Bye Bye Trade War? China Plans $1 Trillion Buying Spree to Reduce US Trade Deficit

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OSU79

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Wonder if that has anything to do with the Socialists occupying the title "professor" at a rate of 12-15 to ONE (Conservative).What a shocker! Socialists shoveling their leftist bullshit down our kids throats.Any student that speaks up against is admonished or embarrassed. Wake up pinhead, they are kids and when they have to compete in the real world...you know, the one where you are judged on your ability and value and not protected by a University or government position reality will kick em right between the legs.
EXACTLY why dems were floating the idea of lowering the voting age to 16. What a way to pick up millions of legal voters before they have any clue what the cost of free stuff is!
 
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https://www.cbsnews.com/news/trump-...50-billion-of-chinese-imports-in-retaliation/
Trump boosting U.S. tariffs on $550 billion in Chinese imports

The president said U.S. tariffs on $250 billion in Chinese imports will increase from 25% to 30% on October 1. An additional $300 billion in Chinese goods will be taxed at 15%, instead of 10%, starting on September 1. The stepped-up tariffs means the U.S. has hiked taxes on virtually all goods imported from China.


It looks like this is getting escalated further. I hope China blinks before this drags us into a worldwide recession.
 

CaliforniaCowboy

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https://www.cbsnews.com/news/trump-...50-billion-of-chinese-imports-in-retaliation/
Trump boosting U.S. tariffs on $550 billion in Chinese imports

The president said U.S. tariffs on $250 billion in Chinese imports will increase from 25% to 30% on October 1. An additional $300 billion in Chinese goods will be taxed at 15%, instead of 10%, starting on September 1. The stepped-up tariffs means the U.S. has hiked taxes on virtually all goods imported from China.

It looks like this is getting escalated further. I hope China blinks before this drags us into a worldwide recession.
China’s enormous debt ‘no longer can be ignored,’ analyst says

The world’s second biggest economy, which is slowing, is past a point where it cannot ignore its enormous debt anymore, according to an analyst.

Fraser Howie, an independent analyst, told CNBC Tuesday that there’s a “whole host of hidden debt” in China, which had kick started stimulus this year as its economy slowed.

“China is very much past the tipping point where the debt simply no longer can be ignored. The cost of servicing the debt ... simply distracts from almost everything else,” said Howie.

China’s total debt — corporate, household and government — rose to over 300% of its GDP in the first quarter of 2019, slightly up from the same period a year earlier, according to a report by the Institute of International Finance.
https://www.cnbc.com/2019/08/23/chinas-debt-levels-amid-its-slowing-economy.html

( In the first quarter of 2019, the U.S. debt-to-GDP ratio was 103%. )
 

Donnyboy

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So China and the US the two largest economies on Earth have unsustainable debt and are in a pissing contest. Prepare for bad times.
 

CocoCincinnati

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EXACTLY why dems were floating the idea of lowering the voting age to 16. What a way to pick up millions of legal voters before they have any clue what the cost of free stuff is!
Promising free college and lowering the voting age to 16 go together like peas and carrots. The Dems know it's easier to buy votes when you have a voting bloc willing to sell them.
 

OSU79

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China’s enormous debt ‘no longer can be ignored,’ analyst says

The world’s second biggest economy, which is slowing, is past a point where it cannot ignore its enormous debt anymore, according to an analyst.

Fraser Howie, an independent analyst, told CNBC Tuesday that there’s a “whole host of hidden debt” in China, which had kick started stimulus this year as its economy slowed.

“China is very much past the tipping point where the debt simply no longer can be ignored. The cost of servicing the debt ... simply distracts from almost everything else,” said Howie.

China’s total debt — corporate, household and government — rose to over 300% of its GDP in the first quarter of 2019, slightly up from the same period a year earlier, according to a report by the Institute of International Finance.
https://www.cnbc.com/2019/08/23/chinas-debt-levels-amid-its-slowing-economy.html

( In the first quarter of 2019, the U.S. debt-to-GDP ratio was 103%. )
Who in the hell holds all of China's debt? All we've heard about for the past 20+ years is how much of our debt China holds. Sounds like the ultimate Ponzi scheme. Maybe all nations could forgive the debt of all other nations and we'll just start over.
 

ksupoke

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Who in the hell holds all of China's debt? All we've heard about for the past 20+ years is how much of our debt China holds. Sounds like the ultimate Ponzi scheme. Maybe all nations could forgive the debt of all other nations and we'll just start over.
China owns virtually all of its own debt, through its 4 state owned banks. That’s why I said buy US banks and other US financial entities (insurance etc...) they have no exposure to unrest in China unlike other areas where they have substantial stakes in those countries central banks.

China could simply write off its debt and send its currency into the sewer, they need us far more than we need them.
 

CaliforniaCowboy

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China could simply write off its debt and send its currency into the sewer, they need us far more than we need them.
I think it's much more complicated than that... China has $50 trillion "off the books" (according to their financials), half of which they loaned to themselves (banks), and half of which they put in shell companies that purchased US stocks, commodities and real estate.

Allegedly, China is sitting with it's finger on the "sell" button, which would instantly plunge the US market into a collapse... and they lose nothing, because it was money printed out of thin air.

I'm not saying they would want to do that, but logic would seem to suggest that if they were going down, then it makes sense to bring us down too, that way they're still working from a position of relative equality.... and we would suffer more because our people are use to comforts and air-conditioning, and many of their people are closer to still living in caves.
 

ksupoke

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I think it's much more complicated than that... China has $50 trillion "off the books" (according to their financials), half of which they loaned to themselves (banks), and half of which they put in shell companies that purchased US stocks, commodities and real estate.

Allegedly, China is sitting with it's finger on the "sell" button, which would instantly plunge the US market into a collapse... and they lose nothing, because it was money printed out of thin air.

I'm not saying they would want to do that, but logic would seem to suggest that if they were going down, then it makes sense to bring us down too, that way they're still working from a position of relative equality.... and we would suffer more because our people are use to comforts and air-conditioning, and many of their people are closer to still living in caves.
As I've mentioned elsewhere phalic measures aren't my cup of tea, but at the risk of running afoul of you in an area that appears to be your expertise, your numbers don't make sense.

The entire US Stock Market is vauled at roughly $35T it varies from day to day but that's a pretty sound estimate, there is simply no way that the Chinese gvt, either directly or through wholly owned shells that invest in the market owns 70% of the value of the market. I saw an estimate from a highly reputable firm that puts the estimate somewhere just south of $2T between direct and indirect (as noted here).

Additionally, the Chinese gvt ownership of US treasuries (debt) has decreased from its high of 9.1% in 2010-2011 to right at 5% as of the end of 2018.

What would be hard to estimate is what is the value of the major companies that Chinese investors have purchased, as an example - I can't come close to spelling it but a major chinese investor owns GE appliances and has for a while there are several other examples, which I find appalling given the lack of investment and or ownership opportunity for foreign entities in chinese companies, we need a similar regulation, but I digress.

If they do an abrupt sell off of any of this (debt, equity or investor owned co's) it will not fetch what they paid and it will collapse their economy, it will impact ours.

They can't afford to weaponize any of this unless they are planning for a more traditional war which I highly doubt but could absolutely be wrong about, in which case who owns what is mice nuts in the big scheme.

Public hyperboly aside, I repeat, they need us far more than we need them which is why a trade agreement will happen sooner rather than later, and then, to borrow and paraphrase a line from my all time favorite movie (admittedly a very small sample size) "all will be right with the world'.
 
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CocoCincinnati

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Public hyperboly aside, I repeat, they need us far more than we need them which is why a trade agreement will happen sooner rather than later
Yeah but how much sooner is sooner. It seems pretty clear to me that China is going to try and hold out until the 2020 election knowing that if a Dem wins, things will go back to the status quo. They also know that the downturn of the economy in the meantime will in fact help the Dems take back the WH, so there's no good reason for them to make a deal unless/until Trump wins re-election......and if he doesn't, all of this trade war will have been for nothing. Yet one more reason to hope he does I guess.
 

ksupoke

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Yeah but how much sooner is sooner. It seems pretty clear to me that China is going to try and hold out until the 2020 election knowing that if a Dem wins, things will go back to the status quo. They also know that the downturn of the economy in the meantime will in fact help the Dems take back the WH, so there's no good reason for them to make a deal unless/until Trump wins re-election......and if he doesn't, all of this trade war will have been for nothing. Yet one more reason to hope he does I guess.
My opinion is that in the next 30 days you’re going to hear that most, if not all of the added, read new, tariffs have been lifted, that’s not the same thing as a trade agreement and it doesn’t have to be. I think though that by the end of October you’ll see the framework of, if not a complete, trade agreement in place.

Having said that, if you get in during all the bitching and moaning and you see the fundamentals are still very strong (there is nothing that points to a recession, a slow down of an all time economy, sure and you should always expect a cool off of a hot economy, if a liberal were in office there would be 0 talk of a recession everyone would be pointing to the incredibly sound fundamentals but there’s not so they don’t) nd you are, this is the key, patient, then you will make a decent amount of money. At some point before an agreement is struck the money will flow in at that point, it’s a little late but you’re still going to make money if your patient.

China can’t hold out that long their economy is, quite literally, always on the brink of collapse.
 
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SLVRBK

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My opinion is that in the next 30 days you’re going to hear that most, if not all of the added, read new, tariffs have been lifted, that’s not the same thing as a trade agreement and it doesn’t have to be. I think though that by the end of October you’ll see the framework of, if not a complete, trade agreement in place.

Having said that, if you get in during all the bitching and moaning and you see the fundamentals are still very strong (there is nothing that points to a recession, a slow down of an all time economy, sure and you should always expect a cool off of a hot economy, if a liberal were in office there would be 0 talk of a recession everyone would be pointing to the incredibly sound fundamentals but there’s not so they don’t) nd you are, this is the key, patient, then you will make a decent amount of money. At some point before an agreement is struck the money will flow in at that point, it’s a little late but you’re still going to make money if your patient.

China can’t hold out that long their economy is, quite literally, always on the brink of collapse.
@ksupoke what are your thoughts on the headlines from the G7 summit; Japan trade deal, Germany pushing EU for trade deal with US?
 

ksupoke

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@ksupoke what are your thoughts on the headlines from the G7 summit; Japan trade deal, Germany pushing EU for trade deal with US?
I haven’t had a chance to read anything yet, I’m, to quote that famous trio of the past, leaving on a jet plane later this morning and I’ll grab copies of most of the papers to read on the plane, at that point I’ll give you a more thoughtful reply.
My initial reaction is that it doesn’t surprise me, Germany has for the most part, always been pragmatic in dealing with US trade and Japan is a charred dot in the ocean or worse a Chinese territory without us, their people may not appreciate it but their gvt damn sure does.
Without having read anything on it yet,
I will add, this would put tremendous pressure on China to work out a deal, they aren’t capable of being an isolationist economy, I wasn’t kidding, their economy is always on the brink of collapse.

Again imo this is all about negotiating or ‘The Art of the Deal’ Trump, from a business pov, is Romney without the facade of kindness.
Anyone who had any dealings with Romney’s funds knows they were as cutthroat as any and much more than most.
 
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Yeah I looked through his posts and didn't really see anything egregious. My guess is we ain't going to find out.
Probably something on the sports board. Back on GoPokes, whenever he got mod attention it was on that side, not on the politics. But lately he's been all sunshine and lolipops on there, so kinda weird.
 

ksupoke

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@ksupoke what are your thoughts on the headlines from the G7 summit; Japan trade deal, Germany pushing EU for trade deal with US?
I’ve found it strange, there’s a lot about what happened out there but not much in the way of detail, I suppose that’s what they do it for, the g7 (as all of these summits are) is the dog and pony show and all the grooming is done in private. My opinion, for what it’s worth is, there’s a concern on the part of the eu that brexit could create a rift in trade with the US and they seem to understand that a majority of taxpayers in the US support the potus, generally speaking, so he’s not backing down and they are being forced to. Japan continues to rely on us for protection they are in no position to change their pro US stance unless they are resigned to a Chinese future. The g7 leaders are genuinely fearful of a trade war and know the only country left standing would be us, as in US so they’re working overtime on that trying to head it off. France inviting Iran was not expected but also not all that surprising and not a bad thing and it wouldn’t come as a shock if Trumps team wasn’t behind it, Trump, for all his bluster, works well through intermediaries and once everyone is at the table it’s shown he is tough but respectful.
So in a nutshell nothing earth shattering but a lot of positive forward momentum. My prior gut reaction hasn’t changed all that much except I think the EU is showing more concern about the future of the EU post brexit than I expected they would.
I still fully expect China will be at the negotiating table in the next 30 days.
AND
We’re still in a buy window but signs the window is closing are apparent in the numbers.
 
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