Global Economic Fragmentation

[Meclazine for Israel]

https://www.abc.net.au/news/2024-04-21/the-global-economy-is-fragmenting-what-can-australia-do-about-it/103748984

"In March, a fascinating paper was published with the title, Are We Fragmented Yet? Measuring Geopolitical Fragmentation and its Causal Effects.

It was written by Jesús Fernández-Villaverde (Professor of Economics at the University of Pennsylvania), Tomohide Mineyama (International Monetary Fund), and Dongho Song (Johns Hopkins University)."

https://www.sas.upenn.edu/~jesusfv/Fragmentation.pdf

[addyj76ers]

The trade policies pursued by the new administration can have a direct impact on global economic fragmentation. Changes in tariffs, trade agreements, and trade relations can affect the flow of goods and services between countries, potentially leading to trade disputes or barriers that fragment global trade.

[Associate Justice PiT]

     A small part of the overall picture, but it strikes me how fragmented social media actually is. It's a big thing people think of as unifying the world, yet if you look at some of the largest nations it paints a very different picture. China has banned numerous Western social media apps and runs their own versions of them. India has banned Tiktok. Russia bans Facebook and Instagram, with VKontakte being their version of the former. The internet was meant to bring the world together, but in that space there are a stunning number of national silos operating out there.

[Open Source Intelligence]

The trade policies pursued by the new administration can have a direct impact on global economic fragmentation. Changes in tariffs, trade agreements, and trade relations can affect the flow of goods and services between countries, potentially leading to trade disputes or barriers that fragment global trade.

Well thanks for your academic answer. But both Trump and Biden regardless of who is elected will probably seek pretty similar economic policy as relates to foreign trade. Both as well as their trade surrogates are doing, have done, or heavily signaling they are going toward tariffs, protectionism, "fair trade" versus "free trade", American jobs first. Industrial policy is coming back into vogue.

If you realize this will all increase inflation, congratulations, you are smarter than most people in the world and everyone in the financial markets only concerned with rate cuts. Both Biden and Trump are making a bet of to be anti-mercantilism as currently practiced globally (this is heavily driven by China, but countries the likes of Japan and Germany would be affected as well), they have to be protectionist. I think both would take a deal where U.S. jobs increase 5% in exchange for costs on everything going up 10%. The 2% inflation target is done for the foreseeable future unless the CPI rate is heavily gamed, which it is.

[Benjamin Frank 2.0]

The trade policies pursued by the new administration can have a direct impact on global economic fragmentation. Changes in tariffs, trade agreements, and trade relations can affect the flow of goods and services between countries, potentially leading to trade disputes or barriers that fragment global trade.

Well thanks for your academic answer. But both Trump and Biden regardless of who is elected will probably seek pretty similar economic policy as relates to foreign trade. Both as well as their trade surrogates are doing, have done, or heavily signaling they are going toward tariffs, protectionism, "fair trade" versus "free trade", American jobs first. Industrial policy is coming back into vogue.

If you realize this will all increase inflation, congratulations, you are smarter than most people in the world and everyone in the financial markets only concerned with rate cuts. Both Biden and Trump are making a bet of to be anti-mercantilism as currently practiced globally (this is heavily driven by China, but countries the likes of Japan and Germany would be affected as well), they have to be protectionist. I think both would take a deal where U.S. jobs increase 5% in exchange for costs on everything going up 10%. The 2% inflation target is done for the foreseeable future unless the CPI rate is heavily gamed, which it is.

In this scenario, U.S jobs would increase by 0%

[Open Source Intelligence]

The trade policies pursued by the new administration can have a direct impact on global economic fragmentation. Changes in tariffs, trade agreements, and trade relations can affect the flow of goods and services between countries, potentially leading to trade disputes or barriers that fragment global trade.

Well thanks for your academic answer. But both Trump and Biden regardless of who is elected will probably seek pretty similar economic policy as relates to foreign trade. Both as well as their trade surrogates are doing, have done, or heavily signaling they are going toward tariffs, protectionism, "fair trade" versus "free trade", American jobs first. Industrial policy is coming back into vogue.

If you realize this will all increase inflation, congratulations, you are smarter than most people in the world and everyone in the financial markets only concerned with rate cuts. Both Biden and Trump are making a bet of to be anti-mercantilism as currently practiced globally (this is heavily driven by China, but countries the likes of Japan and Germany would be affected as well), they have to be protectionist. I think both would take a deal where U.S. jobs increase 5% in exchange for costs on everything going up 10%. The 2% inflation target is done for the foreseeable future unless the CPI rate is heavily gamed, which it is.

In this scenario, U.S jobs would increase by 0%

That's where Trump and Biden are both going. They've both announced it, just with their own personal flourishes on it. Universal free trade is dead.

[Benjamin Frank 2.0]

The trade policies pursued by the new administration can have a direct impact on global economic fragmentation. Changes in tariffs, trade agreements, and trade relations can affect the flow of goods and services between countries, potentially leading to trade disputes or barriers that fragment global trade.

Well thanks for your academic answer. But both Trump and Biden regardless of who is elected will probably seek pretty similar economic policy as relates to foreign trade. Both as well as their trade surrogates are doing, have done, or heavily signaling they are going toward tariffs, protectionism, "fair trade" versus "free trade", American jobs first. Industrial policy is coming back into vogue.

If you realize this will all increase inflation, congratulations, you are smarter than most people in the world and everyone in the financial markets only concerned with rate cuts. Both Biden and Trump are making a bet of to be anti-mercantilism as currently practiced globally (this is heavily driven by China, but countries the likes of Japan and Germany would be affected as well), they have to be protectionist. I think both would take a deal where U.S. jobs increase 5% in exchange for costs on everything going up 10%. The 2% inflation target is done for the foreseeable future unless the CPI rate is heavily gamed, which it is.

In this scenario, U.S jobs would increase by 0%

That's where Trump and Biden are both going. They've both announced it, just with their own personal flourishes on it. Universal free trade is dead.

Trump is an incoherent ignoramus. During his Presidency he wanted to force the Chinese company that owns Tik Tok to tell it off, now he defends it.

Biden is coherent and understands policy. I think he wants to engage in 'friendshoring' basically getting the U.S and allies away from China and Russia but there are Democrats (and Republicans) who want to engage in Autarky, and Biden is not necessarily averse to fighting against that for domestic political reasons.

In regards to China, which clearly is using its economic power to be a threatening rogue nation in its region and the world, as a free trader I can understand how strategic concerns need to take priority over free trade.

[Open Source Intelligence]

The trade policies pursued by the new administration can have a direct impact on global economic fragmentation. Changes in tariffs, trade agreements, and trade relations can affect the flow of goods and services between countries, potentially leading to trade disputes or barriers that fragment global trade.

Well thanks for your academic answer. But both Trump and Biden regardless of who is elected will probably seek pretty similar economic policy as relates to foreign trade. Both as well as their trade surrogates are doing, have done, or heavily signaling they are going toward tariffs, protectionism, "fair trade" versus "free trade", American jobs first. Industrial policy is coming back into vogue.

If you realize this will all increase inflation, congratulations, you are smarter than most people in the world and everyone in the financial markets only concerned with rate cuts. Both Biden and Trump are making a bet of to be anti-mercantilism as currently practiced globally (this is heavily driven by China, but countries the likes of Japan and Germany would be affected as well), they have to be protectionist. I think both would take a deal where U.S. jobs increase 5% in exchange for costs on everything going up 10%. The 2% inflation target is done for the foreseeable future unless the CPI rate is heavily gamed, which it is.

In this scenario, U.S jobs would increase by 0%

That's where Trump and Biden are both going. They've both announced it, just with their own personal flourishes on it. Universal free trade is dead.

Trump is an incoherent ignoramus. During his Presidency he wanted to force the Chinese company that owns Tik Tok to tell it off, now he defends it.

Biden is coherent and understands policy. I think he wants to engage in 'friendshoring' basically getting the U.S and allies away from China and Russia but there are Democrats (and Republicans) who want to engage in Autarky, and Biden is not necessarily averse to fighting against that for domestic political reasons.

The Trudeau administration were scared pretty sh*tless a little more than a year ago by Biden's electric vehicles subsidies that notably said nothing about Ontario. I see nothing beyond words there from Biden. David Herle and Scott Reid will tell you relations never recovered under Biden to what they were pre-Trump. Trump calls it America First or MAGA. Biden frames it as pro-worker, pro-labor. The end result is the same. Trump is effectively a Democrat economically ex-taxes. And Europe at the moment are not in the friendshoring plans. Australia, Britain, and Japan are.

The world right now is heading for a very dark place in my opinion. I see a pre-World War I European mentality out there when you look under the covers at what is going on economically. It’s heading there whether Trump or Biden get elected, although trajectories in either case would be different. I think a more globalized war becoming reality I’m probably at 1 in 3, and it’s not necessarily over Ukraine. Biden has a sense of institutional restraint in him but is just not the leader I trust in such a situation. Trump in contrast has no restraints at all. That can be positive, but can also be very negative. There's this Western mentality of everything will be fine because we have the money and we don't have to ask our citizens to be required to sacrifice anything. I think that era is over and how are people going to react?

But no one gives a sh*t what I think, I've acknowledged that, so I just sit back and wait.

[Benjamin Frank 2.0]

The trade policies pursued by the new administration can have a direct impact on global economic fragmentation. Changes in tariffs, trade agreements, and trade relations can affect the flow of goods and services between countries, potentially leading to trade disputes or barriers that fragment global trade.

Well thanks for your academic answer. But both Trump and Biden regardless of who is elected will probably seek pretty similar economic policy as relates to foreign trade. Both as well as their trade surrogates are doing, have done, or heavily signaling they are going toward tariffs, protectionism, "fair trade" versus "free trade", American jobs first. Industrial policy is coming back into vogue.

If you realize this will all increase inflation, congratulations, you are smarter than most people in the world and everyone in the financial markets only concerned with rate cuts. Both Biden and Trump are making a bet of to be anti-mercantilism as currently practiced globally (this is heavily driven by China, but countries the likes of Japan and Germany would be affected as well), they have to be protectionist. I think both would take a deal where U.S. jobs increase 5% in exchange for costs on everything going up 10%. The 2% inflation target is done for the foreseeable future unless the CPI rate is heavily gamed, which it is.

In this scenario, U.S jobs would increase by 0%

That's where Trump and Biden are both going. They've both announced it, just with their own personal flourishes on it. Universal free trade is dead.

Trump is an incoherent ignoramus. During his Presidency he wanted to force the Chinese company that owns Tik Tok to tell it off, now he defends it.

Biden is coherent and understands policy. I think he wants to engage in 'friendshoring' basically getting the U.S and allies away from China and Russia but there are Democrats (and Republicans) who want to engage in Autarky, and Biden is not necessarily averse to fighting against that for domestic political reasons.

The Trudeau administration were scared pretty sh*tless a little more than a year ago by Biden's electric vehicles subsidies that notably said nothing about Ontario. I see nothing beyond words there from Biden. David Herle and Scott Reid will tell you relations never recovered under Biden to what they were pre-Trump. Trump calls it America First or MAGA. Biden frames it as pro-worker, pro-labor. The end result is the same. Trump is effectively a Democrat economically ex-taxes. And Europe at the moment are not in the friendshoring plans. Australia, Britain, and Japan are.

The world right now is heading for a very dark place in my opinion. I see a pre-World War I European mentality out there when you look under the covers at what is going on economically. It’s heading there whether Trump or Biden get elected, although trajectories in either case would be different. I think a more globalized war becoming reality I’m probably at 1 in 3, and it’s not necessarily over Ukraine. Biden has a sense of institutional restraint in him but is just not the leader I trust in such a situation. Trump in contrast has no restraints at all. That can be positive, but can also be very negative. There's this Western mentality of everything will be fine because we have the money and we don't have to ask our citizens to be required to sacrifice anything. I think that era is over and how are people going to react?

But no one gives a sh*t what I think, I've acknowledged that, so I just sit back and wait.

I think I used the wrong word 'averse.' I meant that Biden is not necessarily going to fight it. Shame on me for using 'big words' when they weren't necessary.

[Open Source Intelligence]

The trade policies pursued by the new administration can have a direct impact on global economic fragmentation. Changes in tariffs, trade agreements, and trade relations can affect the flow of goods and services between countries, potentially leading to trade disputes or barriers that fragment global trade.

Well thanks for your academic answer. But both Trump and Biden regardless of who is elected will probably seek pretty similar economic policy as relates to foreign trade. Both as well as their trade surrogates are doing, have done, or heavily signaling they are going toward tariffs, protectionism, "fair trade" versus "free trade", American jobs first. Industrial policy is coming back into vogue.

If you realize this will all increase inflation, congratulations, you are smarter than most people in the world and everyone in the financial markets only concerned with rate cuts. Both Biden and Trump are making a bet of to be anti-mercantilism as currently practiced globally (this is heavily driven by China, but countries the likes of Japan and Germany would be affected as well), they have to be protectionist. I think both would take a deal where U.S. jobs increase 5% in exchange for costs on everything going up 10%. The 2% inflation target is done for the foreseeable future unless the CPI rate is heavily gamed, which it is.

In this scenario, U.S jobs would increase by 0%

That's where Trump and Biden are both going. They've both announced it, just with their own personal flourishes on it. Universal free trade is dead.

Trump is an incoherent ignoramus. During his Presidency he wanted to force the Chinese company that owns Tik Tok to tell it off, now he defends it.

Biden is coherent and understands policy. I think he wants to engage in 'friendshoring' basically getting the U.S and allies away from China and Russia but there are Democrats (and Republicans) who want to engage in Autarky, and Biden is not necessarily averse to fighting against that for domestic political reasons.

The Trudeau administration were scared pretty sh*tless a little more than a year ago by Biden's electric vehicles subsidies that notably said nothing about Ontario. I see nothing beyond words there from Biden. David Herle and Scott Reid will tell you relations never recovered under Biden to what they were pre-Trump. Trump calls it America First or MAGA. Biden frames it as pro-worker, pro-labor. The end result is the same. Trump is effectively a Democrat economically ex-taxes. And Europe at the moment are not in the friendshoring plans. Australia, Britain, and Japan are.

The world right now is heading for a very dark place in my opinion. I see a pre-World War I European mentality out there when you look under the covers at what is going on economically. It’s heading there whether Trump or Biden get elected, although trajectories in either case would be different. I think a more globalized war becoming reality I’m probably at 1 in 3, and it’s not necessarily over Ukraine. Biden has a sense of institutional restraint in him but is just not the leader I trust in such a situation. Trump in contrast has no restraints at all. That can be positive, but can also be very negative. There's this Western mentality of everything will be fine because we have the money and we don't have to ask our citizens to be required to sacrifice anything. I think that era is over and how are people going to react?

But no one gives a sh*t what I think, I've acknowledged that, so I just sit back and wait.

I think I used the wrong word 'averse.' I meant that Biden is not necessarily going to fight it. Shame on me for using 'big words' when they weren't necessary.

It's in no one's interest to state such things, but there are Trump policies that were an abrupt change to status quo that Biden has continued. The reaction to Biden's tariffs would be heavily different if Trump hadn't already broached them. Both parties with a few exceptions are on-board as the Republican Party under Trump has become less Chamber of Commerce and more working-class nationalist, working-class nationalist being about as good a descriptor of a traditional historical labor union you could come up with if you remove the farther right-wing connotations from the word nationalist.

(Chamber of Commerce types at the moment in contrast don't really have a political party. They're still Republican majority but they're being forced to swallow a lot of things they don't like.)

Trump's anti-China policy was adopted whole hog by Biden, although the reason the Democrats have changed in addition to it's obviously pro-domestic labor (yet also pro-creating inflation) is I think that's more driven by the intellegentsia on such topics by Hong Kong as an independent polity inside China effectively disappearing and then by everything with Covid, and these people finally forced to acknowledge what any rando could've told them beforehand that China will not change. Multinationals and their execs in New York, London, Paris, Tokyo, Dubai, Toronto, Singapore, etc. crying into their champagne as they have to now deal with this new world.

[Person Man]

The trade policies pursued by the new administration can have a direct impact on global economic fragmentation. Changes in tariffs, trade agreements, and trade relations can affect the flow of goods and services between countries, potentially leading to trade disputes or barriers that fragment global trade.

Well thanks for your academic answer. But both Trump and Biden regardless of who is elected will probably seek pretty similar economic policy as relates to foreign trade. Both as well as their trade surrogates are doing, have done, or heavily signaling they are going toward tariffs, protectionism, "fair trade" versus "free trade", American jobs first. Industrial policy is coming back into vogue.

If you realize this will all increase inflation, congratulations, you are smarter than most people in the world and everyone in the financial markets only concerned with rate cuts. Both Biden and Trump are making a bet of to be anti-mercantilism as currently practiced globally (this is heavily driven by China, but countries the likes of Japan and Germany would be affected as well), they have to be protectionist. I think both would take a deal where U.S. jobs increase 5% in exchange for costs on everything going up 10%. The 2% inflation target is done for the foreseeable future unless the CPI rate is heavily gamed, which it is.

In this scenario, U.S jobs would increase by 0%

That's where Trump and Biden are both going. They've both announced it, just with their own personal flourishes on it. Universal free trade is dead.

Trump is an incoherent ignoramus. During his Presidency he wanted to force the Chinese company that owns Tik Tok to tell it off, now he defends it.

Biden is coherent and understands policy. I think he wants to engage in 'friendshoring' basically getting the U.S and allies away from China and Russia but there are Democrats (and Republicans) who want to engage in Autarky, and Biden is not necessarily averse to fighting against that for domestic political reasons.

The Trudeau administration were scared pretty sh*tless a little more than a year ago by Biden's electric vehicles subsidies that notably said nothing about Ontario. I see nothing beyond words there from Biden. David Herle and Scott Reid will tell you relations never recovered under Biden to what they were pre-Trump. Trump calls it America First or MAGA. Biden frames it as pro-worker, pro-labor. The end result is the same. Trump is effectively a Democrat economically ex-taxes. And Europe at the moment are not in the friendshoring plans. Australia, Britain, and Japan are.

The world right now is heading for a very dark place in my opinion. I see a pre-World War I European mentality out there when you look under the covers at what is going on economically. It’s heading there whether Trump or Biden get elected, although trajectories in either case would be different. I think a more globalized war becoming reality I’m probably at 1 in 3, and it’s not necessarily over Ukraine. Biden has a sense of institutional restraint in him but is just not the leader I trust in such a situation. Trump in contrast has no restraints at all. That can be positive, but can also be very negative. There's this Western mentality of everything will be fine because we have the money and we don't have to ask our citizens to be required to sacrifice anything. I think that era is over and how are people going to react?

But no one gives a sh*t what I think, I've acknowledged that, so I just sit back and wait.

I've been saying this since 2015. I just don't know how a 1913 world would work with 2024 world technology. A part of me just thinks that there's going to be this three-legged stool of chaos, fraud, and good old-fashioned inertia that keeps the world stagnant, but intact for decades, if not generations. This possible state of affairs is probably no more likely than a 19-year old's what-if scenario about World War I being fought with modern technology. What happens could also be somewhere between these extremes or worse than we could imagine. There might even be an upside risk from new medical and engineering marvels, but this has yet to materialize substantially.  This is the case even without discussing the upside and downside risks of AI or Global Warming. Especially in a world where everyone hates each other and everyone is getting their rights taken away.

I guess what I am trying to say- is when you say "a very dark place", you mean that you honestly have no idea what is going to happen and don't really see a viable long-term sitation at this point?

[Benjamin Frank 2.0]

The trade policies pursued by the new administration can have a direct impact on global economic fragmentation. Changes in tariffs, trade agreements, and trade relations can affect the flow of goods and services between countries, potentially leading to trade disputes or barriers that fragment global trade.

Well thanks for your academic answer. But both Trump and Biden regardless of who is elected will probably seek pretty similar economic policy as relates to foreign trade. Both as well as their trade surrogates are doing, have done, or heavily signaling they are going toward tariffs, protectionism, "fair trade" versus "free trade", American jobs first. Industrial policy is coming back into vogue.

If you realize this will all increase inflation, congratulations, you are smarter than most people in the world and everyone in the financial markets only concerned with rate cuts. Both Biden and Trump are making a bet of to be anti-mercantilism as currently practiced globally (this is heavily driven by China, but countries the likes of Japan and Germany would be affected as well), they have to be protectionist. I think both would take a deal where U.S. jobs increase 5% in exchange for costs on everything going up 10%. The 2% inflation target is done for the foreseeable future unless the CPI rate is heavily gamed, which it is.

In this scenario, U.S jobs would increase by 0%

That's where Trump and Biden are both going. They've both announced it, just with their own personal flourishes on it. Universal free trade is dead.

Trump is an incoherent ignoramus. During his Presidency he wanted to force the Chinese company that owns Tik Tok to tell it off, now he defends it.

Biden is coherent and understands policy. I think he wants to engage in 'friendshoring' basically getting the U.S and allies away from China and Russia but there are Democrats (and Republicans) who want to engage in Autarky, and Biden is not necessarily averse to fighting against that for domestic political reasons.

The Trudeau administration were scared pretty sh*tless a little more than a year ago by Biden's electric vehicles subsidies that notably said nothing about Ontario. I see nothing beyond words there from Biden. David Herle and Scott Reid will tell you relations never recovered under Biden to what they were pre-Trump. Trump calls it America First or MAGA. Biden frames it as pro-worker, pro-labor. The end result is the same. Trump is effectively a Democrat economically ex-taxes. And Europe at the moment are not in the friendshoring plans. Australia, Britain, and Japan are.

The world right now is heading for a very dark place in my opinion. I see a pre-World War I European mentality out there when you look under the covers at what is going on economically. It’s heading there whether Trump or Biden get elected, although trajectories in either case would be different. I think a more globalized war becoming reality I’m probably at 1 in 3, and it’s not necessarily over Ukraine. Biden has a sense of institutional restraint in him but is just not the leader I trust in such a situation. Trump in contrast has no restraints at all. That can be positive, but can also be very negative. There's this Western mentality of everything will be fine because we have the money and we don't have to ask our citizens to be required to sacrifice anything. I think that era is over and how are people going to react?

But no one gives a sh*t what I think, I've acknowledged that, so I just sit back and wait.

I've been saying this since 2015. I just don't know how a 1913 world would work with 2024 world technology. A part of me just thinks that there's going to be this three-legged stool of chaos, fraud, and good old-fashioned inertia that keeps the world stagnant, but intact for decades, if not generations. This possible state of affairs is probably no more likely than a 19-year old's what-if scenario about World War I being fought with modern technology. What happens could also be somewhere between these extremes or worse than we could imagine. There might even be an upside risk from new medical and engineering marvels, but this has yet to materialize substantially.  This is the case even without discussing the upside and downside risks of AI or Global Warming. Especially in a world where everyone hates each other and everyone is getting their rights taken away.

I guess what I am trying to say- is when you say "a very dark place", you mean that you honestly have no idea what is going to happen and don't really see a viable long-term sitation at this point?

There are always very possibilities of what could happen. As the line goes, they always seem obvious in hindsight, but in reality there are several/multiple possibilities.