USA Trade war.

[ZenOps]

https://www.bloomberg.com/view/articles/2018-06-01/mexico-knows-how-to-fight-trump-s-trade-war

I will defend Trump. There is some precedent to raising prices so that they can have more money flow in dollars, which will increase taxation. If the ultimate goal is to raise prices so that they do not have to print more money - then its a worthwhile risk.

If you have a free market pizza that only costs $15, you can only tax proportionately on that $15. But if you restrict the flow of cheese and bread, you can punch up that pizza to $150 - and tax accordingly.

Now before anyone goes OMG, take this from the perspective that the USA needs a diet because it is the fattest country in the world.

[Buster]

There are better ways to achieve inflation, if thats your goal.

[ZenOps]

Its very effective if you want global inflation. Most other policies would only be effective within country of rule.

Typically its been the role of the big banks and the Federal Reserve to try and manage global inflation, not the USA.

Since day 1, Trump has been saying that China has been producing too much stuff for too cheap (too inexpensive).

[Xtrema]

Since day 1, Trump has been saying that China has been producing too much stuff for too cheap (too inexpensive).

He's right and he's wrong, just look at cell phone price trend of the last 5 years.

[95EagleAWD]

https://www.bloomberg.com/view/articles/2018-06-01/mexico-knows-how-to-fight-trump-s-trade-war

I will defend Trump. There is some precedent to raising prices so that they can have more money flow in dollars, which will increase taxation. If the ultimate goal is to raise prices so that they do not have to print more money - then its a worthwhile risk.

If you have a free market pizza that only costs $15, you can only tax proportionately on that $15. But if you restrict the flow of cheese and bread, you can punch up that pizza to $150 - and tax accordingly.

Now before anyone goes OMG, take this from the perspective that the USA needs a diet because it is the fattest country in the world.

Nobody will buy pizza anymore for $150. People will be out of work because of $150 pizza. For every 1% increase in unemployment in the USA, 1500 more Americans die.

[ExtraSlow]

For every 1% increase in unemployment in the USA, 1500 more Americans die.but 1500 Americans get richer, so overall its a benefit in terms of republican votes.

[ZenOps]

Nobody will buy pizza anymore for $150. People will be out of work because of $150 pizza. For every 1% increase in unemployment in the USA, 1500 more Americans die.

Maybe. But lets say its avocadoes from Mexico instead of pizza, you can 10x the price of avocadoes and people will just eat all-American hot dogs for 2x the price. People have to eat afterall. Steel and aluminum is arguably even more a staple of civilization than food is.

Should staples be expensively priced or cheaply priced? That it is important should make it more expensive (ask any grain farmer what they think of $100 per ton wheat prices) Although it does beg the question: Is the threat of starvation a good motivation tactic? (expensive pizza, expensive aluminum, expensive steel) I don't think anyone is really throwing away *that* many aluminum pop cans, or day old uneaten pizzas.

It may be the correct move from the standpoint that it may make things like farming and steelworking more appealing as a career in the USA - Instead of having people moving to the cities, playing Fortnite in their parents basement, and making $300,000 a week.

Put americans on an all US grown oatmeal diet for four years - the ones that survive get to survive. Noone is going to like it, but America is sick - she needs that awful tasting medicine and maybe an amputation, or she might not pull through. I was really hoping to be 80+ years before a "Trump" to not have to live through the pain, but oh well...

[ZenOps]

BTW: I'm pretty sure if you ask Trump, China has been the ones artificially creating deflation for decades. And that his current actions would simply be to bring prices where they "should" be.

If China had its way, they would probably be pushing for $50 per ton rice or wheat (soybeans really, but that's another story)

Trump comes from a background where you have to make enough in rent, to payback $915 million construction debts. Which makes it physically impossible to payback if you are renting to said farmer only making a few dollars per ton who can only afford to rent a hotel or casino vacation for one day of the year.

And that's the eternal question. Is my lobster served in a trump casino little better than prison food? What are things actually worth in nominalized US dollars? Did people manage to break free of the matrix without the rich people knowing about it?

In the long run, if this trend continues - This may actually end up being in Canadas favour. Generalized inflation will undoubtedly show in oil at some point, if not immediately. Losing out 25% in two key metals, might be offset fairly quickly by a 25+% jump in oil.

[tonytiger55]

There was a great talk on the radio last night.
The guy was explaining nobody wins on the trade war between Canada and USA. The term 'steel' is too simplified. The reasoning is the there are many types of it and uses and one country does not produce all. The USA and Canada is a text book example of how the trade benefits both countries.

So in your case Zen ops... Yes there is cheese, but there are different types of cheeses for different types of markets. One would not put Blue Stilton on a pizza for example. Or if you just have mozza cheese. What about all the other people who eat welsh cheddar and crackers..? What about that segment of the market..?

[ZenOps]

I don't see these types of punitive tariffs in terms of cheese so much as nukes:

Trump would probably be the sort of guy who would like to build one nuke at 100x destructive force than 100 nukes at 1x destructive force. Quality over quantity, and then charge 1000x for the singular nuke as a superior nuke.

China and even Canada has been more along the lines of "be a river to your people, abundance is wealth" Abundance or quality, you can't have both - unless you fire all the humans and let the machine take over (which is the best idea yet)

Personally since I have a computing background - abundance (more gigahertz, more terabytes) is what you want, quality you can always work on later. If you can make it cheaper, make it cheaper. 52x CD-ROM drive with two week warranty? Yes, that *is* progress, quality last. The USA consumer has voted, and they like Chinese products.

[HiTempguy1]

Trump is finally doing something about what has been a problem for a long time

http://business.financialpost.com/opinion/lawrence-solomon-trump-didnt-start-the-trade-war-hes-just-finally-fighting-back

People in general are starting to get very tired of the doublespeek politicians have been getting away with for the past 30 odd years.

"Sunny ways". "Hope". But their all just window dressing. A system built on rules and laws doesn't actually work when you just turn a blind eye to those who willingly and continuosly break them.

The USA has the biggest economy, they aren't doing anything crazy besides forcing others to abide by the rules. The WTO is a joke, why would the US care? The only reason the WTO has power is because the US says it does.

[ExtraSlow]

I'm no expert on international trade, but I do agree that Canada is incredibly protectionist and closed to foreign trade. Hell, we are quite closed to inter-provincial trade in many areas.

[sabad66]

I'm no expert on international trade, but I do agree that Canada is incredibly protectionist and closed to foreign trade. Hell, we are quite closed to inter-provincial trade in many areas.

how so? got any examples of foreign trade protectionism? (I agree with the inter-provincial statement somewhat)

[ExtraSlow]

Dairy is a quick example. Total volume of cheese allowed to be brought in from the EU is controlled.

[tonytiger55]

how so? got any examples of foreign trade protectionism? (I agree with the inter-provincial statement somewhat)

Cheese!! Motherfuckers... why is it so damm expensive here! In the UK its so dam cheap! So much good cheese!! Im talking about the good shit. Its sooo expensive here.
I spoke to a old civil servant that worked in the foreign trade sector one time. There is a cheese cartel here.

[suntan]

how so? got any examples of foreign trade protectionism? (I agree with the inter-provincial statement somewhat)

There's a tariff of around 17% for clothing.

[HiTempguy1]

how so? got any examples of foreign trade protectionism? (I agree with the inter-provincial statement somewhat)

Uh, just look at duty rates. Anything with a duty is trade protectionism, and anything over 10% is extreme protectionism.

How about the Quebec syrup cartel? I don't think you are allowed to import syrup from the US into Canada.

Only 1500 pages of tariffs. Have fun.

http://www.cbsa-asfc.gc.ca/trade-commerce/tariff-tarif/2016/01-99/01-99-t2016-1-eng.pdf

[sabad66]

interesting... i had heard of the dairy thing but had no idea how big the list was outside of that.


There's a tariff of around 17% for clothing.

now it makes sense why i had to pay UPS an extra $45 on a $120 pair of shoes i ordered from the UK. fuckers.

[rage2]

The Canadian diary cartel pisses me off. I never liked cheese much, overpriced crap. Went to Europe, so much more selection with shit that tastes 100x better at 1/4 of the price. Most people just don't know any better I guess.

[HiTempguy1]

The Canadian diary cartel pisses me off. I never liked cheese much, overpriced crap. Went to Europe, so much more selection with shit that tastes 100x better at 1/4 of the price. Most people just don't know any better I guess.

Even just going down to the USA. Tillamook cheese is to die for, pick up like 10 bricks whenever I am in Washington or Oregon. Marble, pepperjack, it just tastes so much better. And lasts a long time, had a brick in the fridge (yes, fridge, not freezer) unopened for 10 months and it was fine once opened.

[suntan]

The Canadian diary cartel pisses me off. I never liked cheese much, overpriced crap. Went to Europe, so much more selection with shit that tastes 100x better at 1/4 of the price. Most people just don't know any better I guess.

Wow, am I reading the tariff correctly? 245.5% on the overallottment for cheese? ROFL.

[rage2]

Wow, am I reading the tariff correctly? 245.5% on the overallottment for cheese? ROFL.
Yup. Canadian cheese is so ridiculously high priced here, it was cheaper for Pizza restaurants to buy retail "pizza kits" from the US that contained mozzarella cheese and pepperoni than to buy local cheese because they were classified as food prep and duty free. At least till CBSA closed the loophole.

How fucked is that, cheaper to import retail cheese packages from US than to buy wholesale cheese here as raw ingredients. :nut:

edit - fun read. https://www.theglobeandmail.com/report-on-business/canadian-pizza-eateries-in-a-bind-as-cheese-import-loophole-closes/article16012293/

[suntan]

I knew it was high, I didn't realize it was THAT high, just LOL.

I love how protectionist the Canadian parties are.

[ExtraSlow]

No political party has the balls to stand up the dairy cartel.

Owning milk quota is pretty lucrative too. It's like owning taxi licenses, except there's no uber swooping in to destroy that business model. Canadian dairies that accidentally make too much milk (by having a good year) have been known to dump it into the sewer if they can't somehow purchase additional quota from someone.

[HiTempguy1]

No political party has the balls to stand up the dairy cartel.


Bernier tried. Wish he was conservative leader, but look what trying to do something about it did. That was some shady business.



How fucked is that, cheaper to import retail cheese packages from US than to buy wholesale cheese here as raw ingredients. :nut:


It's the same deal with gasoline.

[ZenOps]

Ketchup is a strong indicator of where tariffs will eventually head. Warren Buffet knows ketchup, Trump knows ketchup.

As to why billionaires like ketchup on their burgers and steaks is somewhat of a mystery. Ketchup seems to be more valuable than caviar.

[ExtraSlow]

It's the same deal with gasoline.but with gasoline, it's because of easy to understand and mostly transparent taxes, not the hidden actions of supply reduction and farmer coercion.

[HiTempguy1]

but with gasoline, it's because of easy to understand and mostly transparent taxes, not the hidden actions of supply reduction and farmer coercion.

Nope. You can literally import and resell gasoline cheaper from the USA, taxes all in.

As with most things in Canada, industry has us pay more because we will pay more, and the ability to compete with current fuel distribution companies is difficult. There is a reason why there are so many "no-name" or "non-franchise" gas stations in the USA, because it is a more competitive market.

[ExtraSlow]

Are you saying if I had a tanker truck full of regular unleaded purchased at retail in montana, and I paid all provincial and Canadian federal taxes on it, my costs would be less than buying wholesale here in Alberta? That surprises me.

[HiTempguy1]

Are you saying if I had a tanker truck full of regular unleaded purchased at retail in montana

Possibly. But no, wholesale to wholesale, why would I be talking retail?

[ExtraSlow]

Because that's what rage2 said was possible with cheese. And you said it was the same with gasoline.

[Buster]

People who don't want Canadians to continue getting gouged on cheese: Donald Trump

People who want Canadians to get gouged on cheese: Justin Trudeau.

lol crazy world.

[Sugarphreak]

...

[Buster]

There is more depth to this issue than that. I am not a fan of the dairy cartel in Canada, but I also recognize that US farmers/producers are massively subsidized to the point where they can basically flood the market with artificially cheap product

No it isn't more complicated than that.

If the US gov't wants to subsidize Canadian consumers, then the Canadian consumer wins. It's a transfer of wealth from the US taxpayer to the cheese-eating Canadian. Bring it on.

[tonytiger55]

There is more depth to this issue than that. I am not a fan of the dairy cartel in Canada, but I also recognize that US farmers/producers are massively subsidized to the point where they can basically flood the market with artificially cheap product

Maybe the product itself is artificial too..? Or they have low dairy standards...

[dj_patm]

Possibly. But no, wholesale to wholesale, why would I be talking retail?

Unlikely in the west. Gas supply is pretty balanced and refiners give big discounts to Wholesalers. Once you get your CBOB up to spec and transport it here, you wont have much room left. I think you see marginal imports of gas on the west coast since marine from Washington to BC is cheap but its very small volume. You see a lot more gasoline being imported into the Ontario and Quebec where there is a big short, not really are cartel thing though like the dairy producers, its short cause no one wants to build a refinery.

[Sugarphreak]

...

[dirtsniffer]

I hate the fucking dairy cartel. So many delicious European cheeses we can't fuckinh dat because of the quotas

[ExtraSlow]

Okay, yeah, the amount of cheese in the average Americans diet is high, and so is thier BMI, but this dairy cartel seems like a pretty oblique healthcare strategy.

[Darell_n]

I hate the fucking dairy cartel. So many delicious European cheeses we can't fuckinh dat because of the quotas

Quotas or our requirement for pasteurization that many European cheeses don’t have?

[msommers]

I could eat a good Camembert every day if I could afford it. My body would certainly not be a temple but a wheel ready to take me to Delicious Town.

[ZenOps]

Quick factoid: "American style cheese" used to have the requirement of being at least 51% cheese by weight. Somewhere along the line, Kraft managed to remove the requirement.

As is "American cheese" is probably best termed as emulsified mild solids.

TMR8a8nCM4c

[suntan]

Quotas or our requirement for pasteurization that many European cheeses don’t have?

Our standard for pasteurization is simply 60 days of aging.

The USA have much more stringent requirements.

The problem is that once your product is 245.5% more expensive, demand goes down.

[ZenOps]

https://www.milk.org/Corporate/Processors/Milk_Class_Table.aspx

For reference, just in case someday someone wants to actually get serious about it.

[suntan]

Quick factoid: "American style cheese" used to have the requirement of being at least 51% cheese by weight. Somewhere along the line, Kraft managed to remove the requirement.

As is "American cheese" is probably best termed as emulsified mild solids.

TMR8a8nCM4c

Huh. Kraft actually changed the recipe in the States. Now it seems to be the same as Canada's.

They actually weren't called "American Cheese" for the longest time - they were literally just "Kraft Singles" down there.

Anything with the words "cheese product" or "style-cheese" means it doesn't meet the USDA standard for cheese BTW.

[Sugarphreak]

...

[suntan]

Consumerism is wealth transfer to producers, how do you think China got rich. They are the kings of subsidization, and they've gobbled up entire markets to themselves.

Besides, look at the positive side of this issue... dairy is horrible for your health. The last thing we need is people consuming more cheese because it is cheap, we already have obesity problems in Canada.

Look at the difference between US and Canada when it comes to average weight, I bet a lot of that can be contributed to subsidized dairy.

USA! USA! USA!

168 lbs for females. Absolutely disgusting.

[dirtsniffer]

Who needs nano bots when you have fingers.

I'm not looking to buy 1kg blocks of cheddar. I'm just sick of paying $20 for a decent size block of tasty cheese like primadonna or tallegio

[ZenOps]

I guess it depends on where you grew up, but it was always talked aboot as American cheese for me.


https://www.fooducate.com/app#!page=post&id=57A3443B-2042-C98E-49CD-A10CF3E0725B

* Pasteurized process cheese - contains 100% cheese
* Pasteurized process cheese food - contains at least 51% cheese.
* Pasteurized process cheese product - contains less than 51%

Although if anything is less than 51%, you might as well just call it what it is. Trump isn't letting it slide. He knows the power of Dairy, as does China. I'm still leery of radioactive cows of the 1960's.

[sabad66]

Saw this interesting stat posted by Ian Bremmer:


Average tariff rate on imported goods:

US: 1.6%
EU: 1.6%
Japan: 1.4%
Canada: 0.8%

(via World Bank)

[suntan]

Yeah, that's a fairly misleading stat. It's a trade-weighted tariff average.

[Supa Dexta]

'Canada does allow some tariff free imports - about 10%. This percentage has been increasing in recent years; CETA and the new TPP have whittled away a sizeable chunk of our dairy market. But get this: this 10% is more than double the amount that the USA allows. Say what??? Yes, you read that correctly. The US caps tariff free imports at about 2.75%. '

[rage2]

There is more depth to this issue than that. I am not a fan of the dairy cartel in Canada, but I also recognize that US farmers/producers are massively subsidized to the point where they can basically flood the market with artificially cheap product
The US subsidies have pretty much ended. US farmers are fighting each other so hard on prices that margins are low, with many farms failing because of unforeseen difficulties for short amounts of time. They make up for it by exporting surplus. This causes fluctuations in prices. Canada doesn’t want that. They want stability. They want farmers to earn a good living (actually damn good living) subsidized by consumers. If there’s surplus milk, they rather dump it down the sewers to keep prices and profits in check. How fucked is that? Sure there’s stability, but we’re paying 4x the price elsewhere.

The last of the US subsidies, which was a consumer subsidy with the government cheese program ended long ago. Some tasty ass ghetto fake cheese if you’ve ever tried it back in the day.

[JRSC00LUDE]

I love the consistency of your passion for the cheese wars over the years.

[rage2]

I love the consistency of your passion for the cheese wars over the years.
I’m passionate about food. I feel scammed for over half my life until the blinders were pulled off and I finally saw the light on cheese and beef outside Canada. The passion is driven by the anger that I’ve been robbed for so long.

[JRSC00LUDE]

I’m passionate about food. I feel scammed for over half my life until the blinders were pulled off and I finally saw the light on cheese and beef outside Canada. The passion is driven by the anger that I’ve been robbed for so long.

You definitely changed my world view of beef.

[Supa Dexta]

Look at the outright pandering the PCs are doing by shuffling out Bernier. I'm sure it's just coincidence at the very moment that the liberals are being accused of being weak on dairy protection, the PCs pull a move where they can say 'look at us, we're so on your side we hold our own members to task'

[ZenOps]

https://www.thestar.com/news/world/2018/06/16/china-threatens-tariffs-on-us-lobsters-as-business-booms.html

China considering retaliatory tariff on lobster.

They are listening to me again, its already stupidly priced.

[racerocco]

Aging has nothing to do with pasteurization. All retail cheese made in Canada is required to be pasteurized, usually using an HTST system, requiring the product to be held at a specified temperature for a minimum time. This is why some of the exotic European cheese isn't legal here.

[suntan]

Anything over 60 days old is considered to be pasteurized, even if raw milk was used, according to Health Canada. Weaklings should avoid it.

https://www.canada.ca/en/health-canada/services/milk-infant-formula/raw-or-unpasteurized-milk.html#a2

[nismodrifter]

Trump at it again in todays news conference...

[phreezee]

I'm worried that China will impose tariffs on US Oil. USA exporting less, will mean they will import less from Canada.

[vengie]

Trump at it again in todays news conference...

Coles notes??

[Tik-Tok]

I'm worried that China will impose tariffs on US Oil. USA exporting less, will mean they will import less from Canada.

We should maybe build a pipeline to the coast then.

[vengie]

I'm worried that China will impose tariffs on US Oil. USA exporting less, will mean they will import less from Canada.

I'd hate to say it, but I hope they do. My employment is O&G dependent.

Maybe then the rest of Canada will start to realize the importance of having access to different markets.

Short term pain.

[Tik-Tok]

I'd hate to say it, but I hope they do. My employment is O&G dependent.

Maybe then the rest of Canada will start to realize the importance of having access to different markets.

Short term pain.

Im pretty sure most of the country understands. Its only a select few who don't, and even fewer who know, but want to stomp their feet, and milk the shit out if the feds to allow it.

[nismodrifter]

Coles notes??

Canadians are scumbags who smuggle milk and shoes back to Canada.

[ZenOps]

Again. He is telling the truth. Canadians most definitely go to the USA wearing rags and come back looking like a million bucks. Do most people go to the USA, scuff a newly bought shoes a bit and come back? Well...

Not that its in itself a good reason to impose trade tariffs, but hes definitely got us nailed.

[msommers]

Canadians are scumbags who smuggle milk and shoes back to Canada.

Don't forget wine.

All from France going into Quebec :rofl:

[KrisYYC]

My sister lives in Nevada. I do all of my clothes/shoe shopping down there when I visit. Even at shitty exchange rates it's still cheaper, and the selection and inventory levels totally clown Canadian retail. Canadian retail sucks.

[rage2]

The shoe smuggling is sorta legit. There aren't any duties on US made shoes, but there are huge duties on non NAFTA shoes, which is 99% of all shoes on the market. It's not really for the price, it's about the same for the exact same shoe in Canada vs US even at current exchange rates. It's for the selection as Canada always gets shafted on selection. There are just a billion more options in the US, especially on the cheap side, so shoes are effectively "cheaper" in the US.

The milk smuggling is 10000% legit. Remember this thread?

https://forums.beyond.ca/threads/358060-Costco-in-Bellingham-WA


https://www.youtube.com/watch?v=QyCZTVapOnM

Clearly supply management works fucking great in Canada. :rofl:

[msommers]

Yeah, well, the US smuggles in our precious water!!!! ;)

_BQCoCsZRIc