Economics/Statistics

No, A 50% Tariff Doesn’t Mean A 50% Price-Hike

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Authored by Randy White via AmericanThinker.com,

The tariff doomsday machine is roaring again. This time, it’s over talk of a 50% tariff on certain imports.

Predictably, the panic-peddlers are out in force, warning that such a tariff means retail prices will skyrocket 50%.

It’s an easy line to chant, but it’s wrong — flat wrong — and anyone with a basic grasp of economics should know better.

Let’s make one thing clear: a tariff applies to the transaction value, not the final retail price. The transaction value is what the importer pays the exporter, plus freight and insurance. That cost is just the first step in a long supply chain. By the time a product reaches the consumer, it’s been marked up to cover domestic shipping, warehousing, employee wages, utilities, sales tax, and profit margins for every hand it passes through. The tariff is just one input among many.

Take a simple example.

A retailer imports a widget with a $100 transaction value. Add a 50% tariff, and the cost to the importer becomes $150. That importer then sells it wholesale — perhaps at $200 — to a retailer, who marks it up again to $300 for sale. That $50 tariff is now 16.7% of the retail price. Even if every penny of the tariff is passed along, you’re not looking at a 50% increase in retail price — you’re looking at something closer to 17%.

But here’s the kicker: tariffs are not always fully passed on to the consumer. Importers and retailers know they can’t raise prices beyond what the market will bear. Sometimes they absorb part of the cost, cut expenses, renegotiate contracts, or shift to different suppliers. The market reacts; it doesn’t just lie down and take it.

Still not convinced? Look at the real-world data.

The National Bureau of Economic Research analyzed the 2018–2019 U.S. tariffs on Chinese goods. They found that for every 10% tariff, retail prices rose 1–2%. So even a 50% tariff, if applied, might cause retail prices to edge up 5–10% — not 50%. That’s a far cry from the alarmist headlines.

So why do politicians and media outlets keep pushing the scare narrative? Easy: Fear sells.

“Fifty percent” is a lot more dramatic than “maybe 5 to 10%.” It’s easier to provoke outrage than to explain how pricing actually works. They’re banking on the average person not understanding the difference between wholesale cost and retail price — or not caring enough to dig into the numbers.

Yes, tariffs matter. They influence trade behavior. They can increase some costs. They can disrupt certain supply chains. But they’re not some magic multiplier that doubles the price of your groceries or gadgets overnight.

Anyone pushing that line is either economically illiterate or deliberately misleading you.

The next time you hear that a 50% tariff will mean a 50% price hike, don’t nod along. Push back. Ask for the math. Demand the details.

Because when it comes to tariffs and retail pricing, the facts just don’t support the hysteria.

geopolitical issues

The Three Steps — Which Way is Forward, Which Way is Backward in Russia’s War Fighting, Peac e Negotiating Strategy

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This image has an empty alt attribute; its file name is twee-3-1024x831.png

byJohn Helmer, Moscow
@bears_with

Kirill Dmitriev (lead image) is the Stanford and Harvard educated official appointed by President Vladimir Putin to persuade American businessmen to invest in the profits to be made from dismantling US economic sanctions against Russia.

Today at the Kremlin (April 11), he tried again in fresh talks with Putin and Stephen Witkoff, President Donald Trump’s negotiator.

Dmitriev was just fourteen years of age when he first arrived for schooling in California where neither he, nor anyone else, had ever heard of Vladimir Lenin’s 1904 booklet on the difference between revolutionaries and opportunists in politics; Lenin’s title had been “One Step Forward, Two Steps Back.” All Russian adults schooled before Dmitriev know that phrase.

But on April 4 in Washington, when Dmitriev invited Russian reporters to ask whether he had made any steps forward in his talks with the Americans, he replied: “Yes, definitely. I would say that today and yesterday we made three steps forward on a large number of issues.” Either Dmitriev was making a mockery of Lenin’s three steps, or he was revealing his total ignorance of them.

At home in Moscow no one has dared to fault Putin’s emissary for transforming the direction of Lenin’s three steps. Nor has anyone asked Dmitriev to say concretely what his three steps are, or in what direction. The closest he came to that in his remarks in a Washington park were that he has been discussing “possible cooperation in the Arctic, in rare earth metals, in various other sectors where we can build constructive and positive relations…[and] active work on restoring air travel.” One of the “other sectors” Dmitriev mentioned is an Elon Musk project to fly to Mars.

That Dmitriev is proposing to open sectors of the Russian economy which are legally closed under national security control – at the same time as the US is escalating its military power projection from Greenland to Alaska – has been noted by the Russian Foreign Ministry, which has been trying to curb Dmitriev’s powers, as well as his tongue. Dmitriev has retreated, ingenuously telling the BBC: “first of all, I am focused on economics and investment, so I don’t comment on political issues.” Then he did just that. “There are already very good results. So the stop of the hitting the energy infrastructure is a major, major result. And frankly that is a good result for Ukraine.. for Russia, for the world.”

Dmitriev was referring to President Putin’s undertaking to President Trump during their telephone call of February 12 to halt Russian strikes on Ukrainian energy targets. This partial ceasefire by the Russian side has been ignored by the Ukrainians and their US and NATO advisors. Although the Kremlin notice warned that “in the event of a violation of the moratorium by either party, the other party has the right to consider itself free from obligations to comply with it”, there has been no Russian retaliation yet.

When Lenin had begun his three steps a century ago, he warned: “When a prolonged, stubborn and heated struggle is in progress, there usually begin to emerge after a time the central and fundamental points at issue, upon the decision of which the ultimate outcome of the campaign depends, and in comparison with which all the minor and petty episodes of the struggle recede more and more into the background.”

In the record which the Russian and American negotiators have been making since the presidents’ telephone call, the outcome to date is nothing but “minor and petty episodes”. Dmitriev is the only Russian official to say otherwise.

At the first round of talks in Saudi Arabia on February 18, Foreign Minister Sergei Lavrov disclaimed there had been agreement on anything but a programme of talks to follow at the sub-ministerial level on ceasefire measures in the Black Sea, and on the restoration of regular operations between the State Department and the Foreign Ministry. “We didn’t just listen”, Lavrov said in briefing the Russian press after the meeting, “but we also heard each other…This does not necessarily mean a convergence of positions.”

The subsequent talks which have followed have demonstrated almost no “convergence of positions.”

The negotiations between Andrew Peek and Michael Anton on the US side, Senator Grigory Karasin and Colonel-General Sergei Beseda on the Russian side, held in Riyadh on March 24 discussed Ukrainian proposals for a ceasefire on the Black Sea, including Odessa port, and the resumption of Ukrainian grain exports. The two sides failed to accept a joint communiqué of what they had agreed.

Instead, the Kremlin issued a detailed outline of agreement for the Black Sea with preconditions. These were “the removal of sanctions imposed on Rosselkhozbank (Russian Agricultural Bank) and other financial institutions involved in ensuring international food trade (including fish and fish products) and fertilisers, their reconnection to SWIFT, and opening of relevant correspondent accounts; the removal of restrictions imposed on trade finance operations; the removal of sanctions imposed on companies producing and exporting food (including fish and fish products) and fertilisers, as well as restrictions banning insurance companies from working with food cargoes (including fish and fish products) and fertilisers; the removal of restrictions on servicing ships in ports and sanctions against ships flying the flag of Russia, if they are involved in food trade (including fish and fish products) and fertilisers; the removal of restrictions on supplies to the Russian Federation of agricultural machinery and other goods used in the production of food (including fish and fish products) and fertilisers.”

In the US communiqué, the Russian sanctions terms were ignored.

Source: https://www.whitehouse.gov

Instead, the US said that in principle it would “help restore Russia’s access to the world market for agricultural and fertilizer exports, lower maritime insurance costs, and enhance access to ports and payment systems for such transactions. “ It said no more about the Ukrainian attacks on energy targets except that “the United States and Russia agreed to develop measures for implementing President Trump’s and President Putin’s agreement to ban strikes against energy facilities of Russia and Ukraine.” That was on March 25. In the interval of three weeks since then, the frequency of the Ukrainian drone attacks on Russian energy targets has increased.

The US and Russia then sent officials to Istanbul on April 10 for negotiations to implement the earlier Rubio-Lavrov agreement in Riyadh “to address irritants to our bilateral relationship with the objective of taking steps necessary to normalize the operation of our respective diplomatic missions.” Alexander Darchiev for the Russian Foreign Ministry (he is the new Russian Ambassador to Washington) and Sonata Coulter, a deputy assistant secretary of State, failed to agree on any of the issues on the agenda except for one: “the U.S. and Russian delegations exchanged notes to finalize an understanding to ensure the stability of diplomatic banking for Russian and U.S. bilateral missions.”

The return of Russian offices, residences and other property in the US, confiscated on White House order for several years, was the Russian priority. According to Darchiev, “the return of illegally seized diplomatic property to the Russian side… is of critical importance for the restoration of normalcy in the entire bilateral relationship.” Coulter refused, claiming the US priority is “the Russian Federation’s policy prohibiting the employment of local staff, which is the key impediment to maintaining for stable and sustainable staffing levels at the U.S. Embassy in Moscow.”

This serial failure, dictated by the Trump subordinates, has now led to an afternoon meeting in St Petersburg between Putin, his foreign policy advisor Yury Ushakov, Dmitriev and Witkoff. Lavrov was not present. The meeting appears to have been arranged hastily on the US initiative. “The situation on the negotiation track of the United States and Ukraine is developing rapidly,” Putin’s spokesman Dmitry Peskov announced. “There are a lot of developments in one day.”

Source: http://en.kremlin.ru/events/president/news/76675

For the time being neither the Kremlin nor the White House has claimed any result. RIA Novosti, headlining that the meeting with Witkoff lasted for four hours, reported no detail at all.

Several hours after Witkoff had left meeting with Putin, Trump implied that he is blaming the Russians for the failure of the talks so far, and is planning a new ultimatum. “Russia has to get moving”, Trump tweeted.

Source: https://truthsocial.com/@realDonaldTrump/posts/114319592702753512

A well-informed source in Moscow says that Trump and his subordinates have been surprised by the Russian terms for ending the war. “The Russians have told Americans they will have Odessa and a land corridor to Moldova. They have offered ports on Dnieper River for access to the sea for the Ukrainians. There has been no demand about Nord Stream. Money is being discussed on the sidelines but not in the main talks. In the main room [in Riyadh on February 18] Lavrov and Ushakov brought no papers and asked Americans [Rubio and Waltz] to dust off the December 2021 treaty draft. The Russian positions shocked the Americans. They were told the Ukraine will be demilitarized and its forces will be turned into paramilitary and police. The Americans were also surprised how little Russians cared about Zelensky or his British and Europeans backers. The Americans were told there will be no Ukrainian paramilitary force east of the Dnieper – only police. A new Russian demand was tabled for autonomy of eight Ukrainian oblasts, with Kiev army forces removed. In general, the Russians propose turning the Ukraine into a genuinely federal structure with provisions that Banderites can never take power in Kiev and that the central forces will be limited in their capabilities, supplementing the police if and when Banderites take to the streets. The main purpose of any such force will be de-nazification and keeping it that way. There are demands also about the Orthodox Church in Ukraine.

geopolitical issues

How Strong is Russia Actually?

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True to his stated objective analysis, Igor Strelkov refutes the conventional beliefs, especially among the American alternative social media pundits, about the “strong Russia”. He does it with facts and more facts in the face of just hubris. Especially Gilbert Doctorow is making the rounds these days on behalf of his Masters trying to convince the uninformed about the need to appease Russia or else. Scott Ritter, Col. MacGregor, J. Johnson, are and have been telling us for 3 years now, oh, Russia can take out Ukraine in two weeks any time.

IGOR STRELKOV’S RESPONSE TO CRITICISM OF “ALEXANDER ALEXANDROVICH”

Dear “Alexander Alexandrovich”!

Excerpts

[…]

2). “It was decided to drag out the negotiations until autumn.” Who decided? Were you personally present when the decision was made? I suspect that you were not and this is just your personal (albeit quite true) conclusion. But it may not be possible to “drag out” because (according to information from other letters) Mr. Secretary of State Rubio already (April 4) warned that “the countdown is in weeks and time has started” (for Moscow to accept the “peace settlement” plan based, of course, on the “Kellogg plan”). Alas, Moscow is not a subject of the world political agenda. It is, albeit relatively “independent” and poorly managed, but an object. The “agenda” of the so-called “negotiations” is determined by Washington (and Moscow itself agreed with this and even with “puppy delight”). Therefore, how long Moscow will actually be able to “drag out” without another wave of “crippling” sanctions – we will soon find out (my forecast is May or June).

3). “Significant reserves” (we have) is an absolutely unfounded (on your part) assertion. I do not have such data, and you did not consider it possible (perhaps rightly) to share the sources of such information. The same applies to the “large-scale offensive on all fronts”. No, I believe in intentions of this kind (although “not on all fronts”, since the state of affairs with personnel in some areas is known to me and it is not encouraging). But I remember very well such “rosy plans” of 2024, which stumbled in mid-May in Vovchansk and near Liptsy in the Kharkov region, and to this day remain in a “neither here nor there” position (with a general advance of 8-10 km in depth and 30 km in width along the front). 4 corps were simply “burned”.

Naturally, if I knew about the preparation of this offensive, then (naturally) the enemy’s intelligence knew about it very well. Has anything changed since then, what do you think? Has the enemy weakened or gone blind? – I don’t think so. My forecast is that our offensive will “get bogged down” just like the previous one, because we have nowhere to “take” and throw into battle 3-4 full-fledged armies necessary for a strategic deep operation, and another 3-4 corps (if they exist at all) will not be able to go beyond the operational level. And our successes (if they exist at all) will be limited to pieces of Donbass, Zaporizhia and (maybe) Kharkov regions. At the level of another “Avdiivka-Ugledar-Kurakhove”. Which will not and cannot give any advantage in a “war of attrition”.

4). “Improvement of the work of the diplomatic corps” – I do not notice it “not even once”. All our “allies” are North Korea, Sri Lanka and some cannibals from equatorial Africa. Well, Venezuela too. Where are the “diplomatic victories”? Finland and Sweden are in NATO, there are American ground forces in Estonia. Dmitriev (Surkov’s fosterling) – is he negotiating with the USA? – Is this “improving quality”? Is the agent negotiating with his masters about the fate of Russia? – Is this a “success”? – This is nonsense…

5). “Improving the work of other government bodies.” – Are you serious? Khinshtein (a homosexual) at the head of the Kursk region – is this an “improvement”? Hmm. Are you, by any chance, “playing a joke” on me?

6). “They want to remove liberals from the Ministry of Finance, the Ministry of Economic Development and the Central Bank” – Who wants to remove them? – You? Or me? – Maybe, but certainly not those who can do it.

7). “The system began to break and now it is partially corrected.” The first part is 100% true, and the second does not stand up to any criticism. The system has ceased to meet the requirements (minimum), because it turned out to be completely incapable of reacting to the crisis (dreaming of “sitting it out”, without changing itself in any way). And this is already irreversible – time is lost irretrievably.

8). “A fair reputation as a “doomsayer” – well, so be it. But at least I have a reputation. Most (if not all) modern Russian “politicians” have no reputation at all – they only have “what would you like, Your Excellency?!” And yes – I, in general, don’t care whether I will be “less interesting to readers” (not to mention that soon readers will have “no time for reading” – they will think about a piece of bread and safety 90% of the time). I do my Duty – as I understand it and as I can. I have never chased popularity and intend to do so specifically in the future.

I hope you understood from my letter that I have much more information than the correspondents you mentioned send me, and I can still critically evaluate the information I receive. And also that I am not a “consumer of ready-made conclusions” (like those you sent me – without any specific justification). Do you want to really have a “positive-corrective effect” on me? – Operate with facts! And I will evaluate them as carefully as the arguments of your opponents.

I also ask you to convey my regards to “Ivan Ivanovich”! (I would not object if you decided to acquaint him with this opus). However, I also do not object to a wider publication.

Sincerely, I.V. Girkin

08.04.2025

/all names and surnames in the text, taken in quotation marks ” “, are fictitious/

Source

geopolitical issues

Trump is Toast

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Illegal immigrants? Backtracking. Tariffs? Backtracking. Ukraine peace in 24 hours? Backtracking. 90 days? Backtracking? Stop supporting Ukraine? Backtracking. War against Iran? Backtracking. Deportation of Palestinians? Not yet.

From NBC News:

Trump floats plan for undocumented farm and hotel workers to work legally in the U.S.

The president’s comments suggested a vague plan that would allow the government to bring back “great” people who are “working hard” and who “go out … in a nice way.”

President Donald Trump suggested at a Cabinet meeting Thursday that undocumented people working on farms and in hotels would be allowed to leave the country and return as legal workers if their employers vouched for them.

Trump said at the meeting with reporters present that “we have to take care of our farmers, the hotels and, you know, the various places where they tend to, where they tend to need people.”

“So a farmer will come in with a letter concerning certain people, saying they’re great, they’re working hard. We’re going to slow it down a little bit for them, and then we’re going to ultimately bring them back. They’ll go out. They’re going to come back as legal workers.”

It was unclear what he meant by “slow it down a little bit for them.” The administration has been pouring resources into arresting, detaining and deporting undocumented immigrants to fulfill Trump’s campaign pledge to conduct a history-making mass deportation of immigrants from the United States.

Trump said the administration is going to work with people if they “go out … in a nice way.” (Full article.)

BlackRock CEO Larry Fink:

“The sweeping US tariff announcements went beyond anything I could have imagined in my 49 years in finance”

Trump is quickly losing the support of Wall Street Investors.

From Bloomberg:

BlackRock Inc. Chief Executive Officer Larry Fink said he was caught by surprise at the breadth of President Donald Trump’s tariffs last week on many countries, including key US trading partners.

“The sweeping US tariff announcements went beyond anything I could have imagined in my 49 years in finance,” Fink said on a call on Friday with analysts after the company reported first-quarter financial results.

The president imposed the steepest tariffs in a century on April 2, sparking markets to sell off around the globe. On April 3 and 4, the S&P 500 Index had its steepest two-day plunge since the March 2020 onset of the pandemic.

“This isn’t Wall Street versus Main Street,” Fink told analysts Friday.

“The market downturn impacts millions of ordinary people’s retirement savings.”

The US is either very close to a recession or already in one, Fink said in a CNBC interview after the analyst call. He said he was shocked at the 10-Year Treasury’s reaction in the wake of Trump’s tariffs. (Full article.)

Asia’s central banks hold and can dump $3 trillion worth of US Treasuries, leverage that could ultimately put the Tariff Man in line

From Asia Times:

The real bond vigilantes hounding Trump are Asian

The dollar extended its biggest plunge in three years on Friday after China raised tariffs on the US to 125% from 84%, a tit-for-tat step that has gold surging, markets everywhere gyrating and investors more uncertain than ever about the global economic and financial outlook.

It’s now US President Donald Trump’s move. Does the Trump 2.0 White House double down and increase its own tariff rate, now at 145%, on Asia’s biggest economy? Trump, after all, has threatened before a 200% levy on certain Chinese products.

Perhaps most interesting about this week is what global investors learned about the Trump 2.0’s pain threshold. Punters learned – to their horror – that Trump is willing to stomach epic stock market losses but not telltale signs of distress in the bond market.

Posterity will show that it wasn’t the US Congress, the judiciary or voters that forced the US president into a more relational tariff policy. It was bond traders.

In Asian trading hours on April 9, the so-called “bond vigilantes” pushed the yield on 30-year US Treasury bonds above 5%, Bloomberg reported. That — and memories of events from the mid-1990s, mid-2000s and the Silicon Valley Bank bust in 2023 — saw Trump beat a hasty and rare retreat on most tariffs.

Yet it’s concerns about the next round of vigilantes to take on the Trump White House that made him blink: Asian central banks.

Central banks in the region hold roughly US$3 trillion of US Treasuries, with Japan and China, the top holders, sitting on a combined $1.9 trillion. If they were to start selling on a significant scale, who could pick up the slack?

Other than the largest global banks buying steadily, arguably no one.

That’s why chatter in bond trading pits this week that Japan, China and other Asian monetary authorities might be selling so alarmed top US Treasury Department officials.

For years, traders feared China might dump its trove of US T-bills in retaliation against US sanctions and restrictions. That day may have arrived.

China, after all, has an incentive to show that “it won’t hesitate to cause turmoil in the global financial market in order to improve its negotiating power against the US,” says strategist Ataru Okumura at SMBC Nikko Securities. (Full article.)

It's All About Jews

Kissinger and Israel’s Attack on Iran

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Is this the best time or the worst time for Israel to gamble on the outcome of a war with Iran?

https://t.me/AlgoraPublishing/1064

Capitalism in Decay

Some Fall-Out From The Tariff Wars

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via MoA

President Trump likely thought that he could press China into making a deal with him. The tariffs he imposed were supposed to create leverage for that.

Instead he found that China is willing and able to fight back:

China said it will raise its tariff on US goods to 84%, retaliating to the hefty new tariffs on its imports that kicked in on Wednesday.

The move came after the Trump administration followed through on a threat to add a 50% tariff on Chinese goods, in addition to 34% reciprocal tariffs, raising the overall tariff rate on Chinese goods to 104%. The steep new duties on China and 184 other US trading partners took effect at 12:01 a.m. ET on Wednesday.
Beijing’s move marks further deterioration in US-China trade relations after China vowed on Tuesday to “fight to the end” in the renewed trade war.

When the U.S. launched its proxy war in Ukraine against Russia it thought that it could defeat Russia by economic means. A wall of sanctions and other restrictions were to destroy the Russian economy. But Russia was prepared and much stronger than the U.S. had anticipated. Its economy did better than those of the countries which opposed it.

A similar miscalculation seems to have happened with regards to China.

Trump is not knowledgeable about China’s mighty economy. Vice-President Vance recently called China’s highly qualified work force ‘peasants‘. Treasury Secretary Scott Bessent is likewise ignorant:

I advised Scott Bessent, now Trump’s Secretary of the Treasury who is leading the tariff war, in 2013 when he was still with Soros. An investment bank engaged me to advise Bessent on China’s economy and consumer trends and go over my book The End of Cheap China.

I took an instant disliking – Bessent was one of the most arrogant and ignorant on China people I had ever met. He was uber bearish on China and was largely ideologically driven in his analysis. Communist countries couldn’t succeed was basically the jist of his views.
Data and rational analysis did not reign supreme.
…
He thinks America has the upper hand with China right now. I worry for America. We have one of the most ignorant on China yet arrogant people I’ve ever met running a trade war against China.

Along with trouble in the stock and treasury markets we now can see trade between the U.S. and not only China but large parts of South Asia comes to a screeching halt:

Amid escalating trade tensions between China and the United States, some Chinese exporters are taking the drastic step of ditching shipments mid-voyage and surrendering containers to shipping companies to avoid crushing tariff costs.

Industry insiders have dubbed the move “preparing for the Long March”, a grim metaphor for what many see as a prolonged and punishing downturn in cross-Pacific trade.
A staff member at a China-listed export company, who requested anonymity, said its US-bound container volume had plummeted from 40 to 50 containers a day to just three to six as a result of the new tariffs on Chinese imports imposed by the second Trump administration.
…
“We’ve halted all shipping plans from the Philippines, Vietnam, Indonesia and Malaysia,” the employee said. “Every factory order is halted. Anything that hasn’t been loaded will be scrapped, and the cargo already at sea is being re-costed.”

Those are goods that U.S. importers expected to see but which will not be delivered. Not even to higher prices. It may take a few weeks until the effects will be seen in U.S. stores but empty shelves, especially for low value everyday stuff, are now sure to appear.

There are no other producers to take up the space.

This will hit the U.S. much more than China:

The Chinese trade surplus with the US is about 3% of its GDP. China would not lose off of that; it would wind up redirecting a lot of those goods to other countries that would only welcome the extra stuff up to a point, or even sell more domestically. But China could weather the hit. Economic suffering that clearly results from US malevolence would also be unifying, while a sluggish economy due to the deflating of a monster property bubble is much less so.

Trump is proposing to make this dire situation worse by sanctioning pharmaceuticals.
…
The only way inflicting this level of punishment on Americans (a huge spike in untreated illnesses, on top of the economic distress from sudden rises in costs and resulting spending cutbacks that will result in business failures, high inflation (conceivably hyperinflation if the destruction of productive capacity is large enough, and readers know I hate the casual use of the “h” word), and a big uptick in unemployment, is if the plan is to produce so much upheaval as to justify the imposition of martial law. But who wants to be the emperor of a hellhole?

On Monday I had quoted Adam Tooze who provided a scenario of rising Treasury interest:

Rather than investors piling into Treasuries driving the price up, instead, we could see investors selling Treasuries en masse.
…
At this point we would expect to see the Fed step in, not just to lower interest rates, as is now commonly expected, but do more drastic interventions.
…
But [..] what if investors, both American and foreign decide, that they no longer wish to hitch their wagon to the empire of the mad king? What if they decide that the US is indeed exceptional, but that it is exceptional in rather nasty ways? […] Well in that case, holding billions in dollars newly created by the Fed does not give you the security you want.

So you sell the dollars. You just want out of the mad house.
This, Ladies and Gentleman, would be the truly big disaster.

The unthinkable move in Treasury happened last night:

Treasury yields spiked on Wednesday as investors bailed out of what has been perceived as the world’s safest instrument on expectations of crumbling foreign demand as tariffs take effect.

The yield on the 10-year Treasury spiked to as high as 4.516%. Yields move in the opposite direction to prices.
Yields settled down after China called for dialogue with the U.S. on trade, and then moved right back near the highs of the day after China said it was increasing its tariffs on the U.S. to 84%.
The yield on the 30-year Treasury was 4.91%, having earlier peaked above 5%.
“Something has broken tonight in the bond market. We are seeing a disorderly liquidation,” said Jim Bianco, president and macro strategist at Bianco Research.
…
[T]ariffs are devastating to bonds — not only do they have an inflationary impact, but they result in fewer dollars being sent to foreign countries that have traditionally recycled them into financial assets and U.S. Treasury securities in particular.

—

Peter Schiff @PeterSchiff – 10:51 UTC · Apr 9, 2025
U.S. stocks, bonds, and the dollar are all down. This is a broad-based liquidation of U.S. assets. Trump claims his tariffs will cause foreigners to invest in the U.S. to avoid the tariffs. Instead, tariffs have already resulted in foreigners pulling their money out of the U.S.

Rising interests is the last thing the Trump administration wanted to see. It wants to borrow more to be able to cut taxes. But with interest rates on the rise it will become more difficult to cover the U.S. deficit.

The real damage though will probably happen in smaller Asian countries who have borrowed in U.S. dollar and, due to tariff and trade troubles and rising interest rates, will have difficulties to pay back their loans. If they default the western banks who have lend them the money will go down with them. The trade trouble could thus develop into a serious banking crisis.

These are interesting times to live in …

Capitalism in Decay

Tariffs, no Tariffs? Too Little, Too Late

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by Claudiu Secara

I see no solution for the US in its foregone predicament – Trump or no Trump.

If the US continues on the path of trade imbalance as of now, it can continue enjoying its lifestyle for another generation as it goes on selling its assets one by one, land, real estate, art collections, gold, etc. It would face the same historical transition as happened in nineteenth-century Europe when the emerging bourgeoisie capitalized on its hard work and savings and replaced the la dolce vita landed aristocracy.

This is well illustrated by at least two classic pieces of literature, The Cherry Orchard by Chekhov and The Leopard, by Lampedusa. Nothing new to see here.

The other option that the US has is to raise tariffs and other trade barriers against the countries that are overtaking its domestic production, and retreat as a standalone economy. A form of twenty-first century autarchic economy. The result? Stagnation, third-worldization, backwardization, etc. Not good.

So, the historical trend is clear. There is not much for the US to do. World War III? Not a chance to win. Trigger a world pandemic? Use bioweapons? Not much hope to get out unharmed. In fact, the brief experiment with Covid showed that the US had a much higher level of destruction and death than its adversaries. New forms of exotic weapons like geo-weapons, climate weapons, direct energy weapons? The US is no longer facing an army of bows and arrows, but even better and more sophisticated technological powerhouses in China and Russia.

It would be wise then to call for a truce, ask for help in order to wind down its excesses of the last 30 or 40 years. Not yet unmanageable. Engage in a constructive dialogue, give up its claims to hegemony and look ahead for another day, when it can re-tool itself and recast itself into a different national identity. But that ain’t going to happen because the national hubris and arrogance is so deeply engrained in the populace that such a sudden loss of status is unpalatable.

If the competition is shaping up to be between team China and team US, there is every reason to believe based on known qualifications that team China is already projected to be the winner. Hard work, excellent education, focus, discipline, unity of the goal, good morals and far less corruption as the institutionalized policy of the US system, all of these and more are all meant to predetermine the outcome.

But, we’ll have to wait and see.

La Resistance - One by One

They Own You!

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George Carlin the great American Prophet said it best:

“It’s never going to get any better, don’t look for it, be happy with what you’ve got.

Because the owners, the owners of this country don’t want that. I’m talking about the real owners now, the BIG owners! The Wealthy… the REAL owners! The big wealthy business interests that control things and make all the important decisions.

Forget the politicians. They are irrelevant. The politicians are put there to give you the idea that you have freedom of choice. You don’t. You have no choice! You have OWNERS! They OWN YOU. They own everything. They own all the important land. They own and control the corporations. They’ve long since bought, and paid for the Senate, the Congress, the state houses, the city halls, they got the judges in their back pockets and they own all the big media companies, so they control just about all of the news and information you get to hear. They got you by the balls.

They spend billions of dollars every year lobbying, lobbying, to get what they want. Well, we know what they want. They want more for themselves and less for everybody else….”

To know who the owners are just find out who you cannot criticize.

See more: Today, coincident with D Trump’s Great Tariff Debacle, China announced its Digital Payments Processing system was open for use among about 10 nations , reducing payment costs near-zero and transaction time in seconds! And open to all to join Completely bypassing the SWIFT choke-point game of the elites. https://t.me/AlgoraTelegram/637

Criminals have a different mentality than non-criminals. https://t.me/AlgoraTelegram/636

Military Affairs

Is this the End of “Peace in 100 Days”?

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Ed. Note: Good article, except for the continued fallacious belief in the great Russian army’s successful military campaign against the Ukrainian army. For a much more accurate report of the actual failures of the Russian army, which basically couldn’t win a decisive victory in more than 3 years and is actually struggling with low numbers and low-skilled personnel as well as shortages of ammunition, see Igor Strelkov here: https://t.me/AlgoraPublishing/1024

via MoA

Negotiations between the U.S. and Russia about the war in Ukraine seem to be losing steam.

Russia has long insisted on a solution of the conflict which removes the root causes of it. It can not allow for Ukraine to become a NATO battering ram at its doorstep. It can not allow a fascist government in Ukraine.

Any solution to the conflict must resolve (at least) those two issues.

The Trump administration wants the Ukraine problem out of its way. It wants to implement a ceasefire to be able to turn away and ignore the festering problem.

Russia won’t have that (archived):

On Tuesday, Moscow reinforced its hard-line, maximalist demands when Russia’s Deputy Foreign Minister Sergei Ryabkov complained that Russia’s demand “to solve the problems related to the root causes of the conflict” was being ignored by the U.S., and “we cannot accept all of this as it is.”As the U.S. overstates its progress in talks, Moscow seems concerned that Trump’s negotiators do not understand how serious it is about these demands, according to [Thomas Graham, senior director for Russia at the National Security Council under the George W. Bush administration and now a fellow at the Council on Foreign Relations].

“The question is whether the administration has the patience to continue those negotiations and whether they can conduct the negotiations in ways that can extract concessions from the Russian side,” he said.

“Extract concessions”? By what?

The U.S. has no leverage over Russia. It is the Russian army that is winning on the battlefield in Ukraine. It has ample reserves in soldiers. It is by far outproducing NATO in weapons and munitions. It is stable in political, social and economic terms.

Secretary of State Marco Rubio is threatening Russia with more sanctions (machine translation):

“Now we are not interested in negotiations for the sake of the negotiations themselves – we will not continue this indefinitely. We have a certain amount of time during which we want to understand whether they are ready or not, and this time is already coming to an end. Congress has already started working on a bill for additional sanctions, and pressure from the Capitol will continue to grow, ” the US Secretary of State said.According to him, it was important “just to start a dialogue, because we haven’t talked for a long time, but now we need to make progress.”

The above-mentioned draft law provides for the introduction of new sanctions against Moscow, as well as duties in the amount of 500% on imports for countries that purchase Russian oil, gas, uranium and other products.

In “weeks, not months,” we will know if Russia is ready to end the war, Rubio said.

Russia is already under a total of 28,000 individual sanctions. If the U.S. is threatening other countries with sanctions for buying Russian oil they will find ways around it. It is, like the U.S. ‘tariffs’, just another way of wreaking the global U.S. position.

There are signs that Rubio and his fellow neo-cons in the Trump administration have decided to stall further talks:

Trump’s inner circle opposes a phone call to Putin until the Russian leader commits to a full ceasefire in Ukraine, two unnamed administration officials said.Despite Trump saying he plans to speak to Putin days earlier, no call between the two leaders has been scheduled, the unnamed officials said.

It is possible Trump will abruptly decide he wants to speak to Putin, but he has been advised against calling the Russian leader until Moscow communicates they agree to a full ceasefire in Ukraine, the two officials said.

Not talk to Putin and wait for what? Godoh?

There is fortunately a second line of communication between Trump envoy Steve Witkoff and the head of the Russian Direct Investment Fund Kirill Dmitriev. Russia is offering the U.S. very big investment opportunities. This is Putin’s carrot while the steady progress of the Russian army in Ukraine is his stick.

Dmitriev, during his visit in Washington, stated that talks were going well but that there are certain powers who want to derail them:

Russian President Vladimir Putin’s investment envoy Kirill Dmitriev, who is visiting Washington this week, said on Thursday that unidentified forces were trying to sow tension between Russia and the United States.”Today, numerous forces interested in maintaining tension stand in the way of restoring constructive cooperation… These forces are deliberately distorting Russia’s position, trying to disrupt any steps towards dialogue, sparing neither money nor resources for this,” Dmitriev said on Telegram.

“Opponents of the rapprochement are afraid that Russia and the United States will find common ground, begin to understand each other better and build cooperation both in international affairs and in the economy,” he said.

It is obvious that the moves against further negotiations are coming from neo-conservatives, like Rubio, within the Trump administration.

Will Trump be able to disarm them?

Economics/Statistics

How Trump’s Tariff Tizzy is Burning Down the House

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by Pepe Escobar via https://strategic-culture.su/news/2025/04/03/how-trumps-tariff-tizzy-burning-down-house/

Global Majority, rejoice! And step on the high-speed rail de-dollarization train.

Circus ringmaster Trump’s Tariff Tizzy (TTT), christened by himself as “Liberation Day”, is being largely interpreted around the world – Global North and Global South alike – as Slaughterhouse Day.

This de facto uncontrolled economic demolition gambit starts with the warped fantasy that launching a customs war on China is a bright idea. As bright as collecting a few trillion extra dollars in tariffs assuming the rest of the planet will be somewhat “encouraged” to sell to the Hegemon, while pretending that these tariffs will lead to the re-industrialization of the U.S.

The tragicomic mask of a self-appointed circus ringmaster of turbo-capitalism may be as pathetic as the European chihuahua rage boosting their “revenge” via Rearmament – with funds that they plan to steal from the savings accounts of unsuspecting citizens.

The indispensable Michael Hudson has configured the key problem. Allow me a little tweak: “Sanctions and threats are the only thing that the United States has left. It no longer can offer other countries a win-win situation, and Trump has said that America has to be the net gainer in any international deal it’s made, whether it’s a financial deal or a trade deal. And if America is saying, any deal we make, you lose, I win”, that Mafia extorsion gambit does not exactly reflect the Art of the Deal.

Prof. Hudson neatly describes Trump’s negotiation tactics: “When you don’t have very much to offer economically, all you can do is offer not to hurt other countries, not to sanction them, not to do something that will be against their interest.” Now, with TTT, Trump is actually “offering” to hurt them all. And they will certainly invest in all sorts of counter-tactics to “get away” from that “strategy” of American “diplomacy”.

A trade war on Asia

TTT attacks everyone, especially the EU (“born to hurt us”, according to the circus ringmaster. Wrong, because the EU was invented by the Americans in 1957 to actually keep Europe under control). The EU exports roughly 503 billion euros to the U.S. a year, while importing around 347 billion. Trump is fuming non-stop about this surplus.

So a counter-measure vendetta will be inevitably in store, as already advertised by the toxic Medusa von der Lugen in Brussels – incidentally the sponsor of every weapons producer in Europe.

Yet TTT is above all a trade war on Asia. “Reciprocal” tariffs – not exactly reciprocal – were imposed on China (34%),Vietnam (46%), India (26%), Indonesia (32%), Cambodia (49%), Malaysia (24%), South Korea (25%), Thailand (36%), earthquake-hit Myanmar (44%), Taiwan (32%) and Japan (24%).

Well, even before TTT, a first has been achieved: the circus ringmaster generated a once-in-a-lifetime consensus among China, Japan and South Korea that their response will be coordinated.

Japan and South Korea will import semiconductor raw materials from China, while China will be purchasing chips from Japan and South Korea. Translation: TTT will solidify “supply chain cooperation” among this triad that so far was not exactly too cooperative.

What the circus ringmaster really wants is an iron-clad mechanism – already being developed by his team – that unilaterally imposes whatever level of tariffs Trump may come up with on whatever excuse: could be to circumvent “current manipulation”, to counter a value-added tax, on “security grounds”, whatever. And to hell with international law. For all practical purposes, Trump is burying the WTO.

Even tariffed penguins in Heard island in the South Pacific know that the certified effects of TTT will include rising inflation in the U.S., serious pain on its – delocalized – corporations and most of all the complete collapse of American “credibility” as a reliable and trustworthy trading partner, adding to its certified reputation as “non-agreement capable” – as the Global South knows so well. > Ант: A rentier FIRE Empire (financialization, insurance, real estate, as masterfully analyzed by Michael Hudson), which offshored its manufacturing industries and was gobbled up by a pile of overleveraged hedge funds, Wall Street derivatives and Silicon Valley totalitarian surveillance in the end decides to strike…itself.

Poetic justice applies. Burning Down the House – from inside the house. As for the emerging, sovereign Global Majority, rejoice: and step on the high-speed rail de-dollarization train.