IB and Little Monster set the bar high for repetitive posting. And by darn I intend to raise that bar. If Mystic's not going to help me I'm doing it all on my own.
Quote:
Originally Posted by eccielover
And lastly to all, it's been mentioned earlier in this thread(and in the innumerable others started by this same poster about tariffs), that they are being used largely as a bullying tactic not as an actual long term policy decision. And as such, they are so far having the desired results in at least sparking discussion and in the case of Mexico, them stepping up and acquiescing to some concessions.
China, I agree is a harder nut to crack, but as WC continues to point out, doing nothing gets us nowhere and just further in the hole, so doing something at least shakes up the establishment. And that's part of what I elected Trump to do.  |
So, right, but is it all worth it? How much better would Trump have fared if he'd worked with Europe, Japan, and our other allies to make China play fair, instead of going after them with tariffs too?
The latest is that Trump says he's going to implement 10% tariffs on the remaining $300 billion a year in goods we import from China on September 1, 2019. His timing was great. There's no way Xi Jinping can back down right now, because of domestic political considerations. He's got his annual meeting with party leaders later this month, the 70th Anniversary of the Peoples Republic on October 1, mass demonstrations in Hong Kong, and the U.S. just announced an arms sale to Taiwan. If he makes a deal he looks weak, like he's being bullied by the USA, which he is.
So how did Trump come up with this? Steve Mnuchin, Larry Kudlow, and even Robert Lighthizer the trade hawk begged him not to do it. But Trump's gut and trade nut Peter Navarro won the day.
The Chinese currency, the Renminbi, dropped below 7 per dollar today, sending world markets into a tail spin. As I write this, the Dow is down 870 points, and NASDAQ is down 3.9%.
The Chinese have been propping up the value of their currency, through capital controls among other things. Right now it's difficult to impossible for Chinese people and businesses to buy foreign currencies and invest outside their country. Instead they have to keep their money in China, in Renminbi, which causes the currency to be stronger than it should be.
Apparently the Chinese government isn't going to be quite as aggressive in propping up the Renminbi, in reaction to Trump's escalation of the trade war. Actually, if they let their currency float, like we do ours, you could see the value fall to 7.5 to 8 per USD, helped along by capital flight out of China.
So what's Trump's reaction? Today he's accusing the Chinese of currency manipulation on Twitter, to weaken their currency and strengthen their exports. Well, he's right about manipulation, but they've been manipulating their currency to keep it stronger. This is what he wants. You can attribute the weakness in the Renminbi to one person, Donald J. Trump.
Right now Trump's trade policy is the biggest risk to the world and American economies. And if he keeps this crap up and continues to escalate, it may be the biggest risk to the Republicans losing the presidency and the Senate in 2020. The thing he's got going is a strong economy. If he loses that, Republicans are toast.
My thirty-seventh thread starter on trade
