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23-05-2019, 09:21 AM
Unfortunately for China, it is too reliant on USA as the main exporter. Just like Australia is too reliant on China for commodity exports. USA can increase trade and source cheaper alternative goods from south american nations like Brazil/Mexico/which have low labor cost, though that might require some further investment from american companies to get the factories going. Then there are some cheaper manufacturers from poorer european countries as well. There will be a revival/boom in many local manufacturing sectors as well.
American farmers who are hardest hit will need subsidies from the government, but thats only on 60billion - 100billion of exports , the revenue from tariffs of 300-400 billion china imports into USA should more than cover for that.
It's hard to see how China can come out in better shape than USA, especially if there are mass layoffs from companies shutting down from the 25% tariffs. From what I read, Chinese businesses were not really that affected by 10% tariffs but 25% on everything is another matter.
As evident from the recent Huawei hoo hah, technology is a big thing. Were it not for the unfair restrictions in China, pretty sure we would not have Baidu/Taobao/etc.. They would have been bought over or outcompeted by the likes of Amazon/Google. More importantly in military sectors, the leak of new technology which China has been acquiring easily via "forced technology transfers" can ultimately result in China having more advanced weapons and posing even more of a bigger threat, especially when you consider they already have some high-tech stuff from Russia previously.
The Chinese probably trying to drag things out till next USA Presidential election till they can make an easy deal without Trump around. Will be interesting to see if they can survive till then. Now that 25% tariff in play, I expect next few months a big downturn in Chinese PMI numbers.
American farmers who are hardest hit will need subsidies from the government, but thats only on 60billion - 100billion of exports , the revenue from tariffs of 300-400 billion china imports into USA should more than cover for that.
It's hard to see how China can come out in better shape than USA, especially if there are mass layoffs from companies shutting down from the 25% tariffs. From what I read, Chinese businesses were not really that affected by 10% tariffs but 25% on everything is another matter.
As evident from the recent Huawei hoo hah, technology is a big thing. Were it not for the unfair restrictions in China, pretty sure we would not have Baidu/Taobao/etc.. They would have been bought over or outcompeted by the likes of Amazon/Google. More importantly in military sectors, the leak of new technology which China has been acquiring easily via "forced technology transfers" can ultimately result in China having more advanced weapons and posing even more of a bigger threat, especially when you consider they already have some high-tech stuff from Russia previously.
The Chinese probably trying to drag things out till next USA Presidential election till they can make an easy deal without Trump around. Will be interesting to see if they can survive till then. Now that 25% tariff in play, I expect next few months a big downturn in Chinese PMI numbers.
Virtual currencies are worth virtually nothing.
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