Will Trump's tariffs lead to a global trade war?

[IFocus]

The economic numbers coming out of the US are still reasonably OK not to say they will continue as for the trade war I don't think anyone will blink and yes not sure if its the best way but sooner rather than later China has to start playing the game although every chance they never will ever tried bargaining with a proper Chinese businessman?

 

[Knobby22]

The economic numbers coming out of the US are still reasonably OK not to say they will continue as for the trade war I don't think anyone will blink and yes not sure if its the best way but sooner rather than later China has to start playing the game although every chance they never will ever tried bargaining with a proper Chinese businessman?

Some of the big Republican backers will lose money. I think they may seek to replace Trump for the next election.
Also the trade war may actually be to Australia's advatage.
Trumps also now fighting with India and Japan on the trade front. Great for us!

 

[tinhat]

The economic numbers coming out of the US are still reasonably OK not to say they will continue as for the trade war I don't think anyone will blink and yes not sure if its the best way but sooner rather than later China has to start playing the game although every chance they never will ever tried bargaining with a proper Chinese businessman?

The USA will blink first. The only thing they stood to gain from starting the war was to lose.

 

[Gringotts Bank]

The USA will blink first. The only thing they stood to gain from starting the war was to lose.

If the US/Aus and allies can somehow manage to encourage south east Asian countries to develop manufaturing capacity, there's a chance we can have a mutually respectful relationship with them instead of relying completely on China. Trying to continue business with an aggressive dictatorship is not working.

 

[IFocus]

Some of the big Republican backers will lose money. I think they may seek to replace Trump for the next election.
Also the trade war may actually be to Australia's advatage.
Trumps also now fighting with India and Japan on the trade front. Great for us!

Yes its the one sure thing in politics with the Yanks and here to a degree any economic slow down and you're gone when the big money speaks.

Will be interesting on where it all ends up.

 

[sptrawler]

If Trump gets companies back to the USA then he will get a big boost.

If US companies move from China to Vietnam, Korea, Taiwan, India etc then it gives China a kick but there is no benefit to the US and will be neutral for Trump.

I think you are right on the money there Rumpy, if the multinationals just move to another cheap labor source, he has lost the momentum.
The problem is he is trying to wind back a situation American multinationals caused in the first place, by outsourcing to cheaper labour countries to increase profits.
Now he wants to reverse it, but the problem is internal, the rednecks support him, but the big money will have a knife in his back. Just my opinion.

 

[Gringotts Bank]

... trying to wind back a situation American multinationals caused in the first place

Yes they need to understand the part they played in the current mess. China's stealing of IP and unfair trade practices were probably a backlash against that era of exploitation. However the exploitation of cheap labour continues, including by the Chinese of their own underclasses. Can someone explain to me why people in developing countries are paid less than here for the same work? Is it all about cost of providing reasonable hours, safe work places and worker insurance? Is that the difference?

 

[basilio]

Yes they need to understand the part they played in the current mess. China's stealing of IP and unfair trade practices were probably a backlash against that era of exploitation. However the exploitation of cheap labour continues, including by the Chinese of their own underclasses. Can someone explain to me why people in developing countries are paid less than here for the same work? Is it all about cost of providing reasonable hours, safe work places and worker insurance? Is that the difference?

At its simplest if the cost of housing, food , other essentials is only 25% of what we pay then wages could equally be 25% of our ages and people would have a similar standard of living.

The clever trick of multinationals is having their products made in a low cost country but then selling them in a high value country and making a truck load of profit.

The other point you made however is also valid. Part of the deal of companies setting up factories in China and elsewhere is being able to ignore issues like safety, working hours, and proper wages. In the end Western consumers get cheaper products, manufacturers make higher profits (think Apple, think computer companies) - and there are far fewer jobs left in our local economy.

 

[basilio]

Trumps nuclear option in his current trade war with China. He knows about it. Will he use it ? What will be left if it goes off ?

Donald Trump's 'nuclear' trade option could shut down all Chinese business and investment in US

He has one very big option — trade's nuclear option — at his fingertips.
National emergency declaration
The International Emergency Economic Power Act (IEEPA) is effectively a declaration of a "state of national emergency" — a drastic action far in excess of the tit-for-tat tariff skirmishes currently being fought.
It is the Trump Administration's most extreme trade weapon and could effectively block China's access to all US markets if deployed.
That means not just blocking goods and services, it would target Chinese investments and likely slam the door on China's access to US financial markets and banks.
The IEEPA was drawn up in 1977 to modernise the Trading with the Enemy Act, which dated back to World War I, and focus it on external threats to the US.
It was last invoked by President George W Bush after the 9/11 attacks to block the assets of terrorist organisations.
Earlier this year, President Trump announced he'd wheel out the IEEPA powers to hit Mexico with tariffs to head off the perceived national security threat posed by illegal immigrants continuing to head north across the border.

Now China is in the IEEPA crosshairs as Mr Trump tweeted to doubters of his powers.
https://www.abc.net.au/news/2019-08...-nuclear-option-could-block-business/11445090

 

[bigdog]

https://www.usatoday.com/story/news...k-if-u-s-hits-french-wines-tariff/2108036001/

At G7, EU warns it will respond 'in kind' if Trump puts tariff on French wine
Michael Collins, USA TODAY Published 1:09 p.m. ET Aug. 24, 2019

BIARRITZ, France – The president of the European Council put President Donald Trump on notice Saturday that the E.U. will stand with France and strike back if the United States slaps tariffs on French wines.

“If the U.S. imposes tariffs on France, the E.U. will respond in kind,” E.U. Council President Donald Tusk told reporters at the annual G7 gathering in southwest France.

The last thing the 28-member bloc needs and wants is a confrontation, “especially with our best ally, the United States,” Tusk said. But “we have to be ready. … and we are ready,” he said. “France can count on our loyalty, as all member states do.”

Tusk’s remarks follow Trump’s threat to place tariffs on French wines in retaliation for France’s new digital services tax, which has angered U.S. tech giants such as Google and Amazon.

The 3% levy, approved in July, would be placed on yearly revenues of companies that provide services in France and have global revenues of at least 25 million euros ($28 million) in France and 750 euros ($837 million) worldwide every year.

Trump threatened in July to slap tariffs on French wines in retaliation for the tax. He repeated the threat again Friday night as he was leaving for the G7 meetings.

Trump is expected to raise the issue with French President Emmanuel Macron during this weekend’s summit.

 

[sptrawler]

More tarrifs imposed on Sunday 1/09, it will be interesting to see how the markets respond this week.

https://www.abc.net.au/news/2019-09-01/us-china-trade-war-escalates-with-additional-tariffs/11468922

From the article:
A new round of tariffs took effect from 2:01pm on Sunday, with Beijing's levy of five per cent on US crude marking the first time the fuel has been targeted since the world's two largest economies started their trade war more than a year ago.

The Trump administration will begin collecting 15 per cent tariffs on more than $US125 billion ($185 billion) in Chinese imports, including smart speakers, Bluetooth headphones and many types of footwear.

In retaliation, China started to impose additional tariffs on some of the US goods on a $US75 billion ($111 billion) target list .

It will be interesting, if this trade war, is sorted out just in time for the run up to the U.S elections. Maybe Jan/ Feb.

 

[Garpal Gumnut]

There may be a trade battle, as there always is, but not a trade war.

Most countries such as USA and China have significant assets earning dosh outside of their own jurisdictions, so a war can be self defeating.

gg

 

[sptrawler]

Well the gloves are off now, they are calling it as it is, China is no longer a developing Country and should face the same trade obligations as the developed Countries. The Lima accord, was to help third World countries, not first World Countries.

https://www.abc.net.au/news/2019-09...lls-for-trade-overhaul-of-wto-system/11541522

 

[qldfrog]

Something unrelated to Trump is brewing between South Korea and Japan in term of trade war, and we start seeing articles about this in Australia lately
Slightly off topic but related to trade war with effects on us

 

[SirRumpole]

Something unrelated to Trump is brewing between South Korea and Japan in term of trade war, and we start seeing articles about this in Australia lately
Slightly off topic but related to trade war with effects on us

Seems to have it's origins in wartime forced labour by Japan.

After all these years someone has opened old wounds. Incredible.

I blame the "me too" movement.

 

[IFocus]

Seems to have it's origins in wartime forced labour by Japan.

After all these years someone has opened old wounds. Incredible.

I blame the "me too" movement.

The word from some one I know in Japan (Ausie) is that the South Koreans use any opportunity to have a go at the Japanese hope it doesn't get out of control there is enough dramas happening already.

 

[sptrawler]

US Commerce Secretary Wilbur Ross, explains the trade war pretty well, for those who are interested in listening.

https://www.watoday.com.au/politics...-to-back-us-in-trade-war-20191010-p52zh4.html

Maybe now the Australian media have printed it, they might read it.

From the article:
Mr Ross used his speech in Sydney to keep pressure on Beijing to back down in the trade war with the United States, arguing it was breaking global rules for fair trade.

He said the "rules-based order" was at the heart of the Trump administration's dealings with China.


"We are not opposed to trade with China," he said.

"In fact, we [are] hosting negotiations with them later this week in Washington.

"But we are addressing fundamental issues in our trade relationship with China, including forced technology transfers, cyber intrusions, the stealing of [intellectual property] and industrial subsidies to state-owned enterprises.

"China continues to cause massive dislocations due to overcapacity and dumping excess production into global markets.

"If we can get China to abide by the global rules of trade, every nation in the world will benefit - including China. China is, after all, a real powerhouse. It is growing rapidly. And with its success comes responsibility - it's responsibility to act as a member of the global community."

 

[sptrawler]

The U.S is considering a currency agreement with China and possible hold on next weeks tariff increases.

https://www.reuters.com/article/us-...of-partial-trade-deal-bloomberg-idUSKBN1WP048

 

[Knobby22]

If you read the article it also states the deal with China includes buying large numbers of commodities
Could be bad for our iron exporters.

 

[qldfrog]

And to add a bit of balance to the Trump bashing posts..could not find the right thread probably in my ignore list
https://www.fff.org/2019/10/09/the-cia-versus-donald-j-trump/