Euphoria has been replaced by pragmatism. Less than 96 hours after United States President Donald Trump announced a 90-day trade war truce after a dinner date with China’s head of state Xi Jinping in Buenos Aires, cracks and confusion have started to appear.
Initial optimism of a new round of talks has turned into pessimism with the White House struggling to explain the details of the deal while Beijing has officially reverted to simple platitudes.
The positive sentiment reflected in international markets earlier this week appears to have evaporated and has been replaced by an atmosphere of uncertainty.
Concerns about the vitality of the global economy, including the US, has only added to the gloom after an update by the International Monetary Fund at the end of last month.
“China has long advocated the use of talks to resolve trade disputes with the US, but it is also confident of tackling any challenges in the event of the disputes not being amicably settled,” Mei Xinyu, a researcher at the Ministry of Commerce’s International Trade and Economic Cooperation Institute, wrote in an opinion piece for the leading state-run English language newspaper, the China Daily, on Wednesday.
“The [economic] shadow looming over the US is likely to prompt Washington to resort to more trade protectionist measures, which will make it even more difficult for it to agree to a final deal between China and the US in the coming 90 days,” Mei added. “In the future, therefore, China should prepare to negotiate trade deals, as well as deal with ‘trade conflicts’ with the US.”
The official statement from the Ministry of Commerce was certainly more upbeat but lacking in substance.
Major issues
“We are confident about the implementation [from the meeting],” an unnamed spokesperson said.
“In 90 days, economic and trade teams of both sides will actively push forward the consultation following [a] clear timeline and [a] roadmap,” the official Xinhua agency reported without providing more details.
Major issues at the heart of the dispute are intellectual property violations, cyber theft and Beijing’s state-backed economic model.
Solving these problems will probably take delicate diplomacy and more than 90 days.
So far, the State Council, China’s de facto cabinet, has made the first move by announcing plans to crack down on IP infringements.
“This is an unprecedented regulation on IP violation in terms of the scope of the ministries and severity of the punishment,” Xu Xinming, a researcher at the Center for Intellectual Property Studies at China University of Political Science and Law, said. “[This offers] a security net of IP protection.”
Still, overnight there were mixed signals coming out of Washington just three days after Trump trumpeted an “incredible” deal, despite conflicting accounts from American and Chinese officials. These included an announcement that Beijing would remove tariffs on imported US cars, which has yet to be confirmed by Beijing.
He further muddied the waters on Tuesday when he warned on Twitter that “I am a Tariff Man.” “When people or countries come in to raid the great wealth of our Nation, I want them to pay for the privilege of doing so,” he said.
Trump also hinted that the 90-day ceasefire could be extended, sowing more seeds of doubt on Wall Street.
….I am a Tariff Man. When people or countries come in to raid the great wealth of our Nation, I want them to pay for the privilege of doing so. It will always be the best way to max out our economic power. We are right now taking in $billions in Tariffs. MAKE AMERICA RICH AGAIN
— Donald J. Trump (@realDonaldTrump) December 4, 2018
After the Dow Jones shed 3%, major markets in Asia wobbled on Wednesday with Japan’s Nikkei 225 edging down 0.53% while South Korea’s Kospi fell 0.62% and Hong Kong’s Hang Seng dropped 1.6%.
In Shanghai, the composite index closed 0.61% lower while Shenzhen ended the day 0.48% down.
“It doesn’t seem like anything was actually agreed to at the [G20] dinner and White House officials are contorting themselves into pretzels to reconcile Trump’s tweets (which seem if not completely fabricated then grossly exaggerated) with reality,” JPMorgan Chase stated in a trading note, which was reported by Reuters.
In exchange for putting on hold increased tariffs on Chinese imports worth $250 billion on January 1, Beijing is reported to have promised to buy more US agricultural goods, as well as energy and industrial related products.
This, in turn, would help trim the US trade deficit with the world’s second-largest economy which stood at whopping $258.15 billion for the first 10 months of the year compared to $222.98 billion during the same period in 2017.
But while that might ease trade tensions in the months ahead, dealing with China’s ambitions to become a technological superpower will prove daunting.
“The current trade war between the United States and China is not about trade,” Yukon Huang, a senior fellow at the Carnegie Endowment and author of Cracking the China Conundrum: Why Conventional Economic Wisdom Is Wrong, said in the summer.
“This war is about protecting the technological edge that has made the United States the world’s dominant economic power,” the former World Bank director for China added.
Finding a solution to that conundrum will continue long after the 90-day trade war truce has been consigned to history.
THE G20 WAS A RUSE .LARRY KUDLOW TRUMPS TOP ECONOMICADVISER WAS THERE TO MAKE IT SEEM AS THOUGH A DEAL WAS MADE. THATS THE COVER STORY WHICH WORKED FOR ONE DRIVING THE DOW BACK TO ITS HIGH.BUT THE TRUTH BECAME EVIDENT ON TUES AND KUDLOWS SCAM FAILED .
THE G20 WAS A RUSE .LARRY KUDLOW TRUMPS TOP ECONOMICADVISER WAS THERE TO MAKE IT SEEM AS THOUGH A DEAL WAS MADE. THATS THE COVER STORY WHICH WORKED FOR ONE DRIVING THE DOW BACK TO ITS HIGH.BUT THE TRUTH BECAME EVIDENT ON TUES AND KUDLOWS SCAM FAILED .
Currently, the aim of USA is to oppose China in view of slowing or stop progress in China. This will not work because it is like someone trying to stop a rushing tsunami. Instead, USA must work with China in order to benefit both countries. The Americans must also change their mindset. They must stop thinking that they are superior to the Chinese. Instead, they must accept the fact that they are inferior compared to the Chinese.
Currently, the aim of USA is to oppose China in view of slowing or stop progress in China. This will not work because it is like someone trying to stop a rushing tsunami. Instead, USA must work with China in order to benefit both countries. The Americans must also change their mindset. They must stop thinking that they are superior to the Chinese. Instead, they must accept the fact that they are inferior compared to the Chinese.
A wise man simply walks away from a fool . . .
A wise man simply walks away from a fool . . .
This article can be summed up with two of it’s quotes:
“It doesn’t seem like anything was actually agreed to at the [G20] dinner and White House officials are contorting themselves into pretzels to reconcile Trump’s tweets (which seem if not completely fabricated then grossly exaggerated) with reality,” JPMorgan Chase stated in a trading note…"
and
“This war is about protecting the technological edge that has made the United States the world’s dominant economic power,”
Yes, the US knows that it’s main source of economic growth potential (outside of fossil fuel exports) is from it’s tech industries. If it loses that edge it will become poorer and no longer the "world’s dominant economic power".
The US decisions in the 1980s, when for increased profits, willingly shipped a lot of it’s manufacturing to China, thought it could stay on top with it’s much vaunted technological superiority. It originally thought health care innovation via the emerging field of genetics was the answer and gave tons of money through NIH to genetics research. That turned out to be a bust. It now has only the digital technolgies where they still have an advantage. If it loses that, the US has very little to offer the world other than civilian airplanes, the financial service sector, and forced purchasing of obsolete military hardware. Unfortunately, the probability that the US can stop China’s advances in the technolgical sector is slim to none. The only question left is, will the US collapse the world’s economy due to it’s delusional sense of entitlement and exceptionalism?
This article can be summed up with two of it’s quotes:
“It doesn’t seem like anything was actually agreed to at the [G20] dinner and White House officials are contorting themselves into pretzels to reconcile Trump’s tweets (which seem if not completely fabricated then grossly exaggerated) with reality,” JPMorgan Chase stated in a trading note…"
and
“This war is about protecting the technological edge that has made the United States the world’s dominant economic power,”
Yes, the US knows that it’s main source of economic growth potential (outside of fossil fuel exports) is from it’s tech industries. If it loses that edge it will become poorer and no longer the "world’s dominant economic power".
The US decisions in the 1980s, when for increased profits, willingly shipped a lot of it’s manufacturing to China, thought it could stay on top with it’s much vaunted technological superiority. It originally thought health care innovation via the emerging field of genetics was the answer and gave tons of money through NIH to genetics research. That turned out to be a bust. It now has only the digital technolgies where they still have an advantage. If it loses that, the US has very little to offer the world other than civilian airplanes, the financial service sector, and forced purchasing of obsolete military hardware. Unfortunately, the probability that the US can stop China’s advances in the technolgical sector is slim to none. The only question left is, will the US collapse the world’s economy due to it’s delusional sense of entitlement and exceptionalism?
No one should be surprised. How does one negotiate a trade agreement over dinner?
So who holds the high cards here? Trump is facing enormous pressure to do something to save the soybean farmers from bankruptcy. This is not something that can be put off for a year or even months. There is a crisis in the midwest farm belt. Where does Xi Jinping face equivalent pressure?
"This war is about protecting the technological edge that has made the United States the world’s dominant economic power,”
Quite so, but the truth is that it is the US highly financialized economic structure which wrecked the manufacturing sector and threatens its technological sector. It is not only China which needs reform; the US needs it even more, but that means stripping finance of its power. It means nationalizing the largest banks, taking equity positions on the largest corporations, and putting public representatives on the boards of directors. It means raising wages. It means massive investment in physical AND human infrastructure, eg. graduating more engineers and fewer financial manipulators. This is the only way. Deep reform.
No one should be surprised. How does one negotiate a trade agreement over dinner?
So who holds the high cards here? Trump is facing enormous pressure to do something to save the soybean farmers from bankruptcy. This is not something that can be put off for a year or even months. There is a crisis in the midwest farm belt. Where does Xi Jinping face equivalent pressure?
"This war is about protecting the technological edge that has made the United States the world’s dominant economic power,”
Quite so, but the truth is that it is the US highly financialized economic structure which wrecked the manufacturing sector and threatens its technological sector. It is not only China which needs reform; the US needs it even more, but that means stripping finance of its power. It means nationalizing the largest banks, taking equity positions on the largest corporations, and putting public representatives on the boards of directors. It means raising wages. It means massive investment in physical AND human infrastructure, eg. graduating more engineers and fewer financial manipulators. This is the only way. Deep reform.
US won’t relinquish it’s dominant position without a fight. Who would want to if they’re on the same position ? China capitulated on the trade war coz economy will tank and millions and millions of jobs will be lost. The mother of all DEBT BOMBS WILL EXPLODE. HISTORY IS AGAINST CHINA AS THERE ARE NO COMMUNIST OR SOCIALIST COUNTRY THAT SUCCEDED LONG TERM ECONOMICALLY. THIS IS A FACT. VENEZUELA WAS A RICH COUNTRY BEFORE. CHINA WILL ALSO BE LIKE USSR. We’ll just have to wait this out. US losing its dominant position is just for dreamers. Dream on.
http://www.crusoeresearch.com/article/jim-rickards-debt-bomb-ready-to-explode/
https://www.google.com/amp/s/amp.scmp.com/news/article/2108442/my-prediction-coming-collapse-chinas-ponzi-scheme-economy
USA was losing to Europe and Japan by the 1970s. China gave USA another boost by supporting dollar hegemony and OPEC from inflation against USR while USA freely printed USD but the last decade it’s gone crazy at wimps and everyone is pissed. The game will be over in less than 10yrs.
USA was losing to Europe and Japan by the 1970s. China gave USA another boost by supporting dollar hegemony and OPEC from inflation against USR while USA freely printed USD but the last decade it’s gone crazy at wimps and everyone is pissed. The game will be over in less than 10yrs.
The beginning of the end. Genius Trump’s a great tactician and fools will pay a high price. It’s been designed right from the start – China’s CCP capitulation and subjugation. If Xi Jin Pig don’t comply, total collapse of China’s eco is just around the corner. IT’S A COLLOSAL AND MONUMENTAL ERROR MADE BY XI JIN PIG. Chinese people should realize that.
Trump knows China’s funding of its increasing militarization and it’s increasing aggressiveness and belligerence to US allies and small countries has to STOP.
To all those dreamers out there, good luck and enjoy your ride while it last.
“Jinhua was a key cog in a campaign to move away from chip imports – an influx that surpasses China’s annual spending on oil. Now that vision is in jeopardy. To some, it seems a matter of time till the Trump administrations targets the other two designated national champions: Tsinghua Unigroup’s Yangtze River Memory and Hefei Changxin, run by the government of central Anhui province.
“The majority of market watchers believe that Hefei and Fujian Jinhua – both are central to Beijing’s ambitions to develop home-grown semiconductor behemoths – will be forced out of the market”
https://m.scmp.com/tech/big-tech/article/2175031/chip-maker-caught-us-assault-chinas-tech-ambitions
In a survey conducted by the American Chamber of Commerce, nearly two-thirds of U.S. firmsoperating in southern China were contemplating relocating manufacturing from China to a third country;
https://www.lawfareblog.com/sinotech-us-commerce-department-bans-sales-fujian-jinhua
The beginning of the end. Genius Trump’s a great tactician and fools will pay a high price. It’s been designed right from the start – China’s CCP capitulation and subjugation. If Xi Jin Pig don’t comply, total collapse of China’s eco is just around the corner. IT’S A COLLOSAL AND MONUMENTAL ERROR MADE BY XI JIN PIG. Chinese people should realize that.
Trump knows China’s funding of its increasing militarization and it’s increasing aggressiveness and belligerence to US allies and small countries has to STOP.
To all those dreamers out there, good luck and enjoy your ride while it last.
“Jinhua was a key cog in a campaign to move away from chip imports – an influx that surpasses China’s annual spending on oil. Now that vision is in jeopardy. To some, it seems a matter of time till the Trump administrations targets the other two designated national champions: Tsinghua Unigroup’s Yangtze River Memory and Hefei Changxin, run by the government of central Anhui province.
“The majority of market watchers believe that Hefei and Fujian Jinhua – both are central to Beijing’s ambitions to develop home-grown semiconductor behemoths – will be forced out of the market”
https://m.scmp.com/tech/big-tech/article/2175031/chip-maker-caught-us-assault-chinas-tech-ambitions
In a survey conducted by the American Chamber of Commerce, nearly two-thirds of U.S. firmsoperating in southern China were contemplating relocating manufacturing from China to a third country;
https://www.lawfareblog.com/sinotech-us-commerce-department-bans-sales-fujian-jinhua
WuKong Sun
You’ve got your own history and a crystal ball ? Fantastic !
WuKong Sun
You’ve got your own history and a crystal ball ? Fantastic !
Enb Libra That what my junior school taught us to think about news and history books and not just believe everything written. See the difference between good education and yours?
Enb Libra That what my junior school taught us to think about news and history books and not just believe everything written. See the difference between good education and yours?
See if u can read through at least one doc or even understand the summary of why a oil rich country like USSR need financial aid.
https://nsarchive2.gwu.edu/NSAEBB/NSAEBB364/
See if u can read through at least one doc or even understand the summary of why a oil rich country like USSR need financial aid.
https://nsarchive2.gwu.edu/NSAEBB/NSAEBB364/
President Trump is just give business time to find new customers and new supply chains outside of china . Example a ship carrying soy bean ment for china went to Vietnam instead. No soy beans for china none for you go away ! China has solen our military secrets and our tech. The hate us and mean us harm ,the president knows this and is begaining the process of decoupling from the chicoms .
You ungrateful chinese, should be grateful to the US and the western countries for what you are today. Your greatness is because of them. Nobody is trying to stop your further growth. USA is only doing what needs to be done with Chinas AGRESSIVE rise in the world. China is now a bully driving small countries in debt trap. If china wants to be real super power, first you should have rule of law in your country or atleast you practice your constitution. Without the soft power no chance to become a big power. What china is doing today is lie,cheat and streach your long arms everywhere.
You ungrateful chinese, should be grateful to the US and the western countries for what you are today. Your greatness is because of them. Nobody is trying to stop your further growth. USA is only doing what needs to be done with Chinas AGRESSIVE rise in the world. China is now a bully driving small countries in debt trap. If china wants to be real super power, first you should have rule of law in your country or atleast you practice your constitution. Without the soft power no chance to become a big power. What china is doing today is lie,cheat and streach your long arms everywhere.
Chan = Your right your so much better the US , so I guess America should kick out all chinese students and stop all trade with china because your just to good for us .Damn you are smart ,great idea thanks!!
The whole trade war is now about intellectual property and keeping it out of the hands of the Chinese. The huge Chinese misstep is about there lack of know how and manufacturing in the sophisticated chip market. What strikes me funny is the sophisticated, smart chip market is the engine for the whole digital world going forward——–and China is not (presently) allowed into this small club. The club has only a few members, South Korea who has a lot to lose if China breaks into this small club, the United States who is #2 in the manufacturing of smart chips after South Korea, Japan and the Netherlands where most of the sophisticated chip machines are built. If China is SMART they lick there wounds and give in to the American demands. At present the Chinese really hold no cards in this battle and 2025 looks more like 2035——the serious question is how fast does the Chinese chip market catch up to the four countries that rule the roost——-that is the question no one can answer?? Big props to the financial blog, Seeking Alpha and there smart contributors who have been writing about this storm for some time!!
The whole trade war is now about intellectual property and keeping it out of the hands of the Chinese. The huge Chinese misstep is about there lack of know how and manufacturing in the sophisticated chip market. What strikes me funny is the sophisticated, smart chip market is the engine for the whole digital world going forward——–and China is not (presently) allowed into this small club. The club has only a few members, South Korea who has a lot to lose if China breaks into this small club, the United States who is #2 in the manufacturing of smart chips after South Korea, Japan and the Netherlands where most of the sophisticated chip machines are built. If China is SMART they lick there wounds and give in to the American demands. At present the Chinese really hold no cards in this battle and 2025 looks more like 2035——the serious question is how fast does the Chinese chip market catch up to the four countries that rule the roost——-that is the question no one can answer?? Big props to the financial blog, Seeking Alpha and there smart contributors who have been writing about this storm for some time!!
China cannot catch with semiconductors, that’s for sure. It can fund their own research but it will remain behind as the competitors are not standing by. By the time China make advances, the US-SK-Japan-Eu already made their own advances. China is like running on a threadmill, trying to catch up but it never ends. That’s the reality.
China cannot catch with semiconductors, that’s for sure. It can fund their own research but it will remain behind as the competitors are not standing by. By the time China make advances, the US-SK-Japan-Eu already made their own advances. China is like running on a threadmill, trying to catch up but it never ends. That’s the reality.
WuKong Sun
That’s not good education but a f**king CCP brainwashing session you attended.
WuKong Sun
That’s not good education but a f**king CCP brainwashing session you attended.