Donald Trump: China and European Union ‘Manipulating Their Currencies’
Originally Posted by Helenwheels
Trump discovers a paradox of protectionism: his tariffs have driven down the exchange rates of the countries he has targeted. Exactly as economists predicted back in spring 2017
It looks like Trump's economic team are aware of this and are willing to expanding trade tariffs if they don't comply. Example the US started to impose tariffs on 30 billion dollars of China's good and was expanded to 200 billion because as Trump explained were not willing to change their behavior. It remains to be seen who will throw in the towel first. My bets are on the US to win this trade war because China has a lot more to lose.
The EU will also comply. They are having their own problems with UK leaving next year and have several European countries barely surviving economically. I remember reading an article when the European union was forming that the purpose of their union was to form one big economic power big enough to rival the US. The author was sounding the alarm bells for the US to be wary of this union.
The EU just this week signed a free trade deal with Japan, creating an open trade zone covering nearly a 3rd of the world's GDP. We lost out on the TPP. The world is moving forward without us, striking deals.
The total $250 billion of China exports facing U.S. tariffs represents only 1.3 percent of the country’s GDP, and the damage done by those duties might be only around 0.5 percent of output. That’s not pocket change, but it’s almost certainly insufficient to compel Beijing to grovel.
If you are China, playing the long game with 2025 and 2050 strategies for world dominance, why not sucker Trump into a massive trade war now? It would hurt both nations badly, but a state-run government can do more to artificially prop up its economy than a capitalistic one.
Our tarriffs are already hitting our agricultural sector hard. The price of household goods are rising, hurting everyone soon.
Last edited by helenwheels; 07/21/1808:25 AM.
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