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The 25% tariff is on $200 billion of $500 billion imports from China. China exports to the US is only 20% their worldwide exports. 25% x 20% x 40% = 2% impact on China’s exports, they can easily manipulate own currency exchange rate lower by a few penny to get around this, which probably already done last year. This isn’t going to hurt China.
American consumers, on the other hand, will pay every dollar and cents of Trump tariff plus stock market jittering. China stop buying soybeans to zero, that’s $16 billion a year loss.
Hasn't the Chinese market been hit harder than the American markets thus far?
It's a leverage game. Maybe you are right and we don't really have it. But maybe we are better equipped to withstand some pain for some long-term gain.
I'm not an expert by any means and I think there is a pretty strong consensus, even from Trump himself, that tariffs long-term are problematic and a cuff on the economy. But if they get us better trade deals then the short term losses would be insignificant.
Whether or not it works out that way remains to be seen...
Trump's presidential legacy (at least in the eyes of those not ailing from TDS) may depend on it.
Hasn't the Chinese market been hit harder than the American markets thus far?
It's a leverage game. Maybe you are right and we don't really have it. But maybe we are better equipped to withstand some pain for some long-term gain.
I'm not an expert by any means and I think there is a pretty strong consensus, even from Trump himself, that tariffs long-term are problematic and a cuff on the economy. But if they get us better trade deals then the short term losses would be insignificant.
Whether or not it works out that way remains to be seen...
Trump's presidential legacy (at least in the eyes of those not ailing from TDS) may depend on it.
The problem with comparing China and the U.S. outlooks is they're nothing whatsoever alike in philosophical beliefs.
China is patterning this using state run media as a "war of the people for their very survival and their ability to remain a sovereign nation"
The U.S. on the other hand ……….."trade wars are easy to win and it'll be short term pain for long term gain."
If you cannot see the difference and remove the rose coloured glasses for just a minute you'd realize Americans are looked upon, and believe it themselves, they're the chosen people born to enjoy life's every privilege. While you've been eating Prime Rib for the last 50 years; they're just now enjoying full bellies.
China has no problem convincing their people that all of the gains made in the last 50 years are at risk if they do not prevail against the greedy U.S.. The Chinese are no strangers to personal sacrifice for the greater good of ALL their people.
The problem with comparing China and the U.S. outlooks is they're nothing whatsoever alike in philosophical beliefs.
China is patterning this using state run media as a "war of the people for their very survival and their ability to remain a sovereign nation"
The U.S. on the other hand ……….."trade wars are easy to win and it'll be short term pain for long term gain."
If you cannot see the difference and remove the rose coloured glasses for just a minute you'd realize Americans are looked upon, and believe it themselves, they're the chosen people born to enjoy life's every privilege. While you've been eating Prime Rib for the last 50 years; they're just now enjoying full bellies.
China has no problem convincing their people that all of the gains made in the last 50 years are at risk if they do not prevail against the greedy U.S.. The Chinese are no strangers to personal sacrifice for the greater good of ALL their people.
I don't disagree with what you are saying... but it doesn't mean that Trump playing hardball won't work to get America a better deal.
I don't disagree with what you are saying... but it doesn't mean that Trump playing hardball won't work to get America a better deal.
You just confirmed my point by likening this to some game called "hardball". You can't play hardball when the other team is convinced they have nothing to lose and everything to gain.
China and Chinese do not share our western sense of "fair play." Intellectual property theft is encouraged, rampant and not seen as something wrong.
Attempting to enforce patent protection in China is nothing like attempting to enforce it in the USA. In the USA, you go to court. In China, you have a meeting behind closed doors with a government magistrate or mandarin. There is nothing like what we would consider "due process."
The dominant operating system in used on PCs in China is Windows. The ration of licensed copies to pirat4ed copies asymptotically approaches zero. Chinese don't see that as a bad thing. They don't see it as doing anything wrong.
India isn't far behind. I recall a political cartoon in the Times of India; it showed a plaintiff in front of a judge sitting on high, and this judge was speaking. The text: "OK, so you've proved this official took bribes, steered official business to family members, embezzled large sums of money, punished his enemies, etc. But you said he's corrupt. I don't see any corruption. Where is this corruption you speak of?"
There is a very influential book in China regarding intellectual property including patents, trademarks, copyrights, licenses, trade secrets, etc. This book hasn't been translated into English as of yet, but has been distributed to mandarins across the country. The book presses the case that intellectual property was the West's way of attempting to suppress Chinese economic development.
Famed Intel CEO Andy Grove once told me, "China will begin to respect intellectual property (IP) as we know it in the West about the same time China has significant IP that they need to protect."
You make wonderful, lucid, intelligent comments.. that frequently fall on deaf ears and weak brains.
I think it may be that economics is not taught in high school and few people dive deeply into the subject even in college.
But thanks anyway.
Chinese IP theft, not only happening in China but right under our noses as well... there is no concept of "Intellectual Property" in Chinese culture, they consider stealing anyone's ideas fair game if they get their hands on it.
When you have a society where the culture itself does not understand this concept it makes it hard to negotiate any deals along these lines.
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