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Considering that protectionism appears almost inevitable as trade imbalances continue to rise. At the same time tariffs make imported goods more expensive to your own people and invariably lead to bad feeling with and retaliatory tariffs from the targeted country (read China). Traditionally these bad feelings and retaliations lead to incidents and war.

However: If, instead of tariffs, we insisted that imported goods must match exported goods so that imports from China were not allowed at all if a similar value of goods were not exported to China (you could allow a narrow "grace" margin) then China (and all other countries too) would have to find something they wanted from UK or stop trading. If the English wanted to buy Chinese goods then they must make, grow or dig up something the Chinese want at an acceptable price. The result would be to stimulate UK production to get real with costs and regulations etc. but it would also force the Chinese to trade rather than sell only. It would also stimulate the English to be more self sufficient, probably by exactly the same efficiencies and dumb regulation cutting process.

Capital purchases (houses, land, businesses etc.) would have to be excluded and not allowed as trade goods but otherwise the administration might not be too much different than tariffs. Since the system would be applied to all countries equally; China would not feel unfairly treated. The whole world might get mad as hell with UK but surely UK would be looking after its own and its future would be more secure. Hopefully the idea would catch on and eventually China would be forced to trade and not pile up money which is what is at the heart of all our trade problems.

Has this idea been discussed before? Has it got any inherant problems, unintended consequences etc.?

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that's pretty much how it worked when currencies were pegged to gold. You couldn't have massive net trade imbalances because you'd run out of gold.

The gold standard without gold. So that's a good thing? right?

No debt either!

p.s. My avatar is not comfortable with your avatar.

Edited by Snow Birds

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Considering that protectionism appears almost inevitable as trade imbalances continue to rise. At the same time tariffs make imported goods more expensive to your own people and invariably lead to bad feeling with and retaliatory tariffs from the targeted country (read China). Traditionally these bad feelings and retaliations lead to incidents and war.

However: If, instead of tariffs, we insisted that imported goods must match exported goods so that imports from China were not allowed at all if a similar value of goods were not exported to China (you could allow a narrow "grace" margin) then China (and all other countries too) would have to find something they wanted from UK or stop trading. If the English wanted to buy Chinese goods then they must make, grow or dig up something the Chinese want at an acceptable price. The result would be to stimulate UK production to get real with costs and regulations etc. but it would also force the Chinese to trade rather than sell only. It would also stimulate the English to be more self sufficient, probably by exactly the same efficiencies and dumb regulation cutting process.

Capital purchases (houses, land, businesses etc.) would have to be excluded and not allowed as trade goods but otherwise the administration might not be too much different than tariffs. Since the system would be applied to all countries equally; China would not feel unfairly treated. The whole world might get mad as hell with UK but surely UK would be looking after its own and its future would be more secure. Hopefully the idea would catch on and eventually China would be forced to trade and not pile up money which is what is at the heart of all our trade problems.

Has this idea been discussed before? Has it got any inherant problems, unintended consequences etc.?

The rich-world voters would all say "I want my cheap stuff" ?

I for one prefer a reliable Chinese-made machine for (say) 150 quid instead of a rubbish British one for 800 quid.

Inflation would rocket in the rich countries used to buying from China?

What could China buy from us? Finance? :P

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The rich-world voters would all say "I want my cheap stuff" ?

I for one prefer a reliable Chinese-made machine for (say) 150 quid instead of a rubbish British one for 800 quid.

Inflation would rocket in the rich countries used to buying from China?

What could China buy from us? Finance? :P

Yes I agree, and that is what is happening right now but the situation is unsustainable. We can't keep getting stuff from China and giving them paper for it. The shiit will hit the fan one day and we need a plan "B". We need to know why British stuff costs 800 quid and is rubbish and we need to change that. Actually we have to change that eventually.

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Considering that protectionism appears almost inevitable as trade imbalances continue to rise. At the same time tariffs make imported goods more expensive to your own people and invariably lead to bad feeling with and retaliatory tariffs from the targeted country (read China). Traditionally these bad feelings and retaliations lead to incidents and war.

However: If, instead of tariffs, we insisted that imported goods must match exported goods so that imports from China were not allowed at all if a similar value of goods were not exported to China (you could allow a narrow "grace" margin) then China (and all other countries too) would have to find something they wanted from UK or stop trading. If the English wanted to buy Chinese goods then they must make, grow or dig up something the Chinese want at an acceptable price. The result would be to stimulate UK production to get real with costs and regulations etc. but it would also force the Chinese to trade rather than sell only. It would also stimulate the English to be more self sufficient, probably by exactly the same efficiencies and dumb regulation cutting process.

Capital purchases (houses, land, businesses etc.) would have to be excluded and not allowed as trade goods but otherwise the administration might not be too much different than tariffs. Since the system would be applied to all countries equally; China would not feel unfairly treated. The whole world might get mad as hell with UK but surely UK would be looking after its own and its future would be more secure. Hopefully the idea would catch on and eventually China would be forced to trade and not pile up money which is what is at the heart of all our trade problems.

Has this idea been discussed before? Has it got any inherant problems, unintended consequences etc.?

what you are looking for are import certificates

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That's pretty much how it worked when currencies were pegged to gold. You couldn't have massive net trade imbalances because you'd run out of gold.

Except it punished debtors and did nothing to creditors. Indeed it meant everyone was competing to be a creditor no holds barred. Lousy way to handle world trade.

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Considering that protectionism appears almost inevitable as trade imbalances continue to rise. At the same time tariffs make imported goods more expensive to your own people and invariably lead to bad feeling with and retaliatory tariffs from the targeted country (read China). Traditionally these bad feelings and retaliations lead to incidents and war.

However: If, instead of tariffs, we insisted that imported goods must match exported goods so that imports from China were not allowed at all if a similar value of goods were not exported to China (you could allow a narrow "grace" margin) then China (and all other countries too) would have to find something they wanted from UK or stop trading. If the English wanted to buy Chinese goods then they must make, grow or dig up something the Chinese want at an acceptable price. The result would be to stimulate UK production to get real with costs and regulations etc. but it would also force the Chinese to trade rather than sell only. It would also stimulate the English to be more self sufficient, probably by exactly the same efficiencies and dumb regulation cutting process.

Capital purchases (houses, land, businesses etc.) would have to be excluded and not allowed as trade goods but otherwise the administration might not be too much different than tariffs. Since the system would be applied to all countries equally; China would not feel unfairly treated. The whole world might get mad as hell with UK but surely UK would be looking after its own and its future would be more secure. Hopefully the idea would catch on and eventually China would be forced to trade and not pile up money which is what is at the heart of all our trade problems.

Has this idea been discussed before? Has it got any inherant problems, unintended consequences etc.?

i thought the outcome had already been decided, 20 years ago

Protectionism then

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Has this idea been discussed before?

yeah keynes proposed it via his bancor/world bank proposal for global trade after WWII. Essentially instead of having the $ as reserve currency the debt liabilities of the world bank (bancors) are used, and then on the asset side the world bank accumulates assets in the currencies of the trading nations. The world bank charges a fee for positive AND negative balances over a given limit.

but the yanks preferred the idea of the $ being reserve currency so that's what happened, and hey ho here we are now.

ofc if this is implemented then nations with insufficient internal demand like japan and germany won't be able to export to offset that and will end up with their own populations being subjected to negative interest rates.

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what you are looking for are import certificates

Thanks for that. I googled it and it was very informative. Perhaps it is an idea that is a little ahead of its time but if Warren Buffett suggested it too, it must have some merit. You could argue that it is inevitable given the alternatives, so an exploration of the implications could be profitable . . . . hmmmm.

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yeah keynes proposed it via his bancor/world bank proposal for global trade after WWII. Essentially instead of having the $ as reserve currency the debt liabilities of the world bank (bancors) are used, and then on the asset side the world bank accumulates assets in the currencies of the trading nations. The world bank charges a fee for positive AND negative balances over a given limit.

but the yanks preferred the idea of the $ being reserve currency so that's what happened, and hey ho here we are now.

ofc if this is implemented then nations with insufficient internal demand like japan and germany won't be able to export to offset that and will end up with their own populations being subjected to negative interest rates.

Reminds me of that Churchill quote,"You can always rely on the Americans to get it right . . . after they've tried everything else!

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  • 259 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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