Expect Trump to double down on the trade war with China (Short video, and article from Asia Times)

Asia Times ^ | November 20, 2018 and November 23, 2018 | William Pesek

[cba123]

There are two links for this story. I started linking to the short video which I originally watched.

It is from Asia Times. Basically it is almost an advertisement for the article. Runs about a minute and a half, although it mentions the major points from the article.

Then there is an actual article in the Asia Times. I will also include a link to that article, for those who want to read the full thing.

[entropy12]

Man that is so simple....corporations and stocks ALWAYS concern themselves no longer than 1 or 2 quarters.

The benefit of trade war with China = $400 Billion EVERY YEAR available in USA for manufacturing jobs. But it takes long time to build factories and hire and train productive workers.

In short, trade war with China will be pain for a year or two, but yuge long term benefits lasting many decades.

Also think of this...who does trade war hurts the most? It is the likes of Steve Forbes who benefit by bigger profits by owning stocks in multi-national corporations who have moved manufacturing to cheap labor countries.

Steve Forbes worries about Steve Forbes first, not the 90% ordinary middle class workers who have lost better paying manufacturing jobs.

[Paul R.]

Agreed... partially.

corporations and stocks ALWAYS concern themselves no longer than 1 or 2 quarters.

I would not go THAT far, but, it is true that stocks often concern themselves only 1 or 2 quarters, and many corps put too much weight on the short term.

I also agree many of the short term effects of a trade war are negative. However, not all negative effects are short term. It appears the global economy is slowing down, for a variety of reasons, including, IMO, increasing failures of socialism, among other things. A major trade war can add to that slowdown in both depth and length (time). I don't presently expect such a global recession or depression, costing the US that $400 billion per year that you speak of, to occur soon. But, I can't rule it out, and if it occurs, its duration could be several years, particularly depending on who is in charge of the US Gov't after 2020... I support Trump's policies, but I also recognize the (often necessary) risks.

[Lurch Addams]

The Youtube video is incorrect when it says $505B tariffs.

Evidently that Youtube author doesn’t understand the difference between paying $505B in taxes and paying a small tax on $505B worth of imports.

[entropy12]

Without a trade war, risks to middle class in USA will be permanent. $800 Billion trade deficit EVERY YEAR with all countries we trade with is a HUGE loss of manufacturing jobs, permanently. Just think, for $3 Billion Ford built a large auto plant in Mexico. Manufacturing jobs are mostly middle class jobs.

The truth is economic cycles can not be cured permanently by artificial means such as lower than inflation interest rates by the FED, or encouraging imports to help other countries in bad shape. All it does is postpone the unavoidable economic cycle, and the result is ALWAYS bigger crash at the end.

Notice how the gov’t was “helping” people to own houses by forcing lender to lower standards. Sub-prime loans were every where. Yes, it did prolong housing market boom. But then the laws of economic cycles took over and housing crashed.

The ZIRP policy by our FED has artificially inflated value of hard assets and stocks and bonds. The result will be the same. A harsher recession and crashing of asset values.

The economy can not expand at a rate larger than gains in productivity and population size. If forced to do so, be prepared for a nasty crash later.

[MichaelCorleone]

I do not disagree with all that at all.