The Survival Podcast Forum

Finance and Economics => The Money Board => Economic News, the Global Economy and all Things Monetary => Topic started by: Mr. Bill on August 23, 2019, 01:54:53 PM

Title: US/China trade war
Post by: Mr. Bill on August 23, 2019, 01:54:53 PM
Trump issues an order (via Twitter) for US companies to look for "an alternative to China":

https://twitter.com/realDonaldTrump/status/1164914959131848705
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Our Country has lost, stupidly, Trillions of Dollars with China over many years. They have stolen our Intellectual Property at a rate of Hundreds of Billions of Dollars a year, & they want to continue. I won’t let that happen! We don’t need China and, frankly, would be far better off without them. The vast amounts of money made and stolen by China from the United States, year after year, for decades, will and must STOP. Our great American companies are hereby ordered to immediately start looking for an alternative to China, including bringing your companies HOME and making your products in the USA. I will be responding to China’s Tariffs this afternoon. This is a GREAT opportunity for the United States. Also, I am ordering all carriers, including Fed Ex, Amazon, UPS and the Post Office, to SEARCH FOR & REFUSE, all deliveries of Fentanyl from China (or anywhere else!). Fentanyl kills 100,000 Americans a year. President Xi said this would stop - it didn’t. Our Economy, because of our gains in the last 2 1/2 years, is MUCH larger than that of China. We will keep it that way!

Reuters (https://www.reuters.com/article/us-usa-trade-china/trump-orders-u-s-firms-out-of-china-after-beijing-sets-new-tariffs-idUSKCN1VD21E) comments that:
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It’s unclear what legal authority Trump would be able to use to compel U.S. companies to close operations in China or stop sourcing products from the country.
Title: Re: US/China trade war
Post by: FreeLancer on August 23, 2019, 05:08:04 PM
What could go wrong?
Title: Re: US/China trade war
Post by: Mr. Bill on August 31, 2019, 10:38:29 PM
FactCheck.org, 8/27/19: Can Trump ‘Order’ U.S. Companies to Leave China? (https://www.factcheck.org/2019/08/can-trump-order-u-s-companies-to-leave-china/)

Short answer: maybe.

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...The president cited the International Emergency Economic Powers Act of 1977, which “grants sweeping powers to the President to control economic transactions” during a national emergency, according to a March 20 report by the nonpartisan Congressional Research Service.

But Trump’s tweet suggests invoking the law in a way that it has never been used, experts say. The CRS report said “no President has used IEEPA to enact a policy that was primarily domestic in effect,” and experts aren’t certain how far the president could go in exerting his authority. ...

“The real answer is anything he does would be litigated,”...
Title: Re: US/China trade war
Post by: Stwood on September 01, 2019, 01:55:33 PM
Hmmm. Order all manufacturing to come back home. Good idea, but costly.
Govco have to fund the move?.....
Title: Re: US/China trade war
Post by: FreeLancer on September 02, 2019, 05:56:40 PM
Companion piece to clip posted on another thread, where he argues that China runs a trade deficit in terms of services provided by US companies that their manufacturing surplus barely breaks even with, thus providing a significant reason for digging in their heels for a protracted trade war.

YouTube:  Trump has badly misread China’s hand (https://youtu.be/irMmR9SzPDY)

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Trump may have misread how strong China's hand is by overlooking some key inputs to the trade relationship between the two countries.

While most of the focus has been on traded goods Amstad says to get the full picture you also need to take into consideration the value of services and the profits earned by US companies operating in China. As he outlines in this short video Trump may have badly misread China’s hand.

“In China there is no political cycle. President Trump has got 15 months to sort this out before he faces re-election. So, time is very much on China’s side.”