The CEO Who Says an Asteroid Is Coming to Destroy America's Businesses

https://www.wsj.com/business/tariffs-china-ryan-petersen-small-business-35f99669

by sleepyguy • 1 year ago

13 3 1 year ago

wsj.com

sleepyguy• 1 year ago

https://archive.ph/tU52D

aurareturn• 1 year ago

Stock market is pricing in a reversal in the China/US tariffs. S&P 500 is same today as day before "liberation day".

According to Flexport CEO, container ships from China to US are down 60% since tariffs. That's actually insane.

No US business is going to move factories back to the US because they don't know if the tariffs are temporary. They can spend millions moving to the US, only for Trump to reverse tomorrow. Now their competitors who didn't move will be in a much healthier situation. If Trump doesn't reverse, they can spend the next 4 years building a factory in the US, hire workers, train them, only for the next president to reverse the tariffs. Same problem. It takes a lot of time to recuperate factory costs. Lastly, there's just no way these companies can hire enough skilled workers for factory work in the US. For f sakes, unemployment rate is just 4%. No one in the US wants to work in a factory.

Lastly, China makes much of the factory equipment too but those are also subject to 100%+ tariffs. How can you compete? Chinese companies will completely dominate goods that the US used to dominate in if these tariffs stay. US companies will go bankrupt while Chinese companies will buy those factories, rebrand the goods, and sell to the rest of the world. How can goods that used to be made in China but now moved back to the US compete when China can make the same thing faster, cheaper, and higher quality?

I hear people often say things like "we can 3D print in US". Yea, China makes those 3D printers. Others say "we can automate factories in the US". Yea, China is leading the world in factory automation as well.

jfengel• 1 year ago

The stock market feels like one of those "irrational longer than you can remain solvent" opportunities.

I can't guarantee that the tariffs won't be ditched. But the market seems to be pricing as if it were certain that they will be, and that seems way off to me.

I am extremely cautious in the market. I buy and hold, and for the most part I just buy index funds. I rarely look at the market numbers or my portfolio. Right now my brain is telling me to short the index funds, and my stomach says "that sounds like a recipe for disaster".

The CEO Who Says an Asteroid Is Coming to Destroy America's Businesses

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