Skip to comments.The U.S. is 'winning' the trade war, says Mohamed El-Erian
Posted on 07/13/2018 6:39:34 AM PDT by GonzoII
As trade tensions continue, Mohamad El-Erian, chief economic advisor at Allianz, says the U.S. "will win the trade war."
Investors have been on edge with some fearing that Trump has gone too far with his nontraditional negotiating tactics.
"One of the upside risks, is that you may end up changing, the global landscape in a way that favors the U.S.," he says.
As trade tensions continue, Mohamed El-Erian told CNBC that the U.S. is winning the trade war.
"In relative terms, we are winning and we will win the trade war," El-Erian, chief economic advisor at Allianz, said Monday on "Fast Money." El-Erian is considered one of the most influential financial market thinkers in the world.
"Just look at the performance of U.S. markets relative to China and relative to others," said El-Erian, who was CEO of Pimco. "That is consistent."
President Donald Trump first proposed tariffs in March to correct what he deemed were unfair trading practices. Last week, the administration imposed duties on $34 billion worth of Chinese goods. Beijing immediately retaliated with tariffs of its own and accused the U.S. starting the "largest trade war in economic history."
Meanwhile, investors have been on edge amid the trade tensions. All three major indexes closed up Monday, leading some to conclude that trade fears are waning.
"The tit for tat continues, but ultimately it doesn't lead to a full-blown trade war," El-Erian said.
"When people realize that at the end of the day, the U.S. will prevail, because [China] is a less open economy, because [the U.S.] is a more dynamic economy, that ultimately you may end up in a situation where the U.S.' position in global economic terms is better off," he said.
(Excerpt) Read more at cnbc.com ...
But.. but... but... the media say this is only hurting working Americans!
Pinging our resident “free trader” who likes to post the sky is falling propaganda articles
Trump has gone too far with his nontraditional negotiating tactics....”
hearing that a lot these days, in this context and every other context.....
I’ve followed interviews and commentary by El-Erian for several years and tend to bank on what he says. The key here, is that tax deal allowing companies to bring banked money (400-billion) back into the US. Once that was accomplished...I think you could reshuffle the cards a hundred times, and his hand would always be superior.
But tariffs are STATIST, which means left-wing. Any tiny disruption of muh free market will send the economy into a death spiral! Trump is not conservative, he’s a statist! Yes, sarcasm.
Here’s my take.
For decades following WWII the US has adopted a trade posture of humility and deference to the western world and to much of the rest of the world.
That trade posture has characterized the US foreign policy and was exacerbated under the recent globalists, George H.W. Bush, Clinton, W. and Obama. Especially during these years the US has given away much of our wealth and much of our industrial base. Manufacturing and jobs were lost, wholesale. Add into this mix the fact that our borders have been open and we have been importing hordes of migrant laborers who have driven down wages.
The result was culminated in the disastrous years of Obama when jobs were scarce, tens of millions were on welfare, disability, unemployment, etc.
Enter Trump who, miraculously, has turned around this sorry state of affairs in less than two years. We all know the US was an economic machine waiting to be unleashed and unshackled, which is what Trump has done. There is a lot more work to be done, but after all these decades and the concerted effort to construct “a new world order” Trump is finally correcting this gross over steer.
At this point everything that Trump has done has turned out as a benefit to America, despite the doomsday caterwauling. I trust Trump.
China just ran out of US products to tariff, we still have plenty to go. US economy will show 4% GDP for Q2. Chinas is shrinking. Our stock market is roughly the same since this started. Chinas is down about 25%. We are their BIGGEST CUSTOMER. Who do you THINK is going to win?
Exactly, I’ve made this point elsewhere, but the USA’s consumer market has no equal or substitute anywhere else in the world. If we aren’t buying what you’re selling, you aren’t going to be a global economic player.
That goes for Chinese goods, brie and champagne from France, industrial parts from Germany, etc.
If you want your nation’s economic to flourish, producing something that American’s want to buy is a good way to get there.
A few weeks ago I heard Peter Navarro say that the trade war had been “gamed” out (which I took to mean simulated through computer models) and the U.S. was going to win, no question about it.
There is another aspect of the trade war with China that is not recognized by many. Our robust trade with China has poured tons of money into their country, a portion of which was used to build up their military capabilities (not to mention the theft of our technologies). In other words, we have subsidized the expansion of their military power.
I think Trump wants to put an end to this free ride which is clearly working against our interests as well as our allies security.
Nothing more needs to be said except that I found your exact words in the dictionary under the heading "leverage".
“At this point everything that Trump has done has turned out as a benefit to America, despite the doomsday caterwauling. I trust Trump.”
America, led by President Trump, is becoming a free republic again and is casting of the chains of global bureauracracy and shaking of of the parasites.
Even though America has been and is the most generous nation on Earth what the the rest of the world cannot control they fear. They will just have to adjust.
For decades the US adopted trade positions based on political rather than economic considerations.
We wanted to get Europe back on its feet after WWII.
We wanted to stabilize Mexico and stop the flood of illegals.
We wanted to bring China to democracy and openness.
Those considerations no longer apply or did not work. Europe has long since recovered. Mexico still sends floods of illegals and drugs into the US. China cheats massively, yet remains just as authoritarian as before. Enough. Time for us to demand reciprocity. If others wont agree, tariff the crap out of them. Given their large trade surpluses with us, they have much more to lose. The smart ones will cut a more fair deal sooner rather than later. The dumb ones will be made an example for others not to follow.
This guy is about to be chased out of restaurants.
“nontraditional negotiating tactics.”
Saying what you mean? Acting in your nation’s interests?
This could pay for more tax cuts, increase in the standard deduction and/or increase in the personal exemption, which is probably the best place to start because this is where it will be felt most quickly at the lower end of taxpayers.
I like this guy - he's on Bloomberg all the time; and he's on OUR side ...
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.