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Thread: Boom. You can't out tariff us. Period. This Trump knows.

  1. #841
    Quote Originally Posted by AZJoe View Post
    There is that leftist mantra again - and it is diametrically opposed to everything Dr. Ron Paul espouses.
    Such nutty fallacies over to the Bernie Sanders forum where they will be appreciated by the blind faithful of the cult of government intervention.

    "I'm all for reducing government intervention BUT ... "
    We need government intervention to save us from free trade, low cost, high quality and general increase in the standard of living.
    We need more taxes here to make things fair.
    We need the government to level the playing field.
    We need government regulation, licensing, laws, subsidies and special tariff taxes, etc. to protect this group or even the playing field for that group or make things more fair for that group.
    and on and on for every other government intervention and tax and regulation. ...

    NO WE DON'T!

    Such leftist pro statist propaganda mantras are odious.

    These are the false mantras of the statists, the big government lovers, the regulators, the socialists, the interventionists, and they are all wrong.
    We need government to get out of the way. Want to be more competitive? - get rid of the federal licensing and federal subsidies and federal special interest tariff protections, and the income tax, and the eliminate most of the federal departments entirely, and end foreign welfare, and close down foreign bases, and eliminate the federal deficit spending, and allow free competition in currency, ... --- i.e. the exact opposite of more intervention and taxation. Make government smaller not bigger. Get government out of the way, not more regulation and intervention.

    This is just basic sense.
    You are repeating empty platitudes instead of dealing with the facts and logic.

    You might as well claim that noninterventionism requires us to let a foreign army invade and not send an army of our own to drive them out.


    You can't have an international marketplace without government intervention because the Chinese insist on intervening, the closest you can get to one is to cancel out their intervention unless they agree to stop intervening as the result of negotiations that result from canceling out their intervention.
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment



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  3. #842
    Amid rising fears over US-Chinese trade tensions and mounting tariffs, President Donald Trump said Saturday that firms could easily avoid additional costs by producing goods in the United States. “Such an easy way to avoid Tariffs? Make or produce your goods and products in the good old USA. It’s very simple!” he said Saturday on Twitter, echoing a similar message he sent Friday — and even retweeted.

    More at: https://www.breitbart.com/news/trump...ducts-at-home/
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  4. #843
    China just refuses to play fair:


    In an unusual move, the Chinese delegation has come clean to the domestic press about Beijing's remaining trade-deal related demands, exposing steep divides that could make it a final deal impossible for Trump, who has repeatedly said he will only accept a "great" deal.
    Unsurprisingly, Liu He, the leading Chinese trade negotiator, confirmed what Beijing has intimated time and time again:
    That without the complete removal of all trade-war related tariffs, Beijing will not remorse a deal.
    The other two demands were related to American commitments to buy Chinese goods, something that could also pose a problem.
    In a wide-ranging interview with Chinese media after talks in Washington ended Friday, Vice Premier Liu He said that in order to reach an agreement the U.S. must remove all extra tariffs, set targets for Chinese purchases of goods in line with real demand and ensure that the text of the deal is “balanced” to ensure the “dignity” of both nations.
    Underscoring the parlous nature of the negotiation, Representative Robert Lighthizer said on Friday that the administration is planning to release details of its process for imposing tariffs on $300 billion in Chinese imports. The move will likely have the desired effect: Communicating that Trump doesn't plan to yield on what's left of his core demands.

    More at: https://www.zerohedge.com/news/2019-...ree-trade-deal
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  5. #844
    In FX, the big outlier was the offshore Chinese yuan, which fell to its lowest levels in more than four months at 6.90 to the dollar.



    More at: https://www.zerohedge.com/news/2019-...ina-turns-ugly

    As the Yuan plunges the burden of the tariffs falls on China more and more and less and less on American consumers, it also makes it ever harder for China's house of cards companies to pay their dollar denominated debts.

    Not to mention that Chinese companies lower their prices in an attempt to keep market share.
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  6. #845
    The U.S. Commerce Department has banned six Chinese technology companies, a Pakistani firm and five corporations in the United Arab Emirates from exporting sensitive U.S. technology, Reuters reported May 13. According to the U.S. government, the four Chinese firms have violated U.S. sanctions on Iran, while the other two Chinese companies exported controlled technologies.

    More at: https://worldview.stratfor.com/situa...g-sensitive-us
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  7. #846
    Quote Originally Posted by Swordsmyth View Post
    In FX, the big outlier was the offshore Chinese yuan, which fell to its lowest levels in more than four months at 6.90 to the dollar.



    More at: https://www.zerohedge.com/news/2019-...ina-turns-ugly

    As the Yuan plunges the burden of the tariffs falls on China more and more and less and less on American consumers, it also makes it ever harder for China's house of cards companies to pay their dollar denominated debts.

    Not to mention that Chinese companies lower their prices in an attempt to keep market share.
    One year ago there were 6.3 yuan to the dollar so it is up about ten percent from then.

  8. #847
    Quote Originally Posted by Zippyjuan View Post
    One year ago there were 6.3 yuan to the dollar so it is up about ten percent from then.
    They have been propping it up but they are running out of the ability to do so, it will not be long before it drops a lot.
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  9. #848
    Quote Originally Posted by Zippyjuan View Post
    You are right. It is silly of me to quote Ron Paul on a Ron Paul website. Whatever could I have been thinking? I am sorry.

    But you are radically against Paul. Why would you quote him?
    Quote Originally Posted by TheCount View Post
    ...I believe that when the government is capable of doing a thing, it will.
    Quote Originally Posted by Influenza View Post
    which one of yall fuckers wrote the "ron paul" racist news letters
    Quote Originally Posted by Dforkus View Post
    Zippy's posts are a great contribution.




    Disrupt, Deny, Deflate. Read the RPF trolls' playbook here (post #3): http://www.ronpaulforums.com/showthr...eptive-members



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  11. #849
    Quote Originally Posted by Swordsmyth View Post
    They have been propping it up but they are running out of the ability to do so, it will not be long before it drops a lot.
    I thought you kept saying they were devaluing it to avoid tariffs. I guess they weren't.

  12. #850
    Quote Originally Posted by Zippyjuan View Post
    I thought you kept saying they were devaluing it to avoid tariffs.

    Link?
    Quote Originally Posted by TheCount View Post
    ...I believe that when the government is capable of doing a thing, it will.
    Quote Originally Posted by Influenza View Post
    which one of yall fuckers wrote the "ron paul" racist news letters
    Quote Originally Posted by Dforkus View Post
    Zippy's posts are a great contribution.




    Disrupt, Deny, Deflate. Read the RPF trolls' playbook here (post #3): http://www.ronpaulforums.com/showthr...eptive-members

  13. #851
    Funny that liberals bitch about Trumps tax cuts and then turn around and bitch about tax increases on the things they buy.

  14. #852
    Quote Originally Posted by Zippyjuan View Post
    I thought you kept saying they were devaluing it to avoid tariffs. I guess they weren't.
    They tried that and it caused too many problems with their dollar denominated debts so they switched to increasing subsidies/cutting prices and propping the Yuan up.
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  15. #853
    Quote Originally Posted by phill4paul View Post
    Funny that liberals bitch about Trumps tax cuts and then turn around and bitch about tax increases on the things they buy.
    They love to penalize production and hate to penalize consumption.
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  16. #854
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  17. #855
    A lot has happened since then-candidate Trump said he would label China a currency manipulator on 'day one' should he make it to the Oval Office. So far, at least, the pledge to hold Beijing accountable for manipulating its currency wouldn't fall into the 'promises kept' column. But that could soon change.

    Shortly after the Treasury Department delayed its biannual report on suspected currency manipulators - an ominous indication that the issue might resurface in trade talks after Beijing reportedly balked at a pledge to keep its currency stable - the Commerce Department on Thursday revealed that it's planning to propose a new rule that would allow it to impose anti-subsidy tariffs on imports from countries suspected of undervaluing their currency.

    The change would allow the Commerce Department to impose anti-dumping and countervailing duties on products believed to benefit from manipulated currencies. In effect, an artificially depressed currency would be treated as a government subsidy.
    Though China wasn't specifically named in the Department's announcement, it presence on the Treasury Department's manipulation 'watch list' - which also includes Japan, South Korea, India, Germany and Switzerland - means Chinese companies would be obvious targets.
    And just like that, Wilbur Ross has opened up another front in the US-China trade war - albeit one that could ensnare some of Washington's closest allies, Reuters reports.
    "This change puts foreign exporters on notice that the Department of Commerce can countervail currency subsidies that harm U.S. industries," Commerce Secretary Wilbur Ross said in a statement.
    "Foreign nations would no longer be able to use currency policies to the disadvantage of American workers and businesses," he said.
    Any tariffs applied under the new policies would be distinct from Trump's punitive trade-war tariffs.

    The announcement was light on details, and the department didn't delve into the criteria that could be used to determine whether a currency subsidy is being applied. But Chinese goods would be an obvious target: The yuan has weakened about 8% against the dollar over the past year. And while analysts have blamed trade-war tensions, some suspect that Beijing - which tightly controls the yuan - has allowed it to weaken to offset some of the Trump administration's punitive tariffs.
    According to Bloomberg, the plan has been kicking around the West Wing since shortly after Trump's inauguration, having been pushed by both Ross and Peter Navarro. The plan had reportedly fallen by the wayside, before suddenly rising to the top of the Trump team's agenda in recent weeks (we can only imagine why).

    More at: https://www.zerohedge.com/news/2019-...y-manipulators

    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  18. #856
    A number of recent articles suggest that Chinese officials may reduce their purchases of U.S. government bonds. It is very unlikely that China can do so in any meaningful way because doing so would almost certainly be costly for Beijing. And even if China took this step, it would have either no impact or a positive impact on the U.S. economy.
    Note: This is an updated version of a previously published January 2018 blog post. The original version can be accessed here.

    Suggestions by some Chinese officials that they may reduce their purchases of U.S. Treasury bonds show just how poorly the world understands the balance of payments. Here is what a recent Financial Times article had to say:
    It was an unnerving piece of data for investors last week, buried halfway down an esoteric spreadsheet released by the US government that tracks how many Treasuries foreign investors buy and sell. China, the largest foreign creditor to the US government with total Treasury holdings in excess of $1.2tn, sold $20bn of securities with a maturity exceeding one year in March, according to US government data. The sales amounted to China’s largest retreat from the market in more than two years.
    The article then goes on to suggest that China’s reduced holdings of U.S. Treasury bonds may reflect a strategic response to the escalating trade conflict between Beijing and Washington:
    The data reignited fears that Beijing may weaponise its holdings as part of the trade war, wreaking havoc with the biggest bond market in the world, pushing interest rates higher and increasing the US government’s cost of borrowing.
    “If China starts dumping its Treasuries, it would cause huge financial instability,” said Mark Sobel, a former Treasury department official who spent nearly four decades at the agency, adding that he considered this an unlikely scenario.
    In January 2018, I explained on this blog why China cannot “weaponize” its holdings of U.S. government bonds. It is not because, as many observers seem to think, that selling off the bonds would cause havoc in the market and in doing so would undermine the value of China’s own holdings. This is very unlikely. First of all, the Federal Reserve could easily act to overcome any temporary volatility. Second, as another article in the same issue of the Financial Times points out, rising uncertainty is causing investors to increase their purchases of U.S. government bonds:
    US Treasury yields plunged to their lowest level since 2017 and shares fell more than 1 per cent on Thursday as the deepening trade dispute between the US and China raised concerns about global economic growth.
    The rush to the relative safety of government debt pushed the yield on 10-year US Treasury bonds to roughly the same level as when the Federal Reserve began raising interest rates in 2015. Longer-term rates fell below shorter-term ones, a yield curve inversion that is seen by many traders as an indication of an impending economic downturn.
    I thought it would make sense to revisit and update my January 2018 post. As I explained in that entry, the real reason China cannot sell off its holdings of U.S. government bonds is because Chinese purchases were not made to accommodate U.S. needs. Rather, China made these purchases to accommodate a domestic demand deficiency in China: Chinese capital exports are simply the flip side of the country’s current account surplus, and without the former, they could not hold down the currency enough to permit the latter.
    To see why any Chinese threat to retaliate against U.S. trade intervention would actually undermine China’s own position in the trade negotiations, consider all the ways in which Beijing can reduce its purchases of U.S. government bonds:

    1. Beijing could buy fewer U.S. government bonds and more other U.S. assets, so that net capital flows from China to the United States would remain unchanged.
    2. Beijing could buy fewer U.S. government and other U.S. assets, but other Chinese entities could then in turn buy more U.S. assets, so that net capital flows from China to the United States would stay unchanged.
    3. Beijing and other Chinese entities could buy fewer U.S. assets and replace them with an equivalently larger amount of assets from other developed countries, so that net capital flows from China to the United States would be reduced, and net capital flows from China to other developed countries would increase by the same amount.
    4. Beijing and other Chinese entities could buy fewer U.S. assets and replace them with an equivalently larger amount of assets from other developing countries, so that net capital flows from China to the United States would be reduced, and net capital flows from China to other developing countries would increase by the same amount.
    5. Beijing and other Chinese entities could buy fewer U.S. assets and not replace them by purchasing an equivalently larger amount of assets from other countries, so that net capital flows from China to the United States and to the world would be reduced.

    These five paths cover every possible way Beijing can reduce official purchases of U.S. government bonds: China can buy other U.S. assets, other developed-country assets, other developing-country assets, or domestic assets. No other option is possible.

    • The first two ways would change nothing for either China or the United States.
    • The second two ways would change nothing for China but would cause the U.S. trade deficit to decline, either in ways that would reduce U.S. unemployment or in ways that would reduce U.S. debt.
    • Finally, the fifth way would also cause the U.S. trade deficit to decline in ways that would likely either reduce U.S. unemployment or reduce U.S. debt; but this would come at the expense of causing the Chinese trade surplus to decline in ways that would either increase Chinese unemployment or increase Chinese debt.

    By purchasing fewer U.S. government bonds, in other words, Beijing would leave the United States either unchanged or better off, while doing so would also leave China either unchanged or worse off. This doesn’t strike me as a policy Beijing is likely to pursue hotly, and Washington would certainly not be opposed to it. Let’s consider each possibility in turn.
    1) Beijing could buy fewer U.S. government bonds and more other U.S. assets, so that net capital flows from China to the United States would remain unchanged.

    This would be a non-event. Beijing would in effect simply redirect its purchases from U.S. government bonds to other U.S. assets. Of course, the seller of those other assets would then be forced to deploy the proceeds of the sales elsewhere, so that directly or eventually the proceeds would be used to buy the U.S. government bonds that Beijing sold. The only thing that would change, in this case, is that Beijing would have swapped riskless U.S. assets for risky U.S. assets.
    In that case, there would be no net impact on overall U.S. interest rates and a very small impact on relative interest rates. Because this outcome represents nothing more than a swap by Beijing out of lower-risk assets into higher-risk assets, with no net change in demand for U.S. assets, the result might be at most a small rise in yields on riskless assets matched by an equivalent tightening of credit spreads.
    There would be no change in overall U.S. investment except to the extent that tightening credit spreads would cause a small rise in risky U.S. investments. What is more, Beijing’s decision would leave the U.S. capital account surplus unchanged, so it could not have an impact on the U.S. current account or trade deficits. Finally, Beijing’s decision would leave the Chinese capital account deficit unchanged, so it could not have an impact on the Chinese current account or trade surpluses.
    2) Beijing could buy fewer U.S. government and other U.S. assets, but other Chinese entities could then in turn buy more U.S. assets, so that net capital flows from China to the United States would stay unchanged.

    Again, this would largely be a non-event. The volume of Chinese capital flows to the United States would be unaffected, but there would be minor changes in the composition of assets to which the flows are directed. As in the previous case, there would be no net impact on overall U.S. interest rates and a very small impact on relative interest rates. Again, the result might be at most a small rise in yields on riskless assets matched by an equivalent tightening of credit spreads.
    Again, as in the previous case, there would be no change in overall U.S. investment, except to the extent that tightening credit spreads cause a small rise in risky U.S. investments. Beijing’s decision would also leave the U.S. capital account surplus unchanged, so it could not have any impact on the U.S. current account or trade deficits. Finally, Beijing’s decision would leave the Chinese capital account deficit unchanged, so it could not have any impact on the Chinese current account or trade surpluses.
    3) Beijing and other Chinese entities could buy fewer U.S. assets and replace them with an equivalently larger amount of assets from other developed countries, so that net capital flows from China to the United States would be reduced, and net capital flows from China to other developed countries would increase by the same amount.

    In this case, China’s overall capital account deficit and current account surplus would remain unchanged, but there would be a reduction in its bilateral capital account deficit and current account surplus with the United States, and an increase in its capital account deficits and current account surpluses with the rest of the developed world. The reduction in the U.S. current account deficit would mean a reduction in the excess of U.S. investment over U.S. savings. If U.S. investment were constrained by an inability to access savings, this reduction would occur in the form of lower U.S. investment. Because this is not the case. Given that U.S. businesses have easy access to as much capital as they need to fund investment, the adjustment would occur in the form of higher U.S. savings.
    Savings can be forced up in many different ways, almost always involving either less debt or lower unemployment. For example, a reduction in capital inflows can deflate asset bubbles and so discourage consumption through wealth effects, such a reduction can lower consumption by raising interest rates on consumer credit, or this reduction could even take place by encouraging stronger consumer lending standards. A reduction in capital inflows can also increase savings by reducing unemployment. One way or another, in economies like the United States that do not suffer from weak access to capital, a reduction in foreign capital inflows will automatically increase domestic savings.
    It may be harder than we think for China to redirect capital flows from the United States to other developed economies. Continental Europe, Japan, and the UK are the only developed economies large enough to absorb a significant change in the volume of capital inflows, but none of them are eager to absorb the current account implications. Some economists, misunderstanding the nature of the account identity that ties net capital inflows to the gap between investment and savings, will undoubtedly argue that these inflows would cause investment in Europe, Japan, and the UK to rise, but this is wrong. It would only be true if investment in these economies had previously been constrained by scarce savings, but because this is clearly not the case in today’s environment, the impact of higher capital inflows into developed economies could only be to reduce domestic savings.
    For developed economies, in other words, significantly higher capital inflows from abroad would either cause savings to decline as the inflows strengthen their currencies and reduce exports—causing either unemployment or consumption to rise—or, if their central banks act to sterilize the inflows, to increase imports by increasing consumer debt. If continental Europe, Japan, and the UK are unwilling to accept higher unemployment or higher debt, they would be unwilling to allow unlimited Chinese access to domestic investment and may quickly take steps either to retaliate or to redirect the flows to the United States.
    In the latter case, of course, it would again be a non-event. To the extent that developed countries do not redirect Chinese capital inflows to the United States, however, Chinese sales of U.S. government bonds would affect the U.S. economy, but largely in positive ways. First of all, and contrary to popular perception, a reduction of Chinese capital flows to the United States would not cause U.S. interest rates to rise except to the extent that it would cause U.S. economic growth to pick up. Because the reduction of the U.S. capital account surplus would result in an increase in U.S. savings, this would fully match the reduction in Chinese savings that had previously been imported by the United States. This is just the logical consequence of the balance of payments constraints.
    There would be no direct change in overall U.S. investment, and there would be an increase in U.S. savings, driven by either lower unemployment or a reduction in consumer debt. There might be an indirect change in U.S. investment eventually as the American trade deficit declines. Remember that because Beijing’s decision would reduce the overall U.S. capital account surplus, it would also automatically reduce the U.S. current account and trade deficits, for reasons that I discuss in an earlier blog entry. Finally, because Beijing’s decision would leave the Chinese capital account deficit unchanged, it would have no impact on the Chinese current account or trade surpluses.
    4) Beijing and other Chinese entities could buy fewer U.S. assets and replace them with an equivalently larger amount of assets from other developing countries, so that net capital flows from China to the United States would be reduced, and net capital flows from China to other developing countries would increase by the same amount.

    In this case, as in the previous, China’s overall capital account deficit and current account surplus would remain unchanged, but there would be a reduction in its bilateral capital account deficit and current account surplus with the United States, and an increase in its capital account deficits and current account surpluses with the developing world. As explained above, the reduction in the U.S. current account deficit would occur through an increase in U.S. savings.
    There is no difference between this case and the previous one as far as its impact on the United States or on China. Interest rates in either country would remain unchanged, the U.S. trade deficit would decline, and China’s trade surplus would remain unchanged.
    There is one important difference to the global economy, however. Because investment in developing countries is often constrained by difficulty accessing global savings, a redirection of Chinese capital from the United States to developing countries would boost investment in those countries. This would increase global growth and would benefit both developed economies and developing economies, including the United States. But the reason this is unlikely to happen to any large extent is that China has had a very bad experience with its investments in developing countries and may not be eager to raise them significantly more than it has already planned.
    5) Beijing and other Chinese entities could buy fewer U.S. assets and not replace them by purchasing an equivalently larger amount of assets from other countries, so that net capital flows from China to the United States and to the world would be reduced.

    Finally, China could reduce its overall capital account deficit by reducing the amount of capital directed to the United States and not replacing it with capital directed elsewhere. China, in other words, would export less capital abroad. This would mean, by definition, that China must either reduce domestic savings or increase domestic investment. This would also mean, of course, that Beijing must run lower current account and trade surpluses.
    One way savings can decline quickly is if a drop in exports causes unemployment to rise. The only other way is if there is a surge in consumer debt. For investment to rise quickly, there almost certainly has to be either a rise in unsold inventory as exports drop or a rise in nonproductive investment in infrastructure. In either case, this would mean a rising debt burden.
    As in the previous two cases, there would be no direct change in overall U.S. investment, and there would be an increase in U.S. savings, the latter driven either by lower unemployment or a reduction in consumer debt. There might be an indirect change in U.S. investment eventually as the American trade deficit declines. This is because as Beijing’s decision reduces the overall U.S. capital account surplus, it also would automatically reduce the U.S. current account and trade deficits. Most importantly for China, Beijing’s decision would reduce the Chinese capital account deficit and so it would necessarily also result in a reduction in the Chinese current account or trade surpluses.
    CONCLUSION

    Even if Beijing forced institutions like the People’s Bank of China to purchase fewer U.S. government bonds, such a step cannot credibly be seen as meaningful retaliation against rising trade protectionism in the United States. As I have showed, Beijing’s decision would have no impact at all on the U.S. balance of payments, or it would have a positive impact. It would have almost no impact on U.S. interest rates, except to the extent perhaps of a slight narrowing of credit spreads to balance a slight increase in riskless rates.
    It would also have no impact on the Chinese balance of payments in the case that it leaves the U.S. balance of payments unaffected. To the extent that it would result in a narrower U.S. trade deficit, there are only three possible ways this might affect the Chinese balance.

    • First, China could export more capital to developed countries, in which case the decision would have no immediate impact on China’s overall balance of payments, but it would run the risk of angering its trade partners and inviting retaliation.
    • Second, China could export more capital to developing countries, in which case the decision would have no immediate impact on China’s overall balance of payments, but it would run the very high risk of increasing its investment losses abroad.
    • Or third, China could simply reduce its capital exports abroad, in which case it would be forced into running a lower trade surplus, which could only be countered, in China’s case, with higher unemployment or a much faster increase in debt.





    https://www.zerohedge.com/news/2019-...treasury-bonds
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment



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  20. #857
    U.S. imports from China dropped 12 percent year on year in the first quarter of 2019, in contrast to rises with Vietnam (up 38 percent), Taiwan (up 22 percent), South Korea (up 17 percent) and Bangladesh (up 13 percent), according to data released June 6 by the U.S. Census Bureau.

    More at: https://worldview.stratfor.com/situa...-first-quarter
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  21. #858
    For many years China has been allowed to maintain a mercantilist dictatorship and protectionist model under the excuse that its high growth made it attractive.
    Shortly before the US launched its set of tariffs, the Chinese government accelerated two dangerous policies that we cannot ignore: intensifying capital controls , limiting the outflow of dollars from the country, and increasing the list of banned companies and sites, two measures that proved that the Chinese government was unlikely to open its economy, rather the opposite. These measures intensified in the last year and a half. Two other factors show China’s decision to halt the opening of its system. The “Made In China 2025 Plan” and the removal of the two-term limit on the presidency, effectively allowing Xi Jinping to remain in power for life.
    Between 2004 and 2018, the United States filed 41 complaints against China at the World Trade Organization, focused on 27 different areas. The vast majority of these WTO resolutions are not enforced (” Paper Compliance: How China Implements WTO Decisions.” The previous strategy of looking the other way and expecting the Chinese economy to open up little by little met the reality of increased interventionism.


    A senior official of the US Administration explained to me several months ago that there were two opposing opinions in the White House. The first claimed that starting a trade war would sink the US dollar, make US bond yields soar and throw the economy into a recession. The second estimated that the risk to the US economy was small and manageable. These were proven right with the US 10-year bond at 2.13%, its demand (bid-to-cover) comfortably doubling supply despite the end of the Federal Reserve purchases, and the dollar (DXY Index) at a conveniently strong level, adding very solid employment level, wages, and economic growth. The US dollar strengthened its position as the world reserve currency at 88% share of transactions while the yuan was only 4%, according to the BIS.
    Meanwhile, the proponents of a “gold-backed” yuan faced the reality of a Chinese central bank that injected and increased the money supply in a more aggressive way than the US Federal Reserve. China is not following sound money policies. The PBOC is copying the same policies of the Fed and BOJ by the book. It is not even remotely close to a gold standard, as gold reserves are less than 0.25% of M2 money supply.
    The gold-backed-yuan mirage faded with two consecutive devaluations, a currency that is used in less than 4% of global transactions and an extremely aggressive monetary policy.


    “Firing blanks”

    Many have mentioned that China could sell its US treasury holdings or threaten with its rare earth supply, essential for the manufacture of technological equipment.
    China is not the largest holder of US bonds in the world, not even close. It’s the US. In fact, China has already reduced part of its holdings in US bonds and yields fell.
    No, China could not weaponize its US debt holdings because it would run out of reserves and sink the economy and the yuan with it (read this excellent analysis ). China’s FX reserves have fallen by 21% from the highs and the vast majority of them cannot be used.
    The only solution for China would be to eliminate its capital control and let the yuan float, but then it could face a huge devaluation that would lead the country to a spiral of bankruptcies which may, in turn, lead to more yuan printing, a yuan that is not used worldwide and with diminishing demand. Recession or financial crisis.


    What about rare earths?

    In a magnificent article called ” The False Monopoly “, the authors debunk the myth of the alleged US dependence on China, but there is an additional factor. None of the Chinese miners in this sector generate returns above the cost of capital. Either they are loss-making or losing relative to working capital costs. We know this because they already tried both blanks in the past and they did not work.
    The confidence of the hawks in the United States administration was strengthened by the evidence that “the Chinese currency is not even wanted by the Chinese” given the evidence of capital outflows and a huge percentage of loans backed by copper and other commodities. China’s dependence on the US dollar turned out to be double: via FX reserves and via commodities. Their vast reserves are much smaller and less accessible than many thought.
    The technological battle

    There is a fourth factor added to the high trade surplus, capital controls, and lack of legal security and property rights. The technology battle.
    70% of the software used in China is pirated from the US. The negative impact for the North American economy, only in the area of ​​intellectual property, is $600 billion (“China: Effect of Intellectual Property Infringement and Indigenous Innovation Policies on the US Economy “) a larger figure than the trade surplus that China has with the US.
    It is not just a battle for control of technology, but security. The American technological giants are private companies and most of their leaders are critical of the White House Administration. The technological giants in China are either government-owned, semi-state owned or concessions to members of the communist party.
    The wrongly-called trade war is much more than tariffs. There are many additional forms of protectionism, and capital controls, restrictions on currency, lack of separation of powers and respect for intellectual property are also forms of protectionism.
    The United States has discovered the Achilles heel of China. The same one Japan had in the 80s when it seemed that it was going to invade the world. Its dependence on the US dollar to maintain its large domestic imbalances, a very fragile house of cards of excess capacity, real estate bubble and unproductive spending.
    Does the United States have anything to lose? A lot, but much less than China. According to Oxford Economics, the impact on US GDP of a total and prolonged trade war would be between 50% and 70% higher in China than in the US, and we have to add the domino effect of bankruptcies in China Global fund flows move to the US and out of emerging economies.
    The strength of the United States is to have a safer, open economy where currency remains a global reserve, not because of military power, but because the rest of the currencies fall into the trap of carrying out the same monetary imbalances as the US but without its free market, openness and real demand for currency.
    China’s Achilles heel has been to try to be a reserve currency whilst maintaining capital controls and increasing state intervention, playing to be the US without its dynamism, openness and free market. Its only card was a debt-fueled high-growth economy. Chinese officials knew it was impossible, but thought that being the “engine of world growth” would allow them to get away with it. They have met with a customer, the United States, which is the only one that supports its huge trade surplus ( China has a trade deficit with most of its other partners), and that does not depend so much on exports. The US exports less than 12% of its GDP.

    More at: https://www.zerohedge.com/news/2019-...more-trade-war
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  22. #859
    In response to the Trump administration's trade war with China, major tech companies are preparing to relocate key manufacturing operations. According to Bloomberg, Google is moving production of its US-bound Nest thermostats and motherboards to Taiwan. The Wall Street Journal reports that Nintendo is shifting at least some production of its Switch console to Southeast Asia.

    Some companies are better prepared than others to shift out of China if necessary. Apple Inc. partner Foxconn Technology Group said it would be able to manufacture all US-bound iPhones outside of China if it were forced to do so. Wistron Corp., a company that makes servers for Facebook and Microsoft, is reportedly looking to shift some production away from China, though it hasn't shared specifics.
    The trade wars are impacting Chinese companies, too, most notably, Huawei. In addition to losing Android support and being cut off from American chipmakers, Huawei has reportedly slowed its manufacturing operations. According to the South China Morning Post, Foxconn has stopped Huawei phone production on several lines in response to reduced orders.

    More at: https://www.engadget.com/2019/06/12/...na-trade-wars/
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  23. #860
    Quote Originally Posted by Swordsmyth View Post
    In response to the Trump administration's trade war with China, major tech companies are preparing to relocate key manufacturing operations. According to Bloomberg, Google is moving production of its US-bound Nest thermostats and motherboards to Taiwan. The Wall Street Journal reports that Nintendo is shifting at least some production of its Switch console to Southeast Asia.

    Some companies are better prepared than others to shift out of China if necessary. Apple Inc. partner Foxconn Technology Group said it would be able to manufacture all US-bound iPhones outside of China if it were forced to do so. Wistron Corp., a company that makes servers for Facebook and Microsoft, is reportedly looking to shift some production away from China, though it hasn't shared specifics.
    The trade wars are impacting Chinese companies, too, most notably, Huawei. In addition to losing Android support and being cut off from American chipmakers, Huawei has reportedly slowed its manufacturing operations. According to the South China Morning Post, Foxconn has stopped Huawei phone production on several lines in response to reduced orders.

    More at: https://www.engadget.com/2019/06/12/...na-trade-wars/
    More jobs being moved to America! Wait- they are not coming here. Instead we will pay more to import them from somebody else.

  24. #861
    Quote Originally Posted by Zippyjuan View Post
    More jobs being moved to America! Wait- they are not coming here. Instead we will pay more to import them from somebody else.
    Some will come here and the rest won't be sending money to our greatest enemy so that they can use it to continue to destroy our economy and impose communism on the world.
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  25. #862
    Quote Originally Posted by Swordsmyth View Post
    Some will come here and the rest won't be sending money to our greatest enemy so that they can use it to continue to destroy our economy and impose communism on the world.
    Everything in your post describes moving to another Asian country- not the US.

  26. #863
    Quote Originally Posted by Zippyjuan View Post
    Everything in your post describes moving to another Asian country- not the US.
    It isn't a comprehensive list of companies that are leaving or will leave China.
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  27. #864
    Quote Originally Posted by Swordsmyth View Post
    China just refuses to play fair: ...
    Just more leftist-socialist economic whining. (WAHHHH). If trading with China is just so "unfair" then why is it Japan has a trade surplus with China? Why is it that Korea has a trade surplus with China? Why is it that Germany has a trade surplus with China? Australia, Malaysia, Brazil and others all maintains a trade surplus with China.

    ITs the same old crying that markets are "unfair" so we need government intervention to protect our US manufacturing again the ability to obtain low-cost qualify materials to make themselves more competitive.

    When it is remarkably faster and easier to sety up a business or manufacturing in China than the US that is a reflection of the US self-sabotage, nothing to blame China.

    China is not responsible for USA's loss of competitiveness. You can blame the US government for that along with to a lesser extent various state governments with their income taxes, the regulations and reporting and red tape, and minimum wage laws and withholdings regulations and regulatory requirements, and unemployment tax and ss tax and medicare tax and 10.000 other requirements, and import and export requirements and filings and tariffs and excise taxation and reportings and 10,000 other burdens and requirements piled on. It is death by a 1,000 cuts.

    Now these same protectionist leftist mindset statists want to fix the problems cause by government regulation and taxation by adding more government regulation and taxation in the form of tariffs and trade wars and sanctions and imperial decrees of what business can buy and sell and from and to whom. Pure idiots. You can also blame the statists protectionists because it is their mindset that led to all these handicaps imposed on American businesses to make us less competitive.

    We need rent controls to protect against unfair rents by landlords.
    We need minimum wage laws to protect against unfair wages by employers.
    We need caps to protect against unfair price gouging.
    And now the Trumpette leftists are crying we need to tax American importers, business, and manufacturing with high tariff taxes to protect them against unfairly taking advantage of low cost imports to make themselves more competitive.

    "Yeah more government and more taxes is the answer."

    Trump is an idiot.
    Last edited by AZJoe; 06-18-2019 at 09:40 PM.
    "Let it not be said that we did nothing." - Dr. Ron Paul. "Stand up for what you believe in, even if you are standing alone." - Sophie Magdalena Scholl
    "War is the health of the State." - Randolph Bourne "Freedom is the answer. ... Now, what's the question?" - Ernie Hancock.



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  29. #865
    Quote Originally Posted by AZJoe View Post
    Just more leftist-socialist economic whining. (WAHHHH). If trading with China is just so "unfair" then why is it Japan has a trade surplus with China? Why is it that Korea has a trade surplus with China? Why is it that Germany has a trade surplus with China? Australia, Malaysia, Brazil and others all maintains a trade surplus with China.

    ITs the same old crying that markets are "unfair" so we need government intervention to protect our US manufacturing again the ability to obtain low-cost qualify materials to make themselves more competitive.

    When it is remarkably faster and easier to sety up a business or manufacturing in China than the US that is a reflection of the US self-sabotage, nothing to blame China.

    China is not responsible for USA's loss of competitiveness. You can blame the US government for that along with to a lesser extent various state governments with their income taxes, the regulations and reporting and red tape, and minimum wage laws and withholdings regulations and regulatory requirements, and unemployment tax and ss tax and medicare tax and 10.000 other requirements, and import and export requirements and filings and tariffs and excise taxation and reportings and 10,000 other burdens and requirements piled on. It is death by a 1,000 cuts.

    Now these same protectionist leftist mindset statists want to fix the problems cause by government regulation and taxation by adding more government regulation and taxation in the form of tariffs and trade wars and sanctions and imperial decrees of what business can buy and sell and from and to whom. Pure idiots. You can also blame the statists protectionists because it is their mindset that led to all these handicaps imposed on American businesses to make us less competitive.

    We need rent controls to protect against unfair rents by landlords.
    We need minimum wage laws to protect against unfair wages by employers.
    We need caps to protect against unfair price gouging.
    And now the Trumpette leftists are crying we need to tax American importers, business, and manufacturing with high tariff taxes to protect them against unfairly taking advantage of low cost imports to make themselves more competitive.

    "Yeah more government and more taxes is the answer."

    Trump is an idiot.
    Other countries aren't as stupid and collaborationist as our leaders have been and China has targeted us because they want to rule the world and we are in their way.
    ChiCom government intervention in the marketplace is as bad or worse than domestic government intervention in the marketplace, they tariff our industries and use non-tariff barriers more than any other country in the world and they subsidize their industries, in order to protect ourselves from their economic warfare we must cancel out their intervention or ban trade with them entirely, canceling out their intervention is preferable.

    Our own taxes and regulations are a problem but they aren't the only problem but even if they were that doesn't make allowing the destruction of America and its conquest by globalists and communists while we try to fix it is a good idea.

    It used to be accepted that you can't have open borders while you have a welfare state and it is just as true that you can't have free trade while you have a regulatory state but it seems that some libertarians think that the destruction of America is a good thing and that it will result in increased liberty.
    They are the idiots.
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  30. #866
    Quote Originally Posted by Swordsmyth View Post
    I... you can't have free trade while you have a regulatory state b....
    So more government is the answer as usual of the leftist statists. The answer is to oppose free trade, and expand government and increase taxation and more government regulation.

    And this is a perfect example of the kind of statist idiocy that is destroying our nation and destroying US competitiveness. Simultaneously recognizing that government regulation, taxation and interference in the markets is hindering US competitiveness and so the solution is a call for bigger government, more regulation, more taxation, more intervention in the markets. Brilliant, just brillant.

    And people wonder why US has lost so much of its competitive edge. Its this leftist mindset, whether by Bernie Sanders protectionists or the Trump delusion cult socialist protectionists. They are all big government central planning crony socialist statists.
    "Let it not be said that we did nothing." - Dr. Ron Paul. "Stand up for what you believe in, even if you are standing alone." - Sophie Magdalena Scholl
    "War is the health of the State." - Randolph Bourne "Freedom is the answer. ... Now, what's the question?" - Ernie Hancock.

  31. #867
    Quote Originally Posted by AZJoe View Post
    So more government is the answer as usual of the leftist statists. The answer is to oppose free trade, and expand government and increase taxation and more government regulation.

    And this is a perfect example of the kind of statist idiocy that is destroying our nation and destroying US competitiveness. Simultaneously recognizing that government regulation, taxation and interference in the markets is hindering US competitiveness and so the solution is a call for bigger government, more regulation, more taxation, more intervention in the markets. Brilliant, just brillant.

    And people wonder why US has lost so much of its competitive edge. Its this leftist mindset, whether by Bernie Sanders protectionists or the Trump delusion cult socialist protectionists. They are all big government central planning crony socialist statists.
    Is a tourniquet good for the human body?
    Might you need it to save your life?

    It used to be accepted that you can't have open borders while you have a welfare state and it is just as true that you can't have free trade while you have a regulatory state but it seems that some libertarians think that the destruction of America is a good thing and that it will result in increased liberty.
    They are the idiots.




    Let's just go ahead and have open borders in a welfare state and free trade in a regulatory state and let the most liberty oriented society in the world be destroyed and replaced with a communist dictatorship because perfect free trade (which we can't have thanks to Chinese intervention anyway) is ideal in a perfect libertarian country that we don't have.
    And let's let all accident victims with a torn artery bleed out because a tourniquet is bad for their circulation.
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  32. #868
    Quote Originally Posted by Swordsmyth View Post
    Other countries aren't as stupid and collaborationist as our leaders have been and China has targeted us because they want to rule the world and we are in their way. ..
    OMG. Aside the saturday morning cartoon level lunacy of this comment, ..

    So other, much smaller, countries are fully able to cope with China’s alleged currency manipulation or tariffs or subsidies but not the USA. That merely confirms it is US government’s own policies stifling the nation’s competitiveness. Can’t blame China for the problems caused by Washington and various state governments. Although some spamming Socialismsmyth surely will.

    Again, China is not to blame for US loss of competitiveness.

    While China spends its money building the largest most advanced highway system in the world, and the largest most advanced and high speed train system in the world, the newest most advance and efficient air and naval cargo ports in the world, and building win-win infrastructure to expand, improve, reduce costs and increase speed of multi-way trade across Eurasia, the government in Washington allows the US infrastructure to continually age and deteriorate while depleting trillions upon trillions upon trillions of resources wasted on overseas occupations, invasions, bombing, destruction, regime changes, color revolutions, proxy wars etc. Meanwhile burdening the US economy with an unfathomable $22 trillion in acknowledged debt and incomprehensible $80k+ trillion in actual GAAP government debt.

    US says it wants to lead the world in trade but then wastes all its resources and efforts on foreign empire and bombs and wars and subsidizing the MIC, meanwhile going around the world threatening every other nations if they don’t do what US says and telling them who they can buy from or sell to and will be punched if they don’t obey the despot. Meanwhile the China invests in trade infrastructure, trade routes, and projects to increase trade capacity and trade efficiency and making win-win trade deals with the rest of the world.

    US government is solely to blame for its destruction of US competitiveness. And the Trump delusion cult joins hand in hand with the leftists, the socialists, the neoconservatives, the neoliberals to continue these policies of self-destruction because Trump is now leading the charge down the very same path of self-destruction.
    Last edited by AZJoe; 06-25-2019 at 09:14 PM.
    "Let it not be said that we did nothing." - Dr. Ron Paul. "Stand up for what you believe in, even if you are standing alone." - Sophie Magdalena Scholl
    "War is the health of the State." - Randolph Bourne "Freedom is the answer. ... Now, what's the question?" - Ernie Hancock.

  33. #869
    To borrow an analogy of the US economy and Asian economies from a wise economist, it is akin to an American and 5 Asians on an island. One Asian collects fish and shellfish each day to provide food, another hunts and traps and obtains a few animals each week to also provide food and leather, another builds clothing and bags from the hides, another weaves sandals and shoes and blankets from reads and grasses.

    The American sits around all day and at the end of the day grabs some loos grass and cuts notches for 1 5 and 10 and says here will uses the grass stems as money so each day you can sell the product of your labor to me in exchange for the grass stems I create. Further, once you sell stuff to me you can also use the grass as currency amongst yourself to trade with each other. The American just keeps printing the grass currency each day and proclaims he is the engine of the Island economy; Without him nothing would function and the economy would come to a halt; He is the consumer providing the demand so everyone can work.

    That is the US economy compared to others. Who is the one that getting taken advantage of? Who is the one benefitting? Trump and the nitwits would complain that the American is being taken advantage of because he has a trade deficit with the Asians. The trade deficit comes from the money printing and the other economies accepting it. In the US the driver of the trade deficit comes from the never-ending money expansion and perpetual and never ending and accelerating debt spending.
    "Let it not be said that we did nothing." - Dr. Ron Paul. "Stand up for what you believe in, even if you are standing alone." - Sophie Magdalena Scholl
    "War is the health of the State." - Randolph Bourne "Freedom is the answer. ... Now, what's the question?" - Ernie Hancock.

  34. #870
    Quote Originally Posted by AZJoe View Post
    OMG. Aside the saturday morning cartoon level lunacy of this comment, ..

    So other, much smaller, countries are fully able to cope with Chinaís alleged currency manipulation or tariffs or subsidies but not the USA. That merely confirms it is US governmentís own policies stifling the nationís competitiveness. Canít blame China for the problems cause by Washington and various state governments. Although some spamming Socialismsmyth surely will.

    Again, China is not to blame for US loss of competitiveness.

    While China spends its money building built the largest most advanced highway system in the world, and the largest most advance and high speed train system in the world, the newest most advance and efficient air and naval cargo ports in the world, and building win-win infrastructure to expand improve reduce costs and increase speed multi-way trade across Eurasia, the government in Washington allows the US infrastructure to continually age and deteriorate while depleting trillions upon trillions upon trillions of resources wasted on overseas occupations, invasions, bombing, destruction, regime changes, color revolutions, proxy wars etc. Meanwhile bordering the US economy with an unfathomable $22 trillion in acknowledged debt and incomprehensible $80k+ trillion in actual GAAP government debt.

    US says it wants to lead the world in trade but then wastes all its resources and efforts on foreign empire and bombs and wars and subsidizing the MIC, meanwhile going around the world threatening every other nations if they donít do what US says and telling them who they can buy from or sell to and will be punched if they donít obey the despot. Meanwhile the China invests in trade infrastructure, trade routes, and projects to increase trade capacity and trade efficiency and making win-win trade deals with the rest of the world.

    US government is solely to blame for its destruction of US competitiveness. And the Trump delusion cult joins hand in hand with the leftists, the socialists, the neoconservatives, the neoliberals to continue these policies of self-destruction because Trump is now leading the charge down the very same path of self-destruction.
    ON. THE. NOSE.
    There is no spoon.

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