Posts
‘We
have far more bullets’: Trump threatens China with more tariffs if
Beijing dares to retaliate
RT,
22
September, 2018
Donald
Trump has threatened to impose even more tariffs on Chinese goods if
Beijing dares to impose tit-for-tat measures in response to
Washington’s latest package of levies targeting some $200 billion
of Chinese exports.
Trump
has cautioned the world’s second-largest economy to think twice
before engaging in a trade war in which, he claims, the US has “more
bullets.”
“We’re
going to go $200 billion at 25 percent on Chinese made goods. And we
will come back with more if they retaliate. We have a lot more to
come back with,” Trump
told a packed rally in Missouri for Republican Senate candidate Josh
Hawley.
China
said it will institute new tariffs on US goods worth $60 billion from
September 24, after the US administration slapped new
levieson
Beijing’s exports.
While
both the Chinese and US measures are set to go into effect Monday,
Trump previously noted that the initial 10 percent tariffs would rise
to 25 percent on January 1, 2019. The world’s two largest economic
superpowers have already applied tariffs on $50 billion of each
other's imports.
While
the US keeps accusing China of refusing to buy American products to
maintain a “fair” trade
balance, Beijing is complaining that Washington’s protectionist
practices are detrimental to the entire global economy – and has
even taken up the issue with the World Trade Organization.
Yet,
despite Beijing’s willingness to negotiate some kind of a deal to
stop the escalation of the trade war, the White House is trying to
coerce their partner into submission. In a separate slap on the
wrist, just days after announcing the new $200bn levies, the Trump
administration introduced sanctions against China’s leading arms
acquisition body and its director, over the purchase of Russian Su-35
multi-role fighters and S-400 missile defense systems. Beijing
immediately hit back at the US administration, urging it “to
remedy the mistake and cancel the sanctions” which
forbid arms export licenses and foreign exchange transactions under
US jurisdiction. “Otherwise,
the US has to bear the consequences,” the
ministry's spokesperson stressed.
Amid
the escalating tensions, China has reportedly canceled a mid-level
delegation visit to Washington next week, that was supposed to pave
the way for further trade negotiations with President Xi's top
economic adviser and vice-premier Liu He, the Wall Street Journal
reported, citing sources.
A
Path To War? China Cancels US Trade Talks As 'Skirmish' Escalate
21 September, 2018
Following
a surge in Chinese, European, and much of the US equity markets this
week amid hopes that the so-called 'trade skirmish' was less
'war-like' than expected, China
just dropped an early Saturday morning (local time) tape bomb that is
sure to resurrect 'trade war' talk.
After
President Trump slapped a fresh round of tariffs on Chinese
goods, targeting 10 percent duties on $200 billion of goods; the
two camps were scheduled to meet in order to dial back tensions. As
we noted earlier in the week, China
had 'downgraded' the team with a mid-level delegation from China due
to travel to the U.S. capital to
pave the way for Vice Premier Liu’s visit.
That
was what sparked hope that this was just a trade skirmish (as Jamie
Dimon attempted to play down), sending stocks soaring all week.
However,
that is all over now.
The
Journal just
reported on Friday that, according to sources, China
has rescinded the proposals to send two delegations to Washington.
Chinese officials have said such pressure tactics wouldn’t induce them to cooperate.
By declining to participate in the talks, the people said, Beijing is following up on its pledge to avoid negotiating under threat.
“Everything the U.S. does hasn’t given any impression of sincerity and goodwill,” Chinese Foreign Ministry spokesman Geng Shuang said at a press briefing Friday.
“We hope that the U.S. side will take measures to correct its mistakes.”
*
* *
The timing of this news,
after the exuberant equity week, is also noteworthy as it follows Ray
Dalio's, founder of Bridgewater, warnings that the current trade
tensions mirror those of the 1930s:
"I think that the 1935-40 period is most analogous to the current period and that it is worth reflecting on what happened then when thinking about US-Chinese relations now.
To be clear, I’m not saying that we are on a path to a shooting war, but I am saying that we have to watch what path we are on, given these cause-effect relationships that history has taught us and that are described in the template. This excerpt describes how the economic and political conditions of the late 1930s evolved into the wars that followed. "
We
have discussed this case-effect relation before...
Get
ready for some Sunday night futures fun and games...
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