Kinda blows my mind that the US is on a strongly antagonistic & isolationist streak in that context. Seems like a great way to turn the US economy (and prosperity) into a smoking crater
Apart from the US several countries meet this threshold, including the UK, Canada, Australia, New Zealand and Japan. On the other hand, the Eurozone countries do not, and this helps some of the member states, but only at the expense of some of the others.
Last I looked I recall 39% of the US stock market is owned by foreigners. Fair enough since say Apple revenue I'd say 60% from foreign sources.
Like, maybe that's sustainable but it's certainly not sustainable in a world where you're pissing your trading partners off on a daily basis.
You don’t see oil markets trading in New Zealand dollars. Or half the world holding large amounts of Aussie dollar in their forex reserves. Or a bunch of Canadian gov bonds. Or benchmark their rates against the US in reporting.
If the US prints more half the world carries the pain but US gets all the benefit. Lose reserve currency status and that so called exorbitant privilege goes up in smoke. Along with the financial system built on it
You might say it's a PR problem, others might say it's an actual problem. Either way it's going away now.
Today, nearly everyone has pocket computers, cheap internet, longer lifespans, better healthcare, cars that last decades, homes with plumbing, electricity and climate control, etc.
Poverty has been declining for decades.
Your life looks much better than your parents, and looks much, much, much better than your grandparents.
Except having what are essentially televisions in their pocket. That's the one win they get.
Doing more poorly? but everyone has all kinds of home appliances, nice reliable cars with tons of features, more people have college degree, bigger houses, etc.
In what way?
> and looks much, much, much better than your grandparents
I'm not so sure about that one, either—my grandparents had to go to war to kill the Nazis, and it's looking like we're going to have to do that again.
A huge hurdle for American manufacturers is that their products simply cost too much, all else being equal, because the value of the dollar is too high.
So their plan is try and devalue the dollar while also keeping it the reserve currency. To put that another way, he wants countries that have invested in the dollar to take a hit on their investments while also getting their population to buy more American goods.
His negotiations will probably center around offering continuation of "America world police" services (people hate it, but governments love it) in exchange for following this path.
Whether or not this will work? Who knows, but at least that is the idea they have chosen.
For example, tariffs on agricultural products that won't grow in the US do not fit into any sort of rational model.
My comment just outlines that plan.
Plenty of US manufacturing already pays close to retail wages and these geniuses want to reshore stuff with much lower value add. It's delusional.
In New Zealand as a purchaser of a lot of US services and few US goods, I can see why countries want to create tariffs against US services.
Trump was elected by blue collar workers and his plan reflects that.
Blue Collar workers: ~ 30–35% of working population. Policy that screws your country and the other 2/3rds of the population is bad.
I do think a country needs a manufacturing base if it wants to support a military without getting pwned.
And I do agree with you, I think the current administration is focused on devaluing the dollar, while trying hard to minimize collateral damage such as higher rates.
I don't think this is going to work, but I can see a lot of ways in which it could. Future will tell us.
The US government seems to want to intervene in every place it can, and doesn't look anything like say old school China or Japan. It seems like some people see anything short of maximally interventionist as isolationism, and I don't understand it.
Being a little isolated seems like being a little pregnant.