reduction in a few years is remarkable. Heating and power generation infrastructure is not something you can pivot quickly. These transitions usually take decades.

I think giving your enemy money is beyond stupid.

This is all looking like a strategy to intentionally depress asset valuations so that they can be acquired at fire sale prices.

Yeah, this has read to me as another double win for the Disaster Capitalist class. I'm sure we'll be seeing record profits for the s & p 500 by year's end no matter the outcome for the rest of us.

Times needs to get less interesting.

Peter Navarro is the big driver of Trump's economic approach (and he's a mercantilist quack):

https://hatchetmedia.substack.com/p/the-man-behind-trumps-wa... (podcast with Justin Ling, a great independent journalist)

and https://www.bugeyedandshameless.com/p/beggar-thy-neighbor-be...

also a long-time China hawk (like on the far end of hawkism)

And Canadians, apparently!

"the only diplomats who were more treacherous and disingenuous than the Canadians were the Communist Chinese."

To be fair, Canada is the only country that has ever invaded the US :)

Tesla stock has been particularly hammered. Ontario apparently cancelled a Starlink contract and Italy is considering to do so as well. Musk’s political antics are affecting his businesses.

The fact that Canada, Mexico, China and the EU haven’t banned Tesla imports yet is remarkable. I’d expect that plus additional registration charges on premium vehicles, especially Cybertrucks, within a year if this continues.

> The fact that Canada, Mexico, China and the EU haven’t banned Tesla imports yet is remarkable.

Why do they need to? They can just apply tariffs and let the consumer do it without the political baggage.

> Why do they need to?

Messaging and frankly national security.

So the EU needs to hit back for "national security" reasons against the country which has subsidised their security to the tune of tens of trillions.

...yep, makes perfect sense.

> the EU needs to hit back for "national security" reasons against the country which has subsidised their security to the tune of tens of trillions

The loyalists argued the same in the American Revolution. (You’re also falsely conflating Musk and America.)

Nobody was even considering it a few months ago. I wonder if anything has changed regarding EU security recently?

fight fire with fire

They don't have to. Sales are falling off a cliff in all those places.

Yeah, I think Tesla would be in approximately the same position if Elon never jumped into the political fray. Their market cap has been beyond ludicrous for years. Any slowdown in sales was due to crater the stock.

The Cybertruck is a turd, driverless cabs seem still not that close. The early adopters all have EVs and sales growth as a whole has plateaued. Other automakers have greatly improved their offerings, and Tesla's vehicle quality and fit-and-finish have both remained poor. The EV tax credits are probably going away soon.

One doesn't have to tip the scales against them at the moment.

But he continues doing what he started. Considering the fact that he is very smart and definitely hungry for absolute power, you can think about his true goal. If he is ready to risk that much of his worth, it means that the potential win for him will bring so much more.

Elon isn't particularly smart and his continuing to do what he started is pretty much entirely ego driven. He's afraid he'll look like a bitch if he throws the towel in now.

Of course, in reality, he's looked like a bitch since at least 2018.

> Considering the fact that he is very smart

Is he though?

Plenty of people start out smart and then melt their brains in one way or another. Musk really seems like he's going down the same road.

Smarts aren't a permanent state of being, they're a temporary blessing, and if you're lucky they're slowly replaced with wisdom as you age. Musk doesn't seem to be getting the late-life migration to wisdom. Wise elders generally focus on a legacy that benefits their community, they don't spout slurs and pay people to make them look like they're good at video games.

https://elonmusk.today/

Elon's strong legacy is imo masking a mental decline. People are excusing behavior on his part because of what he's built in the past but imo its not so simple.

Differentiating between 5d chess and delusional behavior is not easy. I'm personally inclined to think its the latter, but there's admittedly room for debate.

The reason I think this is because it is failure mode that is not uncommon in highly driven, egocentric geniuses. Especially one individual who has stated on record that they are taking ketamine, a powerful dissociative drug.

Or he's misestimating his potential wins because he's on tons of drugs and they're giving him delusions of grandeur.

This seems like the closest thing to an Occam’s razor take to me. If all his companies crash and burn from his unhinged behavior, he’s not going to be useful to other billionaires or as powerful regardless. The fact so much of his wealth is in Tesla, a company that relies on climate conscious consumers, and he throws around nazi salutes in a heavily watched and historical event makes no sense at all. Meanwhile the administration is dismantling anything that would help EVs. It’s not 5D chess, sorry. I wonder what Tesla engineers and others inside the company think about all this.

> that the potential win for him will bring so much more.

what do you think is the potential win for him?

Vast control over the US Federal Government and impunity for him and all his companies to violate the law.

It's hard to put a price on the power to fire people investigating your company for wrongdoing.

Or the power to blow up starships even though you were told by the government you can't launch more because you blew up the last one, raining down debris on everyone and causing their flights to be grounded.

Wouldn't you love to be able to do that without any repercussions?

Or to test your driverless car tech on public roads and not get in trouble no matter how many people they kill.

Or to sell your unsold vehicle inventory, that's building up because your product is a boondoggle, directly to the government.

Or the power to bully foreign governments into using your product with the full backing of the United States military.

Or to award yourself and your companies government contracts worth billions of dollars without having to bid or compete over them.

Or to train your fledgling AI on all the information you're scraping about Americans from government data sources unavailable to your competitors.

Or to cancel government projects that benefit your competitors, like killing investments in EV charging infrastructure, forcing everyone to use the one you own.

Or to test your brain implant on human subjects without the pesky FDA up your ass making sure it's done "humanely".

On and on and on. The corruption is just endless if you're creative enough...

You mistake IQ for judgement.

They are related but distinct.

This site is living proof of that.

> Musk's political antics are affecting his businesses.

The scary part is that he doesn't care. Money is no longer his motive.

It's called "fuck _me_ money", and it's one reason billionaires shouldn't exist.

https://www.reddit.com/r/AdamCarolla/comments/5jfeoz/whats_t...

-2?

I see DOGE/Musk fanbois frequent Hacker News.

It'll be wild to see how Congress responds.

We’ve been waiting for Congress to respond for weeks. I wouldn’t hold your breath.

With talk of a anticipated 10% to 20% drop in the markets, their silence could be ruinous.

SP500 is already down 10% in the last month

> SP500 is already down 10% in the last month

Not yet. Nasdaq is in correction, but the S&P is only down 8.6% from its 19 February high of 6,144 [1]. (5,529.)

[1] https://www.marketwatch.com/story/nasdaq-falls-back-into-cor...

Yes. I eyeballed it at roughly 9% earlier and rounded up. My point stands. We're already pretty much in the ballpark of what GP cited.

As of today S&P has given up all gains since the election, and then some.

Or they are silently buying the dip till the midterms.

2 years of a 'dip' is, ummm, not just a dip, right?

NASDAQ is already down 11.5% in the last month.

They're busy trying to pass a continuing resolution on Republican-only votes the keep the government open.

Because heaven forbid both parties compromise.

The compromise between fucking insanity and good governance is not agreeing to go half way into fucking insanity.

Meeting an unreasonable person half-way is giving them a blank cheque to become more unreasonable.

All it does is tell them that you're a sucker.

Depends on what cards one is holding.

Getting half of what one wants and not being driven off a cliff can be preferable to smiling in moral smugness while the car arcs through the air.

Past behavior of this administration strongly predicts that your reward for kowtowing to its value-compromising demands... Is becoming the target of further value-compromising demands.

It doesn't engage in positive-sum games.

It doesn't have to.

Strictly in terms of self-interest, sometimes compromise can be the optimal move.

If they're willing to self-harm for the cause, then the optimal move is to grab the wheel and yank it yourself to change direction and stop the car from careening off the cliff.

Or at minimum, not gas it up.

> smiling in moral smugness while the car arcs through the air

Sorry, why is this metaphorical car arcing through the air again? What's that all about?

> trying to pass a continuing resolution on Republican-only votes the keep the government open

They can’t. They need Democrats in the Senate [1].

It should honestly fail without a provision defunding and deauthorising DOGE.

[1] https://www.politico.com/live-updates/2025/03/10/congress/jo...

One of the big questions is what happens to all the money Congress has allocated?

The budget keeps allocations the same, but now that for example Mark Rubio announced USAID is to be entirely eliminated, it's remaining 15% of programs moved into State Department, what happens to that money? https://apnews.com/article/trump-musk-rubio-usaid-foreign-ai...

Expectations are that it's just treated as a giant slush fund for whatever the executive feels like. Whether Dems do anything to curb DOGE's chainsawing act or whether they try to wrestle with what happens to these "savings" is something Dems have a chance right now to tangle with, and much less leverage in the future. https://talkingpointsmemo.com/edblog/will-dems-pick-up-their...

I’m sorry there is only one party which is consistently doesn’t compromise at all. It’s a party of bullies and it’s a party which brought us here (and will bring us somewhere much worse). I’m afraid by now the only option forward don’t compromise with them at all, they understand only power.

The stock market falls by 10% or more on average every 1.2 years: https://www.covenantwealthadvisors.com/post/understanding-st....

There were 5 such drops in 2020, 4 in 2022, and 1 in 2023. Somehow, the nation avoided ruin during those periods.

Nearly every market worldwide was dropping in 2020 due to the pandemic.

IIRC, the drops in 2022 correlated with federal interest rate hikes and other federal policies designed to help ease inflation, with the expectation that markets would rapidly cool but avoid a larger overall crash.

Simply put, a 10% drop isn't in itself concerning if correlated with shifting market conditions. It is when those in charge are foot-gunning the market with their policies, and then threatening to double down in the face of the 10% drop they caused.

> Somehow, the nation avoided ruin during those periods.

2020 was a serious recession; the nation may have avoided ruin, but many people did not

> There were 5 such drops in 2020, 4 in 2022, and 1 in 2023. Somehow, the nation avoided ruin during those periods

Come on, look at your numbers. Recession in 2020 with 5 blips on the monitor. Last quarter we saw negative real GDP Q1 ‘22, 4 blips. 1 blip in ‘23 and none in ‘24 while the economy did so well prices overheated.

Now we’re seeing 1 blip in Q1. If we annualise that to 4 blips, it puts us back in the last year in which we had a single quarter with negative real GDP growth.

I am looking at the numbers.

And what the numbers show is that a 10% drop happens on average every 1.2 years and is not something that needs Congress to get involved in every time it happens.

If you can't tolerate 10% drops on a regularly occurring basis, the answer is not to beg Congress for help, it is to invest in something safer with lower returns.

> a 10% drop happens on average every 1.2 years

You’re averaging a non-averageable time series.

> If you can't tolerate 10% drops on a regularly occurring basis

The point is to look at data together. A 10% drop on its own isn’t much. A 10% drop alongside crashing ISM indices and the President being noncommittal on a coming recession is another.

You seem weirdly determined to ignore all context in a discussion about markets.

> And what the numbers show is that a 10% drop happens on average every 1.2 years

Is the market done dropping?

Did you mean decades?

It's commonly said Presidents get 100 days in office to enact the bulk of their platform. It's an approximation, of course, but it's about then that the new-to-office approval rating bump starts to wane and Congress starts gearing up for midterms. We're about half way there.

If the economy is in bad shape in May, I would not be surprised if Congress intervenes on tariffs. The fear of being primaried by MAGA loyalists will become smaller than the fear of losing to the other party very rapidly if a tariff-induced bad economy is the result.

The constitution gives Congress the power, but they've delegated it to the President, which means they can take it back. They will if losing elections seems likely.

It should be clear now that the GOP has nearly total and absolute control over the MAGA base, meaning they will take whatever spin they’ve been given by the party.

In other words, the GOP can do whatever it wants or nothing at all and it will get little pushback from their voters. That’s a pretty powerful position to be in as a party.

They get little pushback from ~95% of their voters. However, the last 5% of their voters are center/center-right voters, and it's those voters that flipped the election from Biden/Harris to Trump and are presumably willing to flip back.

I wish I had your optimism. Too many Republicans lack a spine and likely think their best chance of survival is actually to do nothing.

> If the economy is in bad shape in May

Would note that we’re still only seeing leading indicators and forecasts crash. Even real GDP can be dismissed as a calculation. Job losses, on the other hand, will be obvious corpses. Unfortunately, those might take until the fall to pile up.

Trump crossed the threshold from being more unpopular than popular this week. If history is any guide, he won't recover from that during his term https://www.economist.com/interactive/trump-approval-tracker

Congress already made their bed with the cuts to medaid in order to fund capital tax cuts. I wouldn't be surprised if Florida completely flips next month unless the senators wake up.

You're framing this as an incentive for them to moderate their positions, but I'm reading it as a motive for them to rig elections.

I don't think either party ever didn't have that incentive. If elections could feasibly be rigged then they already are I'm sure.

You think sebete republicans are going to have a spine? Boy do you have wayyy more faith in them than they deserve.

> Congress intervenes on tariffs

the tariffs on Canada/Mexico haven't gone into effect yet and Trump may yet again change his mind or end up keeping it restricted to a few select industries (i.e. steel) who are clamoring for it (my guess is the latter)

As for China, I think many in Congress from both parties are supportive of them, so I would expect those to stay

They certainly have gone into effect. They've been paused on USMCA covered goods, but that's only 1/3rd of the goods from Canada and 1/2 from Mexico.

> 1/2 from Mexico.

That's what the WH said. But the Mexican president said that nearly all Mexican exports to US were covered under the USMCA.

Why? Congress is majority republican, who have been under selection pressure to be party faithful. If that fails, they are getting death threats to stay in line.

The Republican strategy is to punish bi-partisan efforts.

From a Dem standpoint, its simpler to point out the fact that they have no real power, and let the Republicans take the heat.

What can Congress do?

So far the Republicans haven't been willing to do anything except go along. They are inert.

This administration is either intentionally performing market manipulation or is simply incompetent. Either way, we all lose.

Hope the general populous is happy with their choice, lol.

I wouldn't be surprised if there's an inner circle buy/sell club around the tariff announcements. There's no economic sense to pushing them hard and then hitting the brakes so much unless you are actively looking to manipulate things.

The on/off tariffs are just as bad as imposing them for market confidence (if not worse).

The simple explanation is they want the tariffs, but get scared by the blowback, but can't just give up, because that would look even more dumb than it already does.

There's a theory circulating about it's all a show to provoke rate cuts. Theory behind theory is rate cut period boosted the previous run, so it ought to boost another one?

It's intentional. Anyone thinking otherwise hasn't been listening to Treasury Sec Bissent talk these last two months. The goal to lower prices is to "increase supply and lower demand," and yes that's a direct quote. You don't lower demand by asking people to stop buying things. You lower demand by reducing people's ability to buy things.

That’s not some secret plan, that’s how policymakers historically address inflation: https://www.vox.com/future-perfect/2022/7/13/23188455/inflat...

> Higher interest rates generally reduce inflation by reducing spending, which in turn slows the economy and can lead to mass unemployment.

> One of the people who denounced Volcker’s moves was then-Senate Majority Leader Robert Byrd, who declared after Volcker announced his new effort in October 1979, “Attempting to control inflation or protect the dollar by throwing legions of people out of work and shutting down shifts in our factories and mines is a hopeless policy.“

The question is if the recession can be structured to disproportionately hit financialized and knowledge industries while sparing manufacturing.

> Higher interest rates generally reduce inflation by reducing spending, which in turn slows the economy and can lead to mass unemployment.

But higher interest rates aren't what the Whitehouse wants.

The article is about interest rates, but the relevant point here is that higher interest rates are a way of slowing the economy, which reduces demand, which in turn reduces inflation.

The White House wants to reduce prices without raising interest rates. So you need some other way of slowing down the economy. There’s lots of ways to do that, such as laying off federal workers.

That’s like saying amputation is a way to handle getting a paper cut. It’s in “not even wrong” territories of incorrectness.

Higher interest rates are about shifting investment priorities and loan rates. It increases the cost of lending, which results in people making choices about taking on risk and debt.

The reduction in loans being written, and the increase in interest being paid means that people start moving their money into savings, reducing the velocity of Money.

Laying off people from the government reduces the amount of money being used productively, but doesn’t do a thing to stop loans being written or money being printed.

It destroys the ability of the system to be efficient, resulting in more waste, and with more risk appetite + weaker regulators it results in the ability for people to break laws with impunity, resulting in captured or rent seeking markets.

This results in a recession, and a failed economy.

The same people also say "tariffs are going to bring us so much money" and "we are going to call it the External Revenue Service". So maybe don't read rationality into clueless vibe statements.

> we are going to call it the External Revenue Service

To be fair to them (even if they're likely unaware), that was effectively a thing back in the 1800s: https://en.wikipedia.org/wiki/United_States_Revenue_Cutter_S...

> The federal government desperately needed revenue, and determined to raise it chiefly from tariffs on imports. Strong enforcement of tariff laws could blunt rampant smuggling. Urged on by Secretary of the Treasury Alexander Hamilton, the United States Congress on 4 August 1790 established the Revenue-Marine, later renamed the Revenue Cutter Service by act of 31 July 1894 (28 Stat. 171)

1800s

How do tariffs fit into the stated goal of “increasing supply?”

Entrepreneurs are supposed to offer domestic versions at their own risk

With how quickly the tariffs are added and removed, if I were an entrepreneur I’d find it difficult to lean in on a risky investment that may be undermined or undercut by the eventual and sudden removal of tariffs. I’m curious how this plays out in reality.

so far, Apple says they'll invest $500bn to bring their supply chain stateside, Softbank $100bn-$200bn, "Stargate" Group is supposed to be $65bn

and that was just to curry favor as well as get in front of the tariff plans

we'll see if they follow through, but those count as American entrepreneurs too

if there are disruptions on smaller scales, some people will take the risk, and there will be winners and losers as with everything else.

Tariffs don’t achieve this, and it misdiagnoses the problem in the first place.

Manufacturing is now increasingly automated, so it doesn’t employ as many people anymore. This is an issue India faces as does every developing economy. Economic growth is increasingly dependent on service sector growth.

Moving supply chains also requires weaker labor laws, and lower salaries for workers, than minimum wage, to be competitive.

OSHA is a problem for factory owners, because it increases costs with the tradeoff of higher worker safety. In contrast, there are suicide nets around factories in China.

The American populace doesn’t want to work jobs at lower wages. The price for competitive goods requires firms to be cheap.

You are going to be subsidizing people to work in factories, for decades, if not a full century. All the while people will take aim at the subsidy, and then blame minimum wages and people who support labor laws. Ad infinitum.

America has many American workers at minimum wage and above. (and below)

In this specific sector, the entire industry including retail has shown they will pay many multiples of a higher price for GPUs and cloud services. So if a US grown supply already cost that much out the gate, there is already examples of the market being able to bare that.

I get your point - but when I see what you are saying, the focus is on the demand side and price elasticity.

There is definitely an unserved market. Even now, there’s many people who want to purchase the service and can’t afford to.

However, even if we concede your point in its strongest sense - the revenue is a different beast from the profit margins.

Higher labor and compliance costs mean that making things in america is more expensive.

The solution is usually to not pay people that much

In the end a company is measured by its stock performance. Their incentive is to maximize profit.

If the solution is to pay people less, most voters balk.

Exactly, rather than evolve our economy and support high paying jobs which often require high education, the strategy seems to be revert to past things that made our economy successful and neglect the education system. Why? I think it’s because it guarantees votes and is an easy movement to get behind but it’s not /better/. I don’t think it will actually work either because you have to compete with your aforementioned labor costs which isn’t sustainable.

Right!

I say take it a step further - not everyone is excited by sitting in front of a computer and doing intellectual exercises. People like different things and are suited to doing different things as well.

But if there is only one way forward, which is Engineering, Medicine and Law - then you have essentially recreated 1970s India and China.

But this is 2025 - not only do we have automation we have GenAI, which threatens to take away tons of low level service work. Education is something that takes years to result in blooms. Decades of nurturing.

(Hey - thats a useful analogy. Societies plant and harvest crops of trained professionals.)

Can people discuss these difficult topics? Nope. Besides, if you do - people start becoming more “liberal”, “disconnected” from ground reality. Code for people not voting the way leadership would like.

It’s definitely interesting. I’m starting to think of the potential upside there and it’s going to be a relatively long road to move all that back here.

There’s an issue of raw materials supply as well and I’m curious if this is more of an “assembled in USA” type of thing or the whole chain will move. Time will tell.

I mean, sure, inducing a recession works for lowering prices, but it's freaking stupid and makes people poorer.

It's a stupid decision from the perspective of the people getting poorer, but what about the people who are getting richer? It' a great decision for them.

Is there a specific aspect of the administration's policies which you believe are causing this?

Candidates would include "actual impact of tariffs enacted" or "uncertainty about future tariffs" or the same things but with "geopolitical decisions" instead of tariffs. Or similarly "fiscal solvency" or "profile of government spending" etc. It's all well and good to make untestable post facto explanations based on vibes but I'd be interested in whether you (or other people in the thread) have specifics, so we can think about backtesting and prediction. Do you predict that these phenomena will have long-term implications or if they will self-correct?

Any assertion of the causation of a market movement is itself pretty economically tenuous. I think any of the above policies can be criticized on principled grounds; if the stock market is the arbiter of whether economic policy is correct I do not think that anyone would be happy with where this leads.

Tariff may be worse for the economy, but threatening tariffs as a "negotiating tactic" with Canada and Mexico is just plain stupid. Unless if they have insider information, businesses simply have no idea how to operate. For example, it would take years to build a factory, and they don't want to sink hundreds of millions in a factory in the US if tariffs don't actually go through or vice versa.

I completely agree, but I would argue this whether or not the stock market is going up or down in the immediate term.

That makes building the factory in the U.S. the safe choice whether tariffs are implemented or not.

The safe choice is not to build the factory.

Even if you build the factory in the US to avoid tariffs on the goods you sell, did all your inputs also get built in the US? Are the tariffs on your inputs going to wipe out your profits?

To build a factory you want to predict out the cost vs benefit. But if the costs are highly uncertain, then the numbers in your spreadsheet fluctuate wildly. So you just sit on the money you have and wait to build the factory until things are more certain.

How is it safe to spend all this money on a domestic factory just for it to be cheaper to import everything anyways? The safe choice is to hoard cash and inventory until they have certainty of whether tariffs will happen or not. All Trump is doing is creating unnecessary deadweight loss when he can just negotiate without threatening a suicide pact.

Tariffs are a well known ineffectual move by anyone with any experience in finance.

They are simply the addition of inefficiency to a market. You are taught this in any 101 Econ course, its part and parcel of learning how to draw supply and demand curves.

It is SO basic, that discussion of this on educated forums, is fear inducing.

Furthermore, this is a trade war based on vibes. This is not implemented with something like anti-dumping in mind. It’s not based on real flaws that the target countries can address.

It’s based on a fabricated alternate reality. This means that retaliatory tariffs have no economic cut off / threshold. It is only measured in behavioral and political stances. This is now a question of faith and pain tolerance, and not economic rationality.

This was already a possibility, known in November. At this point, for many institutional investors, worst case scenario contingency plans are being put into play.

Markets are a well known measure of whether economic policy is sound. IT isn’t the ONLY measure however, but it is one of several markers that are tracked to understand what people forecast outcomes, growth and expectations of the future are.

It sounds like you're making a principled argument against tariffs. That's great, and whether you're right or wrong is independent of the stock market reaction. And there's a fine discussion to be had on the merits of tariffs and tariff uncertainty on economic activity.

But attributing short-term market movement to a specific phenomenon is, to put it bluntly, plain foolishness. Ex post facto reasoning is almost always an absurd task and it's important to push back on it, *especially* when it confirms your own biases.

This is not a principled argument.

This is the actions people I know are taking to manage investments.

Look - I can’t help you if you wish to believe something.

That’s an issue of faith.

I have no idea why you believe that this is ex post facto reasoning.

Tariffs cause recessions, it’s not even correlation.

Let me elaborate - the moment Trump was elected, I knew that he was going to impose tariffs, and that it was going to tank the US economy.

If you want logic, I can debate. If this is a matter of faith and belief that this is some error on my part and that no one can know things are causative - then that’s a matter of faith and religion.

It is a principled argument -- even if the stock market had gone up you would still believe that tariffs are bad. If your claim is that it is impossible for the stock market to go up in the face of tariffs, then you're making a real proposition which can be tested and (let's face it) easily shown to be false.

Blaming the current stock market movement on a reaction to the tariffs is not a valid argument. Saying that tariffs have a negative economic impact is totally valid, and has a lot of evidence to support it.

Trying to offer narrative explanations for market movements is a suckers game; it's just the bloomberg headline generator "Markets <insert direction markets moved> on news of <insert current news>", with no predictive value.

I am ex-finance. I didn't get paid for intellectual arguments:

> Saying that tariffs have a negative economic impact is totally valid, > narrative explanations for market movements is a suckers game

So let me be clearer - I knew in November, that Trump's style of tariffs, were going to tank the economy, which would tank the stock markets which reflects the stock market.

The causatory force (not correlatory) of tarriffs is well known, and I've lived in the era where tariffs were commonplace. I've seen an entire economy rise from the ashes when tariffs and protectionism was removed.

You are hiding behind an intellectualism in a world where these kinds of blind spots mean someone else is taking your money.

The stock market is based on and is a measure of vibes/confidence.

Deliberately diminishing the importance of the richest and most powerful nation in the world doesn't seem like the move if you want to inspire confidence.

The administration is trying to definancialize the economy. Everything points in that direction, from tariffs to foreign policy moves that would reduce the dollar’s status as a reserve currency.

> definancialize the economy

Not sure what does it mean in the context of the economy in general.

The point is to change the incentives to favor building things in the U.S. rather than increasing profits by building things overseas.

Consider what high tariffs would do, for example, to Apple. Since Steve Jobs died, Tim Cook has focused on increasing profits by building a hyper-optimized Chinese supply chain. That doesn’t help American workers, and I’d argue in the long run it hurts innovation. But imagine if Apple had to be an exorbitant tariff for every foreign-made iPhone. Had such a policy been in place 20 years ago, we may have dramatically changed the direction the cell phone industry went in the country.

> That doesn’t help American workers

Depends on your definition of 'help,' no kid in school thinks "Gosh I hope I can become a factory laborer when I grow up."

Let's be realistic, it doesn't help US geopolitical strategy and doesn't maintain US hegemony. The US doesn't need or want factory workers, it wants citizens who are self-actualized. It might need some factory workers to realize that aim, but human drudgery powering factory production isn't an end in itself.

Ideally the US leapfrogs all this and gets to fully automated production before anyone else. People want purpose in life, and being a factory drone is a pretty lousy purpose.

> Depends on your definition of 'help,' no kid in school thinks "Gosh I hope I can become a factory laborer when I grow up."

The revealed preference suggests you're wrong. That's why the messaging of every politician that has resonated with the working class, from Bernie to Obama to Trump, it's focused on bringing back manufacturing jobs.

> The US doesn't need or want factory workers, it wants citizens who are self-actualized.

You can't be a citizen in a participatory democracy if you're not needed. The cognitive elites that call half the country "deplorables" might choose to give you a dole, but they'll hold it over your head and it'll come with strings attached.

> focused on bringing back manufacturing jobs

Everyone focuses on bringing them back, because you're correct that it resonates. However, what goes unsaid is that everyone hopes it'll be someone else going to work in those factories.

> You can't be a citizen in a participatory democracy if you're not needed. The cognitive elites that call half the country "deplorables" might choose to give you a dole, but they'll hold it over your head and it'll come with strings attached.

The 'cognitive elites' never called half the country deplorables. One person called half of Trump supporters that, referring to an undeniably real subset of that voting block that is racist/homophopic/xenophobic. The (Number of Trump Voters) * 0.5 is nowhere near half the country.

This is of course a derail from the derail, which is the claim that you can't be a citizen if you're not 'needed.' You can be and are, and 'needed' is a value judgement by the ruling class who can divide and conquer the citizenry by manufacturing mass media telling citizens who is 'needed' and who is not.

> One person called half of Trump supporters that, referring to an undeniably real subset of that voting block that is racist/homophopic/xenophobic.

According to whose value system? By the standards of your typical knowledge worker, almost everyone in my home country of Bangladesh is “racist/homophobic/sexist.” But why do they get to decide? You can bet that in your hypothetical, the cognitive elite will use their leverage over the government dole to impose their value system on everyone else.

Who is “needed” is not a “value judgment” it’s a structural fact about the economy. In a future where the machines make all the goods, you’ll need cognitive elites to operate and maintain them. But most people won’t be needed. And they’ll never be allowed to be full participants in a democracy—which necessarily includes development of social and moral norms.

> And they’ll never be allowed to be full participants in a democracy

This is what the elites often assert before the mobs with guillotines, torches, pitchforks, etc come for them.

Who gets to decide who is a participant? Ultimately it's the group that seizes power. You might think that a tiny group of despotic people can hold out against the overwhelming majority (South Africans sure tried, and some are still bitter that they failed at it) forever, but this type of thing never lasts, fortunately.

You couldn't feasibly overthrow the elite, because they would control the machines that automated the production. South Africa actually illustrates the problem. Post-Apartheid, South Africa is basically two countries in one country: a largely white, industrialized country participating in the globalized and financialized economy, and a largely black developing-nation economy. The black south africans cannot expel the whites, because the latter would take with them almost all industrial and agricultural technology.

> You couldn't feasibly overthrow the elite

Just to review: the South African apartheid regime was famously overthrown, peacefully.

> Post-Apartheid, South Africa is basically two countries in one country

Not where it matters. South Africans, no matter their ethnicity, all have the same vote and the same elected leadership. The place isn't perfect but it's no longer operating as a wholly morally repugnant regime.

This is just one example, mind you. It's the whole "The arc of history is long, but it bends toward justice" pattern. Despotic rule by a tiny minority never lasts, no matter what temporary technological advantages they might have.

> Tim Cook has focused on increasing profits by building a hyper-optimized Chinese supply chain. That doesn’t help American workers

Agree, and that's kind of obvious.

> we may have dramatically changed the direction the cell phone industry went in the country

Not sure. Even less sure how instantaneous and very tariffs can help with that. Also it's not clear how that less of the financealisation.

This comment struck me as interesting re: financialization. https://x.com/ces921/status/1886037535283143162

It reads to me as 'unknown unknown' not as a plausible strategy.

They also want "to keep the U.S. the dominant reserve currency in the world, and we will use stablecoins to do that". They are idiots with conflicting goals and not even a conception of plan.

I don't know — depending on if it gets bad enough, last time we got a New Deal out of it.

After millions died of starvation

Millions did not die of starvation during the Great Depression in the US.

https://history.stackexchange.com/questions/12297/how-many-p...

We got a world war out of it as well

..which did more to boost the economy than the New Deal.

I don't know why there is this general vibe amongst technologists that they are somehow far superior in their thought process compared to the general populace. I have heard the words peasant class come up quite often in the tech circles. Why is this ? Aren't you part of the general populace ?

At the risk of getting downvoted let me posit a different narrative.

What if the past governments were just propping up growth by increasing government spending. The facts that are coming out now point in this direction.

Unemployment numbers that were fudged and recalled by nearly 1M on two occasions. 35% government hiring in the last 3 years.

What if this is the unwinding that was needed long ago but is happening now.

Yes tariffs are a net negative for the US economy, but there is no guarantee that tariffs will stay as we saw with the Canada and Mexico tariffs.

So may be, the government is not completely incompetent.

This data from Apollo management points to a not so bleak picture.

https://www.apolloacademy.com/wp-content/uploads/2025/03/DC_...

>>35% government hiring in the last 3 years.

Keynsian economics 101. “The government should pay people to dig holes in the ground and then fill them up." except in this case it's government non jobs rather than asking people to do manual labour.

> What if the past governments were just propping up growth by increasing government spending. The facts that are coming out now point in this direction.

Nothing like that is seen now. You primary see markets reacting to tariffs and to boycotts. You see them reacting to large contracts that should be to Musk companies.

The government spending did not went down yet.

> Why is this ? Aren't you part of the general populace ?

In the country where I live/lived programmers are usually 1) top 25% earners 2) dis-proportionally vote liberal leaning candidates

Of course that 25% is a part 100%, however that absolutely not a random selection and very different from the "median" citizen and their problems.

Being top earner definitely skews ones views - not a novel phenomenon.

> 35% government hiring in the last 3 years.

I've been wondering how a labor market miracle seems to happen every quarter in the face of steep interest rate increases. The Fed has been trying to engineer a recession for years now.

> I don't know why there is this general vibe amongst technologists that they are somehow far superior in their thought process compared to the general populace.

It’s a recent shift. Historically, “technologists” were skeptical of the supposed knowledge of “experts.” When Linus built Linux, the “experts”—the guys with PhDs—said the future was microkernels: https://en.wikipedia.org/wiki/Tanenbaum%E2%80%93Torvalds_deb.... Linus was right. But I feel like today techies would’ve mocked him for being just a student arguing with a tenured professor on a subject in the professor’s field.

Opposition to free trade has been building for 25 years: https://www.britannica.com/event/Seattle-WTO-protests-of-199.... We used to make routers in California and sell them to China. Now we make them in China and Americans drive Uber. Economists tell us that this is efficient, but the public isn’t required to believe them. And it’s fine to try a different approach to see what happens.

I get your point, I really do. And I somewhat agree with the basic tenet. It's just that if you look at the big picture and what they are doing on all fronts, it looks really really bad. And it's also who is doing this. I think Trump is a lying, shallow, stupid stupid man. I have thought this for a long time. People like this bring pain and suffering, not reform.

Even more, if you truly believe what you are saying, and you want a more competitive trade environment, getting someone who will botch it will hurt your cause. I see no way these guys are going to leave your country in a good state.

I mean in theory you could maybe argue that free trade economically makes the the country as a whole better off, but it could still be worse off strategically (EG by not being able to produce weapons or the necessary components to defend itself).

It's also pretty clear that any economic benefits that there were, didn't benefit all of society equally,

I strongly suspect that free trade is good for the economy as a whole in the short to medium term, though has a negative effect on distribution (disproportionately benefitting those whose jobs can’t be easily outsourced). But in the long term it may destroy a country’s competitiveness by vitiating any comparative advantage.

I've thought long and hard about free trade. Ultimately, people want cheap products and free trade optimizes for price that's it. It's like this single objective function that disregards all other functions.

So the competitive advantage for any country now boils down to the entire nation optimizing for cost. A country like China can do this, because the cost optimization for USA = lifting someone out of poverty in China. They are at the rock bottom of cost already.

Now that China has learned to optimize for cost, they will continue down that path - AI, robotics whatever tool they can amass to drive down cost, they will.

Meanwhile, other nations arbitrage about quality of life, politics, hatred of the rich so on and so forth and let the cost optimization slide. Ideally if every country optimized for cost, free trade would work like magic. Sadly, China is the only country doing that and rest of the world is now beholden to them, losing their once cherished competitive advantage.

Now China which once was derided for cheap quality has learned to build quality at scale and for cheap. Literally no one can compete with them on price:quality ratio. 3-4 decades of cost optimizations have paid off immensely for them.

The competitive advantage boils down to being able to do what is optimal for you to spend your time on. America can enrich a majority of the richest people on earth, by having a fraction of the populace working.

China has to put up nets on its factories and subsidize entire swathes of its economy, for decades, to be competitive.

Currently - the value of labor is being eroded by the value of automation. This is why it’s no longer possible for India to succeed by turning into a manufacturing powerhouse. The global option now is in having effective service industries. Generative AI is already throwing a wrench in that plan.

This is leaving ZERO room for people with ordinary resources, knowledge and skills.

The idea that free trade is the problem, may have held for a specific window in time. That window was small and has closed. The larger issue is automation, and the displacement of neophyte workers.

——-

My personal take - the challenge today is helping people actualize themselves. This is a very fuzzy term, and frankly it embarrasses me to use it. But we have better tools, practice, and science behind human thinking. I’ve used this knowledge practically, and I’ve seen results in team performance and motivation.

I have the actual experience and knowledge to talk about this, having done my grunt work as the idiot analyst.

The American military is a massive source of employment for Americans, and has been the case for decades. It is the source of multiple careers, education opportunities and investment into core sectors for the economy.

Without looking at the numbers, I am going to bet the 35% increased hiring is not military forces. Given the spread I saw of government employment, I suspect its going to largely be nurses, doctors and grunts to do work in many of the understaffed government agencies.

Tariffs are a net negative for the Global Economy, and in this case tariffs are political in nature.

This means there is no economic cut off or action target countries can take to remedy the situation - only ‘vibe’ and ‘appearance’ related actions.

Counter tariffs are going to target Trump and Republican dominated regions. The cut offs here are extreme - they are a form of communication through mutually inflicted pain.

Since it’s America vs the world; Canada, Mexico, the UK, China, India - will coordinate to make trade between each other more efficient, so as to offset the costs imposed on their goods.

Since America has jettisoned its soft power, they have no tools to bring to the negotiating table, meaning that the only options for America are - endure / capitulate / escalate.

This is the emperor’s new clothes territory. The New Emperor is naked, but people believe that they must simply be unable to see the greater plan.

> I don't know why there is this general vibe amongst technologists that they are somehow far superior in their thought process compared to the general populace. I have heard the words peasant class come up quite often in the tech circles. Why is this ? Aren't you part of the general populace ?

I think the HN crowd (and technologists) are generally better informed on the economy and the nuances on economic growth, inflation, stock market etc. and that's probably the point OP is making. Dont get me wrong, a lot of technologists did vote for Trump.

It's simple incompetence. The whole lot are economically illiterate. Musk is out there talking about the US going bankrupt. Trump is saying other countries will pay for the tariffs. It's mind numbing.

This is why you can't have business people running a country. A country is not like a business or a household.

or have people that played business people on TV shows...

This. He was playing a character. People think it was a documentary.

Canada imposed tariffs on China last year [1]. Is that incompetence as well?

[1] https://www.canada.ca/en/department-finance/news/2024/08/can...

Canada imposed targeted tarrifs on certain Chinese products, increasing their cost for Candadian consumers to level the playing field. China didn't pay Canada a dime.

The United States on the other hand is planning a blanket tariff with certain carveouts, and the current administration seems to believe it will be foreign countries paying the United States as a result. When in reality, it will be American consumers and business owners paying 100% of the tariff costs. That is incompetence.

The tariffs are for different purposes.

Canada's tariffs were to prop up their automotive industry. America's tariffs are to encourage nations to so more to stop importing illegal drugs into the US.

That doesn't make sense.

How does charging American consumers and businesses an additional 25-50% tax on purchases and imports accomplish that?

Because people will stop buying products imported from those countries, and buy from their competitors instead.

If the goal is really to increase law enforcement along the borders, this still does not make sense.

There aren't really domestic competitors for much of the imported materials used to create American products, so the foreign suppliers have the upper hand in the "deal" since Americans are reliant on them and do not have their own competitors in place.

To me this appears to be more about the federal government charging the majority of Americans more in taxes, to pay for the deficit being created by tax cuts for the few ultrawealthy Americans.

There is no way they are this dumb. Musk especially, he's not some 1 in a lifetime genius, but he's no dummy either. There is no way he does not understand that what he is doing will have severe negative ramifications.

> Musk is out there talking about the US going bankrupt

Musk is particularly dark—he was born in South Africa. He knows how this winds up. Yet he seems adamant to recapitulate the ANC’s corrupt playbook.

Simple explanation. Musk has lost it. His long term drug (ketamine) use has resulted in a psychotic break, which we are watching play out publicly.

Exactly. And the clear proof is the ridiculous dance around tariff policy. Tarrifs were a clear fait accompli, promised in the campaign and scheduled the moment the administration took office. Then the market tanked right as they were about to take effect. Then there was a delay! Then they were only going to apply to goods not covered by NAFTA^H^H^HUSMTC! Which is all goods, basically. So no tariffs. Except they're still on the books.

That's not a rationalist trade policy. At its most charitable, it's a failed attempted at brinksmanship. More likely it's just not understanding how markets work and in particular how that is reflected in the stock market (which, if not "rationalist" per se, is a lot more so than the administration). Incompetence either way.

My neighbours and I have been buying up cropland on the cheap as a result of the trade war. As an ethical move, we’re only buying in Trump-voting counties from registered Republicans. But at the end of the day, there is massive pain in that sector, particularly among soybean farmers and dairy farmers close to Canada, and it’s directly attributable to Trump.

> As an ethical move, we’re only buying in Trump-voting counties from registered Republicans.

That's a strange kind of ethics, refusing to buy from Democrats who want to sell. It's like you're boycotting Democrats.

> refusing to buy from Democrats who want to sell

These are distressed properties. They’re not for sale by the original owners, who probably would prefer to keep them. (Their creditors, on the other hand, want to get paid.)

I suspect it's incompetent market manipulation.

I think it's possible they are telling their friends of these random policy flip flops to trade the news things like tariff exemptions and crypto reserve. But it's pretty poor politics, businesses hate it, elites see their stocks go down. I don't care what concessions Mexico, Canada or China give if tariffs raise my cost of living and interest rates are kept high

I would be amazed if there is not insider trading going on. The incompetent part I'm referring to is driving down the mid and future value of US stock. Reputational damage is often something that can't be reversed.

"Never attribute to malice that which is adequately explained by stupidity."

-Hanlon's razor

https://en.wikipedia.org/wiki/Hanlon's_razor

Of the general populous, there are more people who didn't vote for the current administration than people who did.

Arthur Hayes, the founder of Bitmex, argues that Trump tries to manufacture recession to get lower interest rates (for his real estate empire)

https://cryptohayes.medium.com/kiss-of-death-916ae30fedc5

Not just Trump, but every truly rich person in the US has described “high interest rates” as their number one complaint with the economy.

The problem is that these people complaining about interest rates are stupid.

Both, they're incompetently trying to pull a big scam. It's said that Trump did a lot of shady stuff in real estate, same for musk .. so they probably thought they could sell cutting everything federal as a 'new american age' while ensuring massive profits on the sell-off.

Sometimes I worry that, somehow, their reckless actions land onto a tangibly visible positive outcome, and they would brag about it until they die.

If you look at all the revisions to the employment numbers over the past few years, one could arrive at the conclusion that a downturn was inevitable.

The timing though.

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