Look at the time that TheHill article was written. It was May last year. Trump’s team had reached an agreement with Beijing but Trump tore it up days later. And here we are 12 months later still with nothing. Actually what we have is worse than nothing.
I am actually fine with Trump breaking agreements. It’s realpolitik. There is no morals among sovereign states. It’s all about power. If he can bring about a better agreement with his antics, all the power to him. What I am saying is that he is going in with a bad strategy and bad tactics, and he is failing.
Is there a trade deal? How can there be renege when there is no deal? Don’t fall prey to biased journalism.
What is your assumed goal of Trump? Americans love his style so his approach is correct. Is what won him the Presidency and should get him a second term.
I saw some arguments saying Trump actually wants confrontation, to show he’s “tough on China” and to have a foreign country as a bogeyman to rally Americans. That way he can win re-election.
If that’s his goal he actually has superb strategy and is executing very well.
Others have another theory that Trump wants to suppress China’s rise. That’s somewhat related to above but if that’s his real goal his strategy is not too good. Trump needs to have allies lined up to the same goal but he’s doing all he can to alienate them.
My conclusion is that Trump is a genius when it comes to promoting himself and benefiting himself at the expense of others. In this case at the expense of the whole world. But economics and geopolitics? Forget about it. He doesn’t even understand the absolute basics.
China has flooded our markets with cheaper goods. Great for consumers not so good for manufacturers and their employees. Time to take a stand. Europe takes on China so should we. At least the tariffs can help balance the budget.
That’s misinformed BS. Efficiency gains benefits everybody in the long run. You want Americans stuck in doing low value jobs? Even China is moving away from the lowest rung like sewing T-shirt’s.
No good for the environment either. Cheap junk that’s in a landfill in a year’s time. Nothing wrong with consuming a little less of it. As for things like iphones maybe folks keep them for five years instead of two. The sky won’t fall.
I’ve seen all measure of arguments and theories. Like the market would crash if Trump was elected. Or the economy would crash. Or there would be a war. Or he colluded with the Russians to get elected.
If the greatest economy in two generations amid a halving of the growth rate of the national debt and rising interest rates, no new military adventurism, the defeat of ISIS and a pullout from Syria are all evidence of economic and geopolitical ignorance then I am officially coming out as pro-ignorance.
There’s nothing efficient about cheap labor. Efficiency is producing more stuff with fewer people. That is how standards of living rise in the long run. Increased productivity, not increases in the labor pool.
Efficiency is measured as the amount of input going in vs the amount of output coming out. “Amount” is best measured in terms of money. If government artificially keeps low value jobs onshore consumers pay more, companies make less, and workers don’t have incentives to learn better skills.
This is all basic economics and yet you throw in the mix of nationalism suddenly people who used to cheer for capitalism turn into Bernie-style socialists.
Money doesn’t measure efficiency. A low-paid worker is not more efficient than a more highly paid one doing the same work.
Where cheap labor isn’t readily available the solution is often automation. Fewer jobs - but higher value jobs - replacing grunt-style work. And the knock-on effects from the automation create yet more jobs. America is not better off for getting it’s consumer goods out of sweat shops - or, for that matter, it’s food out of fields that look like something out of a Steinbeck novel.
Did Americans go to China to buy cheap stuffs or American businesses import them into US? Who spec the manufactured goods, China factories or American manufacturers? Is iPhone cheap? Any1 landfilling iPhones after one year?
Are there still sweat shops in China?
Are illegalundocumented immigrants cheaper than China labor? Why?
There are three issues that are important to understand about this trade war.
The first is that even if the US were to “win” the trade war, it wouldn’t solve the problem of “bringing back American jobs.” We have an enormous, productive economy with near capacity employment, but 90% of the wealth flows to the top 10%. “Winning” wouldn’t change this, it would just result in a few more meager rewards for the workers.
The second thing is that having a trade imbalance with China is not necessarily a bad thing: the US has a lot of money, much of it generated internally, and therefore we buy more from others. This is not to say that China practices fair trade, they don’t, and particularly in the realm of national security this is a big concern. But the idea that the trade deficit number is the most important thing is faulty.
Another issue is that the US is actually targeting Chinese industrial policy; the US wants to dictate domestic economic policy to China. This is an attack on China’s national security and future prosperity that no country can tolerate. So, China has far more at stake and cannot afford to capitulate to US demands.
China is likely very willing to make under the table concessions to the US which I believe Trump understood well since he does business with China before running for Presidency. Why is he trumping up the rhetoric?
Tariffs are always bad. Free trade is always good.
Investors are always irrational. Buy and hold for the long haul to counter short term fluctuations due to irrationality and those who try to make a quick buck by selling/shorting.
The stock market will survive and thrive with or without Trump.
“Trump doesn’t want American companies to do business with China,” the “Mad Money” host added. “Trump doesn’t want any sort of effort that makes China militarily better, that makes them ahead of us in terms of 5G,” the next generation wireless technology.
Cramer also speculated Friday that Trump does not want “sincere talks” with China over trade because the president feels like he has “got them on the run” and “feels this is how you get re-elected.”
If Trump got elected for 2nd term, we know Americans agree with Trump’s stand that doing business would allow China to be prosperous till China becomes militarily stronger than USA. Looking from this perspective, since semi is the heart and soul of modern military technology, USA would do all it can to stall China advances. Also, Trump doesn’t want trade deal.
Global equity investors are likely underestimating what may be immense damage across a variety of industries triggered by the U.S.-China trade dispute, particularly involving the latest Huawei Technologies Co. escalation, Wall Street analysts say.
The Trump administration putting Huawei – and dozens of its affiliates – on an export blacklist means “the U.S. government has halted China’s 5G push,” and is transforming the trade war “into a digital one,” Sean Darby, Jefferies’s chief global equity strategist, wrote in a note. The move may have ramifications well beyond the tech sector as well, analysts at MKM wrote.
The trade war has gone from bad to nuclear in one day, and most Americans don’t even realize. There are some anecdotes coming from China about how people are reacting, and it’s not good. CCTV even changed their regularly scheduled programming to put on a movie about the Korean War, where the Chinese army fought the Americans. Things are taking a scarily nationalistic tone.
A scary report from Nikkei says the hardliners in CCP forced Xi to abandon the deal. Chinese position is hardening:
And what did Trump do? To add nuclear fuel to a burning fire. Chinese are rallying around the flag so to speak. Irrationality takes hold. It’s no longer about business. It gets personal.
I now don’t think the trade war will end anytime soon. Market underpriced the risk of a prolonged trade war. Maybe the bond guys are right after all. Yield curve inversion may indeed mean something sinister.
President Trump is now in charge. He’s in charge of which American companies can do business in China. If you do too much, he’ll smite you. If you buy too much, he’ll find you. If you rely on them too much, he’ll crush you," Cramer said. “The companies that didn’t see this escalation coming, they may get stream-rolled, but the ones that thought ahead are being re-rated to more exalted status … I think their stocks aren’t done going higher.”
I have no idea what he’s talking about. US and China are interdependent. Trade war hurts Chinese economy and they will buy less from everybody else. How will that not hurt American economy?
China has the second biggest economy in the world. Nothing good will come from actively sabotaging it. Germany barely escaped recession this quarter and Italy turned slightly positive after a technical recession. The world is not in a very good shape to begin with.