6th Apr Update #1 : New China US Trade War

[Y_Participant 4591]

6th Apr Update #1 : New China US Trade War

I add the link to the original post here
/forums/topic/the-new-china-us-trade-war-a-matter-of-survival/

Trump threatens tariffs escalation to $100 billion of goods.

In his latest salvo in the trade war Trump turned his attention to the World Trade Organization, lambasting their lack of action as “unfair.”

China, which is a great economic power, is considered a Developing Nation within the World Trade Organization. They therefore get tremendous perks and advantages, especially over the U.S. Does anybody think this is fair. We were badly represented. The WTO is unfair to U.S.

Then China hits back with two press releases – this is very very rare occurrence. The content in both is even more disturbing if you understand how the Chinese use – or not use – civility in their responses

The Chinese envoy to the EU just said the European Union and China “must act together” to counter US protectionism.

“The Chinese side will follow suit to the end and at any cost, and will firmly attack, using new comprehensive countermeasures, to firmly defend the interest of the nation and its people,” the Commerce Ministry said in a statement on its website on Friday.

“We don’t want a trade war, but we are not afraid of one.”

China’s Xinhua news – unofficial mouthpiece of the Party quoted China’s Ministry of Commerce and Ministry of Foreign Affairs:

“We Chinese do disdain that Washington, which is in no position to initiate a trade war with China, persists in wielding the tariff baton. We are fully able to inflict as same losses on the US as those on China. The US will have to repay whatever loss and harm it has caused on China with huge economic and political cost.

“The White House’s latest proposal will hit Chinese exports to the US, and in response China will make a sweeping counter attack at US exports to China. China can retaliate at a wide range of areas including US goods exports to China, service exports and the US’ highly profitable investment in China.

“It takes both strength and willpower to engage in a large-scale China-US trade war. While the two countries are about evenly matched in trade power, the future is on China’s side. The trade war will cause pain for China, but in the meantime it can force China to speed up its economic transformation. What the US is losing in this process is its future. Many leading US companies will lose the Chinese market and thereby lose their edge. The US’ modern agriculture industry will be dealt a heavy blow.

“China won’t back off. The Chinese society will unite around the Party and the government to weather through the hardships, which is unparalleled for the US. More importantly, in the trade war launched by the US, China is on the righteous side safeguarding multilateral trade rules and our own rights on this basis.

“Chinese are aware that the only option now is to hit the US hard enough so that it will remember the pain. Otherwise Washington will go more recklessly and cause more losses.

“When Zhu Guangyao, China’s vice finance minister, and Wang Shouwen, vice commerce minister, announced proportionate tariffs on $50 billion US goods exported to China at a press conference on April 4, the short video got more than 2 million likes in two days. That is how Chinese people feel.

“It is not only the Chinese government’s decision, but the choice of society to firmly strike back against the US pressuring moves at any cost. Chinese society has been mad at repeated threats from the US in these years. Even if the Trump administration wants to take the trade war to the direction that bilateral trade and investment is suppressed to zero, China will meet all the challenges.

“Based on information we have received, Chinese authorities have made detailed response plan with many specific measures. Relevant Chinese government departments are fully confident in our ability to hit back at Washington, safeguard China’s interest and defend the multilateral system.

“Most Americans have their life linked with China-US trade.

“As the tensions escalate, we want to expand the trade war to all Americans so that they have to choose whether to support Trump’s unscrupulous move or to hold the president accountable.”

Civility is very important to the Chinese conducting official business. This deliberate removal of civility for Washington in the Chinese response is a deadly serious warning that the gloves will come off if need be.

Meanwhile the DJIA shows general price action of buying the dips after each tariff salvo, which saw institutional investors hedging their positions.

In the 12 hours or so since President Trump announced plans for $100 billion in additional tariffs on China, offshore yuan has tumbled 300 pips (3%). This is understood as a mini-devaluation of the yuan by the PBoC.

It is not clear if this a shot across the bow for Washington or a test case to see market reaction – or perhaps both.

This quote by the Chinese News agency before the devaluation

“If the trade war happens, China will show that it has just as many reserve plans as the US, if not more. Chinese experts suggest that China could even take actions to weaken the strength of its currency.

“Since China is the world’s largest trading economy and the largest buyer of commodities like oil products, China could use its influence to push its own currency, RMB, in global markets to reduce the dominance of the US dollar. That would be a heavy blow to Washington.”

Of course, China could still take other measures – like curbing package tours or student transfers to the U.S., or steps against American companies’ operations in China; or the final threat of ‘going nuclear’ by withdrawing from US Treasury auctions, maxi-devaluing its currency (think of the Aug 2015 turmoil), or a more petrodollar-focused retaliation.

As Petromatrix managing director Olivier Jakob wrote in a recent reports, if the trade war between U.S. and China continues “there is a risk for oil prices that China uses the bazooka option it has on U.S. crude oil exports,” which would be to curb shipments from America.

China is one of the biggest importers of U.S. crude at ~400k b/d, so any counter-tariffs on crude could become very heavy for the U.S. supply and demand picture, and would weigh on U.S. prices and spill over to global oil pricing.

Since the opening of the petro-yuan futures last week and expected petro-yuan to parallel the US petro-dollar in the later part of 2018, China has effectively neutralised possible US sanctions related to trade.

It is clear that the Chinese Government is prepared to take this trade war head – on.

Citations
[1] https://www.zerohedge.com/news/2018-04-06/stocks-tumble-china-urges-americans-rise-against-unscrupulous-president
[2] https://www.zerohedge.com/news/2018-04-06/stealth-retaliation-yuan-weakens-300-pips-trump-doubled-down-china-tariffs
[3] https://www.zerohedge.com/news/2018-04-06/tit-tat-trade-tariffs-reach-limit-will-china-go-nuclear
[4] https://www.zerohedge.com/news/2018-04-05/china-declares-trade-war-victory-warns-us-suffering-after-crushing-counterattack

[Anonymous 42]

Lets just make a new rule!

.1 Any trade deficit at the end of each year is abolished and no debt is held against the United States and the total amount is forfeited, and resets to $0.00 on the first of January every year.

[Faust For ScienceParticipant 22521]

Anonymous wrote:

Lets just make a new rule!

.1 Any trade deficit at the end of each year is abolished and no debt is held against the United States and the total amount is forfeited, and resets to $0.00 on the first of January every year.

Yesterday, I read how China dumping its U.S. bonds would screw over China. If China sells it U.S. bonds they will only be sold in U.S. dollars, which would weaken the U.S. dollar to the China Yuan, making China imports more expensive in the U.S.

At the same time, China would have to find a way to offload these billions of U.S. dollars.

In addition, this act would upset the rest of the world because this would weaken the U.S. dollar against their currencies, forcing them to buy U.S. bonds to strength the U.S. dollar back to the usual level so their imports are cheaper in the U.S.

The one good thing about having a multi-trillion dollar annual economic deficit with the rest of the world is the U.S. has everything to gain by rocking the boat and the rest of the world will pay big to keep the boat stable.

[JakeParticipant 908]

excellent idea mg tower

[iMickey503Participant 12465]

Faust For Science wrote:

MG-ɹǝʍo┴ wrote:

Lets just make a new rule!

.1 Any trade deficit at the end of each year is abolished and no debt is held against the United States and the total amount is forfeited, and resets to $0.00 on the first of January every year.

Yesterday, I read how China dumping its U.S. bonds would screw over China. If China sells it U.S. bonds they will only be sold in U.S. dollars, which would weaken the U.S. dollar to the China Yuan, making China imports more expensive in the U.S.

At the same time, China would have to find a way to offload these billions of U.S. dollars.

In addition, this act would upset the rest of the world because this would weaken the U.S. dollar against their currencies, forcing them to buy U.S. bonds to strength the U.S. dollar back to the usual level so their imports are cheaper in the U.S.

The one good thing about having a multi-trillion dollar annual economic deficit with the rest of the world is the U.S. has everything to gain by rocking the boat and the rest of the world will pay big to keep the boat stable.

Not a boot licker. But this is impressive. No wonder MGTOW is such a threat on so many levels. Not only do you learn massive amounts to better your life. The insight that you get here is sort of like having an inside trader in your corner.

Thank you.

You are all alone. If you have been falsely accused of RAPE, DV, PLEASE let all men know about the people who did this. http://register-her.net/web/guest/home

[743 roadmasterParticipant]

Faust For Science wrote:

MG-ɹǝʍo┴ wrote:

Lets just make a new rule!

.1 Any trade deficit at the end of each year is abolished and no debt is held against the United States and the total amount is forfeited, and resets to $0.00 on the first of January every year.

Yesterday, I read how China dumping its U.S. bonds would screw over China. If China sells it U.S. bonds they will only be sold in U.S. dollars, which would weaken the U.S. dollar to the China Yuan, making China imports more expensive in the U.S.

At the same time, China would have to find a way to offload these billions of U.S. dollars.

In addition, this act would upset the rest of the world because this would weaken the U.S. dollar against their currencies, forcing them to buy U.S. bonds to strength the U.S. dollar back to the usual level so their imports are cheaper in the U.S.

The one good thing about having a multi-trillion dollar annual economic deficit with the rest of the world is the U.S. has everything to gain by rocking the boat and the rest of the world will pay big to keep the boat stable.

Well put, I looked at it a little different but it has the same ending. The reason I think China is in serious talks behind this smoke screen.

mgtow is its own worst enemy- https://www.campusreform.org/

[743 roadmasterParticipant]

https://apnews.com/ab8520cf80764a0dbdff2dae1b3d7b11

Amid trade fight, Trump says China will do the ‘right thing’

Amid global fears of an escalating trade dispute between the U.S. and China, President Donald Trump suggested that Beijing will ease trade barriers “because it is the right thing to do” and that the economic superpowers can settle the conflict that has rattled financial markets, consumers and businesses.

But fostering more uncertainty, the president’s top economic advisers offered mixed messages Sunday as to the best approach with China, which has threatened to retaliate if Washington follows through with its proposed tariffs, even as Trump emphasized his bond with Chinese President Xi Jinping.

“President Xi and I will always be friends, no matter what happens with our dispute on trade,” Trump wrote. “China will take down its Trade Barriers because it is the right thing to do. Taxes will become Reciprocal & a deal will be made on Intellectual Property. Great future for both countries!”

mgtow is its own worst enemy- https://www.campusreform.org/

[Y_Participant 4591]

743 roadmaster wrote:

Amid trade fight, Trump says China will do the ‘right thing

Trump needs help bad 743R. Plus he has no clue how to handle a trade war. The idiots advising him have no idea or they have no choice – makes no difference.

This is not the Apprentice. China has a lot of options – they are patient and time is on their side. Trump will not win this. The best he can hope for is a stalemate.

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