Hacker News new | ask | show | jobs
by morcus 431 days ago
On the mortgage and tax bill specifically, sure there is no impact.

But I (an American) pay for some European services in Euros, meaning those got 10% more expensive. I understand this might be the intended effect, but it's not good for me.
2 comments
coldtea 431 days ago
>But I (an American) pay for some European services in Euros, meaning those got 10% more expensive.

European services would be the least of issues. The main issue would be the tons of foreign imported food, cars, products, clothes, gadgets, and so on - including tons of component parts for "american" products (not to mention materials and tooling to make even the increasingly rarer "100% made in US" products).

link
neilwilson 431 days ago
Wouldn't that be their problem?

Where else are they going to sell all that stuff given there isn't an untapped source of demand to absorb it (or that demand would already be serviced).

So what you have is a production glut, and nowhere to shift it to. Which usually causes a price collapse and production collapse.

Which then causes unemployment in the source nation and interest rate cuts...

link
coldtea 430 days ago
>Wouldn't that be their problem?

Not as much, as they can route around the issue, selling elsewhere. The import (or things "made in USA" but depending on imports) represents like X% of US good consumption, but each players' US exports represents a much smaller (and falling) share of their total exports.

The world is much wider in 2025 than it was in the 1980s or even in 2000 or 2010. 2025 United States's Share of Global GDP: 12.7% (project to fall to 11.x in the next 5 years). It was around 40% in 1960s, and 25-30% in 1990. US represents in average 20% of China's exports across various categories. The max % seen is about 25% for consumer electronics segment.

The rest is cope.

link
neilwilson 431 days ago
But that’s because you decided to take on currency risk without hedging or having a matched foreign income stream.

That’s not what anybody with scale will have done.

And now you have to reevaluate the cost of that service relative to the alternatives - including letting them know they need to take fewer Euros to retain your custom vs the competitive alternatives.

Customers are hard to come by. Are they prepared to let you go?

link
morcus 431 days ago
You're just shifting the goalposts here.

I will still stick with them because they're better value than the American alternatives, but that's beside the point.

You were arguing that the same number of dollars will get me the same number of goods and services, which is not true.

link
neilwilson 431 days ago
"You were arguing that the same number of dollars will get me the same number of goods and services, which is not true."

In aggregate within a rational competitive framework.

It is true for those that are rational and subject to competition.

Where else are they going to sell their stuff? Why would you agree to pay more?

Your behaviour will change, as will everybody elses - and you're the customer. So you go back to them and say no I won't pay any more. Haggle. Are they going to turn you away?

Why is you agreeing to pay more more important than the other person who decides it is too much and cancels the service?

Changing the goalposts is assuming you, and everybody else, are always a price taker, passively accepting what you are given. That's describing a monopoly/oligopoly scenario.

I'm sure that isn't the case.

link