I hear and read of the fears that President Trump’s tariff impositions have caused in the investment markets and on Wall Street.  I am heavily invested in corporate securities and have seen my retirement funds decline precipitously.  But I am holding pat and buying bargains as I can manage.

I believe that the market will come back in due time.  Many have recently written on this site in support of Trump’s gambit, and I agree with this high-risk effort to retool and reindustrialize America.  In the short run, we will gain revenue (about $2 billion per day) to reduce our debt.  China has used our money to grow rich and build its military over 40 years.

Donald Trump is accomplishing two goals with his tariffs on China.  The leadership in China has miscalculated by thinking that our dependency on the Chinese for products, critical minerals, and precursor elements needed for final assembly in our country would make us desperate for a quick solution.  The COVID experience has taught smart people that a great nation cannot survive dependent upon potential enemies.  Back in 2000, Al Gore gave a speech to agricultural MBA students advocating that one day, they would be employed to manage moving food from foreign countries to ours, since costs in America were too high to meet all our food needs.  A country that cannot feed itself is likely to be a hostage during hard times.  This is the risk of globalism as practiced on Wall Street and among the left politicians. 

China has control over factories in many Asian countries, most notably Vietnam.  China needs to import much of its oil energy to power its factories.  Therefore, it is no wonder that it sides with Iran and Russia in conflicts.  The Chinese need Russian and Iranian oil exports, and they use the surplus finances gained in trade with the West and especially America ($300 billion per year) to buy this energy.

When China retaliated, Trump increased tariffs to over 100%.  This will have two effects not expressly mentioned: Over time, it will deprive China of liquid funds and reduce output from Chinese factories while gaining us revenue.  It encourages our companies to move their factories out of China.  If the tariffs remain on other countries dominated by China, this will choke them further.  The brilliance of Trump is that this will also starve Russia (a large gas station) and Iran (another gas station and weapons supplier to Russia).

The many different opinions given by Trump Cabinet members on tariffs only further causes chaos and panic among other countries and their leadership.  Yes, it creates uncertainty on Wall Street and might threaten some companies.  Trump must force these multi-nationals to retool idle factories in America.

Trump has been successful in the past, but his plan takes time to work.  Middle and Rust Belt Americans are willing to wait.

Ross Perot warned that the “sucking sound” of jobs shifted to Mexico would destroy our country.  Now Trump seeks to undo the globalists’ vision, which has hollowed out America.  Godspeed.

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