On the Trade Uncertainty Principle
Foreign trade only accounts for 12% of the US GDP. The consumer accounts for 68%. The consumer drives the US economy, and he/she is doing fine with unemployment rates at 50-year lows and at all-time lows for African Americans, Hispanics, and women. Salaries, particularly for the lower paid, are rising rapidly as are savings.
The economic problem for the US is finding willing and capable workers. This WILL hold back the growth of the economy, but we will have a great Christmas!
With a crashing currency and huge unpaid debt, it is clear that Argentina will not be able to climb out of its financial hole with the normal Peronist policies. The only way to attract capital will be to switch to free enterprise and capitalism. It will be fun to watch.
The problem continues to be very simple. A majority of the currently ruling Conservative Party disagrees with a majority of the British public who voted to leave the EU. These Conservatives also disagree with their duly elected leader and Prime minister, Mr. Johnson, who would like to carry out the will of the people. Conservatives won't even allow a vote to ensure that the British voters still want to leave. Ultimately, as in any democracy, the people's will WILL be carried out. It’s just a question of when ( possibly because they realize that it hasn't changed.).
It's a bit like a majority of Republicans not allowing Trump to be elected.
For years Americans have undersaved. Now that the economy is booming with unemployment rates at 50-year lows, and for minorities at all time lows, and with incomes rising much faster than inflation, they can afford to build up their savings accounts AND spend.
What the Journal also misses, after sleeping through Econ 101, is that savings equal investment. High saving rates allow high rates of investment which, in turn, will maintain continued good economic growth. The major problem facing the United States economy today are workers willing and able to work. This has already been slowing the economy in recent reports.
If the CEO of a public company does not truly believe that his major goal is to maximize the long term financial return to his shareholders, he should not be the CEO. This is the only metric that the stock market believes in. Failing to deliver it will cause the stock to drop, which, in turn, causes his shareholders to lose money. Over time, this will cause the directors to fire him. If they fail in their duty to do this, they will be fired.
All the other fine objectives are noble and, in many cases, if met, will help the CEO to deliver profits for his shareholders, but they are only peripheral to his major goal.
So China should be able to violate the World Trade Organization regulations at will, illegally force our companies to give up their trade secrets, disregard patents at will, and force foreign corporations into unfair alliances with Chinese companies? Only the US has the economic clout and this administration the courage to take on China directly.
Apple has more than 1.4 billion screens in the hands of the public. Providing the material to be shown on these screens represents its next growth phase. Software is inherently much more profitable than hardware with a gross margin approaching 100%.
Yes, in a "command” economy (like China) where inventory accumulates behind closed doors, production can be "commanded" , but not demand, as Russia discovered years ago.
The whole point of a well-crafted tax reduction, such as the recent one in the US, is to improve the economy and generate more taxes from both corporations and individuals. This is beginning to happen with record domestic corporate profits from business and individual income beginning to accelerate based on record low unemployment rates among Hispanics, African Americans, and women. Reducing the deficit by tax reduction will happen over a decade, but not in the first year.