Posted on 08/29/2019 2:19:36 AM PDT by cba123
Editor's Note: US President Donald Trump has ordered American enterprises to pull out of China, claiming that the International Emergency Economic Powers Act enables him to do so. Is it possible for US companies to withdraw from China? Two experts share their views on the issue with China Daily's Liu Jianna. Excerpts follow:
Washington ignoring US firms' interests
The United States passed the IEEPA in 1977 to safeguard US hegemony and fight "enemies". The act gives the US president the power to bypass the Congress and the US judiciary to curb transactions between countries or enterprises, freeze assets of individuals and companies, and impose financial sanctions on entities that it believes pose a threat to its national security. The IEEPA has been used against countries including Russia and Iran. And the sanctions against Huawei, too, reflect the use of the act.
(please see full article, at the link)
(Excerpt) Read more at global.chinadaily.com.cn ...
Later there is a similar bit, by the second writer.
Zhang Monan wrote the first bit.
Tao Wenzhao wrote the second half.
People's Daily.
They were the main communist newspaper, way back when.
You would think that the folks in Beijing, would realise they should have accepted the original trade deal, so many months ago.
Just saying.
Just ask Trump, whether he would still take that deal.
I don't know that. But someone in Beijing is certainly making things a whole lot more complicated, than they really needed to be.
For real.
The reason the Chinese have later backed off their adherence to previous agreements, and the reason they will do so again, is that adherence to the policies Trump wants spells the end of Communist power. Trump wants the rule of law. There is no such thing in China. The law is whatever the communists say it is at the moment. This is the source of their power. The rest of the agreement has to do with how the party gets its money, theft of intellectual property and organ selling. Adherence to the agreement, the rule of law, means that China can’t execute someone just to harvest their organs. (This is a major source of income.) Theft of intellectual property is how the communist run companies survive. They don’t do research and development, nor is that something they could do as they are just cash cows for the party.
China will sign an agreement and then they will back off and we will do this all again.
Uh, recent events would suggest that “The Rule of Law” ain’t actually worth much here, either.
“China will sign an agreement and then they will back off and we will do this all again.”
They will adhere as longas Trump is inoffice because they now know he won’t fold,
After 2024 it will depend on who is in office and how courageous they are.
The PLA, the Communist Chinese Army, that rules the Chinese economy is worried about the freedom of U.S. companies that have made China great. Ironic.
I like to look at ideas and opportunities when geopolitics come into play. A lot of people ignore those and somehow or politically agnostic when they invest. I don’t see how you can do that. That said I just pulled up an ETF that is a pure Vietnamese play VNM. Anybody out there have any opinions on it? And I certainly will not hold anybody accountable not that I could and nobody out here is professional that’s fine too I just like to bounce ideas around. I have made enough mistakes and have enough successes for the past 30 years so I’m not a beginner but I don’t know a whole lot about this ETF.
“You would think that the folks in Beijing, would realize they should have accepted the original trade deal, so many months ago.”
I guess it rests on their assessment of the credibility of the threat.
Could/would President Trump actually put in place enough tariffs, and be able to hold them long enough?
It really was conventional wisdom on both sides of the Ocean, that no, too much domestic opposition, and the economic pain in the USA, would cause President Trump to blink first. Then his time would pass, and the inevitable tide of history would continue its march toward one world communist state.
Now however, people (here and there) are starting to realize that the communist Chinese economy is much more fragile than they imagined. Maybe things are not different this time, and what has always been an unsustainable level of debt, will be unsustainable this time too.
Tariffs are mounting quickly - another $1.5 billion per month piles on this weekend. Another billion per month gets added next month. Another $2 billion per month in December.
Business is leaving, the currency is devaluing. Debt payments in dollars, euros or yen get harder to make.
At some point, things are going to break.
$1.5 Billion is a drop in the bucket! It should be $15 Billion per month at least. $1.5B is a $22T economy doesn’t even move the needle.
US security comes first. Defunding China’s military complex is much more important than the bottom line.
“$1.5 Billion is a drop in the bucket! It should be $15 Billion per month at least.”
$1.5 billion per month is just the additional increase that goes into effect this weekend. It gets raised another additional billion per month the next month. another increase ($2 billion per month more) in December. Back in June, a package costing over $5 billion per month was added.
The total will be around $10 billion per month around Christmas. Probably more will come in January, or soon thereafter.
They export about $40 billion per month to the USA.
There is a bit of a bow wave before a tariff goes into effect, where customers order extra to stock up, but afterward the volume drops. That effect is smoothed out by rolling them out a few percent per month on the total trade volume (but focused on a subset of the products each time, at a level that forces a substitution to a non-Chinese supplier).
So each month, each quarter, additional products are picked off.
For now, the total volume is still skewed by one-time big pre-orders ahead of new tariffs (bow waves), while big new tariffs are coming. As we get into next year though, and most of the tariffs are in place (say 25% or 30%, across the board) total volume from China should be going down pretty sharply, and tariff revenue with it (mission accomplished).
There should be two or three quarterly reports showing big drops in Chinese imports before the election, and a good chance of the Chinese economy imploding under their debt load.
The Federal Government will probably pocket $100-$200 billion or more from tariffs, before Chinese imports fall to low levels.
The Chicoms, and the American Communists DemRat party agree.
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