A U.S. flag is seen during a welcoming ceremony in Beijing, China, November 9, 2017. REUTERS/Thomas Peter
WNU Editor: It looks like the Chinese are changing their tone on their trade war with the U.S. .... from issuing threats of retaliation to now crying to the world that the U.S. is being a bully .... China says US swinging ‘big stick’ of unfair trade tactics (AP). I guess they did the math, and realized that their trade surpluses with the U.S. are not only at risk, but U.S. companies are now seriously contemplating pulling back from investing in China and establishing joint ventures. If I was advising the Chinese government right now, I would be saying them that their threats are not working, and their policy of delay-delay-and delay have reached its limit with this U.S. administration. That while it may have worked in the past .... it is not now, and that a new approach is needed. The problem that I can easily predict is that the Chinese are very stubborn when it comes to changing their economic policy on a dime, and when it is going to hurt them .... doubly so. President Xi needs to intervene, and to use the authority of his office to push for a compromise with the U.S.. But I suspect that when he finally does that, the $200 billion tariff threat that President Trump made a few days ago .... will have already been implemented.
6 comments:
As discussed on your blog. China had the weaker position on the trade war.
An easy war to win for the US. Long term concern though is IF others start to use other currencies for trade base instead of the greenback. This might complicate matters for US
Michael, is that such a bad thing? Since the advent of the Petro dollar the US has pretty much been able to run the deficits to whatever a President wants and not worry about interest rates on the debt. This loss of fiscal discipline has led the US to serious overseas adventures that turned into calamity.
Going back to exchange rates where the dollar had to compete on value might just get the US's house in order, although the journey will be very painful.
Bad thing or not it's going to happen. The US dollar will lose its role as works reserve currency. It cannot be prevented.
". . the journey will be very painful." The goal of US policy should be to try and work for a "soft landing."
That’s funny it couldn’t have been more than a couple of weeks ago I saw a headline on CNBC “speak loudly but carry a small stick” characterizing Trumps terrif wars...
Post a Comment