U.S. Push for Manufacturing Revival and Potential Shock to Financial Markets

• Background:
  The U.S. economy has grown through financialization, but a push to revive manufacturing could alter this existing structure.

• Key Changes Expected:

  1. Shift in Labor-Capital Distribution:
     As manufacturing recovers, labor unions may regain strength, leading to higher corporate costs and weakening the traditional "shareholder value maximization" model.

  2. Decline in Stock Market Profitability:
     Transitioning from a finance- and IT-centered economy to a manufacturing-centered one could lower corporate profit margins and dampen stock market growth potential.

  3. Negative Effects of Tariff Policies:
     Tariffs, a core part of protectionism, could increase raw material costs, burden consumers, reduce corporate profitability, and shrink investment.

  4. Weakening of Dollar Hegemony:
     A focus on manufacturing could shift global capital flows, leading to a weaker dollar and reduced liquidity in U.S. financial markets.

• Trump’s Strategy to Protect Manufacturing:

  • Strengthened tariff policies
  • Inducing labor market changes (strengthening blue-collar bargaining power)
  • Providing tax incentives

  → However, these could disrupt supply chains, raise domestic product prices, and increase government fiscal burdens.

• Conclusion:
  Balancing the manufacturing revival with financial market stability is crucial.
  Excessive protectionism or mismanagement of the financial sector could damage America's main growth engines.
  Thus, a strategy that simultaneously promotes manufacturing and maintains financial market confidence is essential.