Please consider Trump says has tariffs ready for further $267 billion worth of Chinese imports.
> U.S. President Donald Trump said on Friday that he has tariffs ready to go on a further $267 billion worth of Chinese imports, as the world awaits his decision on imposing levies on $200 billion worth of the Asian nation’s goods.
> “The $200 billion we are talking about could take place very soon depending on what happens with them. To a certain extent its going to be up to China, Trump said. “And I hate to say this, but behind that is another $267 billion ready to go on short notice if I want. That changes the equation.”
If you hate to say and do things that are foolish, the simple solution is to not say and do those things.
Tariffs are a direct tax on consumers and businesses. A handful of protected businesses gain a little, a mountain of others lose.
This is not winning.
Also consider Canada, the Petroyuan Thesis, and Balance of Trade Issues in Pictures
Mike “Mish” Shedlock
Mish, Any thoughts on getting into 2 year treasuries at this point?
Does no-one here live in the real world?
It is self-evident that huge trade imbalances are unsustainable. That means they are going to come to an end some day, one way or another. How do you get the exporting countries which have benefitted from past stupid US policies to take constructive action to help remedy the imbalance — preferably by increasing their imports?
It has traditionally been easier for the Chinese to buy off the likes of Hillary Clinton than to take steps to facilitate balanced global trade. But the resulting trade imbalance is still unsustainable.
Threats of tariffs are one of the ways of persuading the Chinese that donations to the Clinton Foundation will no longer buy them more time. Free traders should be applauding the threat of tariffs as a way to bring China to the negotiating table. Because if the trade imbalance is not addressed now, the inevitable eventual future collapse in world trade is going to be much more damaging to all parties.
Kin, seems to me the USA has a massive advantage in being the world’s banker and having the world’s oil traded only in its currency (until recently). Witness how we were able to print our way out of financial crisis compared to those just pegged to the dollar. The USA imports excess cheap real goods in exchange for fiat printed paper “money” that is manipulated to the advantage of American Bankers. Just who is the winner in that deal?
Trump and USA is losing this trade war at face value. We have record Chinese imports based on our economic cycle approaching a peak, and the yuan having been devalued 10%. Trump imposes more tariffs and the Chinese devalue another 10%. How does the result change?
However, consider Trump is rather initiating a sort of flat tax focused on poorer citizens. Normally, Repug politics accomplishes same by stoking domestic inflation to cover tax break induced deficits. Now the technique is to inflate prices and directly skim off that extra bit for tax revenue to pay for those tax breaks to the rich. And all the while he can demagogue that he is doing it out of concern for American workers.
Maybe Trump is not so stupid.
Yes, and just wait a few years till the fracking miracle turns into a depletion bust.
Got that right. None of the fracking companies make any money. They just borrow it and flush it down the hole. The whole fracking “miracle” is a big con job.
To make up for 500 billion deficits not enough tax is being collected. 10%Tariffs on about 5 trillion of imports will be needed or income tax revenues need to be increased or a 500 billion cut in spending. Which option will prevail ?
You gotta laugh. Every time Trump talks about new tariffs, the USD rockets higher just as it did today. This not only destroys the value of emerging markets currencies making their exports to America cheaper, it destroys US exporters by making their goods even more expensive. Trump is going to preside over the highest US trade deficits in history and every thing he does will make them worse.