AuthorTopic: 🚛 Trade Warz  (Read 11406 times)

Offline azozeo

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Re: 🚛 Trade Warz
« Reply #30 on: August 20, 2018, 12:19:04 PM »
by Peter Koenig for The Saker Blog

Sanctions left and sanctions right. Financial mostly, taxes, tariffs, visas, travel bans – confiscation of foreign assets, import and export prohibitions and limitations; and also punishing those who do not respect sanctions dished out by Trump, alias the US of A, against friends of their enemies. The absurdity seems endless and escalating – exponentially, as if there was a deadline to collapse the world. Looks like a last-ditch effort to bring down international trade in favor of — what? – Make America Great Again? – Prepare for US mid-term elections? – Rally the people behind an illusion? – Or what?
I know exactly what you mean. Let me tell you why you’re here. You’re here because you know something. What you know you can’t explain, but you feel it. You’ve felt it your entire life, that there’s something wrong with the world.
You don’t know what it is but its there, like a splinter in your mind

Offline azozeo

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Trade Warz-How the Trade War Helps Hide Central Bank Sabotage Of The Economy
« Reply #31 on: September 19, 2018, 04:13:04 PM »

Almost every aspect of the global economic downturn, which started ostensibly in 2007-2008 and is still ongoing to this day, can be traced back to the actions and policies of central banks. The Federal Reserve, for example, used artificially low interest rates and easy money to create a supposedly no-risk loan environment. This translated into a vast amount of toxic mortgage debt along with a web of derivatives (Mortgage Backed Securities) attached to that debt.

The Fed ignored all the signs and all the alternative analyst warnings. Agencies like S&P backed the Fed narrative that all was well as they gave AAA ratings to endless toxic market products. The mainstream media backed the Fed by attacking anyone that argued the notion that the U.S. economy was unstable and ready to falter. In that era of economics, the truth was effectively hidden from the public by the system through relatively standard means. Today, things have changed slightly.
I know exactly what you mean. Let me tell you why you’re here. You’re here because you know something. What you know you can’t explain, but you feel it. You’ve felt it your entire life, that there’s something wrong with the world.
You don’t know what it is but its there, like a splinter in your mind

Offline Eddie

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Almost every aspect of the global economic downturn, which started ostensibly in 2007-2008 and is still ongoing to this day, can be traced back to the actions and policies of central banks. The Federal Reserve, for example, used artificially low interest rates and easy money to create a supposedly no-risk loan environment. This translated into a vast amount of toxic mortgage debt along with a web of derivatives (Mortgage Backed Securities) attached to that debt.

The Fed ignored all the signs and all the alternative analyst warnings. Agencies like S&P backed the Fed narrative that all was well as they gave AAA ratings to endless toxic market products. The mainstream media backed the Fed by attacking anyone that argued the notion that the U.S. economy was unstable and ready to falter. In that era of economics, the truth was effectively hidden from the public by the system through relatively standard means. Today, things have changed slightly.

I read this one, and I started to comment on Brandon Smith's  site, but he's another self-important little prick who doesn't like critical thinking people questioning his glue-sniffing conspiracy theories. Why bother, he'd only delete my comment.

First, I don't think the 3.4% of the US national debt the Chinese own is likely to get dumped. The US is still too important a trading partner for them to let the yuan appreciate the way it would if they dumped their holdings. The Chinese have the yuan (reminbi) pegged to the dollar and they have to keep lots of dollars to make that happen. The safest way to do that is to own UST's

For the Chinese to get out of Treasuries, they would have to think that they didn't need US trade at all anymore. That might be someday, but it isn't true now.

De-dollarization, which has been ongoing to some degree, does not seem likely to me to be nearly the short term threat that some collapse writers think it is. I don't think these writers really understand how trade imbalances and their relation to currency pairs really works out in the real world.

Writers like Brandon Smith think the "globalists" will intentionally let the dollar fall precipitously, which will lead to the USD losing its reserve currency status. I don't think that's likely, not because I don't think the globalists have a agenda...they do, but there are plenty of reasons the dollar might surge higher in the short run.

If Italian banks failed (not unlikely)  and the EU does not assume their debt, for instance (likely they will, but assume the worst and say they did not) then the USD will go to the moon. If the US stock market crashes, the USD will go to the moon. The Euro lost nearly a 3rd of its value against the USD in the 2008 crash. Look it up.

Brandon is styling himself a "macro economist" these days. He called himself that in response to a recent comment I left there. i didn't waste my time questioning this article, which he managed to get published by Birch Gold. Gold sellers like to promote the whole "dollar is doomed" shtick. But it doesn't all quite hang together for me, when examined critically.

I don't think the USD would fail if China sold their last dollar. No hyperinflation, sorry. Not in the cards in today's world.

Brandon is somewhat right about the inflation part. We're about to get some major inflation the way we're now headed, although a stock market crash would be the kind of deflationary event that could cause that to reset, too. If US assets in general get clocked, like 2008 or even worse, then we'll likely get Europeans levels of QE here and zero or even negative interest rates again.

You can't have the kind of inflation that's heating up and now and have a deflationary asset crash too. Those things are mutually exclusive. We walk on the edge of a razor blade, with high inflation (not hyperinflation) on one side, and popping bubbles and falling stocks and real estate on the other side.

The part about a crash being blamed on Trump has some merit, and I do think it'd be a rallying cry for the socialists here, and we might see the Republican austerity and libertarianism replaced by new calls for basic income and more "free shit" as TBP used to call it. But that doesn't bother me. I'm not as married to "conservative ideals" like Brandon is.

What makes the desert beautiful is that somewhere it hides a well.

Offline RE

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Brandon "Lexington & Concord" Smith sells his Globalist Conspiracy meme in large part because it plays well with the Zero Hedge crowd.  Gets him readership, and financial contributions no doubt as well.  I've watched his prose morph over the years and he becomes progressively more strident all the time and puts out some absolutely WACKY stuff which on an Economic level is much like David Koresh preaching the Bible.

Not that I don't think there is a Globalist Agenda, there most certainly is, but it is nowhere near so coordinated as BS makes it out to be.  Global Banksters are generally just reacting to events and trying to maintain their hegemony over global trade.  Which they are generally successful with, because the alternatives are positively laughable.  The Chinese Banking system makes Western Banksters look positively HONEST.  Gold is even more ridiculous than Chinese Banking, it just can't function in trade when the whole system depends on running deficits and loaning more money into existence.

Undoubtably, the Dollar will eventually crash.  But not before the Euro and the Yen go to the Great Beyond.  Will it be a deflationary crash or an inflationary one?  That's really impossible to say, but it really doesn't matter because in either case the current system of global trade goes KAPUT.

BS looks for somebody to blame that other right wing ideologues eat up like ice cream sandwiches.  Central Banksters and Da Fed are his whipping boys.  His theories though are so insane he makes AZ's Lizard Aliens more believable.  He's definitely on track for a nice Waco style snuffing by the FBI & ATF in his Colorado Bunker at some point.

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Offline RE

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🚛 Not ‘in Tatters’: Why the West Has Failed to Destroy Russia’s Economy
« Reply #34 on: September 25, 2018, 12:02:08 AM »

Not ‘in Tatters’: Why the West Has Failed to Destroy Russia’s Economy
September 24, 2018 branford perry


Eric ZUESSE | 23.09.2018 | Strategic Culture

Despite Barack Obama’s economic sanctions against Russia, and the plunge in oil prices that King Saud agreed to with Obama’s Secretary of State John Kerry on 11 September 2014, the economic damages that the US and Sauds have aimed against a particular oil-and-gas giant, Russia, have hit mostly elsewhere — at least till now.

This has been happening while simultaneously Obama’s violent February 2014 coup overthrowing Ukraine’s democratically elected pro-Russian President Viktor Yanukovych (and the head of the ‘private CIA’ firm Stratfor calls it “the most blatant coup in history”) has caused Ukraine’s economy to plunge even further than Russia’s, and corruption in Ukraine to soar even higher than it was before America’s overthrow of that country’s final freely elected nationwide government, so that Ukraine’s economy has actually been harmed far more than Russia’s was by Obama’s coup in Ukraine and Obama’s subsequent economic sanctions against Russia (sanctions that are based on clear and demonstrable Obama lies but that continue and even get worse under Trump).

Bloomberg News headlined on February 4th of 2016, “These Are the World’s Most Miserable Economies” and reported the “misery index” rankings of 63 national economies as projected in 2016 and 60 as actual in 2015 — a standard ranking-system that calculates “misery” as being the sum of the unemployment-rate and the inflation-rate. They also compared the 2016 projected rankings to the 2015 actual rankings.

Top rank, #1 both years — the most miserable economy in the world during 2015 and 2016 — was Venezuela, because of that country’s 95% dependence upon oil-export earnings (which crashed when oil-prices plunged). The US-Saudi agreement to flood the global oil market destroyed Venezuela’s economy.

#2 most-miserable in 2015 was Ukraine, at 57.8. But Ukraine started bouncing back so that as projected in 2016 it ranked #5, at 26.3. Russia in 2015 was #7 most-miserable in 2015, at 21.1, but bounced back so that as projected in 2016 it became #14 at 14.5.

Bloomberg hadn’t reported misery-index rankings for 2014 showing economic performances during 2013, but economist Steve H. Hanke of Johns Hopkins University did, in his “Measuring Misery Around the World, May 2014,” in the May 2014 GlobeAsia, ranking 90 countries; and, during 2013 (Yanukovych’s final year as Ukraine’s President before his being forced out by Obama’s coup), Ukraine’s rank was #23 and its misery-index was 24.4. Russia’s was #36 and its misery index was 19.9. So: those can be considered to be the baseline-figures, from which any subsequent economic progress or decline (after Obama’s 2014 Ukrainian coup) may reasonably be calculated. Hanke’s figures during the following year, 2014, were reported by him at Huffington Post, “The World Misery Index: 108 Countries”, and by UAE’s Khaleej Times, “List of Most Miserable Countries” (the latter falsely attributing that ranking to Cato Institute, which had merely republished Hanke’s article). In 2014, Ukraine’s misery-index, as calculated by Hanke, was #4, at 51.8. That year had 8 countries above 40 in Hanke’s ranking. Russia was #42 at 21.42. So: Russia’s rank had improved, but, because of the globally bad economy, Russia’s absolute number was slightly worse (higher) than it had been before Obama’s coup in Ukraine and subsequent sanctions against Russia. By contrast, Ukraine’s rank had suddenly gotten far worse, #4 at 51.80 in 2014, after having been #23 at 24.4 in 2013.

The figures in Bloomberg for Russia were: during 2015, #7 with a misery-index of 21.1; and projected during 2016, #14 with a misery-index of 14.5; so, Bloomberg too showed a 2015-2016 improvement for Russia, and not only for Ukraine (where in the 2016 projection it ranked #5, at 26.3, a sharp improvement after the horrendous 2015 actual numbers).

“Hanke’s Annual Misery Index — 2017” in Forbes, showed 98 countries, and Venezuela was still #1, the worst; Ukraine was now #9 at 36.9; and Russia was #36 at 18.1.

Thus: whereas Russia was economically sunningly stable at #36 from start to finish throughout the entire five-year period 2013-2017, starting with a misery-index of 19.9 in 2013 and ending with 18.1 in 2017, Ukraine went from a misery-index of 24.4 in 2013 to 36.9 in 2017 — and worsening its rank from #23 to #9. During that five-year period Ukraine’s figure peaked in the year of Obama’s coup at 57.8. So, at least Ukraine’s misery seems to be heading back downward in the coup’s aftermath, though it’s still considerably worse than before the coup. But, meanwhile, Russia went from 19.9 to 18.1 — and had no year that was as bad as Ukraine’s best year was during that period of time. And, yet: that coup and the economic sanctions and the US-Saudi oil-agreement were targeted against Russia — not against Ukraine.

If the US were trying to punish the people of Ukraine, then the US coup in Ukraine would have been a raving success; but actually Obama didn’t care at all about Ukrainians. He cared about the owners of America’s weapons-making firms and of America’s extractive firms. Trump likewise.

During that same period (also using Hanke’s numbers) the United States went from #71 at 11.0 in 2013, to #69 at 8.2 in 2017. US was stable.

Saudi Arabia started with #40 18.9 during 2013, to #30 at 20.2 in 2017. That’s improvement, because the Kingdom outperformed the global economy.

During the interim, and even in the years leading up to 2014, Russia had been (and still is) refocusing its economy away from Russia’s natural resources and toward a broad sector of high technology: military R&D and production.

On 15 December 2014, the Stockholm International Peace Research Institute headlined, “Sales by Largest Arms Companies Fell Again in 2013, but Russian Firms’ Sales Continued Rising,” and reported, “Sales by companies headquartered in the United States and Canada have continued to moderately decrease, while sales by Russian-based companies increased by 20 per cent in 2013.”

The following year, SIPRI bannered, on 14 December 2015, “Global Arms Industry: West Still Dominant Despite Decline,” and reported that, “Despite difficult national economic conditions, the Russian arms industry’s sales continued to rise in 2014. … ‘Russian companies are riding the wave of increasing national military spending and exports. There are now 11 Russian companies in the Top 100 and their combined revenue growth over 2013–14 was 48.4 per cent,’ says SIPRI Senior Researcher Siemon Wezeman. In contrast, arms sales of Ukrainian companies have substantially declined. … US companies’ arms sales decreased by 4.1 per cent between 2013 and 2014, which is similar to the rate of decline seen in 2012–13. … Western European companies’ arms sales decreased by 7.4 per cent in 2014.”

This is a redirection of the Russian economy that Vladimir Putin was preparing even prior to Obama’s war against Russia. Perhaps it was because of the entire thrust of the US aristocracy’s post-Soviet determination to conquer Russia whenever the time would be right for NATO to strike and grab it. Obama’s public ambivalence about Russia never persuaded Putin that the US would finally put the Cold War behind it and end its NATO alliance as Russia had ended its Warsaw Pact back in 1991. Instead, Obama continued to endorse expanding NATO, right up to Russia’s borders (now even into Ukraine) — an extremely hostile act.

By building the world’s most cost-effective designers and producers of weaponry, Russia wouldn’t only be responding to America’s ongoing hostility — or at least responding to the determination of America’s aristocracy to take over Russia, which is the world’s largest trove of natural resources — but would also expand Russia’s export-earnings and international influence by selling to other countries weaponry that’s less-burdened with the costs of sheer corruption than are the armaments that are being produced in what is perhaps the world’s most corrupt military-industrial complex: America’s. Whereas Putin has tolerated corruption in other areas of Russia’s economic production (figuring that those areas are less crucial for Russia’s future), he has rigorously excluded it in the R&D and production and sales of weaponry. Ever since he first came into office in 2000, he has transformed post-Soviet Russia from being an unlimitedly corrupt satellite of the United States under Boris Yeltsin, to becoming truly an independent nation; and this infuriates America’s aristocrats (who gushed over Yeltsin).

The Russian government-monopoly marketing company for Russia’s weapons-manufacturers, Rosoboronexport, presents itself to nations around the world by saying: “Today, armaments and military equipment bearing the Made in Russia label protect independence, sovereignty and territorial integrity of dozens of countries. Owing to their efficiency and reliability, Russian defense products enjoy strong demand on the global market and maintain our nation’s leading positions among the world’s arms exporters. For the past several years, Russia has consistently ranked second behind the United States as regards arms exports.” That’s second-and-rising, as opposed to America’s first-and-falling.

The American aristocracy’s ever-growing war against Russia posed and poses to Putin two simultaneous challenges: both to reorient away from Russia’s natural resources, which the global aristocracy wants to grab, and also to reorient toward the area of hi-tech in which the Soviets had built a basis from which Russia could become truly cost-effective in international commerce, so as to, simultaneously, increase Russia’s defensive capability against an expanding NATO, while also replacing some of Russia’s dependence upon the natural resources that the West’s aristocrats want to steal.

In other words: Putin designed a plan to meet two challenges simultaneously — military and economic. His primary aim is to protect Russia from being grabbed by the American and Saudi aristocrats, via America’s NATO and the Sauds’ Gulf Cooperation Council and other alliances (which are trying to take over Russia’s ally Syria — Syria being a crucial location for pipelining Arab royals’ oil-and-gas into Europe, the world’s largest energy-market).

In addition, the hit to Russia’s economic growth-rate from the dual-onslaught of Obama’s sanctions and the plunging oil prices hasn’t been too bad. The World Bank’s April 2015 “Russia Economic Report” predicted: “Growth prospects for 2015-2016 are negative. It is likely that when the full effects of the two shocks become evident in 2015, they will push the Russian economy into recession. The World Bank baseline scenario sees a contraction of 3.8 percent in 2015 and a modest decline of 0.3 percent in 2016. The growth spectrum presented has two alternative scenarios that largely reflect differences in how oil prices are expected to affect the main macro variables.”

The current (as of 15 February 2016) “Russia GDP Annual Growth Rate” at Trading Economics says: “The Russian economy shrank 3.8 percent year-on-year in the fourth quarter of 2015, following a 4.1 percent contraction in the previous period, according to preliminary estimates from the Economic Development Minister Alexey Ulyukayev. It is the worst performance since 2009 [George W. Bush’s global economic crash], as Western sanctions and lower oil prices hurt external trade and public revenues.” The current percentage as of today, 17 September 2018, is 1.9%, after having plunged down from 2.2% in late 2017, to 0.9% in late 2017; so, it is rebounding.

The World Bank’s April 2015 “Russia Economic Report” went on to describe “The Government Anti-Crisis Plan”:

On January 27, 2014, the government adopted an anti-crisis plan with the goal to ensure sustainable economic development and social stability in an unfavorable global economic and political environment.

It announced that in 2015–2016 it will take steps to advance structural changes in the Russian economy, provide support to systemic entities and the labor market, lower inflation, and help vulnerable households adjust to price increases. To achieve the objectives of positive growth and sustainable medium-term macroeconomic development the following measures are planned:

• Provide support for import substitution and non-mineral exports;

• Support small and medium enterprises by lowering financing and administrative costs;

• Create opportunities for raising financial resources at reasonable cost in key economic sectors;

• Compensate vulnerable households (e.g., pensioners) for the costs of inflation;

• Cushion the impact on the labor market (e.g. provide training and increase public works);

• Optimize budget expenditures; and

• Enhance banking sector stability and create a mechanism for reorganizing systemic companies.

So: Russia’s anti-crisis plan was drawn up and announced on 27 January 2014, already before Yanukovych was overthrown, even before Obama’s agent Victoria Nuland on 4 February 2014 instructed the US Ambassador in Ukraine whom to have appointed to run the government when the coup would be completed (“Yats,” who did get appointed). Perhaps, in drawing up this plan, Putin was responding to scenes from Ukraine like this. He could see that what was happening in Ukraine was an operation financed by the US CIA. He could recognize what Obama had in mind for Russia.

The “Russia Economic Report, May 2018: Modest Growth Ahead” says:

Global growth continued its 2017 momentum in early 2018. Global growth reached a stronger than- expected 3 percent in 2017 — a notable recovery from a post-crisis low of 2.4 percent in 2016. It is currently expected to peak at 3.1 percent in 2018. Recoveries in investment, manufacturing, and trade continue as commodity-exporting developing economies benefit from firming commodity prices (Figure 1a). The improvement reflects a broad-based recovery in advanced economies, robust growth in commodity-importing Emerging Markets and Developing Economies (EMDEs), and an ongoing rebound in commodity exporters. Growth in China – and important trading partner for Russia – is expected to continue its gradual slowdown in 2018 following a stronger than-expected 6.9 percent in 2017.

Putin’s economic plan has softened the economic blow upon the masses, even while it has re-oriented the economy toward what would be the future growth-areas.

The country that Putin in 2000 had taken over and inherited from the drunkard Yeltsin (so beloved by Western aristocrats because he permitted them to skim off so much from it) was a wreck even worse than it had been when the Soviet Union ended. Putin immediately set to work to turn it around, in a way that could meet those two demands.

Apparently, Putin has been succeeding — now even despite what the US aristocracy (and its allied aristocracies in Europe and Arabia) have been throwing to weaken Russia. And the Russian people know it.

PS: The present reporter is an American, and used to be a Democrat, not inclined to condemn Democratic politicians, but Obama’s grab for Russia was not merely exceedingly dangerous for the entire world, it is profoundly unjust, it is also based on his (and most Republicans’) neoconservative lies, and so I don’t support it, and I no longer support Obama or his and the Clintons’ Democratic Party, at all. But this certainly doesn’t mean that I support the Republican Party, which is typically even worse on this (and other matters) than Democratic politicians are. On almost all issues, I support Bernie Sanders, but I am not a part of anyone’s political campaign, in any way.

About the author

EricZuesseERIC ZUESSE, Senior Contributing Editor •  Investigative historian Eric Zuesse is the author, most recently, of They’re Not Even Close: The Democratic vs. Republican Economic Records, 1910-2010, and of CHRIST’S VENTRILOQUISTS: The Event that Created Christianity. Besides TGP, his reports and historical analyses are published on many leading current events and political sites, including The Saker, Huffpost, Oped News, and others.
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Offline RE

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So how many farmers and grain belt workers are going to vote for Trumpovetsky in 2020?

This is called shooting yourself in the foot.


US farmers forced to leave crops rotting in fields as Trump's trade war bites
Will Martin

US farmers are struggling amid the global trade war. Here, US President Donald Trump in Peosta, Iowa, in July 2018. Scott Olson/Getty Images

    American farmers are struggling to sell their products as tariffs introduced during the trade war between Washington and Beijing stifle demand.
    In certain states, farmers are being forced into plowing their crops under — effectively burying them under soil in fields — as there is simply not enough storage room in storage facilities.
    The problem is most acute for soybean farmers, as China generally buys around 60% of US soybeans, but purchases have basically stopped since tariffs began.

American farmers are struggling to find storage for crops that would usually be sold overseas, with some being forced to leave produce rotting in fields as a last resort, as the trade conflict between the US and China continues.

Farmers in various US states, farmers are being forced into plowing their crops under — effectively burying them under soil in fields — as there is not enough storage room in storage facilities, and they are unable to sell their products thanks to Chinese tariffs, Reuters reported on Wednesday.

All grain depots and silos are almost completely full, meaning farmers have to find their own storage solutions, or allow their crops to rot. Neither option is particularly palatable.

The problem is most acute for soybean farmers. China is the largest importer of soybeans in the world, but since the start of the trade war it has slapped US soybeans with a 25% tariff, and turned to Brazil in an attempt to meet domestic demand.

Chinese purchases generally make up around 60% of all US soybean exports, but those exports have practically stopped since the tariffs were introduced.

In Louisiana, as much as 15% of this year's soybean crop has been ploughed under, or is too damaged to sell, according to data analyzed by Louisiana State University staff and cited by Reuters.

Read more: 'We will never have a deal': China's former top trade negotiator warns Beijing is hurting itself in Trump tariff battle

xi trump point laughThe US and China's trade war continues. Xi Jinping and Donald Trump in Beijing in November 2017. Thomas Peter/Getty

There is some good news for farmers, however. Firstly, the Trump administration has started a programme of subsidies to try and lessen the impact of his trade war on US agriculture.

In August, the administration launched a $4.7 billion initial investment plan to help corn, cotton, dairy, hog, sorghum, soybean, and wheat farmers.

The program is slated to expand to as much as $12 billion. But according to Reuters, less than $900 million has been paid out so far.

On top of the subsidies, tensions between the two sides appear to be waning, with the US signaling a more conciliatory stance when it comes to tariffs. Trump has reportedly sidelined some of his most aggressively anti-China team members, with Peter Navarro, an uber-protectionist trade adviser, among those given a back seat.

The most significant sign that the US and China may actually come to some agreement came last week after reports surfaced that Beijing sent a letter to the Trump administration outlining possible concessions.

So far, the US and China have traded tit-for-tat tariffs on goods totalling $360 billion, with the US acting as the aggressor, and Trump threatening numerous times to place tariffs on all US imports from China, worth about $500 billion.
« Last Edit: November 21, 2018, 04:42:02 AM by RE »
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🚛 GM warned Trump that his China tariffs would hurt jobs. He now complains
« Reply #36 on: November 28, 2018, 12:38:51 AM »
There's 15,000 White Trash who won't be voting for Trumpofsky in 2020.  Not to mention all the parts suppliers who will go outta biz.  Another perfectly aimed foot shot from the Donald.  ::)


GM warned Trump that his China tariffs would hurt jobs. He now complains that it's happening.
Callum Burroughs

Donald Trump nucelar deal President Donald Trump railed against GM for cutting jobs, but it's partly his trade war's fault. Chip Somodevilla/Getty Images

Analysis banner

    President Donald Trump is railing against GM's decision to close plants and ax about 14,000 jobs, events triggered in part by his trade war.
    Though it cited demand and other factors when announcing the latest job cuts, GM warned earlier this year that tariffs would hurt jobs and wages.
    Trump specifically criticized GM's decision to idle its plant in Ohio, a state that voted for him in 2016.

US President Donald Trump is railing against General Motors' decision to close plants and ax about 14,000 jobs, something his trade war helped trigger in the first place.

When listing reasons behind the job cuts on Monday, GM tiptoed around trade policy and blamed a host of other factors. But the company has been much more direct in its criticism of Trump's trade war in the past.

Earlier this year, GM lowered its profit forecasts for 2018, citing higher steel and aluminum prices caused by new US tariffs. And in June, GM warned that trade tariffs could lead to job losses and lower wages, telling the Commerce Department that higher steel tariffs would affect competitiveness.

The automaker, which employs about 110,000 workers, on Monday said it planned to halt production at a plant in Ohio, a state that voted for Trump in 2016.

GM did not specifically mention tariffs, instead citing "changing market conditions and customer preferences" among the reasons.

While that may be true, "the import tariffs probably accelerated the move," said Edward Alden, senior fellow at the Council on Foreign Relations. "GM is eliminating its lower margin passenger vehicles to concentrate on higher-margin products, and the rising cost of steel probably made made those lower margin vehicles even less attractive than they already were."

Trump lashed out at CEO Mary Barra. "I was very tough," he said, per CNN. "I spoke with her when I heard they were closing, and I said, you know, this country has done a lot for General Motors. The United States saved General Motors, and for her to take that company out of Ohio is not good."

Trump said he told the CEO that she had "better" reopen plants in the US soon.

Trump's trade war shows no signs of abating. He told The Wall Street Journal on Monday that he was likely to go ahead with a hike on tariffs on Chinese goods, increasing them to 25% from 10%. The tariffs have so far hammered global shipping, US farmers, and, perhaps, even iPhone users.

GM on Monday said its Lordstown Assembly plant in Warren, Ohio, would be "unallocated" by the end of 2019, as would its Oshawa Assembly plant in Oshawa, Ontario, its Detroit-Hamtramck Assembly plant in Detroit, and its propulsion-component plants in Maryland and Michigan. It also said it would cease operations at two unnamed assembly plants outside the US.

The stock soared 4.8% on Monday's announcement. On Tuesday, however, GM shares were down 1.5% in premarket trading as of 11 a.m. in London (6 a.m. EST).
« Last Edit: November 28, 2018, 01:36:50 AM by RE »
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Offline RE

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Can I still go across the border for a cheap dentist?


As Trump threatens to close border, experts warn of billions in economic damage
By Molly O'Toole, Noah Bierman and Eli Stokols
Apr 01, 2019 | 4:15 PM
| Washington
As Trump threatens to close border, experts warn of billions in economic damage

A rancher drives along the border fence separating his property in Cochise County, Ariz., from Mexico. (Brian van der Brug / Los Angeles Times)

When the Trump administration abruptly shuttered the San Ysidro border crossing for five hours on the Sunday after Thanksgiving following a skirmish with a group of migrants, holiday traffic snarled for hours south of San Diego.

Businesses on the U.S. side of the border lost about $5.3 million in sales, local officials said. Tens of thousands of people were temporarily stuck on both sides of the border, creating chaos in nearby areas.
inRead invented by Teads

President Trump now is threatening to exponentially increase the scale of that disruption, vowing to indefinitely close the U.S. border with Mexico to show his resolve — and his pique — as tens of thousands of Central American migrants continue to jam legal entry points and unguarded remote areas.

Trump’s acting chief of staff, Mick Mulvaney, said Sunday that the president, who has threatened to close the border before, is not bluffing. But White House officials declined to provide details of what, if anything, Trump intends to do.
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It is probably impossible to close the entire 2,000-mile-long border. But Trump could shut some or all of the 47 official entry ports, which process more than 1 million people and about $1.7 billion in commerce every day.

Even a limited and temporary closure would be felt from California to Texas. A longer-term closure would devastate local businesses and ripple through regional supply chains, directly affecting the farms and automobile manufacturers whose employees form the core of Trump’s political base.

It would quickly face legal challenges and add to chronic staffing problems for already-stretched U.S. immigration enforcement agencies. It also would require Mexico’s cooperation, which is hardly assured.

The U.S. Chamber of Commerce, a pro-business organization, warned Monday of “severe economic harm on American families, workers, farmers, and manufacturers across the United States” if Trump closes the border.

“I imagine they probably do have the authority to close any particular port of entry temporarily,” said Leon Rodriguez, director of U.S. Citizenship and Immigration Services from 2014-17. “Having said that, the political, logistical and economic consequences of doing that are potentially devastating.”

Even some of Trump’s immigration allies worry about the economic impact of a border shutdown.

“If this were to go on for more than a few days, you could see some American factories shutting down temporarily until it's over,” said Mark Krikorian, the director of the Center for Immigration Studies, a Washington think tank interested in restricting illegal immigration.

The White House could limit the economic impact, he said, by halting passenger, car and pedestrian border crossings while keeping rail and truck ports open.

“That would be one way to send a message to Mexico without as severe of an economic impact on the U.S.,” he said.

Trump, who shut part of the federal government for 35 days in December and January in a dispute with Congress over his demands for a border wall, may decide those risks are worth the potential political gain as he gears up for his reelection campaign.

He plans to travel to California on Friday for fundraisers in Los Angeles and a visit to the border at Calexico, where he is expected to highlight the recent surge in migrants from Central America.

The administration has amped up its rhetoric, vowing to crack down on what officials called a spike in asylum seekers from Central America that has overwhelmed U.S. immigration agencies.

Homeland Security Secretary Kirstjen Nielsen ordered the Customs and Border Protection commissioner to reassign 750 officers from ports of entry to help Border Patrol agents operating primarily between ports of entry and to consider increasing that number.

Nielsen told reporters Friday that closing ports of entry was also under consideration.

“If we have to close ports to take care of all of the numbers who are coming, we will do that. So it’s on the table,” she said.

Nielsen said pulling officers from busy crossing points would require closing some lanes that process cars and people.

Squeezing ports of entry almost certainly would put more strain on the officers and Border Patrol agents who are dealing with the crisis, however. Administration efforts to hire 15,000 new border agents and immigration officers have largely flopped — the agencies face thousands of vacancies instead.

If trucks carrying farm produce and car parts are barred from crossing the border, the economic impact would quickly spread.

Nearly $13.7 million in agricultural products move through the port of entry at Nogales, Ariz., every day, for example, said Veronica Nigh, an economist with the American Farm Bureau Federation in Washington. Because those products are perishable, even a short closure could hurt farmers and consumers on both sides.

“It’s not like we have steel that can sit in storage and wait for a year to be shipped after it’s produced,” Nigh said. “We’re talking about a matter of hours on a lot of these products.”

Similarly, the car parts shipped across the border each day are integral to supply chains that span the globe. A slowdown could idle workers and raise prices both in the United States and abroad.

After the 9/11 attacks in 2001, the George W. Bush administration stepped up inspections at border ports that brought crossings to a standstill in some areas.

Bush received a call from the president of General Motors, who said the auto giant would soon go bankrupt if the situation persisted, according to Alan Bersin, who served as a senior official in the Homeland Security Department in the Obama administration.

Bersin said Trump has the executive authority to seal off the border, but his threats are “ultimately a bluff.”

Last Tuesday, Nielsen held unannounced talks with Mexican counterparts in Miami, warning them of a slowdown at the border and urging them to do more to stop migrants traveling north.

On Wednesday, she signed what she hailed as a “historic” pact with the Northern Triangle countries of Guatemala, Honduras and El Salvador to curb unauthorized migration, including joint police operations to combat trafficking.

Even as Trump is seeking such cooperation, he said he would cut aid to the three Northern Triangle countries because “they haven’t done a thing for us.”

The State Department has been instructed to cut a total of $450 million that Congress had authorized for the three countries over the last two years but has not yet spent.

The administration is required to inform Congress and, in the event of objections, to negotiate the size of the cuts. But White House officials can also ignore those objections and simply allow the funding to expire.

“We have asked for details, and so far nothing,” said a senior congressional staffer with knowledge of Latin America. “The agencies were all caught off guard and now are scrambling to figure out what this means and what [Trump] was talking about.”

Times staff writers Jazmine Ulloa in Los Angeles and Tracy Wilkinson in Washington contributed to this report.
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🚛 Trump Vows to Close Border, Even if It Hurts the Economy
« Reply #38 on: April 03, 2019, 01:30:28 AM »

Trump Vows to Close Border, Even if It Hurts the Economy

President Trump said on Tuesday that “security is more important to me than trade.”Credit Al Drago for The New York Times

By Jim Tankersley and Ana Swanson

    April 2, 2019

WASHINGTON — President Trump acknowledged Tuesday that closing the southern border with Mexico could damage the United States economy, but said protecting America’s security was more important than trade.

In remarks from the Oval Office, Mr. Trump reiterated his threat to shut the border if Mexico, America’s third largest trading partner, cannot restrict a flow of asylum seekers trying to cross into the United States. But the president’s economic team, concerned about the damage from such a move, said it was looking for ways to limit the fallout if Mr. Trump does do so.

“Sure, it’s going to have a negative impact on the economy,” Mr. Trump said, adding, “but security is most important.”

“Security is more important to me than trade,” he said.

Republican lawmakers, economists and business groups largely disagree with that assessment and warned this week that closing the border could cripple the flow of goods and workers and devastate American automakers and farmers, as well as other industries that depend on Mexico for sales and goods.


“Closing down the border would have a potentially catastrophic economic impact on our country,” Senator Mitch McConnell, Republican of Kentucky and the majority leader, said in an interview. “I would hope that we would not be doing that sort of thing.”

Mark Zandi, the chief economist at Moody’s Analytics, said that “a full shutdown of the U.S.-Mexican border of more than several weeks would be the fodder for recessions in both Mexico and the U.S.”
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Mr. Trump’s economic advisers have briefed him on the potential financial damage from a border shutdown and started looking for ways to mitigate it, including possibly keeping certain trading avenues open.

Larry Kudlow, the director of the National Economic Council, said Tuesday in a brief interview that the Trump administration was trying to secure the border without harming the economy.

“The question is,” he said, “can we deal with that and not have any economic damage? I think the answer is we can. People are looking at different options.”
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Mr. Kudlow added that the administration was “looking for ways to allow the freight passage — some people call it truck roads.”

“There are ways you can do that, which would ameliorate the breakdown in supply chains,” he said.

But business leaders say there is no way to contain the damage from even a partial shutdown of the 2,000-mile border that the United States shares with Mexico. Nearly $1.7 billion of goods and services flow across the border daily, as well as nearly a half-million legal workers, students, shoppers and tourists, the U.S. Chamber of Commerce said Monday.

On Tuesday, officials with the chamber called a partial border shutdown “uncharted territory” and said such a policy would have negative economic consequences, particularly for communities along the border.

“We don’t know whether that is feasible or not,” said Neil Bradley, the chamber’s executive vice president and chief policy officer.

Even if it is possible, a partial shutdown would still cause significant disruptions for industries that are highly integrated across the border, including automobiles, machinery and electronic equipment.

“The North American auto industry will be crippled” in a week, Kristin Dziczek, a vice president for the Center for Automotive Research, an industry research group, said in a tweet.

Mr. Trump’s pledge to close the border comes in response to what officials with the Department of Homeland Security say is an increase in migrant families who are flooding America’s immigration system, leading to overflowing detention centers and mass releases of migrants.
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The president told reporters that if Mexico cannot restrict the flow of asylum seekers trying to cross into the United States, and if Congress cannot agree to several immigration restrictions that Mr. Trump has long pushed for, “the border is going to be closed.”

While 76,000 migrants crossed the border in February, that number is nowhere near the migration levels seen in the early 2000s. And a majority of the migrants crossing the border now are Central American families looking for asylum, as opposed to Mexican individuals looking for work. Homeland security officials could quickly deport Mexican individuals seeking employment, but, by law, they cannot swiftly deport Central American families or unaccompanied children.

Homeland security officials have said they expect the number of crossings to surpass 100,000 this month. And a senior department official said those traveling in and out of ports of entry were already feeling an effect: There was a three-hour wait at the port of entry in Brownsville, Tex., according to the official, and there were around 150 trucks backed up and waiting to cross at Otay Mesa, in California.

On Monday, Kirstjen Nielsen, the homeland security secretary, said she would divert up to 750 border patrol officials from ports of entry to areas in between the ports to handle large groups of migrants crossing the border. A senior homeland security official also said the administration could start closing traffic lanes at the ports.

“The crisis at our border is worsening,” Ms. Nielsen said, “and D.H.S. will do everything in its power to end it.”

Senator Lindsey Graham, Republican of South Carolina and one of Mr. Trump’s external advisers, has been urging the president to ease off the threat. On Tuesday, Mr. Graham portrayed Mr. Trump’s latest broadside as less an eventuality and more a calculated bargaining position.

“You are taking a bad problem and, by closing the ports of entry, you are creating another problem,” he said during an interview. “To the extent that he wants to redeploy resources to the points of entry to deal with the ungoverned spaces — that will create economic upheaval, but that will hopefully lead to a solution.”


Border activity makes up a relatively larger share of Mexico’s economy than the United States’, meaning Mexico would most likely have more economic damage from a border closing, Mr. Zandi said.

But that does not mean the United States would be in a winning position. Communities across the country would probably see supply chain disruptions, product shortages, seizures in stock and bond markets and a plunge in already-fragile business confidence, Mr. Zandi said. The disruption would be especially sharp in the border states of California, Arizona, New Mexico and Texas, which all have Mexico as their No. 1 export market.

Any closure could have far-ranging implications for a wide range of industries — including automotive, electronics and apparel — that source small components and deliver their products on a just-in-time basis on both sides of the border.

It could also be devastating for the agriculture industry. Since the North American Free Trade Agreement began in 1994, American farmers have moved toward specializing in corn, soybeans, chicken, dairy, pork and beef to supply to Mexico, while Mexican farmers have specialized in fresh fruits and vegetables to send to the United States. Any delays in deliveries of these products could lead to near immediate price hikes and empty supermarket shelves, which would hit low-income Mexicans and Americans the hardest.

Christin Fernandez, the vice president for communications at the Retail Industry Leaders Association, said that slowing or halting screenings at major ports near the border would lead to product delays and potentially higher shipping costs.

“The entire retail ecosystem is sustained on the expectation that America’s retailers can provide consumers with the goods they want and need, when they need it, at the best possible prices,” Ms. Fernandez said. “If our suppliers are feeling the pain, retailers will feel the pain, and, ultimately, it is consumers that will bear the burden.”

Stock markets do not appear to be pricing in any risk of a border closure. The S&P 500 was essentially unchanged on Tuesday, and it remains near a six-month high.

Zolan Kanno-Youngs and Glenn Thrush contributed reporting.
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Of course not.  The Koch Bros have assured the Chinese that Trumpovetsky will be brought back into line.  The Donald will then claim an AMAZING VICTORY of his clever negotiating skills.  ::)


Experts say China isn't too worried about Trump's tariff threats
The Chinese strategy, one expert said, is basically to let Trump bluster and then resume talking with more serious administration officials.

China's Vice Premier Liu He shakes hands with U.S. Treasury Secretary Steven Mnuchin as Yi Gang, governor of the People's Bank of China (PBC) and U.S. Trade Representative Robert Lighthizer stand next to them at Diaoyutai State Guesthouse in Beijing, China on March 29, 2019.Nicolas Asfouri / Pool via Reuters file

May 6, 2019, 2:27 PM AKDT
By Corky Siemaszko

The Chinese were not surprised by President Donald Trump's threats to impose more tariffs on their goods, several experts said Monday — they just assumed it was Trump being Trump.

On Sunday, Trump appeared to imperil the ongoing trade talks with China — sending stock prices on a roller coaster ride Monday — with the surprise announcement that he intended to impose tariffs on almost all goods imported from China by Friday.

“I am not sure how literally Trump’s threat is being taken in Beijing, but he has articulated essentially the same threat before,” William Hurst, a Northwestern University political science professor and an expert on Chinese politics and legal institutions, wrote in an email to NBC News.

“So it is likely not a surprise, except perhaps in its timing.”

And Trump may have inadvertently strengthened the Chinese bargaining position, Hurst said.

“The U.S. seems to want trade negotiations to conclude quickly, whereas it is probably in China’s interest to delay or drag them out as long as possible,” Hurst said.

“I think the Chinese leadership generally views Trump as a weak president with some erratic tendencies,” he added. “Trump is at least potentially useful for China because he is accelerating America’s retreat from the world and alienating erstwhile allies and partners as he does so.”

Trump tweeted his tariff threat Sunday and accused the Chinese of trying “to renegotiate” parts of the deal that both sides were thought to have already agreed on.

Earlier this month, Treasury Secretary Steven Mnuchin and U.S. Trade Representative Robert Lighthizer had characterized the proposed trade deal as “getting into the final laps.”

But Trump tweeted that he would raise import taxes on $200 billion in Chinese products to 25 percent from 10 percent as of Friday. That's on top of a 25 percent duty on another $50 billion of Chinese imports. Beijing had imposed penalties on $110 billion of American goods.

Stock prices initially plunged on Wall Street on Monday amid fears of an all-out trade war between the world’s two largest economies before staging a stunning comeback as investors bet China and the U.S. would reach a trade deal despite Trump — not because of Trump.

Hurst said China is playing a long game against the U.S. while Trump wants to appear that he’s trying to make good on his promise to protect industry in the Rust Belt states he needs to win re-election.

“China hopes to paint Trump and the U.S. not so much as adversaries but increasingly as outliers and antagonists in the international economic and security order,” Hurst said. “If the United States becomes more isolated and less trusted, this weakens any claim to American hegemony. China does not want to topple the United States, but wants to fill some of the space left open as America recedes from its position of global dominance."

The Chinese view Trump “as untrustworthy and difficult,” said Phillip Braun, a Northwestern University finance professor who is an expert on Chinese politics and once served as an adviser to the prime minister of Thailand.

“When he makes announcements like this, it makes it difficult for the Chinese,” he said. “They can’t be seen by their own people as capitulating to Trump.”

So their strategy, Braun said, is basically to let Trump bluster and then resume talking with Mnuchin and Lighthizer.

“In the end, Trump just wants to look good,” Braun said. “The Chinese saw what happened with NAFTA when he threatened Mexico and Canada with tariffs.”

Braun was referring to the North American Free Trade Agreement, which Trump had called the “worst trade deal in the history of the world” when he was running for president.

NAFTA was also deeply unpopular in states such as Michigan, Pennsylvania and Ohio, which had, for generations, seen good-paying manufacturing jobs migrate to Mexico.

In the final months of talks to renegotiate NAFTA, Trump threatened to impose a 25 percent tariff on automobile and auto parts exports to the U.S. from Mexico and Canada.

“Without tariffs we wouldn’t be talking about a deal,” Trump said in October after announcing a new agreement to replace NAFTA called the United States-Mexico-Canada Agreement.

But neither the U.S. nor Mexico and Canada have ratified the new deal.

A team from Beijing was set to have talks with American negotiators Wednesday while the two companies push for a trade agreement, according to CNBC. It was unclear if the talks would still be taking place Wednesday.
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🚛 Trade war fears are crushing stocks, and sell-off could keep going
« Reply #40 on: May 08, 2019, 12:42:51 AM »

Trade war fears are crushing stocks, and sell-off could keep going if there is no deal by Friday

Traders work on the floor of the New York Stock Exchange as the Federal Reserve Board Chairman Jerome Powell holds a news conference on December 19, 2018 in New York City.
Spencer Platt | Getty Images News | Getty Images

    Stocks were slammed Tuesday amid worries the global economy and earnings would take a hit from a trade war between the U.S. and China.
    While many analysts still expect a deal, there are concerns that the Trump administration will unleash higher tariffs at the end of the week, hurting the global economy, aggravating tensions with China and extending the time frame for the talks.
    The stock market Tuesday took the announcement of tariffs as a sign of potentially serious problems in the trade negotiations, unlike Monday when it reacted to President Donald Trump’s tariff threats as simply a bargaining posture.

GS: Markets React To Federal Reserve Interest Rate Announcement in New York 181219

Investors are worried the U.S. and China may not find enough common ground to head off a new round of tariffs later this week that could bite into global growth, squeeze profit margins and drive down stock prices.

Trade negotiators are scheduled to meet this week in Washington, but recent tensions make it less likely a deal will be agreed to before the Trump administration unleashes a new round of tariffs. Analysts say a deal is still possible, but the risks have risen that there will be more tariffs before a deal can be agreed, and it could then take a lot longer than expected for an agreement to be hammered out.
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How bad things could get

Stocks plunged and bonds rose in a safety trade Tuesday, after the Trump administration set the clock ticking on a 12:01 a.m. ET Friday deadline for raising tariffs to 25% on $200 billion in Chinese goods. Trump administration officials said they still expect to meet with a Chinese trade delegation this week, but at a media briefing late Monday they said their Chinese counterparts reneged on some key areas of agreement in trade talks.

The Dow fell more than 473 points to 25,965, and the S&P 500 was off 48 points at 2,884.

“It all depends on what happens Friday. Traders were not expecting this. The market is trying to discount it in case tariffs get reinstated,” said Scott Redler, partner with “This is a curve ball, unexpected scenario.”

With the threat of tariffs, analysts say many of Wall Street’s assumption for profits and growth would have to be tossed —suggesting that stocks could be too richly priced near recent highs.

The forward price-to-earnings ratio on the S&P 500 was at 17 times earnings expectations. “That has to come down because growth has to come down...A good part of what went on in this market was predicated on a deal getting done in the first place. If that’s not the case, we have to start taking [earnings] estimates down,” said Art Hogan, National Securities chief market strategist.

Keith Parker, chief U.S. equities strategist at UBS, said the hit to S&P 500 earnings would be 2% or greater, if the 10% tariffs on $200 billion in Chinese goods are raised to 25%. Parker said earnings would be hit by 7% if there was a full blown trade war, while the S&P 500 could trade in a range of 600 points on different scenarios of escalation of trade wars to de-escalation. The S&P is now near the top of the range, he said.

“We think the most likely path is the deal. But escalation risks have risen and the growth backdrop is bit better so [investors should be] selectively staying involved in cyclicals and look for ways to hedge,” said Parker. “The S&P is probably trading much more in line with a status quo or some form of a deal. I would say it’s not pricing that trade war scenario.”

The seeming divide between Chinese officials and the Trump administration added to concerns, after week’s of positive commentary from both sides.

Hogan said China’s comments are problematic and could indicate the two sides are far apart. “They’re not going to back down from the parts of the deal they want. They don’t want to have a full account of the deal made public,” he said.
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But at the same time, leaders in Washington and Beijing may feel like they have more leverage in the negotiations. China’s recent data has shown its economy is stabilizing after months of fiscal and monetary stimulus. The Trump administration too must be feeling upbeat after a strong U.S. jobs report and higher stock prices.

Analysts said the threat of new tariffs puts assumptions about the market at risk, including the expectations for 3% earnings growth this year. Earnings in the first quarter grew at 1.2%, much better than earlier estimates for a decline, and second quarter S&P 500 earnings growth is expected at 1.5%, according to Refinitiv.

On Tuesday, stocks reversed the pattern of Monday, where the worst losses were in the early morning as markets reacted to President Donald Trump’s Sunday afternoon tweets threatening more tariffs. As the day went on, stocks shook off losses as traders took the president’s threats as more a bargaining ploy by the president.

Global equity markets could also take a hit, as global growth would expected to slowdown on another round of tariffs.

“If we have the increase from 10% to 25%, that would lower Chinese growth by a half a percentage point, and global growth by 0.2 of a percentage point,” said Cesar Rojas, global economist at Citigroup. The impact on U.S. growth would be less than a tenth of a percentage point.

“I think that we will get a deal,” said Rojas. “I’m still hopeful there will be an announcement that tariffs will not increase, and that they will come to an agreement...If that’s not the case, and there is a tariff increase on Friday , I will change my base case to having an escalation of trade tensions.”

Rojas said if that’s the case, then a deal might be a much longer way off. China might not come back to the table in a serious way, until after it felt the pain of tariffs. The U.S. would also be hit by Chinese tariffs, and that would also come as U.S. growth was already slowing down from last year’s level.
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“The problem is we don’t know what the stick point is. This is the black box. We’re still concerned because neither side said anything positive,” Hogan said, adding the situation could easily be made worse by tariffs.

“That’s where this turns form a trade negotiation to a trade war because it’s bad for both economies,” Hogan said.

Stocks that would be hurt most by the increase in tariffs include retailers, tech, and industrials. Caterpillar fell 2.3%; SMH, VanEck Vectors Semiconductor ETF lost 2.3%

Goldman Sachs retail analysts Tuesday said companies had been moving to protect themselves against tariffs, when they were at 10% but may have not expected the increase to 25%, given optimism around the talks. Investors may also not have factored in any further tariffs.

“Within our consumer coverage, the most significant category on the $200bn list was furniture - retailers exposed to this category, such as Big Lots (BIG), could see a negative impact, ” the wrote. But the analysts added that companies that buy goods from China, such as Dollar Tree and Five Below could also be negatively impacted.

“We note that DLTR already included the impact of a move to 25% in FY19 EPS guidance, but based on our conversations, investors were anticipating upside if tariffs stayed at 10%,” they wrote.
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May 9, 2019 / 8:05 PM / Updated an hour ago
U.S. escalates trade war amid negotiations, China says will hit back
David Lawder, Yawen Chen

WASHINGTON/BEIJING (Reuters) - The United States escalated a tariff war with China on Friday by hiking levies to 25% for $200 billion worth of Chinese goods in the midst of last-ditch talks to rescue a trade deal.

But even as Beijing threatened retaliation, negotiators in Washington agreed to stay at the table for a second day, keeping alive hopes of an eventual agreement.

U.S. President Donald Trump, who has adopted protectionist policies as part of his “America First” agenda, issued orders for the tariff increase, saying China had “broke the deal” by reneging on commitments made during months of negotiations.

Trump also said he would start the “paperwork” on Friday for 25% duties on another $325 billion in Chinese imports.


In Beijing, China’s Commerce Ministry said it “deeply regrets” the U.S. decision, adding that it would take necessary countermeasures, without elaborating.

Chinese Vice Premier Liu He, U.S. Trade Representative Robert Lighthizer and U.S. Treasury Secretary Steven Mnuchin talked for 90 minutes on Thursday and were expected to resume efforts on Friday to rescue a deal that could end a 10-month trade war between the world’s two largest economies.

The Commerce Ministry said negotiations were continuing, and that it “hopes the United States can meet China halfway, make joint efforts, and resolve the issue through cooperation and consultation”.

With negotiations in progress and no action from the Trump administration to reverse the increase, U.S. Customs and Border Protection imposed the new 25% duty on more than 5,700 categories of products leaving China after 12:01 a.m. EDT (0401 GMT) on Friday.
A general view of Kwai Tsing Container Terminals for transporting shipping containers in Hong Kong, China July 25, 2018. REUTERS/Bobby Yip

The Office of the U.S. Trade Representative separately said seaborne cargoes shipped from China before midnight were not subject to the new tax as long as they arrive in the United States prior to June 1. Those cargoes will be charged the original 10% rate.

The grace period was not applied to three previous rounds of tariffs imposed last year on Chinese goods, which had much longer notice periods of at least three weeks before the duties took effect.

“This delay might create an unofficial window during which the U.S. and China can continue to negotiate,” investment bank Goldman Sachs wrote in a note, adding that it was a “somewhat positive sign” that talks were continuing.

Trump gave U.S. importers less than five days notice about his decision to increase the rate on the $200 billion category of goods to 25%, which now matches the rate on a prior $50 billion category of Chinese machinery and technology goods.

U.S. stock futures fell and Asian shares pared gains after the United State went ahead with its threatened tariff hike, reflecting investors worries that a protracted trade war would hit global economic growth.


E-mini futures for U.S. S&P500 slipped, was last down 0.2% in volatile trade. MSCI’s broadest index of Asia-Pacific shares outside Japan was more than 1% lower. Chinese share markets fell on their reopen after the lunch break but quickly recovered ground, as investors took heart from the continuation of talks.

The yuan also strengthened against the dollar.

“I think the Chinese in the end will want to keep negotiations going. The question is: where do they go for retaliation?” said James Green, a senior adviser at McLarty Associates who until August was the top USTR official at the embassy in Beijing.

Green expected China to increase non-tariff barriers on U.S. companies, such as delaying regulatory approvals, as it couldn’t hit the same amount of imported U.S. goods with higher tariffs.
Slideshow (3 Images)

The biggest Chinese import sector affected by the latest tariff hike is a $20 billion-plus category of internet modems, routers and other data transmission devices, followed by about $12 billion worth of printed circuit boards used in a vast array of U.S.-made products.

Furniture, lighting products, auto parts, vacuum cleaners and building materials are also high on the list of products subject to the higher duties.

Gary Shapiro, chief executive of the Consumer Technology Association said the tariffs would be paid by American consumers and businesses, not China, as Trump has claimed.

“Our industry supports more than 18 million U.S. jobs – but raising tariffs will be disastrous,” Shapiro said in a statement.

“The tariffs already in place have cost the American technology sector about $1 billion more a month since October. That can be life or death for small businesses and startups that can’t absorb the added costs.”


Economists and industry consultants have said it may take three or four months for American shoppers to feel the pinch but retailers will have little choice but to raise prices on a wide range of goods to cover the rising cost of imports before too long, according to economists and industry consultants.

Even without the trade war, China-U.S. relations have continued to deteriorate, with an uptick in tensions between the two countries over the South China Sea, Taiwan, human rights and China’s plan to re-create the old Silk Road, called the Belt and Road Initiative.

Reporting by David Lawder in Washington, and Yawen Chen, Michael Martina, Ryan Woo and Ben Blanchard in Beijing; Editing by Simon Cameron-Moore
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🚛 China Armed With Powerful Market Weapons in Duel With Trump
« Reply #42 on: May 10, 2019, 02:36:49 PM »

China Armed With Powerful Market Weapons in Duel With Trump
By Katherine Greifeld
May 9, 2019, 1:05 PM AKDT Updated on May 10, 2019, 5:05 AM AKDT

    Currencies, Treasuries and soybeans are seen as cudgels
    Yuan and beans have fallen, but bonds have remained buoyant

Current Time 0:08
Duration Time 3:29
U.S. Raises Tariffs as China Says It's Forced to Retaliate: What's Next?

Iris Pang, Greater China Economist at ING, talks about the trade spat between the U.S. and China.

China has a powerful financial-market arsenal for its trade tussle with America, including a hoard of Treasuries and its currency. But using those weapons is not without cost.

Beijing said it will be forced to retaliate -- but didn’t specify how -- after U.S. President Donald Trump followed through with his threat to raise tariffs Friday on $200 billion of Chinese imports to 25% from 10% percent. But simply responding with its own tit-for-tat tariffs isn’t China’s most likely move, said Brad Setser, a former Treasury official who’s now a senior fellow for international economics at the Council on Foreign Relations.

“Matching the U.S. dollar-for-dollar on the U.S. tariffs would imply raising a 25% tariff on all U.S. imports, including those that go into China’s exports,” Setser said. “China certainly could do that, but it would in many cases damage China directly.”

Trump pays attention to financial markets. He has often tweeted about stocks as they’ve zoomed to record highs. After Trump announced the tariff hike on Sunday, the S&P 500 dropped four straight days.

China, the world’s second-largest economy, has markets levers it can pull to escalate the battle. Here are some of them:
Devalue the Yuan

Chinese policy makers could devalue the yuan to offset the impact of U.S. duties on China’s economy. The offshore yuan weakened 5.5% against the dollar in 2018, drawing Trump’s ire and fueling speculation that the country was deliberately weakening its currency. While it has fallen 1.8% this week, the currency rose on Friday after the People’s Bank of China set its daily fixing at a stronger-than-expected level.

However, China’s painful experience with devaluing the yuan in 2015, which prompted capital to flee the nation, is likely to dissuade a similar move, according to Tao Wang, UBS Group AG’s chief China economist and head of Asia economic research. “China doesn’t like the self-fulfilling outflows that come as a result of depreciation, which tend to diminish domestic confidence,” she said. “In addition, yuan depreciation last year angered the Trump administration and led to higher U.S. tariffs.”

Currency has been a focal point in the trade talks. The U.S. has sought a yuan stability pact as part of an eventual deal, according to people familiar with the matter.
Dump Treasuries

China owns $1.1 trillion of U.S. government debt, more than any other foreign nation. If it pared back its holdings in that $15.9 trillion asset class, that could be a potent weapon. Bond markets were jolted last year by a report that Chinese officials recommend slowing or halting Treasury purchases.

However, China doesn’t really have other good options for where to park its $3.1 trillion in foreign-currency reserves -- the world’s largest stockpile -- making this an unlikely path, according to Ed Al-Hussainy of Columbia Threadneedle Investments. In addition, if China dumps Treasuries, that could cause prices to plummet, driving yields higher and devaluing whatever U.S. debt the country is still holding. So far, bonds have rallied, not fallen.

“Any sharp moves higher in U.S. yields both adversely impact the valuation of their existing Treasuries stock and could spark a dollar rally,” the strategist said. “The financial and FX stability risks of this policy could outweigh the benefits.”
Balk at Soybeans

China, the biggest buyer of U.S. soybeans, has already slapped a 25% duty on them. Much of the crop is grown in Midwestern states that make up Trump’s electoral base, making its fate even more important to the president.

Before the trade negotiations soured, China made what U.S. Agriculture Secretary Sonny Perdue described in February as some “good faith” purchases. Now, future buying might be up in the air. While devaluing the yuan or dumping Treasuries would be harder to pull off, balking at soybeans would be a relatively easy move, Setser said.

“There are some easy things for China to do,” including withdrawing from soybeans, he said.

Futures on the crop have dropped 11% since April 10.

— With assistance by George Lei, Mario Parker, and Philip Glamann
(Updates U.S.-China state of play in 2nd graf and yuan pricing.)
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🤡 Here’s how China may retaliate to Trump’s tariff hike
« Reply #43 on: May 13, 2019, 12:52:31 AM »

Here’s how China may retaliate to Trump’s tariff hike
Published 3 hours ago
Huileng Tan
Weizhen Tan

The U.S. flag flies at a welcoming ceremony between Chinese President Xi Jinping and U.S. President Donald Trump in 2017.
Getty Images News | Getty Images
Key Points

    U.S. President Donald Trump on Friday hiked the tariff rate to 25% on $200 billion of Chinese goods.
    China’s Commerce Ministry said it would take countermeasures against the American tariff hike. It did not announce what its response would entail but said it “deeply regrets” the turn of events.
    Experts said China is likely to use a number of methods to economically strike back at the United States.

Beijing has a host of options to retaliate against the latest the hike in U.S. tariffs on Chinese imports, experts said on Monday.

The latest round of trade talks between American and Chinese negotiators concluded on Friday without a trade agreement. Those negotiations fell under the shadow of U.S. President Donald Trump’s threat to more than double the tariff rate to 25% on $200 billion of Chinese goods — which he made good on just after midnight ET on Friday.

China’s Commerce Ministry said immediately after those new rates came into effect that it would take countermeasures against the American move. It did not announce what its response would entail but said it “deeply regrets” the turn of events.

Experts told CNBC that Beijing’s response could end up combining several ways to hurt the U.S.

“I expect that China will retaliate and they will do it in as commensurate a way as they can, and that will include not just imports,” said Susan Shirk, former deputy assistant secretary of state during the Clinton administration. “I think our farmers and our farm exports to China will be targeted because that’s what President Trump cares about politically,”

She added that she expects added pressure on American firms operating in China, potentially including a slowdown in approvals for banks and checks on imports.

“Really anything could be fair game, and I would be extremely surprised if there were no retaliation,” said Shirk, who is now the 21st Century China Center chair at the University of California San Diego School of Global Policy and Strategy.

Another option for Beijing’s retaliation could include currency depreciation, analysts said. That is, a drop in value for the yuan would give Chinese exports a trade advantage and potentially offset the impact of U.S. tariffs.

“We think the currency is one area in which Beijing has a clear advantage over Washington,” Bo Zhuang, chief China economist at research firm TS Lombard, said in a note on Friday.

He said China’s shrinking current account balance, and the tariffs re-escalation “will create an opening for the (People’s Bank of China) to accept further market-driven depreciation ” of the yuan in the second half of this year.

“Note though that, while the People’s Bank of China may tolerate more yuan depreciation, they may be wary of using it as a retaliatory tool. As well as inciting Trump’s wrath, a weaker currency would also risk triggering capital outflows and damage efforts to open China’s economy,” Seema Shah, senior global investment strategist at Principal Global Investors, cautioned in a note.

Many have cautioned that China could dump its more than $1 trillion worth of U.S. debt in retaliation, but one expert told CNBC on Monday that such a move would ultimately not be in the country’s best interest.

“The largest holder of U.S. Treasurys in the world is China, and so they hurt their own balance sheet as much as they incrementally hurt the U.S. and the losses that they would be forced to recognize are very, very real,” said James Sullivan, head of Asia ex-Japan equity research at J.P. Morgan.

Yet despite the array of options available to Chinese President Xi Jinping for retaliation to the American tariff hike, he doesn’t necessarily have the upper hand.

“I think there are workarounds, but this public chicken game between President Trump and President Xi is very, very difficult for President Xi to work his way out of,” said Shirk.

— CNBC’s Jacob Pramuk, Everett Rosenfeld, Eustance Huang and Reuters contributed to this report.
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🤡 The Realities Of Trump's Trade War
« Reply #44 on: May 13, 2019, 04:28:28 AM »
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