Trump's "Liberation Day" is Just a Noise

President Donlad Trump has announced 'Liberation Day', the day he imposed high tariffs on imports into the US, to liberate his country, hostage to its own generosity in the form of low-cost access to the huge US market.

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His announcement to impose tariffs on nearly all of its trade partners has rattled global markets. Trump's dramatic tariff imposition is a reversal of more than a century of U.S. policy. His supporters feel it was a much needed prescription to fix what fundamentally ails the United States, namely its inability to compete in manufacturing with mostly all the countries in the world.

Let us go back and turn a few history pages. In February 1973 a new system emerged as the world economy ruled by a fiat U.S. dollar, wholly untethered by the gold standard. And experts feel that date marked the loss of U.S. manufacturing advantages over the rest of the world. No longer would international accounts settle the traditional way. In the old system, when goods flowed in and money flowed out, prices would adjust, falling in the importing country and rising in the exporting country. With all trade accounts settled in one paper currency, there was an infinite demand for dollars abroad. They could be held as assets by anyone's banking system. That meant they never came home to the United States.