"By putting more barriers in China's path to US markets and, in the process, risking some short-term damage to the domestic and global economies, President Donald Trump could exact a heavy long-term cost on the world's second-largest economy. Indeed, he may even threaten China's chances of eventually entering the ranks of high-income countries. Chinese leaders have long known that they need to change their development model if they are to make this difficult transition, powering through the dreaded"middle-income trap" that's tripped up so many other developing countries".
"With external tailwinds turning into headwinds, China will need to rely far more on domestic demand to generate prosperity. To do so without building up risks in the financial system, Beijing would need to promote far greater household consumption and private investment, rather than relying on the debt-fuelled government investment and inefficient state owned enterprises that have helped drive domestic engines of growth for most of the last several decades."
So says Mohamed El-Erian, writing for Bloomberg, after the US shut Huawei out of its markets, legislation to apply the same export restrictions to ALL firms listed under 'Made in China 2025' progresses through Congress, and suggestions fly the US might even go as far as placing Iran-style sanctions on any third party that IS prepared to sell crucial inputs to Huawei.
"Altogether, an economic war with the US blows China up. China would be cut off from Western markets, ideas, technology, and US dollar-flow long, long before it's ready to replace the US for real."
"President Donald Trump's new tariffs are helping to erode China's appeal as a place where stuff gets madea chorus of executivesare citing the trade war as the final straw in their shift out of China, with margins already squeezed by rising labour costs, tougher environmental standards and domestic competition. Last week Trump hiked tariffs on USD200 billion of Chinese imports and the US is readying the expansion of that treatment to the remainder. Even Chinese firms are moving to dodge the tariffs....".
China should 'stop selling rare earths to the US; sell off its US Treasuries; and shut US firms out its lucrative concentration camps markets'.
So says China's Global Times in an op-ed, 'China has three trump cards to win trade war with US'. Well, the second threat is nonsense, as we keep explaining, and doesn't boost the credibility of the Global Times, to put it mildly; the last will accelerate the flood of firms out of China; and the first means the US will just buy rare earths from Mexico, Vietnam-notice how these two keep winning?-or Australia and in the future Japan, as well as developing its own resources.
https://www.zerohedge.com/news/2019-05-18/why-economic-war-us-blows-china
"With external tailwinds turning into headwinds, China will need to rely far more on domestic demand to generate prosperity. To do so without building up risks in the financial system, Beijing would need to promote far greater household consumption and private investment, rather than relying on the debt-fuelled government investment and inefficient state owned enterprises that have helped drive domestic engines of growth for most of the last several decades."
So says Mohamed El-Erian, writing for Bloomberg, after the US shut Huawei out of its markets, legislation to apply the same export restrictions to ALL firms listed under 'Made in China 2025' progresses through Congress, and suggestions fly the US might even go as far as placing Iran-style sanctions on any third party that IS prepared to sell crucial inputs to Huawei.
"Altogether, an economic war with the US blows China up. China would be cut off from Western markets, ideas, technology, and US dollar-flow long, long before it's ready to replace the US for real."
"President Donald Trump's new tariffs are helping to erode China's appeal as a place where stuff gets madea chorus of executivesare citing the trade war as the final straw in their shift out of China, with margins already squeezed by rising labour costs, tougher environmental standards and domestic competition. Last week Trump hiked tariffs on USD200 billion of Chinese imports and the US is readying the expansion of that treatment to the remainder. Even Chinese firms are moving to dodge the tariffs....".
China should 'stop selling rare earths to the US; sell off its US Treasuries; and shut US firms out its lucrative concentration camps markets'.
So says China's Global Times in an op-ed, 'China has three trump cards to win trade war with US'. Well, the second threat is nonsense, as we keep explaining, and doesn't boost the credibility of the Global Times, to put it mildly; the last will accelerate the flood of firms out of China; and the first means the US will just buy rare earths from Mexico, Vietnam-notice how these two keep winning?-or Australia and in the future Japan, as well as developing its own resources.
https://www.zerohedge.com/news/2019-05-18/why-economic-war-us-blows-china
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