Trump's Trade War

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Re: Trump's Trade War

Postby windwalker on Tue May 21, 2019 7:42 am

Steve James wrote:I really wonder how much American goods that the Chinese buy as opposed to their American counterparts and Chinese (Mexican, Thailand, Malaysian) goods. I'm not an economist, but I think the "imbalance" is precisely that. I.e., we buy shitloads of Chinese merchandise at low prices, and the Chinese hardly buy shit from us. And, what they do buy, they put into products (like Huawei phones) that they sell back to us at lower prices.

US products are not competitive because of the tariffs that are placed on US products..
not just in China but in many other countries.


Yes, it seems like a good idea to even that imbalance out somehow. I understand that if we don't buy their goods it will affect the Chinese economy. But, it's the American consumer and Chinese worker who have benefited.

At the expense of jobs as companies relocated overseas to ease the tax burden and avoid labor laws ect.
This is changing as the tax incentive changes. .



If I were Chinese, however, I would simply look for other markets and opportunities elsewhere. Americans aren't the only customers or providers. Other countries are making agreements with China. Many of them are finding out those agreements work against them in the long run.

Not to mention, iinm, the US is in debt to China, not the other way around. Have we saved enough from the tariffs to pay off our debt?


This means if China does anything to devalue the US their debt also becomes worth less,
its not in their interest to do so...They buy US dollars to stabilize their own economy .

Why China Owns So Much U.S. Debt
China makes sure the yuan is always low relative to the U.S. dollar. Why?

Part of its economic strategy is to keep its export prices competitive.

It does this by holding the yuan at a fixed rate compared to a "currency basket" of which the majority is the dollar. When the dollar falls in value, the Chinese government uses dollars it has on hand to buy Treasuries. It receives these dollars from Chinese companies that receive them as payments for their exports. China's Treasury purchases increase demand for the dollar and thus its value.


It's more likely that China would slowly begin selling off its Treasury holdings. Even when it just warns that it plans to do so, dollar demand starts to drop. That hurts China's competitiveness.

As it raises its export prices, U.S. consumers would buy American products instead.
Which the tariffs will force to happen anyway, just not under their control.
China could only start this process if it further expands its exports to other Asian countries and increases domestic demand.


They have a good strategy that was based on whats being addressed now.
It will be interesting going forward to see how this plays out. Its not sustainable for the US.

As peacedog mentioned, they are starting to have problems with this strategy as manufacturing changes becoming more automated. .
Last edited by windwalker on Tue May 21, 2019 7:45 am, edited 1 time in total.
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Re: Trump's Trade War

Postby Steve James on Tue May 21, 2019 8:00 am

US products are not competitive because of the tariffs that are placed on US products..
not just in China but in many other countries.


So, the Chinese had tariffs on US goods and Trump is just reciprocating?

At the expense of jobs as companies relocated overseas to ease the tax burden and avoid labor laws ect.
This is changing as the tax incentive changes. .


This had nothing to do with what I wrote about Chinese workers benefiting. Ok, tax laws had changed. Have companies come back? Have they stopped closing? If that is the result of the trade war, then why remove tariffs at all?

[Steve]If I were Chinese, however, I would simply look for other markets and opportunities elsewhere. Americans aren't the only customers or providers. Other countries are making agreements with China.

[ww]Many of them are finding out those agreements work against them in the long run.


:) Which ones? How is the "long run" relevant if the agreements have just been made? How is working with China bad? You seem to know a lot about their economics
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Re: Trump's Trade War

Postby Steve James on Tue May 21, 2019 8:05 am

Actually, forget it. I don't look forward to more Americans working under the same labor laws as in China. I don't think the US has money problems. Even if the US has been getting screwed (the way Trum says in the video), we were still number one. So, it's not worth arguing about.
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Re: Trump's Trade War

Postby everything on Tue May 21, 2019 10:25 am

the debt, currency manipulation, and general macroeconomics gets much harder for me to follow. if you keep your currency devalued, yes, that helps make your export prices more attractive. debt, like money, is based on an agreed upon interpretation of value. we agree this piece of paper is valuable. debt means we agree at some point in the future, this thing called money - if I borrow it, you get more of it. the USA has massive debt, but that means China and others all agree that there is future value there. So China is super invested in this future value picture. That should mean long term value creation by both countries is in its vested interest. As others pointed out, Trump will be gone soon, but China has a long term view. Playing the game for long term "shareholder" creation is what the rational and smart execs, technocrats, etc., do, but the short-termist narcissist reality show politicians don't necessary benefit from that kind of decision making...

if we want to know what "smart money" thinks about all this - the traders and investors try to "price this all in" - we can look at the stock market as well as the futures markets. I suppose that's both an interesting spectator sport, but it also affects people with retirement portfolios and in the job market, and these are the people policies should be trying to help.
Last edited by everything on Tue May 21, 2019 10:28 am, edited 1 time in total.
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Re: Trump's Trade War

Postby Peacedog on Tue May 21, 2019 10:41 am

edededed,

In theory, anthropologists are supposed to tell us this kind of thing, but they sold out years ago and basically spend their time being critical of the West and not looking at the negative aspects of the cultures they study.

But keep in mind this only applies to groups. Individuals will always surprise you. :P

I've often wondered if the Brits and French can pull off any of this either. The class based systems in place in both societies mean someone who is considered lower class in the UK, or lacks a graduation certificate from the right Ecole in France, is always dismissed out of hand. I've met many expats in SE Asia from both who were there because they refused to be treated like a bitch in their home societies. Sometimes things worked out for them, sometimes not.

But back to my main point, if a pump operator can't tell the drill boss, or petroleum engineer in charge of the site, that things are about to go tits up, well then you can't do fracking. And +1 about the infrastructure being an issue as well.

Human beings are unique in that our beliefs directly impact what we can perceive and act upon. Beliefs are not universal and some systems work better than others. Unless people can articulate this and act upon it, you keep getting surprises in science, engineering, business, politics, international affairs, warfare, medicine and pretty much anything else that matters.
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Re: Trump's Trade War

Postby edededed on Tue May 21, 2019 5:08 pm

Interesting stuff, Peacedog.

It may be a pendulum though - certainly anthropologists (and everyone else) were only saying nice things about other people, and only criticisms of their own groups for a while. But (sensitive) people have been building up unhappiness about it for a while now, so it seems to be pushing the other way again. I think that it is a good exercise to criticize yourself before you criticize others (like comedians do) - but that should not mean that all cultures are good in all aspects.

Even in US companies though - companies with old-fashioned hierarchies (e.g. banks) are still very much top-down (your opinion counts if your title is high, although it is still a bit better than most Japanese companies where you do not exist if you are a low title).

Agreed that beliefs have a huge effect on human beings - I think that is the point of most humanities. On the other hand, without a balanced approach ("all cultures are good" is not balanced), the results may not be helpful. The US is interesting with its two political cultures (left and right) - giving us two groups who are totally sure of their (opposite) beliefs.
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Re: Trump's Trade War

Postby windwalker on Tue May 21, 2019 7:00 pm

everything wrote:
I don't expect agreement but various people with some kind of theory understanding don't seem to have an explanation for these policies, statements, or moves, including in the administration. This is what's so tragicomic. But other narcissistic bully types seem to have some mutual admiration.


must be one of those narcissistic bully types

By Jeff Ferry and Steven L. Byers, PhD

Economic modeling results from the Coalition for a Prosperous America (CPA) show that an across-the-board 25% tariff on all China imports would deliver a significant, sustained boost to the US economy, including the addition of $125 billion to GDP in 2024 and the creation of 721,000 additional jobs.

CPA modeled the imposition of a permanent, across-the-board 25 percent tariff on all US imports from China, totaling more than $500 billion gross value, and examined the effects on the US economy over the years 2020 to 2024. The results show that the tariff boosted growth in real gross domestic product (GDP) each year, contributing 0.5 percent of additional GDP in 2024.

https://www.prosperousamerica.org/cpa_s ... ds_of_jobs

traditional models exaggerate price effects because they assume that the entire cost of a tariff is passed on to the US consumer.

That assumption causes those models to overestimate the reduction in consumption, demand and employment across the economy. However, demand for virtually every one of the tariffed goods has some elasticity, i.e. demand falls in response to rising prices.

Therefore a tariff leads to some decline in the pre-tariff price of imports. The tariff pass-through rate will differ significantly among products.

The evidence of 2018 and Q1 2019 confirms that overall consumer prices as well as sectoral consumer prices were scarcely impacted by the Section 232 and Section 301 tariffs levied on steel, aluminum, and many Chinese products. China-only tariffs will lead to less price pass-through than worldwide tariffs, as Chinese exporters will be forced to compete with non-tariffed goods from other countries.


echos what was mentioned that others will fill in the gaps for different products as the Chinese products become more expensive.
Last edited by windwalker on Tue May 21, 2019 7:10 pm, edited 1 time in total.
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Re: Trump's Trade War

Postby gzregorz on Tue May 21, 2019 7:19 pm

Wind,

What do you honestly expect from these tariffs?

I am in a union we got a 20% raise. Now that's a raise!

Don't mean to burst your bubble. The MAGA hat is humor by the way didn't mean to get you upset. I will drop it for the moment.

But it's ironic to me that the GOP either did nothing or purposely made moves which destroyed the unions, banking regulations, sent the jobs overseas to maximize profits by cutting costs, destroyed pensions, family farms, raised healthcare costs and prescription drugs, do little or nothing to keep down rents or raise wages, destory or defund education and you still vote for these guys expecting a different result.

Sorry to tell you but your situation before, after and during this administration will be the same. The only difference is your new microwave will cost you a lot more.
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Re: Trump's Trade War

Postby windwalker on Tue May 21, 2019 8:43 pm

I don't expect agreement but various people with some kind of theory understanding don't seem to have an explanation for these policies, statements, or moves, including in the administration.


“The administration’s China strategy is working,” said Jeff Ferry, CPA Chief Economist. “Our imports from China fell substantially in March from the already-reduced levels of February. The reason is not just the immediate cost of the tariffs, but their broader effects in driving hundreds of companies—American, multinational, and even Chinese—to diversify production away from China.

That diversification will continue even when the tariffs are gone. It’s also important to note that the consumer is not paying for these tariffs, because consumer prices continue to rise at an anemic 2 percent annual rate. Whether or not there is a deal with China, these tariffs are starting to reshape global supply chains.

If the tariffs are increased tomorrow, as seems likely, they will continue to benefit the US economy, while at the same time reducing US dependence on China for so many manufactured goods.”

https://www.prosperousamerica.org/us_tr ... five_years

Interesting right, some people don't understand and yet others whose job it is to,,,do
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Re: Trump's Trade War

Postby everything on Tue May 21, 2019 8:46 pm

except that economists don't actually all agree, either. that's why it's so good to be an economist.
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Re: Trump's Trade War

Postby gzregorz on Tue May 21, 2019 9:52 pm

Farmers elected a thug, a gangster, and a conman and thought he gave a damn instead they are declaring bankruptcy and committing suicide.

Watch "Trump Trade War Push Farmers Into Bankruptcy" on YouTube

https://youtu.be/D0KWAcZ5z3s

WISCONSIN FARMER TELLS FOX NEWS SUICIDES, BANKRUPTCY RISING IN RURAL U.S. AMID CHINA TRADE WAR

https://www.google.com/amp/s/www.newswe ... 69%3famp=1


Watch "Farm bankruptcies surge as China tariffs hurt industry" on FOX news YouTube

https://youtu.be/OzI3_KkXanc
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Re: Trump's Trade War

Postby Bao on Tue May 21, 2019 10:33 pm

"China cheats, china cheats, for twenty years our leadership in America has acted like a bunch of weenies, they've let them get away with it. No more, we want you to be part of the global economy, but there are rules," Kennedy told Fox News Thursday.


What China did to cheat I have no idea about. But what the US does now goes against WTO regulations. As always the US is the only one allowed to break rules. :P
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Re: Trump's Trade War

Postby Bao on Tue May 21, 2019 10:41 pm

Trump’s new genius move:
“China, obey my will or I’ll shoot this cat”

Image
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Re: Trump's Trade War

Postby Trick on Wed May 22, 2019 12:11 am

I have noticed many Chinese when they mention a big sum of money, for example ‘one hundred thousand’ they say something as One Million Hundred Thousand, or One Hundred Million Thousand, or any other possible combination.They probably add “Million” so it sound all sound impressive and powerful.When I asked them to put it down in figures it’s-100 000. Trump/Americans need to ask the Chinese to put it in writing with figures.....
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Re: Trump's Trade War

Postby windwalker on Wed May 22, 2019 6:21 am

Bao wrote:
"China cheats, china cheats, for twenty years our leadership in America has acted like a bunch of weenies, they've let them get away with it. No more, we want you to be part of the global economy, but there are rules," Kennedy told Fox News Thursday.


What China did to cheat I have no idea about. But what the US does now goes against WTO regulations. As always the US is the only one allowed to break rules. :P



You have no idea what China does, but what the US does is against the WTO regulations. What regulations?

Used to work in the solar industry for companies that made solar cells. Also works for companies that made the equipment for other companies to make solar cells.

many companies have been put out of business because China can make cells at below cost. This works in the US because the us has a lower import cost for importing Chinese products.

The Chinese among other countries protect their markets by having higher import duties and fees for products not made in their country.


There are unwritten rules in China that they used to gain IP from foreign companies that work there

.European ones, also American firms — that they’ve been told in no uncertain terms that if they don’t hand over this tech transfer then they’re not going to get certain market access. It’s not written down, and this is why the Chinese government has been able to deny up until now that this happens on a systemic level.


This is not only in China but in the other countries that produce high tech goods and services.

Those countries themselves go to great lengths to protect their own IP. Worked for Canon USA.
In their semiconductor division.

With their tool sets once a certain level is reached they only allow Japanese workers from Japan to work on their tools. The machine is blocked off from access, and their technicians are the only ones who can work on their tools once it reaches a certain level of repair.
Last edited by windwalker on Wed May 22, 2019 6:28 am, edited 3 times in total.
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