The popular large-cap China ETF (ticker FXI) led the S&P 500 during the market uptick of the past several days, driven by signals from Beijing and Washington that a resolution of the Sino-American trade dispute was possible.
President Trump this morning tweeted that he had made progress on trade negotiations with China, and had spoken by telephone with his Chinese counterpart Xi Jinping.
Just had a long and very good conversation with President Xi Jinping of China. We talked about many subjects, with a heavy emphasis on Trade. Those discussions are moving along nicely with meetings being scheduled at the G-20 in Argentina. Also had good discussion on North Korea!
— Donald J. Trump (@realDonaldTrump) November 1, 2018
The correlation of S&P returns to FXI returns jumped in recent days to around 90%.
The October plunge in US equity prices, as well as weakness in recent US economic data, give the Trump Administration an incentive to reach a resolution with China.
As I reported from Beijing October 23, China is looking for a framework for a trade deal that would allow Trump to claim credit for better protection for American intellectual property as well as changes in China’s industrial policy. China may tone down its rhetoric about dominating high-tech industries under the “Made in China 2025” program, source of contention with the United States, although it will not abandon its economic goals.
I predicted October 25 that the slumping stock market would motivate the Trump Administration to seek a deal with China.
The October manufacturing survey of the Institute for Supply Management released Nov. 1 showed weaker-than-expected growth in US industry. The index fell from 58.8 to 56.8 while new orders fell from 61.8 to 57.4, and prices paid rose from 69.0 to 71.4. The numbers reflect the percentage of respondents who see expansion vs. contraction and came in far below the consensus of economic forecasters.
The Institute told Bloomberg news that tariffs are a concern to more than 40% of respondents in the broad-based survey. “Import tariffs and counter-tariffs are the biggest inhibitor to the expansion in manufacturing,” ISM official Timothy Fiore said.
Evidently, the administration’s initial confidence that the US would emerge nearly unscathed from a trade war with China has eroded in the face of poor stock market performance and softer-than-expected economic data.
In an open letter to Larry Kudlow published July 19, I warned that tariffs against Chinese imports would hurt the United States as much as they hurt China:
“The vast majority of China’s exports to the US are consumer goods, especially electronics. Most of these goods are assembled in China from imported components. China adds only a third or so the value added to these goods. China has a chronic labor shortage and is shifting low-paid assembly to lower-wage countries in Asia. If you tax consumer goods from China, American consumers will pay more, and the Chinese will accelerate the shift of low-wage employment to the new economic zone they are building in Asia through the $1 trillion One Belt, One Road program.”
I believe that the Trump Administration has come over to my point of view. That portends a sharp recovery in Chinese equities before year-end
That would imply that US regime has brain which is too optimistic thinking way out of reality.
That would imply that US regime has brain which is too optimistic thinking way out of reality.
The elites of the US consistantly out think dictators like Winnie Xi Pooh. That’s because like Stalin & Hitler there is no disent allowed in dictatorships.
The elites of the US consistantly out think dictators like Winnie Xi Pooh. That’s because like Stalin & Hitler there is no disent allowed in dictatorships.
So Trump wants to talk now. LOL!
Please hold off until the Dow tanks further.
So Trump wants to talk now. LOL!
Please hold off until the Dow tanks further.
Surely Atimes can do better than Goldman. What a pompous piece, to quote Scaramuchi (remember him!) you "like to suck your own dick".
Let’s start:
>China is looking for a framework for a trade deal that would allow Trump to claim credit for better protection for American intellectual property as well as changes in China’s industrial policy. China may tone down its rhetoric about dominating high-tech industries under the “Made in China 2025” program, source of contention with the United States, although it will not abandon its economic goals.
So… essentially a small media win for Trump, and a cosmetic change from China to stop talking about Made in China 2025?
What indication is there that any of this will happen? If China is seeking the framework, why is the Trump administration demanding Chinese concessions first? Why is Trump/Kudlow the one to insist on a Chinese meeting?
>Evidently, the administration’s initial confidence that the US would emerge nearly unscathed from a trade war with China has eroded in the face of poor stock market performance and softer-than-expected economic data.
The adminitrations "initial confidence" was idiotic and wishful thinking from an ignorant Trump that the US would triumph and the Chinese econony would crumble. What did he say again, "trade wars are easy to win".
An idiot could have known this would not have happened. Now it seems that China is in a stronger position than the US: interest rates are rising, credit card debt is at an all-time high, inflation is rising, and household savings at are an all-time low.
>In an open letter to Larry Kudlow published July 19, I warned that tariffs against Chinese imports would hurt the United States as much as they hurt China…I believe that the Trump Administration has come over to my point of view. That portends a sharp recovery in Chinese equities before year-end
Christ the pomposity on this guy, you really must like smelling your own farts. Despite your ego, every economist and geopolitical watcher under the sun was saying this except for Navarro. Gary Cohn resigned over this…
Surely Atimes can do better than Goldman. What a pompous piece, to quote Scaramuchi (remember him!) you "like to suck your own dick".
Let’s start:
>China is looking for a framework for a trade deal that would allow Trump to claim credit for better protection for American intellectual property as well as changes in China’s industrial policy. China may tone down its rhetoric about dominating high-tech industries under the “Made in China 2025” program, source of contention with the United States, although it will not abandon its economic goals.
So… essentially a small media win for Trump, and a cosmetic change from China to stop talking about Made in China 2025?
What indication is there that any of this will happen? If China is seeking the framework, why is the Trump administration demanding Chinese concessions first? Why is Trump/Kudlow the one to insist on a Chinese meeting?
>Evidently, the administration’s initial confidence that the US would emerge nearly unscathed from a trade war with China has eroded in the face of poor stock market performance and softer-than-expected economic data.
The adminitrations "initial confidence" was idiotic and wishful thinking from an ignorant Trump that the US would triumph and the Chinese econony would crumble. What did he say again, "trade wars are easy to win".
An idiot could have known this would not have happened. Now it seems that China is in a stronger position than the US: interest rates are rising, credit card debt is at an all-time high, inflation is rising, and household savings at are an all-time low.
>In an open letter to Larry Kudlow published July 19, I warned that tariffs against Chinese imports would hurt the United States as much as they hurt China…I believe that the Trump Administration has come over to my point of view. That portends a sharp recovery in Chinese equities before year-end
Christ the pomposity on this guy, you really must like smelling your own farts. Despite your ego, every economist and geopolitical watcher under the sun was saying this except for Navarro. Gary Cohn resigned over this…
Trump painted himself into a corner. Go soft and watch China wins slowly and surely. Play hardball and meltdown US economy and get himself impeached by angry GOP.
Trump painted himself into a corner. Go soft and watch China wins slowly and surely. Play hardball and meltdown US economy and get himself impeached by angry GOP.
David P Goldman.
What exactly is the rationale and purpose of your article confidently suggesting a ‘predicted’ trade deal. Is twittering Trump predictable? Both parties are merely continuing on with their shadow-play motions and manoeuvres of their chess pieces in this chess game flaunted as ‘trade wars’ for public consumption. Please note that China is playing weiqi or Chinese Chess and the US is playing Western Chess. It is an antithetical conflict of two different mindsets! Both are stumbling and falling in the dark until miraculously when worn and fatigued they should or might manage to grasp each other and pantingly say ‘let us call it a day – you give some and I give some’.
But that is a long way yet. Unless US blinks first. Because Zen China plays the long protracted game. Time is never of the essence for 5000+ year old authoritarian China because there will be no imminent exigencies elections to contend with let alone mid-term elections.
The Eagle is the predator and the Dragon its prey. And you expect the Eagle to win? Surely not! Do you know where China is drawing the line in this trade war or proxy war (because the real conflict or geopolitical objective is of course to prevent or stall China’s declared policy to lead in AI technology by 2025)? You see, US wants to remain supreme, now and into the future!
Imagine Trump is like Commodore Perry with his gunboats and bullying and intimidating China to sign an ‘unequal treaty’. Deal with China as an equal yes! But threatening and bullying like an imperialistic colonial power no!
The Communist Party is like the modern day Emperor. Its ‘mandate from heaven’ will be forfeited if President Xi cowers to Trump and China ends up with an unequal treaty perceived in the eyes of the Chinese citizens as outright humiliation to Chinese honour and self-esteem and dignity. The Communist Party will then have to make way for a more righteous new Emperor! This has always been the way in China.
The West still sees China as communist! If anything the Emperor (Communist Party) have had and has changed and evolved and morphed and reverted back into something that retains traditional Chinese values and characteristics. Karl Marx, Tolstoy and Lenin, they are all ‘foreigners’! China is Chinese! And thus China is now a hybrid of a dichotomy of ‘socialist capitalist’ and state owned free market enterprises. And it is being ruled by a bureaucracy based on academic meritocracy as in the ancient past. Do you know how hard the annual public service entry exam is in China? Do you know the academic credentials of the top echelon leaders of China? When you see this chess game of ‘trade war’ being played take note of the the quality and depth of calibre of China the chess player in this sense.
Vincent Cheok @ https://whirlwindrambler.com/
David P Goldman.
What exactly is the rationale and purpose of your article confidently suggesting a ‘predicted’ trade deal. Is twittering Trump predictable? Both parties are merely continuing on with their shadow-play motions and manoeuvres of their chess pieces in this chess game flaunted as ‘trade wars’ for public consumption. Please note that China is playing weiqi or Chinese Chess and the US is playing Western Chess. It is an antithetical conflict of two different mindsets! Both are stumbling and falling in the dark until miraculously when worn and fatigued they should or might manage to grasp each other and pantingly say ‘let us call it a day – you give some and I give some’.
But that is a long way yet. Unless US blinks first. Because Zen China plays the long protracted game. Time is never of the essence for 5000+ year old authoritarian China because there will be no imminent exigencies elections to contend with let alone mid-term elections.
The Eagle is the predator and the Dragon its prey. And you expect the Eagle to win? Surely not! Do you know where China is drawing the line in this trade war or proxy war (because the real conflict or geopolitical objective is of course to prevent or stall China’s declared policy to lead in AI technology by 2025)? You see, US wants to remain supreme, now and into the future!
Imagine Trump is like Commodore Perry with his gunboats and bullying and intimidating China to sign an ‘unequal treaty’. Deal with China as an equal yes! But threatening and bullying like an imperialistic colonial power no!
The Communist Party is like the modern day Emperor. Its ‘mandate from heaven’ will be forfeited if President Xi cowers to Trump and China ends up with an unequal treaty perceived in the eyes of the Chinese citizens as outright humiliation to Chinese honour and self-esteem and dignity. The Communist Party will then have to make way for a more righteous new Emperor! This has always been the way in China.
The West still sees China as communist! If anything the Emperor (Communist Party) have had and has changed and evolved and morphed and reverted back into something that retains traditional Chinese values and characteristics. Karl Marx, Tolstoy and Lenin, they are all ‘foreigners’! China is Chinese! And thus China is now a hybrid of a dichotomy of ‘socialist capitalist’ and state owned free market enterprises. And it is being ruled by a bureaucracy based on academic meritocracy as in the ancient past. Do you know how hard the annual public service entry exam is in China? Do you know the academic credentials of the top echelon leaders of China? When you see this chess game of ‘trade war’ being played take note of the the quality and depth of calibre of China the chess player in this sense.
Vincent Cheok @ https://whirlwindrambler.com/
Americans too stupid/lazy to play chess. They play checkers which I got bored before 5th grade. Russians play chess.
Americans too stupid/lazy to play chess. They play checkers which I got bored before 5th grade. Russians play chess.
As I’ve mentioned before Trump will be begging Xi like a dog in the summit. Look for body gestures. Goldman is among the few Jews who’s pro China, at least not hostile like Bloomberg news, Wall st and hedge funds, Israeli institutions. But alas he’s among the too few who’s not picking the falling empire. It’s quite expected as Chinese and Jewish people have deep admiration for each other’s culture and achievements. Guess Jewish hardliners will trade anything for quick temporal gains from Trump. Even tiny subservient SK is independently engaging NK and signing agreements without USA. Japan has never been more assertive in persueing and reengaging Asian countries on its own. Once USA lost more power, Israel will be gone.
As I’ve mentioned before Trump will be begging Xi like a dog in the summit. Look for body gestures. Goldman is among the few Jews who’s pro China, at least not hostile like Bloomberg news, Wall st and hedge funds, Israeli institutions. But alas he’s among the too few who’s not picking the falling empire. It’s quite unexpected as Chinese and Jewish people have deep admiration for each other’s culture and achievements. Guess Jewish hardliners will trade anything for quick temporal gains from Trump. Even tiny subservient SK is independently engaging NK and signing agreements without USA. Japan has never been more assertive in persueing and reengaging Asian countries on its own. Once USA lost more power, Israel will be gone.
As I’ve mentioned before Trump will be begging Xi like a dog in the summit. Look for body gestures. Goldman is among the few Jews who’s pro China, at least not hostile like Bloomberg news, Wall st and hedge funds, Israeli institutions. But alas he’s among the too few who’s not picking the falling empire. It’s quite unexpected as Chinese and Jewish people have deep admiration for each other’s culture and achievements. Guess Jewish hardliners will trade anything for quick temporal gains from Trump. Even tiny subservient SK is independently engaging NK and signing agreements without USA. Japan has never been more assertive in persueing and reengaging Asian countries on its own. Once USA lost more power, Israel will be gone.
The US regime has lost contact with reality long time ago, and there is no way in this world that they know how to get back to reality no matter what.
The US regime has lost contact with reality long time ago, and there is no way in this world that they know how to get back to reality no matter what.
What the Dow produces to start with ? The dow in strictly economic terms we can do without it, and the sooner we do the better off we will be.
What the Dow produces to start with ? The dow in strictly economic terms we can do without it, and the sooner we do the better off we will be.
Those foreigners you try to discredit shaped chinese history and way of life, and nowadays they are part and parcel of China itself,and if you try to become wholly Chinese and try to get rid everything foreigner, you have to give up your modern day industry and the internet and many more modern technologies,and return to China in the way it was 1800.
Those foreigners you try to discredit shaped chinese history and way of life, and nowadays they are part and parcel of China itself,and if you try to become wholly Chinese and try to get rid everything foreigner, you have to give up your modern day industry and the internet and many more modern technologies,and return to China in the way it was 1800.
Yes it’s a own goal …and they are blaming on the CHINESE side !!? Crazy Buffon mother ..fu..rs !!
Yes it’s a own goal …and they are blaming on the CHINESE side !!? Crazy Buffon mother ..fu..rs !!
Yeah …it’s a question of time !!! Hein !! But nothing is written yet …and with Trump uff ! It could be any thing !!
Yeah …it’s a question of time !!! Hein !! But nothing is written yet …and with Trump uff ! It could be any thing !!
More contortions from another so-called Austrian School devotee trying to justify Trump’s protectionism. Have you noticed that the American trade deficit has actually accelerated under Trump? Do you remember the 1970’s and how well protectionism worked then?
This President is indefensible. Come out and say it, if you want people to find your articles credible.
More contortions from another so-called Austrian School devotee trying to justify Trump’s protectionism. Have you noticed that the American trade deficit has actually accelerated under Trump? Do you remember the 1970’s and how well protectionism worked then?
This President is indefensible. Come out and say it, if you want people to find your articles credible.
Rudi Matich True, but your comment is irrelevant. The point is that Trump’s economic machismo is a whimpering failure.
Rudi Matich True, but your comment is irrelevant. The point is that Trump’s economic machismo is a whimpering failure.
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I do not think so….that just your speculations without concrete proofs. ..hummmm
I do not think so….that just your speculations without concrete proofs. ..hummmm