Financial Markets React to Trump's Hardball Tactics
While the good people in Asia were in bed on Sunday night, US President Donald Trump Sunday put extra pressure on China to strike a trade deal, announcing he will increase tariffs on $200 billion of Chinese imports to 25% from 10%. He also threatened to extend a new 25% duty on another $325 billion in imports.
Maybe we should all take a leaf from President Trump. After all, he has an estimated net worth of $3.1 billion. He is also author of the book "Trump: The Art of the Deal". If there is one person to shoulder the responsibility of negotiating a good deal for the USA, the good citizens can count on Trump, right?
Increasing the current tax from 10% to 25% AND imposing a new 25% duty - double negative = positive right?!
Markets Reacting - Sea of Red
S&P500, Nikkei225, Taiwan, Singapore, China, Hong Kong, and probably all other equity indexes are negative as well.
As of 6 May 2019, 10:00 AM Singapore Time (SGT). Offset UTC +8:00 hours
So the sell-offs' not due to threats from North Korea or the rising conflict in Middle East, but from the financial war between 2 nations trying to flex and tussling for dominance in an environment where its people are already struggling financially.
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Seems to be a wee bit more than a threat.... On the weather channel last night they said the sun will rise at 5:54 AM. I may just be simple minded, but I took this as a Fact, not a Threat.
As when I read and liked Trump's tweet where he said "The 10% will go up to 25% on Friday", once again, simple me thinking it was a Fact.
It further became a Fact the moment he tweeted it. In absolutely no paradigm, after that tweet will Xi EVER say... Donnie old buddy let's talk about this... Nope, centuries of saving face ment the moment Trump tweeted, it shall happen.
I guess Friday will determine if the mouth breathers were correct about threats.
But then again I come from a perspective the trade war is about food security under the cover of tarrifs. But we will have to wait about 18 months to see how correct this is.
Why food security? Grand Solar Minimum.
Cheers
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More cracks are forming. What happens happens. We've got to ready our war chest when it happens.
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Why shouldn't he raise tariffs?
China has, within the past 72 hours, backpedalled on every single promise they've made at any point in these talks, reaching the point where they were offering nothing of consequence. Bull-headed and brash as he may be, Trump is teaching China "we are no tributary."
Frankly, I hope the tariffs keep increasing. The higher they go, the more manufacturers are moving out of China, which causes massive unemployment (at time when the Party can ill-afford social unrest and causes incomes to drop at a time when China's massive population of seniors depending on their children's financial support is expanding exponentially). China's economy is export-driven and they don't have the per capita income to switch to a consumer-based economy, so anything that deprives them of their ability to manufacture cheap junk is a devastating blow to their economy.
He knows how to hit China, and where to hit China, and if the US has to take a punch in the gut while they're breaking China's legs, so be it. In any fight, the winner gets hit too.
Hard to state it @patriamreminisci ...
... any more clearly than this! 👍