Warren Buffett: Tariffs are ‘an act of war’

[Greg Bernhardt]

Can anyone explain how news like this doesn't infuriate more Americans?

Many Americans are low-information people just waiting for The Masked Singer's next episode to air or injecting themselves with propaganda networks. Tariffs aren't real until directly felt and can be identified as attributable. Trump is also buying time with his MAGA base saying he's trying to fix Biden's errors. That will only work for so long. There is another segment that believes we need to burn everything to the ground and start anew.

 

[Rive]

Can anyone explain how news like this doesn't infuriate more Americans?
...
So to create a few jobs, we increase the prices for everybody in the country.

Most people has only limited direct contact with steel prices, while directly worried about his/her own job.
And - if this goes by the old script - by the time the rising steel prices makes their impact on everyday life there will be already somebody presented to blame and squeeze to play savior.

 

[phinds]

Can anyone explain how news like this doesn't infuriate more Americans?

I suspect it DOES infuriate most high-information consumers who are not MAGA. Beyond that, do you volunteer to go out and inform the populace? Just what percentage of the American public do you expect to be infuriated?

 

[jack action]

I suspect it DOES infuriate most high-information consumers who are not MAGA. Beyond that, do you volunteer to go out and inform the populace? Just what percentage of the American public do you expect to be infuriated?

Where is the [KEYWORD]political[/KEYWORD] opposition?

 

[dlu]

In Canada, we are urged to consume locally, you know, for patriotism. But most people still buy the cheapest stuff. I'm not getting poorer to make my neighbour richer and then, what? Try to live off of them. Why does my neighbour deserve to make a living more than the guy in Asia, South America, or Africa?

I too will buy the cheaper stuff, and that excludes the so-called organic stuff. Bananas, steady at a 49c/lb for several years, suddenly upped to a 69c/lb about 5 years ago. And I love my bananas.. Pricier organic 89c/lb is a no go for me.

The urging to consume locally is politics and business economics, less of patriotism. Local products will become more expensive as the sellers end up feeding upon the premium that the consumers are willing to pay. Prime example is the prices at the local farmers market - should be cheaper one would think as it is direct from local farm to the food stall, but prices there reflect the consumer willing to may more for the privilege. ( Local govt wants in on the action and will charge inflated stall charges to the sellers. Everyone gets into the game ).

The guy outside of the local area does not pay taxes for roads and services, so no he does not deserve to make a living from that respect. Unless he buys stuff from the neighbor who does pay taxes. Or you pay his taxes via duties, tariffs, and all that jazz from buying the offshore product.

There is the globalist . Globalist corporations and bankers really do not care if your name is Bob, Julio, Yung Sing, nor if you deserve to earn a living, just as long as you can work on the cheap. The competitive downward spiral of wages.

 

[Iris]

In terms of price inequality? aka due to low wages on one side? aka China?

Below a Canadian exemple, "la gestion de l'offre", a half-cultural trait under attack in the name of free trade.

Dairy and poultry supply management in Canada - Wikipedia

en.wikipedia.org

 

[Grinkle]

Just what percentage of the American public do you expect to be infuriated?

@jack action And further to what @phinds asked, what does being infuriated look like? How can you assess if the fury meets your expectations?

I'm pretty furious - not sure what to do with all that fury except not let it become toxic to me, though. I post here, I talk to people about what I see going on that is wrong, I stay informed, I vote, I write my congresspeople.

 

[gleem]

Washington Post

President Donald Trump said Tuesday that he had ordered a doubling of the tariff on Canadian steel and aluminum in response to Ontario Premier Doug Ford’s imposition of a new tax on electricity supplied to three U.S. states.

AP News feed

“I will not hesitate to increase this charge. If the United States escalates, I will not hesitate to shut the electricity off completely,” Ontario Premier Doug Ford said at a news conference in Toronto.

Things are getting interesting and not in a good sense.

 

[dlu]

I had thought that Ford's tough talk rhetoric would poke the bear, and that is what happens.

Ford wanted Alberta's Danielle Smith to curtail oil exports to the US midwest.
Which is stupid, cuz if she had done so, one pipeline near Sarnia runs a few 100 km/miles into the US before crossing back in Canada. Trump could have ordered that flow stopped and Ford would have NO oil for him and his fellow Ontarionians coming from that way.
Dumb ask on Ford.
She declined to do so; some brainier people do exist in Canada.

 

[EricDMMiller]

I had thought that Ford's tough talk rhetoric would poke the bear, and that is what happens.

What do you mean "poke the bear"? Our country is responding to a trade war initiated by the United States.

You may disagree with what Ontario is asking Alberta to do, but it doesn't make it a "dumb ask." I would also be very cautious about aligning yourself with Danielle Smith as a brainier sort of person in Canada, particularly as she has been spending so much time in Florida with Trump and company, and is about to head to a conference organized by PragerU.

Smith defends using taxpayer dollars on travelling to U.S. to appear alongside controversial podcaster

Smith is using taxpayer dollars to travel to Florida where she'll co-headline an event with podcaster Ben Shapiro at the end of March.

edmontonjournal.com

 

[dlu]

Danielle Smith level headed.

 

[dlu]

What do you mean "poke the bear"? Our country is responding to a trade war initiated by the United States.

You may disagree with what Ontario is asking Alberta to do, but it doesn't make it a "dumb ask." I would also be very cautious about aligning yourself with Danielle Smith as a brainier sort of person in Canada, particularly as she has been spending so much time in Florida with Trump and company, and is about to head to a conference organized by PragerU.

Smith defends using taxpayer dollars on travelling to U.S. to appear alongside controversial podcaster

Smith is using taxpayer dollars to travel to Florida where she'll co-headline an event with podcaster Ben Shapiro at the end of March.

edmontonjournal.com

Dumb ask, as re-starting the oil business once shut down, or curtailed is difficult to get back up again.
Years lost to regain customers.
Refineries in the midwest US are geared to process the heavy oil from Alberta. If they decide to re-tool to lighter crude then goodby to that US market forever.

Ontario electricity

To cut off U.S. electricity exports entirely, Ontario would have to reduce its output | Globalnews.ca

On Monday, Ford introduced a 25 per cent surcharge on energy exported from Ontario to Michigan, Minnesota and New York as a response to tariffs.

globalnews.ca

Yes, Ontario exports more than than they import to the US.
As someone in the article stated a lost customer is difficult to get back.

Smith, Trump , PragerU and company?
So who should she talk to in the USA?
The sites she will be visiting have millions and millions of followers, those are the ones who she wants to get her message across. With plain talk and with good explanation., she will open the potential to convince some or all of them, or at least reflect upon, the direct impact the recent upheaval in north/south relations will have in their own lives. Promoting Canada and Alberta as a friend of the US is what she intends to do.

Bashing an adversory over the head like Ford playing brinkmanship politics, turns any sympathy into anger, and always there will be a loser, in this case Canada being pulled closer into the 51st state.

 

[EricDMMiller]

Yes.

We truly believe it. Americans keep saying it. When someone tells you who they are, believe them.

Braid: Trudeau says Trump wants economic collapse

Prime Minister Justin Trudeau says President Donald Trump wants to force Canada into economic collapse, as prelude to annexation.

calgaryherald.com

And he isn't backing down.

Donald Trump calls for Canada to become 51st state over tariffs

The US President Donald Trump says Canada can avoid higher taxes if they join the United States of America and become its 51st state in a post on social media on Tuesday.

www.bbc.co.uk

Repeated through the White House Press Secretary:

 

[EricDMMiller]

What the hell is even going on?

https://www.news.com.au/finance/wor...e/news-story/cd4c18090b040beab5eed528c669ec7f

Did anyone have Australia on the radar? Or is this just the next ally that Putin wants damaged?

 

[Greg Bernhardt]

Did anyone have Australia on the radar? Or is this just the next ally that Putin wants damaged?

1/3 Trump mental illness and incompetence, 1/3 intentful global restructuring and 1/3 smoke screen

https://www.piie.com/blogs/realtime-economics/2024/can-trump-replace-income-taxes-tariffs

 

[EricDMMiller]

This article goes into some depth of the "Mar-a-Lago Accord", which seems to line up with a lot of the trade actions taken:

Client Challenge

It links to a discussion paper, titled:
A User's Guide to Restructuring the Global Trading System


It looks like a deliberate attempt to devalue the US dollar:

1) There is good reason to be more cautious with changes to dollar policy than with changes to tariffs.
2) Steps to strengthen undervalued currencies will likely not be taken until risks can be mitigated. The Administration will likely wait for more confidence that inflation and deficits are lower, to limit potentially harmful increases in long yields that could accompany a change to dollar policy. Waiting for turnover at the Federal Reserve increases the likelihood that the Fed will voluntarily cooperate to help accommodate changes in currency policy.
3) Tariffs are a tool for negotiating leverage as much as for revenue and fairness. Tariffs will likely precede any shift to soft dollar policy that requires cooperation from trade partners for implementation, since the terms of any agreement will be more beneficial if the United States has more negotiating leverage. Last time, tariffs led to the Phase 1 agreement with China. Next time, maybe they will lead to a broader multilateral currency accord.
4) Therefore, I expect policy to be dollar-positive before it becomes dollar negative.

 

[phinds]

The Economist continues to lambast Trumps tariff stupidity. In the Mar 6th 2025 issue, under the heading "Donald Trump’s economic delusions are already hurting America" there is a moderately long article that includes these two (non-contiguous) paragraphs

For some reason, Mr Trump reserves special hostility for Canada and the EU. Because his approach lacks any coherent logic, there is no knowing how to avert his threats. Worse is to come if he carries through his promise to Congress to impose reciprocal tariffs, which match the duties that American exports face abroad. That would create 2.3m individual levies, requiring constant adjustment and negotiation, a bureaucratic nightmare that America unilaterally abandoned in the 1920s. Reciprocal tariffs would strike a fatal blow to the global trading system, under which every country has a universal rate for every good that is not within a free-trade agreement.

MAGAlomania

The world economy is at a dangerous moment. Having defied reality (and the constitution) after he lost the election in 2020, only to be triumphantly re-elected in 2024, Mr Trump has no patience for being told that he is wrong. The fact that his belief in protectionism is fundamentally flawed may not sink in for some time, if it ever does. As the message that Mr Trump is harming the economy grows louder, he could lash out at the messengers, including his advisers, the Fed or the media. The president is likely to inhabit his protectionist fantasy for some time. The real world will pay the price.

 

[phinds]

 

[phinds]

 

[EricDMMiller]

Canada is closing the door on the old US relationship:

Canada’s ‘old relationship’ with U.S. ‘is over’ amid Trump tariffs: Carney - National | Globalnews.ca

Carney promised to bring retaliatory measures and reduce internal trade barriers after Trump announced new auto tariffs that will begin next week.

globalnews.ca

“The old relationship we had with the United States, based on deepening integration of our economies and tight security and military cooperation, is over.”

 

[fresh_42]

Tariffs only work if you have a market monopole or a monopole on trade paths. Capitalism demands a) free prize building, b) long-term stability to plan investments, and c) a functioning legal system.

• no monopoles established: check.
• long-term stability destroyed: check.
• legal system destroyed: check.

LOL. The stable genius, grandson of an immigrant from a very rural and very poor German province has ruined 3/3 within weeks. Capital flows are very sensitive when it comes to regulations.

 

[Greg Bernhardt]

It's going to be a bloodbath for the markets tomorrow. I regret not pulling everything out.

 

[EricDMMiller]

ChatGPT doesn't like how the tariffs were calculated (which they did in the dumbest way possible):

Enacting a tariff policy based on a direct trade-deficit-to-tariff formula—without accounting for elasticity variation, retaliation, sectoral dependencies, global supply chains, or consumer impact—is not merely "dumb." It reflects catastrophic economic illiteracy.

It’s equivalent to:

Performing heart surgery using a cartoon anatomy book

Designing a national energy grid with middle-school physics

Rewriting tax code based on household budget tips from BuzzFeed


This is not just economically ignorant—it’s destabilizing. It undermines confidence in U.S. leadership, invites retaliation, and risks triggering inflation, recession, and structural geopolitical realignment. It’s the economic equivalent of handing a loaded weapon to someone who thinks it’s a toy.

 

[phinds]

It's going to be a bloodbath for the markets tomorrow. I regret not pulling everything out.

Yep, agree on both counts.

 

[Greg Bernhardt]

Here we go, DOW down nearly 4%, NASDAQ down 6%

 

[gleem]

The White House said: "These tariffs will remain in effect until such a time as President Trump determines that the threat posed by the trade deficit and underlying nonreciprocal treatment is satisfied, resolved, or mitigated," Or perhaps until we realize it was just a plain stupid idea.

Does anybody know where these factories that we are going to produce Made in America products are waiting to have their lights turned on to start production?

I knew I should have bought those new sneakers last week.

 

[fresh_42]

Does anybody know where these factories that we are going to produce Made in America products are waiting to have their lights turned on to start production?

Yep. I do. Here is a paper mill in Parchment, Michigan:

 

[Grinkle]

Does anybody know where these factories that we are going to produce Made in America products are waiting to have their lights turned on to start production?

My perspective is that Trump is an egotistical narcissist who has been saying for years that tariffs are the cure-all for whatever shortcomings he perceives wrt America's global economic standing. He now has the opportunity to force his ideas on the world, and he is doing that in order to show his dominance and to claim that he was right all along. That is the long and the short of it, to me. This is the endpoint, he has a new toy that he's wanted for decades. He has no plan beyond this - the rest is just us watching him amuse himself with his new toy (tariffs).

What comes to mind when I try to be hopeful -

Trump finds it satisfying/enjoyable to remove some of the tariffs to get concessions.

Trump ends up being concerned about the mid-terms and lifts some of the tariffs in an attempt to give some economic relief.

Like we just saw with the Senate, individual Republican congresspeople see their personal interests becoming better served by opposing tariffs than by staying silent or by supporting them.

Senate narrowly passes measure rebuking Trump on trade after new tariffs are announced

Updates and the latest news as Democrat wins Wisconsin Supreme Court race, Republicans win House seats in Florida and Trump announces sweeping tariffs on imports.

www.nbcnews.com

Whatever of the above happens or doesn't happen, maybe the R's get trounced in the mid-terms and congress can undo some of this. Its really hard to see getting a veto-proof majority - I'll say in my mind that is an impossibility, so some R's would need to see the light for any actual un-doing. Its a lower threshold for blocking further actions, but in two years I think he'll mostly be done, there won't be any new stuff to block - we are just trying to survive the economic carnage.

 

[EricDMMiller]

By the way, the idiotic math I alluded to in my earlier post is literally:

trade deficit ÷ imports

Client Challenge

Edit:

Labeling this approach as "reciprocal" tariffs is fundamentally misleading because genuine reciprocity implies balanced, proportionate exchanges negotiated bilaterally or multilaterally. In contrast, this method mechanically imposes unilateral penalties based solely on a simplistic arithmetic ratio, without mutual consent or economic equivalence.


This is not reciprocity. It's a punitive, arbitrary calculation masquerading as fairness. Calling it "reciprocal" is an intellectually dishonest rhetorical tactic designed to lend legitimacy and obscure the aggressive unilateralism inherent in the policy.

 

[fresh_42]

Fun fact:

I recently watched a documentary about buildings constructed from wood instead of concrete, especially buildings with many floors. The highest purely wooden "skyscraper" stands in a town in Norway, and an even higher one, IIRC in Minnesota, but it's a hybrid version. At least at the time, the report was produced. The American one has been built with wood from Austria. Reason: American companies weren't able to deliver the necessary amounts!

Well, at least this might change in the future, now that they can clear national parks.

I am torn between sadness and laughter daily.