TARIFFGEDDON Trump’s Trade War Ignites India Risk

● Trump Tariffs Began With Miranda Report?!

The Miran Report and the Beginning of the American Economic Dilemma

The Miran Report begins by pointing out the fundamental problems with American economic policy.
According to the report, the structural problem facing the United States is the trade deficit and strong dollar issue due to the benefits of the key currency.
Since the collapse of the Bretton Woods system in 1971, the United States has expanded its fiscal and trade deficits by printing dollars without linking them to gold.
It emphasizes that this has led to a dilemma of weakening U.S. manufacturing competitiveness and slowing domestic demand.

Attempting to Resolve Trade Deficits with Tariff Policies

This is why the Trump administration is pushing for tariff increases based on the logic of the Miran Report.
The United States is trying to reduce its trade deficit and supplement fiscal revenue by raising tariffs, while also trying to bring dollars flowing overseas back into the United States.
In particular, it hopes to revive manufacturing by inducing foreign manufacturing companies to relocate factories to the United States through tariff increases.
However, concerns are being raised that tariff increases may have short-term effects but could lead to side effects such as inflationary pressures and retaliatory tariffs in the long term.

Contradictions in the Strong Dollar and Key Currency System

The United States is at the center of the world economy, maintaining a strong dollar system, but is faced with the problem of weakening manufacturing competitiveness as a result.
The report analyzes that the strong dollar weakens U.S. export competitiveness, resulting in persistent fiscal and trade deficits.
It explains that the strong dollar lowers the price competitiveness of U.S. products, reducing domestic manufacturing jobs and placing the country in a structure where it is difficult to expect trade surpluses overseas.

100-Year Zero-Interest Bonds and Multilateral Currency Agreement Strategy

In addition to tariff policies, the Miran Report suggests that the United States issue 100-year zero-interest bonds.
This bond issuance is interpreted as an attempt to resolve the fiscal deficit problem while inducing a weak dollar by adjusting the demand for dollars inside and outside the United States.
It also implies a strategy to prevent excessive accumulation of reserve assets and reorganize the role of the dollar as a key currency through multilateral currency agreements with allies.
Ultimately, this can be seen as an attempt to improve the U.S.'s long-term trade balance and restore manufacturing, while also seeking to reorganize the global economic structure.

Issues of Tariffs and Inflation, Retaliatory Tariffs

Tariff increases can contribute to improving the trade deficit and fiscal revenue, but at the same time, there are concerns that they will increase inflationary pressures.
If not only the United States but also major trading partners impose retaliatory tariffs, commodity prices may rise globally, increasing the burden on consumers.
This situation may help restore manufacturing competitiveness in the United States, but it risks having a counterproductive effect on resolving overall economic imbalances.
In other words, in order for tariff policies to succeed, they must not only reduce the trade deficit but also require sophisticated measures to minimize side effects such as inflation and retaliatory measures.

Future Outlook and Impact on the Global Economy

It is uncertain whether the short-term tariff increases, 100-year bonds, and multilateral currency agreements suggested by the Miran Report will actually work.
However, it is clear that the United States is seeking a fundamental policy shift to solve the strong dollar structure and fiscal deficit problems.
If these changes are successful, global trade system restructuring will occur and other countries will also be affected, raising the need to review monetary policies and foreign trade strategies.
In particular, major trading partners such as Korea are facing a time when they need to carefully adjust tariff policies, exchange rate fluctuations, and foreign exchange reserve strategies in their economic relationship with the United States.

< Summary >
This article organizes the policy directions of tariff increases, issuance of 100-year zero-interest bonds, and multilateral currency agreements in chronological order, surrounding the structural dilemma of the U.S. economy pointed out by the Miran Report, namely the trade deficit and the strong dollar problem.
The United States is enjoying the benefits of the key currency but is faced with the problem of weakening manufacturing competitiveness and fiscal deficits, and is trying to solve it through tariff policies, but in this process, side effects due to inflation and retaliatory tariffs are also a concern.
The current situation in which the United States is seeking a fundamental shift to reorganize the global economic system and improve its long-term trade balance is an important issue that directly reflects core SEO keywords such as economic policy, tariffs, strong dollar, trade deficit, and key currency.

*Source : [Understanding : All the Knowledge in the World] 트럼프 관세는 ‘미란 보고서’에서 시작됐습니다 (언더스탠딩 김상훈 기자)

● Tariff-Driven Deflation, Trump’s Inflation-Fighting Overdrive

Impact of Tariff War and Global Economic Outlook: Inflation, Deflation, and Interest Rate Changes

1. Tariff War and Initial Reactions

Now that ways to make money are being revealed, the impact of the tariff war on the international economy is really hot.
The United States is causing controversy over stimulating inflation by targeting competing countries such as Canada and Mexico through tariff wars.
The key issues are price increases due to tariffs, the problem of domestic demand stagnation, and the resulting contraction of consumer sentiment.
Here, there are various opinions on how the soaring prices will affect the entire market by preventing consumption.

2. US Strategy and Changes in North American Manufacturing

The local production method of steel mills with Chinese capital invested in Canada and Mexico is at the center of the tariff war structure.
The United States is using a strategy to import North American products duty-free instead of Chinese steel.
However, because American consumers are reluctant to purchase high-priced products, it can affect both manufacturing and demand in the United States.
This is an issue related to various economic indicators such as interest rates, GDP, and inflation.

3. Inflation, Durable Goods Demand, and Deflation Effects

Will price increases due to tariff increases immediately lead to inflation?
The demand for durable goods such as automobiles will decrease sharply if prices rise significantly.
On the other hand, purchases of essential consumer goods are made even if prices rise to some extent, so the impact on the overall inflation rate is somewhat limited.
The inflationary pressure from tariffs is likely to be limited to some markets in the short term, and there is also global deflationary pressure.

4. Global GDP Composition and Supply-Demand Dynamics

The United States accounts for only about 25% of the world’s GDP, and the remaining 75% of countries are likely to experience oversupply and sluggish demand.
Inflation may be temporarily stimulated in the United States, but other countries may continue to experience deflation.
The impact of one country’s inflation stimulus on overall global economic prices must be closely monitored.
In this process, key variables such as tariff wars, interest rate adjustments, and changes in GDP growth rates are closely linked.

5. US Economic Policy, Interest Rates, and Long-Term Outlook

Amid policy contradictions between the Trump and Biden administrations, the United States has put forward various pledges, such as lowering interest rates and introducing tariffs, to curb inflation.
In addition to the impact of the tariff war, the US economy is showing a pattern of going back and forth between immediate economic slowdown and price adjustments in the conflicting relationship between prices and unemployment rates, such as the Phillips Curve.
Historical data shows that the US inflation rate has actually decreased after the tariff war took effect.
Therefore, while there may be short-term inflation stimulus, it is likely to shift to stability or deflationary pressure in the long term due to contracting demand and expanding supply.

6. Final Assessment and Outlook After 6 Months

In today’s policy uncertainty, companies and consumers are both observed to be reducing investment and demand.
The impact of the tariff war in the United States as well as the overall global economy may show fluctuations in prices and interest rates in the short term, but the overall economic outlook after 6 months may be very different.
While the fallout from the tariff war may stimulate inflation, the possibility of medium- to long-term inflation sustainability is low due to contracting demand for durable goods and expanding overseas supply.
In short, the United States will experience the fear of ‘stagflation’ where temporary price increases and economic slowdown coexist, but it is expected that the price stabilization effect will appear due to deflationary pressure worldwide.

The tariff war raises concerns about stimulating inflation in the US in the short term,
Changes in manufacturing in North America, including Canada and Mexico, and strategies for using Chinese capital work together.
Price increase pressure is limited due to contracting demand for durable goods and relative stability of essential consumer goods.
Oversupply and sluggish demand due to the global GDP composition can act as deflationary pressure in countries other than the United States.
The United States will experience short-term difficulties in managing interest rates and inflation, but the effects of the tariff war are expected to gradually be offset in the long term.
Key economic variables such as tariff war, inflation, deflation, GDP, and interest rates must all be considered.

[Related Articles…]
• In-depth Analysis of the Tariff War
• Changes in Inflation Outlook

*YouTube Source: [와이스트릿 – 지식과 자산의 복리효과]

– “관세로 디플레 생길 것” 인플레 잡으려 침체까지 만드려는 트럼프의 무서운 속내 / 김광석 교수 (2부)

● India: Graveyard for Foreign Firms, Betrayal- 박정호 교수

Latest on the Indian Economy: Corruption, Tariff Evasion, Manufacturing Infrastructure Limitations, and Global Market Strategies

The Reality of Corruption and Tariff Evasion

Corruption remains rampant in Indian society.
Foreign companies are easily taken advantage of due to officials demanding undertable money.
As seen in Samsung’s case, tariff evasion issues in India lead to legal disputes.
A common strategy involves sending components to India instead of finished products to reduce tariffs.
In this process, the Indian government can suddenly change its legal interpretations, unlike in the past, increasing legal risks.

Tax System and Legal Risks

India is composed of over 50 states, each with its own laws and regulations, rather than being a single country.
Inconsistent tariff application standards and customs clearance procedures result in many unpredictable risks.
There have been cases of past tariff exemptions, but now lawsuits are frequently filed demanding sudden tariff impositions or fines.
Due to these legal uncertainties, careful consideration is required when entering the Indian market in the global economy.

Problems with Manufacturing Infrastructure and Cost Structure

India has the advantage of low labor costs, but its logistics infrastructure, such as ports and roads, is poor.
While most of the world’s top 50 international ports are concentrated in China, India lacks international-standard ports.
This results in higher-than-expected transportation and logistics costs.
Additionally, a lack of manufacturing base puts India at a disadvantage compared to competitors like China in terms of talent development and technological capabilities.
Therefore, actual production in India often sees the labor cost savings offset by logistics and other expenses.

Indian Market Strategy from a Foreign Company’s Perspective

In the global economy, the Indian consumer market has significant potential, but legal and policy risks persist.
Amid competition with China, targeting the Indian market is emerging as part of export diversification.
However, tariff evasion issues and unpredictable customs clearance can cause significant losses for foreign companies.
Therefore, companies entering India must thoroughly review legal and policy aspects and strengthen their risk management systems.

Future Talent Development and Consumer Market Expansion

India has the fastest-growing young population in the world.
As the number of talented Indian professionals active in the United States and Europe increases, the potential for entrepreneurship and technological advancement in India is growing.
Although the size and purchasing power of the consumer market are still smaller than China’s, the middle class is steadily increasing.
Through this, India is expected to serve as an important buffer in the global economy and export strategy.

In India, tariff evasion issues are frequent due to corruption and demands for undertable money from officials.
The legal system, which varies by state, and unpredictable legal interpretations contribute to significant legal risks.
From a manufacturing perspective, despite low labor costs, there are issues with inadequate logistics infrastructure such as ports and roads, and insufficient talent development.
In the era of the global economy and export diversification, foreign companies entering the Indian market, competing with China, need careful risk management.
Meanwhile, India’s young talent and expanding consumer market are expected to serve as important elements for future growth.

*YouTube Source: [머니인사이드]

– 인도 가서 뒤통수 맞고 온다. 해외 기업들의 무덤이 된 이유 I 박정호 교수 [글로벌인사이드]