# The coming Global Trade War



## KIWIKARLOS (16 July 2007)

With Chinas exports hitting new records and foreign currency reserves accumulating so quickly china now has the power to destroy, change or prop up global financial markets. China can now by the end of the year buy out every single company on the Australian and Taiwan stock markets!

The US and Europe are now cracking it with China and their massively undervalued money. The US has started banning goods and the European may start to follow suit. It is now looking like both the US and Europe will start slapping tariffs on many Chinese made goods.

What will Chinas response be? But with a vast majority of their reserves in US dollars if they tank the US currency they tank themselves. They have no consumers in their country so no one to buy their goods if they boycott the US and European markets?

This could put the resource boom into a slowdown and perhaps shift focus to Indias economy which is continually growing at what appears to be more sustainable and economically sound ways.

Any thoughts?


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## resourcesman (16 July 2007)

the US cant afford to completely ban chinese goods, otherwise the US inflation rate goes thru the roof.......
as for china, alot of their growth and economic activity is coming from industrialisation and moving people from rural areas to the cities, and so their economy would still be running i reckon


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## UPKA (16 July 2007)

KIWIKARLOS said:


> They have no consumers in their country so no one to buy their goods if they boycott the US and European markets?




i dunno where u got that idea from, bt with 1/4 of the world's population in the country, im sure that they can sustain alot of growth from themselves. yes they do have a large trade surplus, bt they r also import a lot of the world's commodity and luxery goods. a saction on China would be stupid, as it would only destablise the world economy. I'm sure the US and Europe is cautious on putting any tarrifs on the Chinese goods. Due to Chinese's economic and military power, a trade war would make both sides suffer, so there will be no winners.


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## KIWIKARLOS (16 July 2007)

I agree there would be no clear winner but in the current situation the US is the clear loser. If they have nothing to loose then it could be a dangerous situation, at the current rate china will become the powerhouse economy of the world sooner rather than later.

With a big economy comes a big military i don't think the US will let it get to that point.

As a matter of interest does anyone kow of any current market restrictions on china by the US.

So far they have banned some foods and childrens toys ?


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## UPKA (16 July 2007)

KIWIKARLOS said:


> I agree there would be no clear winner but in the current situation the US is the clear loser. If they have nothing to loose then it could be a dangerous situation, at the current rate china will become the powerhouse economy of the world sooner rather than later.
> 
> With a big economy comes a big military i don't think the US will let it get to that point.
> 
> ...




I also forgot that the Chinese now have a interim membership to the WTO. I'm not certain, bt if one member is to add tariff to another's export, doesnt it have to pass thru WTO first?


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## gfresh (16 July 2007)

> China can now by the end of the year buy out every single company on the Australian and Taiwan stock markets!




So could the US, Germany, Japan, probably Saudi Arabia, etc.. but they don't



> What will Chinas response be? But with a vast majority of their reserves in US dollars if they tank the US currency they tank themselves. They have no consumers in their country so no one to buy their goods if they boycott the US and European markets?




I think you've answered your own question  They won't, as it will cost them too much themselves. The best approach is just to maintain the status quo and helping to build their own economy, and build the wealth of their population as they have done for the last 20 years.


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## KIWIKARLOS (16 July 2007)

I think the ball is in the US court though, i can't see them allowing their economy to become 2nd to anyone else on the planet. The US has already stated they may make a WTO submission against China. 

They seem more desperate to revalue the Chinese dollar and really what pressure to china have to do it. A desperate person makes rash decisions


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## surfingman (16 July 2007)

KIWIKARLOS said:


> China can now by the end of the year buy out every single company on the Australian and Taiwan stock markets!




Its not that simple to just buy out large companies, governments have laws in place to stop takeover's without approval by them especially in larger corporations. Without these laws our economy would be very hard to keep stable all our dollars would go off shore in a very short period of time.


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## Sean K (16 July 2007)

Great thread, which may become very long and clomplex. 

This is NOT just China v US, but a change in overall world dynamics with the rise of China one of the catalysts. Russia speaking out against the US recently, is only because of a recognition in a change of the balance of power. 

China is just about to overtake Germany as the No3 economy, so those suggesting that their economy is not important need to think again. 

The $US is DOOMED! Those countries stockpilling trillions of the stuff are (or bloody well should be) converting it into Euro, or gold, or Peruvian Soles (economy seems to be pumping here!  ) or something else.....

Maybe.

There's lots more to discuss as far as Chinese military build up including their blue water fleet  and influence around the globe.


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## KIWIKARLOS (16 July 2007)

Agreed, I wasn't stating that China will buy the Aussie stock market simply showing how much reserves they have and that Japan and Germany don't have actual currency reserves big enough to do this.

I believe that Europe will stick with the US due to common ground, shared ideals and the fact that they really do owe the US from both WW1 and WW2. 

China is to far behind in social standards that in my opinion it can't be let to become the dominant power. Look at the corruption, the human organ trade and the fact that they censor their own history (tianamin) to suit the government. 

The US alone doesn't have the economic tools to take on China but with Europe and India on their side they do. Hence why i think they have chosen to grow ties with india which has much more in common with the US than China (Bollywood) etc its a infant US


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## marklar (16 July 2007)

KIWIKARLOS said:


> The US alone doesn't have the economic tools to take on China but with Europe and India on their side they do.



Yes, but for how long? Follow the momentum and project things out a decade, where do you see China & India (individually or together)? Is the US still relevant?


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## KIWIKARLOS (16 July 2007)

My point exactly we are at the crossroads NOW if the US is to act to keep is Dominant status it has to do something big in the next year or two or its two late. The european union is clearly on the US side and is almost a proxy state of the US. The EU troops are basically american troops. Hence the latest draft constition where all countries in the EU must act as one for conflicts etc. 

There won't be a time again when Germany etc jump into a conflict and spain/french sit on the sidlines. 

Really Germany and Japan are like the overseas states of America and when you take into account these countries and otherrs 100% aligned with the US it makes the odds better in the US favour. Gives the US more time to act


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## marklar (16 July 2007)

KIWIKARLOS said:


> we are at the crossroads NOW if the US is to act to keep is Dominant status it has to do something big in the next year or two or its two late.



It's going to be difficult for the US to do anything significant during their election cycle, will the world sit and wait while they find and install a new president?  Will Chindia take the opportunity in the timeframe you've predicted? 

I don't think it will happen that quickly, but I think domestic AND foreign policy of the next president will be fascinating...

m.


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## KIWIKARLOS (16 July 2007)

hahahaha very true I just hope to god Hilary doesn't get in, Her husband was a goose. Bush may make stupid decisions but at least he makes decisions if Hillarys anything like bill she'll sit them uming and aring for 4 years.

Personally i like obama.


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## chops_a_must (16 July 2007)

KIWIKARLOS said:


> Personally i like obama.




Obama is a fraud. One of the reasons he got into politics was because he wasn't publishing anything whilst in his College positions. Good salesman and PR pitch obviously, but nothing underneath.


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## Sprinter79 (16 July 2007)

I know you're from New Zealand, but just take a breath before you type stuff :


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## wayneL (16 July 2007)

Return salvo

http://www.ft.com/cms/s/06ac6fd0-32f2-11dc-a9e8-0000779fd2ac.html



> US food companies hit by China ban
> 
> By Jamil Anderlini in Beijing and Krishna Guha in Washington
> 
> ...


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## Wysiwyg (16 July 2007)

wayneL said:


> Return salvo
> 
> http://www.ft.com/cms/s/06ac6fd0-32f2-11dc-a9e8-0000779fd2ac.html




The best outcome from this situation would be a healthier food export/import future.Not a political wrangle,but could turn out to be a push me shove you case.

Also sad to see that financial crimes are punishable by death.



> Beijing has shut down more than 100 food-processing plants in recent weeks and last week executed the former head of its own food and drug regulator after he was convicted of corruption.


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## wayneL (16 July 2007)

Wysiwyg said:


> The best outcome from this situation would be a healthier food export/import future.Not a political wrangle,but could turn out to be a push me shove you case.:



This skirmish isn't about what it's about. It is about the political wrangle and this is just a sideshow.


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## KIWIKARLOS (16 July 2007)

Lets look at the facts though.

1. US is the largest consumer on the planet and has the biggest military / annual budget on the planet and its GDP can't sustain its spending.

2. China is the worlds biggest manufacturer and has to much money to spend but is reliant on overseas commodities and consumers

The imbalances are huge. So either the US starts producing more which would mean that their living standards would have to move towards that of the chinese

or 

China has to slow its production and revalue itself whilst improving its standard of living.

question is what happens if they don't:
Maybe a US economic recession and china suddenly has a huge surplus of goods with nobody to buy em. So they either stop producing so much or sell the surplus at bargin basement prices to try and cover costs

what may the US do to keep its economic power: 
Force China to revalue it dollar ?
start banning goods under dodgy pretences (if we think chinese food is unsafe you should read about what US patented GM food does to animals that its fed to etc)

What will the Chinese do:
Try to keep the upper hand, start diversifying its reserves looking to expand into other consumer markets or start one of its own?

I think the battle lines are already drawn and and we could see a sort of economic cold war come to fruition?


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## wayneL (16 July 2007)

http://www.ft.com/cms/s/22fcd90c-32ef-11dc-a9e8-0000779fd2ac.html

China's days of exporting deflation appear to be over... another variable to the mix.


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## KIWIKARLOS (16 July 2007)

Hey chops: just in regards to the next US pres

Do youreally believe that the president runs the country? The country is run by institutions. Some have even said that the best US president is one that is a good salesman / actor who stays out of decision making but gets the support of the public. They are really just a figure head and the country would prob operate more smoothly if they towed the line so to speak. 

Look at the most successfull presidents of the US and most were former actors turned to politics 

Presidents that haven't been and run their own agendas other than that of the "state" turn out unpopular and leave the country in a mess.


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## Lucky (16 July 2007)

kennas said:


> Great thread, which may become very long and clomplex.
> 
> This is NOT just China v US, but a change in overall world dynamics with the rise of China one of the catalysts. Russia speaking out against the US recently, is only because of a recognition in a change of the balance of power.




With much of the focus and attention being on China at present, it seems Russia has been able to go about on it's merry ways.  Russia will be one nation to watch.  After the west's premature celebration of the death of Communism and all that's been associated with the East, the great bear that has been in hibernation for the better part of 2 decades has come back with a vengenace.  Watch this space!


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## chops_a_must (16 July 2007)

KIWIKARLOS said:


> Hey chops: just in regards to the next US pres
> 
> Do youreally believe that the president runs the country? The country is run by institutions. Some have even said that the best US president is one that is a good salesman / actor who stays out of decision making but gets the support of the public. They are really just a figure head and the country would prob operate more smoothly if they towed the line so to speak.
> 
> ...




Complete and utter rubbish.

The only former actor come president was Reagan, and he was perhaps the second biggest disaster the US has had, behind Bush. And guess what, neither had the intelligence to make their own decisions. In fact, Reagan was brain damaged. Lol! FDR is another good example of a great president ignoring lobbyists.

The sad fact is, Clinton was one of the best Presidents the US has ever had, and I'm sure most voters would have much rather voted in Clinton than Bush. After the Somalia disaster, Clinton took control over every key decision. So I'd suggest you get your history correct before you make more silly statements.


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## wayneL (16 July 2007)

chops_a_must said:


> Complete and utter rubbish.
> 
> The only former actor come president was Reagan, and he was perhaps the second biggest disaster the US has had, behind Bush. And guess what, neither had the intelligence to make their own decisions. In fact, Reagan was brain damaged. Lol! FDR is another good example of a great president ignoring lobbyists.
> 
> The sad fact is, Clinton was one of the best Presidents the US has ever had, and I'm sure most voters would have much rather voted in Clinton than Bush. After the Somalia disaster, Clinton took control over every key decision. So I'd suggest you get your history correct before you make more silly statements.



Whose version of history one reads, and from which end of the political spectrum the reader sits, might make a critical difference in conclusions however.


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## KIWIKARLOS (18 July 2007)

http://edition.cnn.com/2007/WORLD/asiapcf/07/16/china.meat/index.html

tit for tat bans of imports. Its only food now if they start imposing trade barriers on manufactured goods it will have been escalated to the next level.

A bit of topic seems to be alot of things coming to a head atm. Russian dips expelled from UK, US looking like it will increase troop levels in Iraq (perhapes in responce or anticipation of Iran problems?


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## Wyatt (7 December 2018)

This thread seems to be so current yet over 10 years old.
An interesting TED talk regarding prospects for war


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