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Not sure I agree with you about the timber obstacles in the US. A lot of it is the lumber companies are wary of bumping into the Canadians. They are very good timber and lumber men.

The Canadians have bought up and started a ton of sawmills. They are sourcing US timber and making lumber in anticipation of their Canadian operations running into exactly the buzz saw they have.

You have to remember this all revolves around a treaty expiration and a one year moratorium. While the fight has been going on for a long time, it is only last 2016 the US had any flexibility.

DJT should take care of the regulations.

There are a couple of low hanging victories waiting to be plucked — the maquiladoras in Mexico and lumber with the Canucks.

BRC
http://www.themusingsofthebigredcar.com

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I am way more upset about Ivanka getting booed.

BRC
http://www.themusingsofthebigredcar.com

Yeah, today the MSM is headlining the fact that Ivanka got a boo in Germany and applauding the fact that a leftist San Francisco judge blocked Trumps ability to withhold funds from cities hell bent on bankrupting the state via illegal immigration. Sum Ting Wong!

> And if that is the case then how is that good for us.

The bad news is that builders will pay more for lumber, and US houses will cost more.

The good news is that the US will have a softwood lumber industry again, with its jobs; some US workers will go back to work instead of languishing on welfare and depression; the US will have some leverage to be able to sell milk to Canada, will run a smaller foreign trade deficit.

With a smaller foreign trade deficit, the US may have a stronger US dollar which will make it harder for US companies to export and more attractive for the US to import. Just why the US dollar is so strong while the US is running supposedly an $800 billion a year trade deficit I don’t know.

But supposedly the US has 90 million or so workers out of the labor force. Putting those workers back to work should generate more tax revenue and reduce welfare expenditure, help family construction, etc.

For exporting, I never saw just why the US should do this: E.g., GM and its workers build a Chevy, and we export it. Then we get paid in whatever, some foreign currency, US dollars currently overseas, gold, etc. For the foreign currency, we sell that on the foreign exchange market for US dollars which tends to make dollars more valuable. Then GM gets the US dollars that came from overseas.

So, net, US workers produced a car, and the US economy got some dollars. So, now here in the US, we have more dollars chasing the same quantity of Chevys and other goods, that is, that Chevy that got exported did not add to the goods for sale in the US. Well, usually we believe that more dollars chasing the same quantity of goods causes inflation.

Or, here is what seems like a better solution: If we want more dollars, then just print some. For that Chevy that got produced here in the US but got exported, just keep that Chevy here in the US. So, now we have more dollars chasing at least somewhat more goods.

If we want to sell Chevys overseas in exchange for, say, tin or natural rubber we don’t have, okay. But we are already importing lots of stuff and, really, don’t want to import more since that tends to put US workers out of work.

It’s easy to understand why, say, Microsoft wants to export: They get the dollars. And for jobs, then Microsoft gets to hire more US workers. Microsoft gets to export because their
products are desired in foreign markets. And since Microsoft’s products are from close to zero marginal cost, exporting their bits and bytes does not reduce the Microsoft bits and bytes available in the US.

But one way an another, we can’t continue to have 90 million workers out of work because some foreign countries are determined to sell cheap into the US.

Sounds to me like Canada should just keep their lumber and build more houses for the citizens of Canada. Or, maybe Canada wants to export lumber so that they can buy more Chevys and more Microsoft bytes.

Altogether, I’d like to be much more and better informed on all these issues, including the relevant economics. Here BRC is beating the snot out of all the MSM who’d much rather scream about some made-up, cooked-up, stirred-up, gang-up, pile-on, total nonsense fake news than foreign trade, economics, 90 million people out of work, etc.

Yes, for a first-cut, qualitative analysis, the tariff on Canadian soft lumber will go to the US Treasury and, thus, lower the Federal budget deficit, require less borrowing from overseas, lower the value of the dollar, make it easier for US companies to export, etc.

But, generally, we would expect that it would be better for the US dollar to be more valuable, not less valuable.

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Of course, the premise of the issue is that Canadian lumber is cheaper — in the short term. It is made cheaper through illegal price manipulation.

But, who are we tasked to protect — the consumer or the producer? The answer is BOTH.

Lumber is a commodity and it trades on the CME. Big builders speculate in lumber futures and can take delivery of contracts as they use that much lumber in their operations.

Like chemotherapy, the patient will get better, but not until a period of discomfort is experienced.

In the short term, prices will rise, but they will be offset by the continued decline of the Canadian dollar (on all goods, not just lumber) and, then, the beautiful, lusty bitch called the “market” will slip off her negligee and treat us to a flash of her brilliance.

American suppliers will pick up the slack. There are millions of acres of American (think Southern pine) lying mature to be cut and lumbered.

Capacity — sawmill capacity — will increase and the supply chain will shorten and go through Georgia, South Carolina, Florida. [Note that Canadian lumber companies have been buying and building sawmill capacity in the US for decades. They know where this is headed.]

In the end, US jobs will be created. Wealth will be created. US tax revenues will get a shot in the arm. Prices will be driven by market forces and not manipulation.

The Canadian government and provincial administrations are picking winners (them) and losers (American lumber companies) by manipulating the stumpage price.

Free trade is good. Fair trade is better.

BRC
http://www.themusingsofthebigredcar.com

http://themusingsofthebigredcar.com/us-v-canada-timber-grudge-match/

The Big Red Car ‘splains it to y’all. Read it and understand, eh?

BRC
http://www.themusingsofthebigredcar.com