More from the Article (published in Hong Kong):
"US President Donald Trump said again on Monday that tariffs on an additional US$267 billion worth of Chinese imports – which would equate to sanctions on virtually all Chinese goods – were “ready to go” if there was no trade progress.
In a research note released last week, Cochrane estimated that if a 25 per cent tariff were imposed on all China-US trade and Beijing applied qualitative countermeasures, China’s gross domestic product growth would fall by 1.2 percentage points to 5.2 per cent in 2019 and the Chinese stock market would fall by 9.4 per cent.
Bloomberg reported on Monday that the US is preparing to impose the next round of tariffs on the US$267 billion in Chinese goods in early December if Trump’s scheduled meeting with Chinese President Xi Jinping at the G20 summit in late November produces no progress.
If true, and given the 60-day comments period that would start when the tariffs are announced, this would mean that the new tariffs would be implemented in early to mid-February, during or just after Lunar New Year. Like Christmas in the West, the celebration is the largest instance of consumer spending during the year, so any fall in sentiment caused by the introduction of the new tariffs could have a very negative effect on China’s economy."
Trump wanted to do this to the Chinese for a looong time going back to the 80s. The love fest at Mar a Lago with Zhi was just to tell him not to take personally what was going to follow. Of course Zhi had no idea at the time.
As someone physically located in China, and currently actively involved in the international trade / supply trade industry, I have a few comments...
1. My American clients have held off new orders.
2. My European and Pacific Rim clients are still placing orders with no change.
Overall, for me, I see about a 1% drop in revenue. But that is just for me and my revenue.
The factories that I work with are most doing well. There are some concern, but most believe that after November a trade deal will be reached and trade will resume.
And folks. That is the way it is. You can accept it or not.
Just saying, as of the most current data published, China is currently running the single largest trade surplus in recorded history, with America.
The largest ever.
Between any two countries.
Ever. This year. Right now.
I call that a slight decline... nothing for anyone to panic over. The US currently has a president who actually gives a shi## about us, so he's tweaking the trade arrangements. The Chinese businesses will just have to adjust a little to maintain their lifestyles.
Trump knew this going in - those who carped about his actions had no idea what leverage he actually has...
That's right! This country had had all the cards from the get-go and every President before PDJT failed to see that.
So glad to see President Trump playing hardball with the Chinese. WINNING!!!
It will not only have an effect on China:
One reason the US economy seems to be booming right now is a surge in imports. Companies are rushing to build inventory ahead of the 25% tariff on Chinese goods that takes effect January 1. Coming on top of usual holiday season stockpiling, it is jamming ports, highways, and warehouses—generating many jobs in the process.
That’s all good right now, but those truck drivers and warehouse workers will no longer be necessary once the shelves are stocked. Working down that inventory will take months, at least, and the resulting slowdown could ease the economy into recession next year.
http://ggc-mauldin-images.s3.amazonaws.com/uploads/pdf/TFTF_Oct_26_2018.pdf