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Comment by davidw | Hacker News Reader

One thing companies love is lots of uncertainty like this. It keeps their accountants entertained! "Maybe we should build a factory in the US" ... 24 hours later ... "well, not today".

What's really amazing is all the muttering from "Very Important Wall Street" type people who are saying that he's insane. Like... with that kind of salary, weren't you paying attention? We've known he wasn't right in the head for a while now. Maybe they should be replaced by AI.

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Absolutely no one was seriously considering building a factory in the US based on the insansity of last week

Thailand is a good example. They have about $40b (USD) in balance of trade going the wrong way. Their initial ideas were simply to import more american petroleum, vehicles and aircraft. This likely could have accounted for more than half the difference and significantly reduced their tariff rate by just changing suppliers of already imported products.

The US news is pretty useless here. It's more nuanced than they would like to admit. Foreign sources of news are the most instructive as they're actually covering the options realistically.

Which way is "going the wrong way"?

> Foreign sources of news are the most instructive as they're actually covering the options realistically.

Curious about what your go-to sources are?

There are more consequences if you change the supplier because different supplier often means different product

The market is huge. Absolutely someone was considering it. Whether they had time to put plans in motion is a separate matter altogether.

The costs are huge too which makes the margin small

The market is huge but the actual capital is held (or at least controlled) by relatively few (probably more rational than average) people, no?

Why would a company go through the trouble of building a factory when the next administration could just reverse the decision four years from now? Building factories will take years

How confident are we that there is a "next administration... four years from now"? I don't know what the number is, but it ain't 100% like it used to be.

I would put it at less than 50% at this point. It entirely depends on whether or not he's alive.

The market is huge enough that the fact that something is being considered somewhere doesn’t mean much, right? If I consider building a factory in the woods, but I don’t have two pennies to clack together, does anybody hear it?

Cost differences by everyone's gut estimate is like >10^3 or however many digits. Tariffs are cheaper until it starts T2D3ing.

That was part of the entire purported purpose of this lunacy. They went on TV and everything about having people operating robots screwing in iphone screws and stuff.

Whether anyone bought into it is another matter, but opening factories is part of what they said they wanted.

At this point, I do wonder if long-dated (2-3 months) American-style Puts are a good idea.

The weirdness of this administration has created a lot of volatility. With American-style options you are allowed to exercise early, so if you think there's going to be a ton of ups and downs in the next few months, I wonder if this could be lucrative.

I might try this just as an experiment with one of the cheaper options.

The only way to know is to wait 3 months and see.

Exercising early only makes sense in some pathological examples that do occur but practically never happen. In general, very loosely, a put is worth something for the hedge plus the amount you could get for exercising it right now. Thus, if you want to exercise it right now, you just sell it and get the hedge premium.

Also, the current VIX is the same as January of 2020. If you believe the current state of the world is less certain than the outbreak of a global pandemic, I have some options to sell you.

Yeah, misspoke, I meant selling the option, not exercising.

> Also, the current VIX is the same as January of 2020. If you believe the current state of the world is less certain than the outbreak of a global pandemic, I have some options to sell you.

I don't know if it's more volatile, BUT it it has shot way up since yesterday, and it doesn't seem too weird to think that it will go down to the numbers we had yesterday.

You can just sell the options. You don't need to exercise.

Yeah, that's actually what I meant, sell the option. I misspoke.

Given my exposure I've loaded up with long puts right after this news.

Puts are a necessary hedge now for your 401ks or stock grants.

i doubt you're the first person to think of this. not to be an "it's priced in" guy, but... something to consider

The number of people who are paid to be "professional knower of things" and "professional predictor of things" who are now saying "I never could have predicted that Trump would do something as crazy as this" is just baffling.

In a sane world all these people would be ignored by media outlets moving forward.

The media outlets are part of the problem. Lots of sanewashing and "both sides". Many of them also love "CEO says a thing" articles where they act as stenographers. You see that with a certain car company's wild promises.

In a sane world Trump wouldn’t be president

I sold my stocks just barely in advance of this whole debacle. I remain confused that it wasn't already priced in by that point. I am not a savvy investor by any standard.

It's a confirmation to those that still needed it that finance people are stupid and ideologically blinded. Trump's been speaking of tariffs for years, what made them think his mandate would be good for them?

They knew he was a moron. Their mistake was thinking he was their moron.

If I had any appreciable assets in the stock market OTHER than my retirement savings, I would sell like hell right now.

The market is absolutely delusional right now. It's not pricing in how devastating this general uncertainty is, nevermind the fact that massive tariff hikes are still in effect.

They always knew he was an idiot, the reason they are muttering is to give ammunition and support to anyone who will push back on this insanity.

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