Trump Is Right to Battle China on Trade, But Now Comes the Hard Part

Discussion in 'Economics' started by bone, May 14, 2019.

  1. srinir

    srinir

    Pretty easily. It is giant mis-perception that China needs US. Chinese exports to US is mere 3.5% of its GDP.

    Snap72.png
     
    #31     May 15, 2019
    Cuddles, SunTrader and piezoe like this.
  2. ironchef

    ironchef

    Worst case scenario, total ban would cut their GDP growth from 6% to 2.5% a year, their worst since the 70's.
     
    #32     May 16, 2019
  3. srinir

    srinir

    No. Your math is wrong. US exports are 3.5% of the GDP, means rest of the 96.5% GDP is not effected. Assuming 7% GDP growth rate, new growth rate will be around 6.76%. This is ignoring any substitute effect increasing domestic growth.

    If Trump really wanted to hurt China, he would have signed TPP deal with all those pacific countries. This deal was bigger than NAFTA and specifically designed by Obama to limit Chinese influence in these region. Chinese are now happy to fill any gaps. These deal has moved on without US. Now US wants to get back in, they lost leverage on issues which carved out previously (Ironically farmers lost out again because it had exclusions for beef and dairy products)

    There are issues worth fighting for (like IP protection). At the end of day both sides will declare victory and nothing will change (like new Nafta same as old Nafta). If there is any testing of enduring power, China has it not the US.
     
    #33     May 16, 2019
    Cuddles and piezoe like this.
  4. bone

    bone

    That is somewhat specious. If you look at the trading account balance broken down by country or in the case of the EU by trade block - by far and away the US accounts for almost all of China's trading account surplus. For all other countries, China manages to import about as much as they export.
     
    #34     May 16, 2019
  5. bone

    bone

    Dude, take a look at the Chinese March and April Retail Sales and Industrial Production numbers. Off a freaking cliff...

    And the last three months of 2018 and 2019 to date were juiced to the tits by Beijing stimulus pumping. :rolleyes:
     
    Last edited: May 16, 2019
    #35     May 16, 2019
  6. bone

    bone

    Sure, if you appreciate totalitarian Communist regimes I take your point.

    If you are a proponent of massive STATE owned and subsidized industries competing on the global marketplace - sure you have a point.

    Like modern China, the Soviet Union also had to rely upon massive State-sponsored intellectual property theft from the West.
     
    Last edited: May 16, 2019
    #36     May 16, 2019
    ElCubano likes this.
  7. srinir

    srinir

    Dude. This is somewhat specious :) tying everything to Tariff. Their other 96.5% of GDP also has hit rough patch. Even other emerging market is also not flying either.
     
    #37     May 16, 2019
  8. srinir

    srinir

    True about trade surplus with US, but they do have pretty big deficit with Korea, Japan, Australia and other Asian economies.
     
    #38     May 16, 2019
    piezoe likes this.
  9. bone

    bone

    Just stating facts - pump your brakes; you're sounding like Xi's PR Minister. And quit putting words in my mouth - I never tied Chinese GDP or Retail Sales or Industrial Production to tariffs in my posts.
     
    #39     May 16, 2019
  10. SunTrader

    SunTrader

    China exports to U.S. : Harbor Freight $3.99 20 piece socket set
    U.S. exports to China : Boeing 747-8 $399 million actually $370 m.
     
    #40     May 16, 2019