Article on trade with China
31 responses | 1 like
Started by cfdr - Aug. 2, 2018, 9:01 p.m.

I thought this article was an interesting read.  Of course, it is pro Trump, so some here won't even want to read it.  (g)

He goes through what he sees as a massive economic squeeze being put on China.

Edited to delete one sentence that was not necessary.

By Richard - Aug. 2, 2018, 9:12 p.m.
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I did not read the article but Obama was an actor who was playing a part and he was told to act nice and peaceful because behind the scenes, they were planning a huge surprise for China and was much worse then what is going on. It was not a nice surprise and China and then Trump stopped it and Trump is trying to deal with them in a legit way. Also, The entire scenario about Global Warming is really nothing more then an attack on China

By cutworm - Aug. 2, 2018, 9:53 p.m.
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Great article ! Shows just how in depth the plan is and explains everything we do not hear from the media. 

Richard you should read it.

By wglassfo - Aug. 3, 2018, 1:54 a.m.
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This article shows all of Trumps advantages in trade discussion with china. All good points but as usual there are two sides to every story

So: the article ignores a few things

1st: Trump has turned almost all his natural western allies against him. Not good

When travelling in England, nobody that we talked to had a good word for Trump. You would not believe the  feelings about Trump from the person on the street

2nd:  Iran is flexing its military muscle threatning to shut down the flow of oil thru the Strait of Hormoz

They have assembled 100 fast attack boats with the USA having one air craft carrier in the region. If this turns into a hot war, then the USA will have to rely on Isreal and land based aircraft. How far does Trump want to push a hot war with Iran?? Iran is cornered today with USA sanctions on oil sales. You can bet either Russia or china will rush in to help Iran.

What to do with Russian ICBM silos??. This could get very serious

How far do you dare to push the issue The world needs oil and Germany, EU look to Russia and perhaps Iran for oil. What if a missile or under water torpedo makes its way thru the USA shield and blows up the only war ship in the region. All it takes is one  blow to put an aircraft out of business. Can a war ship defend against 100 smaller boats and you can bet the USA will have orders to not fire unless fired upon

A very messy situation indeed

3rd: China will exert all possible military actions to control the China south seas

Another messy situation, even if limited, do you want limited nuclear missiles flying around the south seas

4th: When we were in China, nobody likes the USA.

They even want to boycott USA consumer goods

You can almost smell the rage against the USA [to borrow an FBI term}

5th: China is very willing to allow the yaun to devalue. They don't even make any attempt to hide their actions

This will eventually offset the current Trump tariffs whist causing a strong USD making sales into china that much more expensive

6th: A nation such as china, if deprived of raw material will have no choice but to take military action to safe guard their supply routes. Either fight or die. Which action do you think they will take??

Does the USA intervene and risk a shooting war???

A serious and messy situation

7th: The Chinese have vast resources which could be developed. China is a very patient country and if the citizens are motivated they will suffer pain and develop these resources. They can also afford to make trade treaties with russia against the common enemy and also develop Russian raw materials, plus increase Africa  and Brazil agriculture

China has a history of accepting short term pain for long term gain. You would not believe the history of china and their ability to suffer pain

Trust me, the citizens are already, willing to go to war against the USA in any economic trade war

China has a history of isolation and who says they won't with draw into their shell or go to war. Remember, that is why Japan struck the USA at Pearl Harbour.

Japan was shut out of raw materials supply, and stock piled as much as they could before trying to open up supply lines

Finally, we all know one truth

Corner an animal, a country or what ever, and you have an extremely dangerous animal

If china feels cornered enough who is to say what they will do

China will never give up their tariff system with out a fight

They know their economy would collapse.

So what would they have to lose if cornered into solutions that do not favour china

You can bet they will fight.

How far is Trump willing to push on the buttons

Is Trump willing to risk the entire planet earth as we know it or is he forced to pull back. The very planet earth could hang in the balance

What would you do if you felt cornered 

I expect you would fight by any and all means

Trump might be leading us down a very dangerous road, with unintended consequences

These various trade wars will not be over by the mid term elections or the 2020 elections. Nody is talking in a serious manner, least of all the chinese

How long will the average USA consumer walk the path of pain before chinks break open at home

Most people in the USA have no patience for long term any thing. What happens if consumer goods increase with no increase in wages.. Riots will break out with Antifa leading the charge. Antifa will do anything to cause disruption. Then Trump has to declare martial law to stop Antifa

Talk about food for the media to whip the citizens into a frenzy

We already see winners and losers in the USA. Some new plants are opening but some manufacturing is already feeling real pain with lay offs and closure

How long will the americian farmer watch Argentina have a good crop next yr and Brazil plant a gazillion more soybeans. Then think about how your average citizen will react when money runs short, due to higher prices or interest rate increases.

How many people are currently forced to live in their car. Wait until that number doubles or triples, with police harassment to move along

Is the gov't willing to bail out every failed farmer and manufacturing plant. Just talk to your USA car makers and ask them what the expected price increase will be. Honda has already done a study on increased cost and expected sales' I know this direct from their accounting department. I expect the other car makers are doing the same and profits will suffer big time. Layoffs are just down the road

All things are not as one sided as 1st meets the eye

Never are and never will be

I expect to see a shooting war some place and depression. History tells us this will happen and this time is some what different but also very much the same

Expect your life to change in many ways and I expect Trump will eventually lose the battle on the home front

1/2 of the people already hate him.

What would real pain do to the other 1/2

The people are not conditioned to accept long term pain. They want the good life today. Just ask the younger generation what they expect to start a home

New everything and if they don't get it then expect more people to get elected like that socialist from N.Y.

You really think china will cash there chips in 1st??

History tells us chinese citizens are conditioned to accept pain, for a much longer time compared to  USA citizens

Heck, many USA citizens will not even work at many jobs if the work is deemed to physically hard or menial They will demonstrate in the streets before working at menial jobs. Most are too fat to bend over all day in a veggie field

Chinese citizens are smaller in size, require less calories and work much harder at menial jobs

Most of us have no idea what the Chinese citizen will do

We know what many USA citizens will do, when the dung hits the fan

Do you see two sides to the problem???

By cutworm - Aug. 3, 2018, 7:39 a.m.
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Metmike feel free to move this to NTR

Wayne just a few thoughts;

2) “Can a war ship defend against 100 smaller boats and you can bet the USA will have orders to not fire unless fired upon”

Aircraft carriers do not travel alone. And I will take that bet about orders not to fire unless fired upon. If our military, under this administration feels threatened, they will shot to kill. Trump will not play the games that killed our men at Bengauzie.

3rd: “China will exert all possible military actions to control the China south seas

Another messy situation, even if limited, do you want limited nuclear missiles flying around the south seas”

This is a result of the failure of the last 30 years policy. Insanity is doing the same thing over and over and expecting a different result.

6th: “A nation such as china, if deprived of raw material will have no choice but to take military action to safe guard their supply routes. Either fight or die. Which action do you think they will take??”

We never said we would not sell raw materials to china. They are the ones making buying raw materials expensive for themselves.

“Finally, we all know one truth

Corner an animal, a country or whatever, and you have an extremely dangerous animal

If china feels cornered enough who is to say what they will do”

Sun Tzu #29 Build your opponent a golden bridge to retreat across.

Just a few thoughts

By Richard - Aug. 3, 2018, 7:41 a.m.
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wglassfo - Trump knows what he is doing and the issues you are bringing up are covered and not a problem. By your writings, you seemed confused. Sit back and watch.

By Lacey - Aug. 3, 2018, 10:23 a.m.
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Well written article, Wayne.  I think you underestimate the will of the typical American to right a trade arrangement that has been aligned against us  and encouraged , if not outright directed by the prior 3 administrations.  If we don't dig in our heels now, then when? Have to admit, many Americans are fat and lazy, but not all.  Hopefully climate change becomes the great equalizer and agent of migration.

By metmike - Aug. 3, 2018, 11:32 a.m.
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From Bloomberg:


Kudlow Says Trump Won't Back Off in Escalating China Trade War

“We’ve said many times: no tariffs, no tariff barriers, no subsidies. We want to see trade reforms. China is not delivering, OK?,” White House chief economic adviser Larry Kudlow said in an interview on Bloomberg TV Friday. “Their economy’s weak, their currency is weak, people are leaving the country. Don’t underestimate President Trump’s determination to follow through.” 

China also signaled on Friday it has no intention of retreating from a trade war. The government announced it has prepared a list of $60 billion worth of U.S. goods to hit with duties should the U.S. follow through on a plan to impose duties on an additional $200 billion of Chinese goods, as early as next month. The Chinese duties ranging from 5 percent to 25 percent will be levied on 5,207 kinds of American imports, the Ministry of Finance said in a statement on its website.


The retaliation stands to further inflame tensions between the world’s two biggest economies. It echoes China’s response to the previous round of tariffs last month, when the U.S. and China imposed tit-for-tat tariffs on $34 billion worth of each others’ goods.

By cfdr - Aug. 4, 2018, 6:35 p.m.
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Meanwhile, China is appearing to stir up trouble.

Also, how long before North Korea (really China) starts testing missiles again?

Who is it that does not want our president to cooperate with Russia??

Lots going on just beneath the surface, it seems.

By joj - Aug. 5, 2018, 6:59 a.m.
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wglassfo:  Interesting points you made.  You certainly know more about the Chinese people than I do.  Their willingness to suffer is certainly self evident in the low pay for menial work that millions of them do.  Although I guess working in a factory for 14 hours a day beats working in the fields.

The original article posted has a quote which states:  "President Trump will not back down from his position; the U.S. holds all of the leverage "

Nowhere in the article does it mention, nor did you mention, that China holds an extremely large amount of US debt.  The largest among all foreign governments.   What if China were pushed into a corner and decided to take a shot across our bow by not participating in a US debt auction, let alone selling.  They could start buying Euro debt instead of US debt.  Interest rates would move sharply higher would be my guess.  Economic war indeed.  Dare we contemplate Trump taking the ultimate step:  Paying only 50 cents on the dollar to China for US debt?  (HORROR!) That is basically how he behaved repeatedly in his decades as a businessman.   Stiffing people he owed money to.  I think such a step lacks honor and common sense, but I suspect Trump's supporters would think of it as "acting tough".  Does the office of the president have that much power?  I don't know but I'd be interested to know if someone on the forum has expertise in this.

This past spring Russia sold 85% of it's US debt in the open market.  Russia's holdings are small compared to China but it probably had something to do with the 10yr note popping over 3%.  Did Russia do that because they knew more about White House plans with China than the rest of us?  I'm not a conspiracy guy so I will leave that alone.  

Trump holds the legal and moral high ground on trade with China.  The past 30 years of our economic relationship isn't working.  Still, I'm not sure why Trump wants to alienate our democratic allies since in any future economic war with China, we will need their help.

By Lacey - Aug. 5, 2018, 9:22 a.m.
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Do you really think Merkle is an ally at this point?.  Do we want the Moslem and African invasion she has going on with  Europe?  She is more the enemy.  If Iran closed down the straight and oil rockets to $200. as Richard has said over and over again, America will adjust to the higher prices more easily than Europe or China.  We will come out of this with a much more even trade relationship with the rest of the world.

By Lacey - Aug. 5, 2018, 9:34 a.m.
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Do we really care if the rest of the world likes us.  They just like current trade relationships that favor them. France ,Germany, Sweden,and England have already lost their culture.  Sharia law will be running the continent in a decade.  If your not careful, Canada will join them.

By Lacey - Aug. 5, 2018, 9:42 a.m.
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Americans have already suffered because of the status quo.  We have so far barely avoided a revolution from losing 155 million jobs.  China will not be so lucky.  Maybe, under Trump we bring half those jobs back.  What a boon to our economy.

By Lacey - Aug. 5, 2018, 9:44 a.m.
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Exactly right cutworm.

By frey_1999 - Aug. 5, 2018, 10:14 a.m.
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This "article" is not fact based  it is an Opinion based, and at best is a slanted Opinion. but even at that it only shows what China loses will move to the next cheap or low cost producer not to the USA. Yes China will lose in this trade war but not to the USA gain but to some other third world country.

If that is how you define winning than lying donney is your guy I guess.

By TimNew - Aug. 5, 2018, 11:07 a.m.
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Please explain the 25 year high in manufacturing job creation for the past 12 months. aided by the solid acceleration of the past 3 months.


By frey_1999 - Aug. 5, 2018, 11:34 a.m.
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during the last six years of the Obama admin. there were 1.1 million Manufacturing jobs added in the US but you and your types did nothing but run around yelling Birther,birther, birther telling lies lead by lying donney.

The US has for the last eight years been leading the way in "NEW" manufacturing jobs in the fields of tomorrow. and we did that without tarrifs.

By TimNew - Aug. 5, 2018, 1:13 p.m.
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So,  you'd rather not answer the question as to why we've have a spike in the last year that shows the fastest and largest increase in manufacturing jobs in 25 years with the increases accelerating dramatically in the last 3 months.   Guess I can't blame ya.  Facts really mess up your objective.

By joj - Aug. 5, 2018, 2:11 p.m.
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Frey didn't acknowledge your point....

And you didn't acknowledge his.

Looks like a fair exchange.

By metmike - Aug. 5, 2018, 2:33 p.m.
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Nothing at all wrong with the exchange going on as this thread continues. However, it is turning into a mostly political thread, regardless of how it was originally intended.

I am ok with leaving it here if everybody wants it left here. I am not ok with deleting any of the comments that are political and leaving it on the trading forum because none of the comments were personal or unacceptable and I will only delete comments that disrespect others.

There is no option to try to separate out comments and put them where they "might" belong.

No doubt, there will be disagreement amonst you on what I should, let's try this.

Since you are currently on the trading forum, please try(if you can) to leave the politics out of it.

BTW, I was personally ok with the old forum of combining everything but am also ok with this format but am just following what I think will work best with THIS format. 

By TimNew - Aug. 5, 2018, 3:17 p.m.
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JOJ.  I asked a direct question.  It was avoided.  Quite simple.   But MM is right.  We are straying from pure trading, so I will refrain.

By silverspiker - Aug. 5, 2018, 3:25 p.m.
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What the so-called grain experts on CNN are trying to spin is only the demand side of the US grain exports... they keep saying that there is an infinite amount of grains that China can pick elsewhere in the world from  an already finite world growing year in the grains...they also do not seem to realize that these grain shipments are to businesses that reside in the country and not to the government themselves...

--- The Main Crucial Element Of This Deal Making Process Is That 1.5 Billion Chinese Need To Eat... And The USA 


Image result for memes about corn

By frey_1999 - Aug. 5, 2018, 5:38 p.m.
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The answer is that the expansion in Manufacturing jobs has been ongoing since around 2010 or 11 this expansion was started by the new age industries be it green energy, autonomous vehicles, medical device breakthroughs arrived at through technology breakthroughs, and science breakthroughs. 

we as a country have left behind the old "manufacturing" of shirts pants and tennis shoes, and moved into Drones ,autonomous autos, GPS and technology type manufacturing. The growth in these fields continue to accelerate add to that the big push in government spending on defense Items and there you have it.  Manufacturing growth excellerates.

Now the question becomes are the federal deficits at over a trillion a year again worth what we are getting ?

and if they are why did people push for sequester back in 2014-15 because back then we were growing as a country at even a faster rate than we are today. 

Im sure you will not think this answers your question but like my first answer it does and even with more detail.  

By TimNew - Aug. 5, 2018, 7:19 p.m.
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Your projected deficits are not a reality, they are forecasts..  And they are based on IMO, nonsensical GDP projections of 10ths of percentage gains. Our last GDP was over 1 percent higher than the average we've seen for about the last decade.  So far,  we are not running any where near your trillion dollars.  We've had far higher within the last decade,  BTW. And the only meaningfully measurable deficit is as a percentage of GDP.

The expansion in all job markets started around 2010 but we were coming off decade level lows.  If there had been no expansion we might be taking knives into the woods by now to find dinner.  What we make has been changing rapidly for the last century or so..  Even more so in the last couple decades as technological advances accelerate. But, I use the term "We" in the international sense.  Everyone is making new stuff. 

What you are still avoiding is the recent spike in U.S. manufacturing job creation.  Why are we hiring so many more people to make this new stuff? The most in 25 years.

By frey_1999 - Aug. 5, 2018, 9:08 p.m.
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the last 12 months the the US has spent 800 billion more than it has brought in and with each passing month the deficit projection for 2018 has been raised by about 100 billion so NO they are not just a whimsical Projection and in the end they will more than likely be bigger than today's forecasted total.

The tax cuts did not work but that should not surprise anybody.

Not sure how many times I need to tell you this and in how many different ways but as with every expansion in the business cycle hiring excellerates and we add more jobs which is what is happening, This will set the grounds for higher Interest rates which in turn will slow down the manufacturing industry starting with the high ticket Items first and moving down the ladder until it catches everybody.  it is a function of the business cycle now this cycle can be stretched or altered by government action ( sequester or huge blast of government spending or defeict spending) but in the end the business cycle will happen. So in 2014 the cycle was altered by sequester and today it is yet being altered again by tariffs and a huge bulge in government deficits.    

By Lacey - Aug. 5, 2018, 9:31 p.m.
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So Frey, this is just a continuation of the jobs recovery started under Obama.  Why did small business optimism climb to a 35 year high in the aftermath of the Trump victory.

By TimNew - Aug. 5, 2018, 9:41 p.m.
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I'll ask one more time.

Why are we seeing 25 years highs in manufacturing job creation with a significant acceleration seen in the last 3 months?

By cfdr - Aug. 5, 2018, 11:10 p.m.
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I think this sentence is key to what we are seeing today.

"This specific President entered office without any IOU’s for the multinational business community, and his entire team are entirely prepared for this.  The question is: are we?"

Are we going to be able to do what is necessary to change the unbalanced trade between us and China, or are we simply going to bury our heads in the sand and hope the road doesn't lead to where it looks like it is leading to in the near future?

By cfdr - Aug. 5, 2018, 11:22 p.m.
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Another article - but on Canada.  

Lighthizer's comments are worth reading in this article.

“Free trade agreements are essentially grants of preferential treatment to other countries in exchange for an approximately equal grant of preferential treatment in their economy. Thus, it is reasonable from time to time to assess whether the bargain has turned out to be equitable.”

[…] “I would like to comment on two proposals by the Canadians, one of which has been in the press quite a bit, and that is a presumed compromise on rules of origin.

We find that the automobile rules of origin idea that was presented, when analyzed, may actually lead to less regional content than we have now and fewer jobs in the United States, Canada, and likely Mexico. So this is the opposite of what we are trying to do.

In another proposal, Canada reserved the right to treat the United States and Mexico even worse than other countries if they enter into future agreements. Those other countries may, in fact, even include China, if there is an agreement between China and [Canada].

This proposal, I think if the United States had made it, would be dubbed a “poison pill.” We did not make it, though. Obviously, this is unacceptable to us, and my guess is it is to the Mexican side also.

Finally, I would like to refer, because I think it fits into this context to an unprecedented trade action that Canada brought against the United States very recently. It constitutes a massive attack on all of our trade laws. If it were successful, it would lead to more Chinese imports into the United States and likely fewer Canadian goods being sold in our market.

Now we understand that countries often challenge specific actions taken by another country in the context of trade laws. This is normal and what we expect. But this litigation essentially claims that 24 years ago, the United States effectively gave away its entire trade regime in the Uruguay Round. Of course, we view this case as frivolous, but it does make one wonder if all parties are truly committed to mutually beneficial trade. It also underscores why so many of us are concerned about binding dispute arbitration. What sovereign nation would trust to arbitrators or the flip of a coin their entire defense against unfair trade?  (more from the end of round #6)"

It is also interesting to read the first of the comments about Canada/Saudi Arabia relations following the article.  I just can't help buy think that the Canadian people have been very poorly served by the Trudeau government.

By frey_1999 - Aug. 6, 2018, 9:24 p.m.
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just because its not the answer you want matters nota

By TimNew - Aug. 7, 2018, 3:35 a.m.
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If I ask what color the sky is and you answer, "The grass is green",  I guess in your world,  you have answered.  That tells me you didn't understand the question or you don't know the answer.

In your attempts to answer,  you have mentioned there were 1.1 million jobs added during the last six years of the Obama admin.   That's not an answer and pales in comparison to nearly 340k in the last 12  months with acceleration in the last 3.(A little more than double the rate  you cite from the Obama era with reasonable expectations of further improvement)

Then you go on to attempt to attribute it to deficit spending using an 800 billion number that seems on the high side of the numbers that I am seeing,  but deficit spending is barely relevant anyway.  From there, you claim the 7 month old tax cut didn't work when anyone with an inkling of eco 101 would realize that it will take 5-6 quarters before we can begin to fully assess the impact. But the economic impact so far appears very positive.   Only a partisan hack could look at the data and conclude "IT DIDN"T WORK".  Aside from all the positive economic data, have you looked at federal revenue as compared to previous years/months?

Then you go on to say we have been expanding since 2010 or 11,  but we make different stuff now.  I can't for the life of me imagine why it matters what we make.  The question is "How many US Citizens are making it" and the answer is "A lot more, and that increase appears to be accelerating".  

So,  back to my original question.  Why?

By TimNew - Aug. 7, 2018, 4:01 a.m.
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On the deficit,  a little blurb from Econoday.

"Individual tax receipts are on the rise but so is spending. The last Treasury statement in June showed a $607.1 billion deficit nine months into the government's fiscal year, up significantly from a $523.1 billion a year ago. Econoday's consensus for the July statement is a monthly deficit of $73.5 billion with the high end estimate at a surplus of $31.4 billion."

 Worst case would still put us well over 100 billion below your 800 billion figure.