Warren Buffett's concept to significantly reduce USA's trade deficit

[expat_panama]

...I don't know, man. Because this thing doesn't affect the size of the government or expand its powers or anything. It's just the one regulation saying trade must be balanced...

LOL!! Just one regulation EIGHT PAGES LONG (here's a link to the bill's text) and it gives Homeland Security power to approve beforehand every single transaction for cross border trade --all $5.3Trillion for every chocolate bar, every cup of coffee, most of our fuel, etc. etc. Then Homeland security gets to impose $8.4Trillion in direct fines (three times the value of imports) which propagates into even higher costs to everyone as consumers.

Please read the bill before deciding what's in it and forming an opinion, then understand that $8.4Trillion in fines is $28,000 for every man, woman, and baby in the US --every year.

 

[editec]

There's extensive testing. The problem, as mentioned before, is that we're unable to easily conduct randomised controlled trials. So that's what econometrics is for; for finding sophisticated ways to determine a parameter "all else being equal". The process of discovery is slower than in say, physics, since we can't easily make some RCTs, but the methodology is otherwise the same.

Oh my god, don't you get it?

What hard scientist has to deal with the problem of having an experiement where the test subjects will react and change behaviors during to the test itself?

Yu make an excellent point about meteorology, and yes meteorology shares one trait with macro that makes them BOTH arts-choas theory.

Both seek to model highly complex systems, both suffer from the problem that is it NOT the mechanistic universe newtonian physics would have us believe.

BUT, macroecomics has an additional problem that does NOT trouble meterorologists.

The weather doesn't change behavior when it learns what the weather is doing.

PEOPLE DO react to to what they know about the economy and generally in ways that are not predictable..


And that problems stems from the fact that people are NOT the rational animals that economics (once, this is changing now) assumed them to be.

No sorry, economic cannot now nor ever be a "HARD" science prcisely because it is seeking to understand the impossible complex machinations of HUMAN beings

It is a social science with all the problem that face all social sciences.

 

[Supposn]

Edward Baiamonte, BriPat9643, & DSGE, if a nation’s annual balance of trade is positive, due to that trade surplus the nation’s annual GDP for that specific year is more than otherwise.
Similarly if a nation’s annual balance of trade is negative, due to that trade deficit the nation’s annual GDP for that specific year is less than otherwise.

These are not opinions but facts based upon the definition of GDP and the accepted conventional formulas used by communities of economists to calculate the GDP.

Trade surpluses ALWAYS contribute and trade deficits are ALWAYS detrimental to their nations’ GDPs.

Respectfully, Supposn

 

[Supposn]

Oh my god, don't you get it?

What hard scientist has to deal with the problem of having an experiement where the test subjects will react and change behaviors during to the test itself?

Yu make an excellent point about meteorology, and yes meteorology shares one trait with macro that makes them BOTH arts-choas theory.


Both seek to model highly complex systems, both suffer from the problem that is it NOT the mechanistic universe newtonian physics would have us believe.

BUT, macroecomics has an additional problem that does NOT trouble meterorologists.

The weather doesn't change behavior when it learns what the weather is doing.

PEOPLE DO react to to what they know about the economy and generally in ways that are not predictable..

And that problems stems from the fact that people are NOT the rational animals that economics (once, this is changing now) assumed them to be.

No sorry, economic cannot now nor ever be a "HARD" science prcisely because it is seeking to understand the impossible complex machinations of HUMAN beings

It is a social science with all the problem that face all social sciences.

Editec, I’ve always objected to the term “social science” and preferred to describe them as “social studies”.
Economics and mathematics are philosophies, (i.e. systems of concepts).
Mathematics is the most exacting philosophies. If within mathematics if you encounter even a single unresolved of exception to a rule, (until resolution has been achieved, the rule’s discarded).

I suppose you share my interest in behavioral economics?

Respectfully, Supposn

 

[DSGE]

Edward Baiamonte, BriPat9643, & DSGE, if a nation’s annual balance of trade is positive, due to that trade surplus the nation’s annual GDP for that specific year is more than otherwise.
Similarly if a nation’s annual balance of trade is negative, due to that trade deficit the nation’s annual GDP for that specific year is less than otherwise.

These are not opinions but facts based upon the definition of GDP and the accepted conventional formulas used by communities of economists to calculate the GDP.

That's not at all true. Trade doesn't affect GDP. I showed you how you were misinterpreting the "conventional formulas" and you never actually addressed my analysis, rather quoted me something from your blog. If you're going to stubbornly hold on to this fallacious position, at least defend the attacks mounted against it?

 

[DSGE]

Oh my god, don't you get it?

What hard scientist has to deal with the problem of having an experiement where the test subjects will react and change behaviors during to the test itself?

Yu make an excellent point about meteorology, and yes meteorology shares one trait with macro that makes them BOTH arts-choas theory.

Both seek to model highly complex systems, both suffer from the problem that is it NOT the mechanistic universe newtonian physics would have us believe.

BUT, macroecomics has an additional problem that does NOT trouble meterorologists.

The weather doesn't change behavior when it learns what the weather is doing.

PEOPLE DO react to to what they know about the economy and generally in ways that are not predictable..


And that problems stems from the fact that people are NOT the rational animals that economics (once, this is changing now) assumed them to be.

No sorry, economic cannot now nor ever be a "HARD" science prcisely because it is seeking to understand the impossible complex machinations of HUMAN beings

It is a social science with all the problem that face all social sciences.

That's why we have theories of expectations and equilibrium concepts. Economists realise that people change their behaviour. This is not a new criticism nor is it a valid one. Economics is entirely about models of human behaviour. It doesn't try to assume people are inanimate objects.

 

[DSGE]

...I don't know, man. Because this thing doesn't affect the size of the government or expand its powers or anything. It's just the one regulation saying trade must be balanced...

LOL!! Just one regulation EIGHT PAGES LONG (here's a link to the bill's text) and it gives Homeland Security power to approve beforehand every single transaction for cross border trade --all $5.3Trillion for every chocolate bar, every cup of coffee, most of our fuel, etc. etc. Then Homeland security gets to impose $8.4Trillion in direct fines (three times the value of imports) which propagates into even higher costs to everyone as consumers.

Please read the bill before deciding what's in it and forming an opinion, then understand that $8.4Trillion in fines is $28,000 for every man, woman, and baby in the US --every year.

Okay. I just assumed it was a simple import quota. Still, why does the OP care about any of that? Why would they want to "further the state" (I forget the phrasing) on something useless. It seems far more likely that they're just ignoring evidence that doesn't confirm their bias.

 

[EdwardBaiamonte]

A balanced budget has nothing to do with the balance of trade. Absolutely nothing to do with it. Think about it: In a closed economy (one with no trade) can the government still run a budget deficit? Yes. They sell bonds to the domestic public. In an economy with a balanced budget, can we still run a current account deficit? Yes. The public borrows internationally to fund consumption and investment.

They are unrelated!

On top of which, who cares if there's a current account deficit? There's no cause to have E equal I!

if there is no budget deficit then the Japanese and Chinese must buy our goods and services to create jobs here. Now they can buy the liberal debt instead.

Now even the liberal can see the relationship between a liberal budget deficit and a liberal trade deficit.

 

[DSGE]

A balanced budget has nothing to do with the balance of trade. Absolutely nothing to do with it. Think about it: In a closed economy (one with no trade) can the government still run a budget deficit? Yes. They sell bonds to the domestic public. In an economy with a balanced budget, can we still run a current account deficit? Yes. The public borrows internationally to fund consumption and investment.

They are unrelated!

On top of which, who cares if there's a current account deficit? There's no cause to have E equal I!

if there is no budget deficit then the Japanese and Chinese must buy our goods and services to create jobs here. Now they can buy the liberal debt instead.

Now even the liberal can see the relationship between a liberal budget deficit and a liberal trade deficit.

You didn't address anything in my post, instead just restated your position.

If they're not buying government debt they'll just buy private debt.

And stop describing everything as "liberal". You sound like a god damn child.

 

[EdwardBaiamonte]

If they're not buying government debt they'll just buy private debt.

if so they would be buying it rather than 2.5 trillion of liberal government debt!!

And stop describing everything as "liberal". You sound like a god damn child.

please find an example of where you think this is not accurate and I'll explain it to you.

 

[DSGE]

If they're not buying government debt they'll just buy private debt.

if so they would be buying it rather than 2.5 trillion of liberal government debt!!

Which means there would still be a trade deficit. Glad we finally got there.

And stop describing everything as "liberal". You sound like a god damn child.

please find an example of where you think this is not accurate and I'll explain it to you.

One example would be: every single time you've used it.

See my problem is right, I can't tell if you're just trolling or if you're actually just terrible. Normally I would assume plain old trolling, but after watching those Tea Party videos it turns out people like you/your caricature actually exist...

 

[EdwardBaiamonte]

If they're not buying government debt they'll just buy private debt

if so they would be buying it rather than 2.5 trillion of liberal government debt!![/QUOTE]

Which means there would still be a trade deficit. Glad we finally got there.

"if" they would buy private USA debt which we have no reason to assume they would. Sorry!!

And stop describing everything as "liberal". You sound like a god damn child.

please find an example of where you think this is not accurate and I'll explain it to you

One example would be: every single time you've used it.

why be so afraid to show your best example for the whole world to see. What does your fear tell you?

See my problem is right, I can't tell
if you're just trolling or if you're actually just terrible. Normally I would assume plain old trolling, but after watching those Tea Party videos it turns out people like you/your caricature actually exist...

If I've said something mistaken why be so afraid to point it out for the whole world to see? Certainly your fear must tell you something?

 

[DSGE]

"if" they would buy private USA debt which we have no reason to assume they would. Sorry!!

We don't need to assume they would. We know they do: News Release: U.S. International Transactions

Obviously. You think the whole trade deficit is funded through foreigners buying Treasuries?

why be so afraid to show your best example for the whole world to see. What does your fear tell you?

Maybe the case in which I asked you about it would be a good example? Hmm? The "liberal budget deficit". You remember there was a surplus under Clinton, right? Who turned it into a deficit? It wasn't a liberal. Most of the current budget deficit is due to the wars, the bush tax cuts, and the downturn. If anything, this is a conservative budget deficit.

And "liberal trade deficit". What does that even mean? The trade deficit comes from private companies borrowing abroad to fund investment.

 

[Supposn]

...............money does come back into the country though, but through the capital account. So the the Current account + Capital account = 0 (ie is always balanced).[/QUOTE]

Capital (aka financial) account is net change of capital assets’ ownership among nations and investors into those nations.
Although there can be casual relationship between the current and the capital account BUT THEY NEED NOT (and I suppose likely do not) balance (as DSGE describes within this message #134).

GDP reports upon the nation’s production of goods and services within the reporting period. Trade balance is the net nations’ net global exchange of goods and services. The capital account reports upon the nation’s net global exchange of capital within the reporting duration.

Capital can and often does cross nations’ boundaries without any regard or relationship to nations’ balances of trade. Capital and current accounts DO NOT balance each other out.

Respectfully supposn

 

[expat_panama]

...Capital and current accounts DO NOT balance each other out...

Huh. Have you ever noticed that the two are always of equal magnitude and opposite sign? Also, how could people possibly trade across borders without the two balancing?

btw, the financial and capital accounts aren't the same. From here:

* The balance of payments (BOP) is an accounting of a country's international transactions for a particular time period.

* Any transaction that causes money to flow into a country is a credit to its BOP account, and any transaction that causes money to flow out is a debit.

* The BOP includes the current account, which mainly measures the flows of goods and services; the capital account, which consists of capital transfers and the acquisition and disposal of non-produced, non-financial assets; and the financial account, which records investment flows.​

 

[EdwardBaiamonte]

The "liberal budget deficit". You remember there was a surplus under Clinton, right?

I remember Clinton inherited a boom from Bush 41 and the first Republican Congress in 40 years who made him lie and say, "The era of big liberal governemnt is over." Newt's, not Clinton's, Balanced Budget Amendment passed the House and failed in the Senate by 1 vote. Had it passed today the deficit would be 0 not $16 trillion.

From Jefferson, the first Republican, to BO 100% of the energy for a Balanced Budget Amendment has been Republican. And now you know your ABC's

 

[Supposn]

...Capital and current accounts DO NOT balance each other out...

Huh. Have you ever noticed that the two are always of equal magnitude and opposite sign? Also, how could people possibly trade across borders without the two balancing?..............................................

ExPat_Panama, I doubt this very much. I perceive no logical reason for the current accounts and the capital accounts between the USA and individual nations should balance each other. Similarly I doubt USA’s global current and capital accounts are balanced to each other.

Nations’ current account is factors of their nations’ gross domestic product; GDPs bolster their nation’s median wage. I consider those two statistics as the most significant indicators of nations' current economic conditions.

Respectfully, Supposn

 

[Supposn]

Obama wants to encourage manufacturing?

I’m awaiting specifics but President Obama seems to be alluding creating a new tax provisions to encouraging US. manufacturing and exporting of manufactured products.

Respectfully, Supposn

 

[EdwardBaiamonte]

Obama wants to encourage manufacturing?

I’m awaiting specifics but President Obama seems to be alluding creating a new tax provisions to encouraging US. manufacturing and exporting of manufactured products.

Respectfully, Supposn

all he has to do eliminate the corporate tax or reduce it to make the economy boom. Ireland proved it!! Republican supply-side economics works, obviously.


Liberals hate the concept because their Marxist class warfare brainwashing makes them want to punish corporations.

 

[Supposn]

Obama wants to encourage manufacturing?

I’m awaiting specifics but President Obama seems to be alluding creating a new tax provisions to encouraging US. manufacturing and exporting of manufactured products.

Respectfully, Supposn

all he has to do eliminate the corporate tax or reduce it to make the economy boom. Ireland proved it!! Republican supply-side economics works, obviously.


Liberals hate the concept because their Marxist class warfare brainwashing makes them want to punish corporations.

Edward Baiamonte, if individuals’ tax rates exceed businesses’, individual entrepreneurs and executives will show little incomes “on the books” but they’ll live very well upon their expense accounts. I income’s to remain taxed, we should tax both individuals’ and commercial incomes at similar maximum rates.

A major (if not the primary) common root causes of our income tax’s inequities are due to progressive tax rates. We have tax loop holes created to remedy inequities caused by enactment of prior tax loop holes which can eventually be traced back to progressive tax rates’ inequities.

I’m a proponent of alternatives to progressive tax rates that would grant some tax consideration to lower income families. It’s possible to tax net incomes or gross sales in manners that are more progressive , but there’s a limit to how progressive they can become.

I also advocate to whatever extent practical we incrementally shift from taxing net incomes to taxing gross sales.

Respectfully, Supposn