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eldarlmari

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Bloomberg New Economy:

China is Winning the Trade War With Trump


Andrew Browne
September 19, 2020, 6:45 AM EDT

After four years of relentless effort by President Donald Trump to push back against China, his campaign reached new heights (or lows) Friday when he sought to ban new downloads of WeChat, China’s ubiquitous messaging and payments app, and the wildly popular video-sharing app TikTok.


Nevertheless, the final scorecard is already in: On just about every metric that matters, China is ahead. At every turn, Trump seems to have been outplayed and outsmarted throughout the global trade war that began shortly after he took office.


relates to Bloomberg New Economy: China is Winning the Trade War With Trump

The Yangshan Deepwater Port in Shanghai
Photographer: Qilai Shen
This week in the New Economy

Consider the trade balance, which Trump seems to regard as the most important measure of success in his effort to get China to play by global trading rules.


China’s trade surplus with the U.S. has grown almost 25% since the start of the Trump presidency, exceeding $300 billion on an annualized basis, writes Jim McCormick of NatWest Markets. And China is nowhere near on track to meet its target of increasing imports from the U.S. under the partial deal (also called “phase 1”) to end the trade conflict, the signal accomplishment of Trump’s tariff tit-for-tat.


Look at China’s powerfully resurgent GDP, the result of its vastly more effective response to the pandemic that began there. China, McCormick notes, is the only country among 48 to have reported a second-quarter gross domestic product number that was higher than at the end of 2019. In the U.S., the worst country when it comes to the coronavirus (as measured by death and infections), the economy shrank 9.5% in the second quarter, a drop that equals an annualized pace of 32.9%, its sharpest downturn since at least the 1940s.
And now the Chinese currency is on a tear, climbing for the eighth week in a row, its longest run of gains since February 2018. Global bond funds are pouring into the country—one that still offers yields. Meanwhile, the dollar is slumping.
Behind these headline numbers also are deeper industrial trends, which again work in China’s favor, helping it pick up global market share in the aftermath of Covid-19 lockdowns. Increasingly, China is supplying the kind of sophisticated machinery that German manufacturers once dominated, like high-end tunnel borers and hydraulic valves and pumps used in wind turbines.
“It’s only a matter of time until Chinese firms are No. 1,” says Ulrich Ackermann, managing director for foreign trade at Germany’s VDMA Mechanical Engineering Industry Association.
Trump Issues Executive Orders Barring Transactions With TikTok And WeChat

Trump’s assaults on WeChat and TikTok are a distraction; there are better ways to mitigate the national security risk Chinese companies may pose by gaining access to U.S. personal data. In any case, lashing out at Chinese tech companies will only slow, not derail, Beijing’s efforts to dominate the 21st century economy.
Take the race to develop batteries, a key to the future of transport, defense and other industries. By 2025, China will have battery facilities with maximum production capacity of about 1.1 terawatt-hours’ worth of cells annually, almost double the rest of the world combined. The White House response? So far, inertia, said Cathy Zoi, chief executive officer of charging-network operator EVgo, and an assistant secretary at the U.S. Department of Energy under President Barack Obama.
The net result of Trump’s efforts to decouple the U.S. and Chinese economies is to push China even further toward self-sufficiency, a strategy set to be enshrined in China’s new five-year plan at a meeting of the Chinese Communist Party Central Committee next month.
This new economic direction is described by the official phrase “dual circulation,” an ambiguous reference to the outward and inward drivers of the Chinese economy. Bottom line: The term “looks set to mark a drive to reduce dependence on imports, particularly of high-end manufacturing equipment and inputs,” writes economist Alicia Garcia-Herrero. “Dual circulation,” she said, is import-substitution by another name.
Democratic Presidential Candidate Joe Biden Speaks On White Nationalism In Iowa

Joe Biden and Donald Trump
Photographer: Tom Brenner/Getty Images North America
A Joe Biden presidency, no less than the Trump administration, would grapple with a China set on global domination of 21st century industries by deploying old-fashioned mercantilism, among other retrograde trade policies. How could it do better?
Robert Zoellick, the former U.S. trade representative and World Bank head (and member of the Bloomberg New Economy Forum advisory board), has this advice for the former U.S. vice president, should he win in November: Foreign policy should start at home.
Focusing on domestic issues like public health, immigration and inclusive economic growth will both signal U.S. leadership and appeal to allies, Zoellick wrote in Foreign Affairs.
“From this new base of cooperation,” Zoellick writes, “the U.S. and its partners will be better positioned to address two overarching challenges: the future of free societies and competition with China.”
 

Hakikat ve Hikmet

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No "surprise" here.....

Even the best of the US brains and minds - be it General McArthur, Secretary McNamara or some one else - failed with China!!! Current mediocre "talents" have no chance.....
 

Beidou2020

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US can’t stop China. China is too big and powerful to stop. That is why the Muricans are frustrated and lashing out trying everything they can.
 

ozranger

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It is not Trump. It is the deep state which made up that kind of strategy. This strategy destroys jobs in western world and it can be seen now in Australia.

The wrong judgement came from a very wrong assumption that China is an export-only economy even when China imported record high number of American cars in 2014.

Taiwanese, FLG and other anit-China groups contributes greatly to this mis-judgement.
 

SuperStar20

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I don't think china is winnings. You can't conclude based on high export dollar amount to USA. Exports are raising even after tariff means china is absorbing the excess cost with their slave labors. No inflation in USA. China is supporting USA lifestyle by their slave labors. If china can't absorb, these things moving/will move to India or vietnam.
 

thewayoftheworld

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The US can't make facemark or enough toilet paper at the peak of the pandemic. The reality is there is no where else in the world can hire millions of people who works hard and show up on time to churn out all products that make modern life what it is. All the crap on Amazon are the exact same product on Alibaba and Aliexpress. American people who are already spread thin will riot if there is no longer any product on the shelf at Walmart. This trade war is 10 years too late.
 

+4vsgorillas-Apebane

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Had the current assault on China happened 15-20 years ago then it would have been painful to the PRC. Now its too late to stem the tide, China has reached 'critical mass' and the wherewithal to blossom in all fields.
 

letsrock

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I don't think china is winnings. You can't conclude based on high export dollar amount to USA. Exports are raising even after tariff means china is absorbing the excess cost with their slave labors. No inflation in USA. China is supporting USA lifestyle by their slave labors. If china can't absorb, these things moving/will move to India or vietnam.
CHinese products are sold at multiple times in us retail. Often up to 10 times. A 25% tariff on them will not necessarily lead to any increase in prices
 

Viet

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Bloomberg New Economy:

China is Winning the Trade War With Trump


Andrew Browne
September 19, 2020, 6:45 AM EDT

After four years of relentless effort by President Donald Trump to push back against China, his campaign reached new heights (or lows) Friday when he sought to ban new downloads of WeChat, China’s ubiquitous messaging and payments app, and the wildly popular video-sharing app TikTok.


Nevertheless, the final scorecard is already in: On just about every metric that matters, China is ahead. At every turn, Trump seems to have been outplayed and outsmarted throughout the global trade war that began shortly after he took office.


relates to Bloomberg New Economy: China is Winning the Trade War With Trump

The Yangshan Deepwater Port in Shanghai
Photographer: Qilai Shen
This week in the New Economy

Consider the trade balance, which Trump seems to regard as the most important measure of success in his effort to get China to play by global trading rules.


China’s trade surplus with the U.S. has grown almost 25% since the start of the Trump presidency, exceeding $300 billion on an annualized basis, writes Jim McCormick of NatWest Markets. And China is nowhere near on track to meet its target of increasing imports from the U.S. under the partial deal (also called “phase 1”) to end the trade conflict, the signal accomplishment of Trump’s tariff tit-for-tat.


Look at China’s powerfully resurgent GDP, the result of its vastly more effective response to the pandemic that began there. China, McCormick notes, is the only country among 48 to have reported a second-quarter gross domestic product number that was higher than at the end of 2019. In the U.S., the worst country when it comes to the coronavirus (as measured by death and infections), the economy shrank 9.5% in the second quarter, a drop that equals an annualized pace of 32.9%, its sharpest downturn since at least the 1940s.
And now the Chinese currency is on a tear, climbing for the eighth week in a row, its longest run of gains since February 2018. Global bond funds are pouring into the country—one that still offers yields. Meanwhile, the dollar is slumping.
Behind these headline numbers also are deeper industrial trends, which again work in China’s favor, helping it pick up global market share in the aftermath of Covid-19 lockdowns. Increasingly, China is supplying the kind of sophisticated machinery that German manufacturers once dominated, like high-end tunnel borers and hydraulic valves and pumps used in wind turbines.
“It’s only a matter of time until Chinese firms are No. 1,” says Ulrich Ackermann, managing director for foreign trade at Germany’s VDMA Mechanical Engineering Industry Association.
Trump Issues Executive Orders Barring Transactions With TikTok And WeChat

Trump’s assaults on WeChat and TikTok are a distraction; there are better ways to mitigate the national security risk Chinese companies may pose by gaining access to U.S. personal data. In any case, lashing out at Chinese tech companies will only slow, not derail, Beijing’s efforts to dominate the 21st century economy.
Take the race to develop batteries, a key to the future of transport, defense and other industries. By 2025, China will have battery facilities with maximum production capacity of about 1.1 terawatt-hours’ worth of cells annually, almost double the rest of the world combined. The White House response? So far, inertia, said Cathy Zoi, chief executive officer of charging-network operator EVgo, and an assistant secretary at the U.S. Department of Energy under President Barack Obama.
The net result of Trump’s efforts to decouple the U.S. and Chinese economies is to push China even further toward self-sufficiency, a strategy set to be enshrined in China’s new five-year plan at a meeting of the Chinese Communist Party Central Committee next month.
This new economic direction is described by the official phrase “dual circulation,” an ambiguous reference to the outward and inward drivers of the Chinese economy. Bottom line: The term “looks set to mark a drive to reduce dependence on imports, particularly of high-end manufacturing equipment and inputs,” writes economist Alicia Garcia-Herrero. “Dual circulation,” she said, is import-substitution by another name.
Democratic Presidential Candidate Joe Biden Speaks On White Nationalism In Iowa

Joe Biden and Donald Trump
Photographer: Tom Brenner/Getty Images North America
A Joe Biden presidency, no less than the Trump administration, would grapple with a China set on global domination of 21st century industries by deploying old-fashioned mercantilism, among other retrograde trade policies. How could it do better?
Robert Zoellick, the former U.S. trade representative and World Bank head (and member of the Bloomberg New Economy Forum advisory board), has this advice for the former U.S. vice president, should he win in November: Foreign policy should start at home.
Focusing on domestic issues like public health, immigration and inclusive economic growth will both signal U.S. leadership and appeal to allies, Zoellick wrote in Foreign Affairs.
“From this new base of cooperation,” Zoellick writes, “the U.S. and its partners will be better positioned to address two overarching challenges: the future of free societies and competition with China.”
There is a solution for this problem.
50 percent of deficits result in high imports in electronics from China.
Due to the tech boom in the US, companies as Microsoft, Google, Cisco, Arista, HP, Juniper rely on goods from factories in China. They are made in using US technology. High price products.
Other factors of deficits are cheap chinese goods. That is another 50 percent.
Well now the US can force the US companies to relocate factories to Vietnam. That will reduce US deficits by 50 percent.
As for cheap Chinese consumer products the US can source from allies. Another 50 percent less deficits.
Ok the deficits will wander to Vietnam and Mexico.
But that’s is another story.

or ultima ratio

The US can use the ultimate weapon: forbid the use of USD in China.
once enforced chinese exports will collapse globally by 50 percent minimum.
 

8888888888888

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There is a solution for this problem.
50 percent of deficits result in high imports in electronics from China.
Due to the tech boom in the US, companies as Microsoft, Google, Cisco, Arista, HP, Juniper rely on goods from factories in China. They are made in using US technology. High price products.
Other factors of deficits are cheap chinese goods. That is another 50 percent.
Well now the US can force the US companies to relocate factories to Vietnam. That will reduce US deficits by 50 percent.
As for cheap Chinese consumer products the US can source from allies. Another 50 percent less deficits.
Ok the deficits will wander to Vietnam and Mexico.
But that’s is another story.

or ultima ratio

The US can use the ultimate weapon: forbid the use of USD in China.
once enforced chinese exports will collapse globally by 50 percent minimum.
You don’t know economics
 

Viet

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You don’t know economics
What economics?
Trump says he will cut off the relationship.
The most easiest thing is to cut off China from international money system, cut off from dollar, euro, yen and sterling. Like Iran, North Korea. The yuan is still at least a decade away in the international money system.
 

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