The Word is “Reciprocity”. POTUS may like this word, but he could ask someone to get an explanation what it really means…
The tariff fight between China and the United States is getting hotter. After China has hit U.S. with $50 billion worth of tariffs, Trump threatened another $100 billion in penalties, while still denying on Twitter he is engagaged in a trade war with China…
Wall Street reacts with increasingly unsettling ECG, which is not only a certain sign, but also a textbook description of a trade war.
Trump should have one advisor who could explain to him that “reciprocity” in trade, at the open market requires about equal size and strength of economy — which is not the case any more. China's economy is larger, more efficient, and is growing 7% a year. U.S. simply cannot follow. Closing the U.S. market for Chinese goods is not the “reciprocity”, it is a reason for Chinese to apply reciprocal measures. And they are ready to do it. Unfortunately for Trump, they can hit harder. Just ask economists like Desmond Lachman, a former deputy director at the IMF’s Policy Development and Review Department and Dr Rebecca Harding, economist and founder of Equant-Analytics.
And a little more on long-term effect and unintended consequences of already announced Chinese tariffs:
Duration: 3:15
But I guess this would be a natural development when you are so smart to dug up John Bolton and put him as an advisor…
Basically that means for us only, that we have to pay more for the crap from China we purchase at Walmart. The real loser is the American consumer. It will not create any jobs and if there are profits to be made by reducing the trade deficit, I bet my ass that we are not going to see any of it. Looks like Trump has started the controlled demolition of the US of A. A trade war with China would be a perfect excuse for the pending crash of the economy...The banksters can blame it either on evil China or stupid Trump.
Excellent summary @herrleeb.
Trump is wrong on this one. Few conservatives would argue on the contrary. He's right about trade imbalances though, but a trtra war only produces losers
Right about that, @empress-eremmy.
Nice post @lighteye, up voted! Cheers
Thank you, @exxodus.