This man has spent several years living there, and has married into a Chinese family. He’s witnessed the transition there from 2008 to ~2018.
I’m beginning to have the feeling that China is preparing to “go to the mattresses”, lock down and “thin the herd”, rather than cave to Trump’s reforms. Their final disposition of Hong Kong will tell the tale.
Ps I think this guy got out while the gettin’ was good.
They’re going to wait it out; Carrie Lam has revealed that much.
The guy in the first video didn’t actually say when he left China, so I wonder if it was before or after President Trump levied the tariffs. Apparently they’re putting a big squeeze on the Chinese economy in addition to whatever problems they had before.
The Chinese may be just enduring the pain in hopes that President Trump loses the election next year. That gives them strong incentive to interfere with our election to try to achieve that outcome. I hope we’re prepared.
I’m curious what you think…
I predict that a lot of US farming sales to China will be lost indefinitely.
The reasons are that US competitors are using the tariff period to increase supply. This in turn will result in increases of land and machinery which can drive costs lower in the long term, thought even if prices remain the same…Which leads me to point #2.
Even if prices stay the same, China would like any opportunity to divest from the US dollar as the US government uses the dollar as a weapon to enact its political will (sanctions as an example), thus buying produce from other markets (like South America) has lots of implications including giving the Chinese more economic and political might.
Now, the question is if US farmer ccan maintain output by finding other markets to sell their goods once sanctions are lifted.
I don’t know enough to know if your argument holds water. But I do remember President Trump signing a trade agreement with Japan where he stated that American farmers may not have enough capacity to produce enough to fulfill the demand. His whimsical advice to farmers was to buy bigger tractors. So China and Japan may have to bid for who gets to buy America’s goods.
I admit that I’m no expert, but I do know that China would like to rely on the US less for its economic health.
I know that tariffs cause the price of US farm products, to increase. 42% of US exports are in a single product, soybeans.
For current soy farmers, recent developments instill acute fear that America’s share of the Chinese market could be permanently lost to farmers in developing countries. Indeed, South America is already a formidable rival in the world trade in soybeans and it got its start precisely because of an American trade blunder.
Brazil’s big boost in soy agriculture came in 1973 when the Nixon administration briefly cut off Japan’s supply of US soybeans. Nixon took this action because soy prices in the US had risen dramatically in the wake of a world shortage of other animal feeds, caused by climate problems. The shortage and attendant price spike for soy threatened to inflate the domestic price of meat from animals fattened on that soy. Higher meat prices for ordinary consumers were not in Nixon’s political interest.
The soy export ban was only fully in effect for seven days. Yet the spooked Japanese decided they could no longer rely on the US as their sole supplier and invested heavily, for 21 years, in turning Brazil into a soy titan.
I found that HERE
Basically, as the trade war goes on, other nations will invest in meeting the demand for soy.
When tariffs drop, at the VERY LEAST, the overall supply of soy will have increased, decreasing the price. Here is the historical price.
The farmers that can stay in business will be those capable of producing at the lowest price. SO US farmers will likely see less profit moving forward if they continue to grow soy.
I’m no expert when it comes to farming, so maybe they can switch crops? That said I assume that if they could, they would have done it already.
If US exports of soy decrease the trade gap will increase.
I think the trade war will have adverse effects on US farmers for a long time to come.
We’re only in the 1ST YEAR of the tariffs. There hasn’t been TIME for farmers to switch crops…which they can do easily year to year. Soybeans ADD nitrogen to the soil making it more fertile for other crops such as wheat, corn or grain sorghum (commonly referred to as “maize.”). All of which serve as feedstocks for BOTH people and meat animals.
You’re looking at the small picture, @csbrown28. In the short run, farmers and producers are hurt. President Trump somewhat compensates by giving some of the tariff money directly to farmers.
For the big picture, remind me what you said a while back. Didn’t you justify deficit spending by Congress on the grounds that we must produce treasuries for sale abroad equal to our imports minus our exports? That is, exports plus deficit spending must be as large as imports?
I thought you were hopping mad, but I now think most in Congress are hopping mad too. So President Trump is first attacking the perceived need for deficit spending by seriously attacking the trade deficit. And China must be forced into a fair trade agreement if we’re ever going to solve our huge trade imbalance.
That’s what the tariffs are for and why they are crucially needed.
Plus, I’m not sure why anyone thinks that the US government earns money when it increases tariffs.
Something like that. What I said was that (Gov spending+Taxes) - (Imports + Exports) will equal some number.
If the number is negative then, in the balance, we should deficit spend to offset money saved outside the economy. If the number is positive, then we should consider a surplus.
Of course, these aren’t al the variables, there are other conditions that should be considered, but these are the largest.
I don’t take issue with the trade deficit at all, in fact, I think the trade deficit represents real benefits and exports represent real costs. But that said, tariffs increase disruption in the markets and result in a lose-lose for everyone.
That ship sailed when we passed on TPP.
For many years, the US had no income tax at all. Most tax receipts by the government were tariffs.
But I don’t think President Trump has any intention of imposing permanent tariffs anywhere. They’re purely punitive. Wayward nations get hit with ever increasing tariffs until they agree to a fair trade deal or stop doing whatever drew the President’s ire. If they dig in their heels, their exports to the US will dry up and their economy will wither.
The tariffs on China are a special case. China needs to keep workers employed, so they responded to the tariffs by manipulating their currency to drive down their prices. So the price of their goods with the tariff added hasn’t gone up much. So yes, the US government is collecting tariff money that hurts China but doesn’t hurt US consumers.
Oh sure, it’s always seems better to receive more stuff than you send. But if that’s giving Congress an excuse to deficit spend, it’s causing the national debt to go up and up and up. That may seem harmless for now, but it means the payments on the debt are going up and up and up. Which means we have to sell treasuries just to pay for interest on those we’ve already sold.
Defaulting will be unavoidable at some point, unless President Trump can stop deficit spending and actually start paying down the debt. It seems impossible, but he’s attacking the trade deficit with gusto. He may pull it off.
No, President Trump calculates that it hurts the cheating countries more than it hurts us. And that makes sense since we import more than we export. So their retaliatory tariffs have less effect. But they’re punitive, so the hope is that the wayward nation will feel the pain and decide to be reasonable.
I don’t understand that response. I didn’t think TPP included China. Also, isn’t it now defunct?
Seriously attacking the trade deficit? It’s grown since last year.
What’s so terrible about a trade imbalance? American jobs? Are we not living in the most amazing economy in American history with unemployment at the lowest levels?
We’re well into the second year of tariffs, a trade war that is “good and easy to win.”
The bureaucrats and politicians end up just picking the winners and losers in the markets, It represents transfers of economic power from one group to another. It make welfare rats of formerly non-welfare farm sectors, like pigs and soybeans. Ya know, all the things it’s not supposed to do.
I think most of the lefties in Congress and some large number of Republicans are basically new Keynesians. Congress’s excuses are more traditional.
AOC is the first real voice for CSB’s MMT in Congress.
Trump has consistently cared about the irrelevant trade deficit since at least 1979. He doesn’t care one whit about the the very relevant spending deficit. He promised in 2016, but for two years, Trump and the Republicans controlled the two branches that approve the budget. They went for near-trillion-dollar deficits instead of spending cuts.
The trade imbalance does not matter; it means we have a capital surplus.
Even if this was the goal, it’s not going to work.
The trade imbalance is not because China is deflating prices. It’s because of consumer activity in each country.
Americans consumers are going into debt to buy more things, Chinese consumers are saving. They have little in the way of social welfare, and men have a hard time finding a wife unless they save for a house.
A task made harder by their real estate bubble.
And they have half a billion people living in the interior in abject poverty who couldn’t buy an iphone with a year’s income.
Hey, remember when those policies I said would hurt us, actually ended up helping us? Well, you Mr. Trump voter think things are so good, why don’t we do the opposite? We can handle it!
She’s not really wrong. But we have to be willing to ignore banking and the IMF in the process. Of course, if we track things as we do now, it can’t work. But those are self-imposed limitations. There is nothing tangible about debt. It’s not real.
By manufacturing sourcing switching from China, to cheaper South-east asian countries like Thailand?
Except… you didn’t call for that. That’s just what happened. It was happening anyway, but Trumps actions pushed it along.
Contracts and businesses operate on the basis of those debts being real. The moment they’re not, those things implode.
Plenty of things in the economy take faith to affirm their value, that’s just a fact of life. Atomizing that faith, or taking on debt on the basis that it doesn’t matter, would turn us into Greece, or Japan. Personally, I’m not liking either option.
Tell that to the bank when you’re delinquent on your loan payment, or to the IRS when you don’t pay your taxes…
Hahaha…that made me LOL. And now CW is aligned with AOC and Trump. And AOC and Trump and most congressional Republicans are aligned.
CSB, MMT has won the day!!!
If you owe $10,000 and can’t pay, you’re in trouble. If you owe $100,000,000 and can’t pay they’re in trouble.