China is Winning the Trade War

[HipKat]

Bloomberg New Economy: China is Winning the Trade War With Trump

 

After four years of relentless effort by President Donald Trump to push back against China, his campaign reached new heights (or lows) Friday when he sought to ban new downloads of WeChat, China’s ubiquitous messaging and payments app, and the wildly popular video-sharing app TikTok.

Nevertheless, the final scorecard is already in: On just about every metric that matters, China is ahead. At every turn, Trump seems to have been outplayed and outsmarted throughout the global trade war that began shortly after he took office. 

 

Consider the trade balance, which Trump seems to regard as the most important measure of success in his effort to get China to play by global trading rules.

China’s trade surplus with the U.S. has grown almost 25% since the start of the Trump presidency, exceeding $300 billion on an annualized basis, writes Jim McCormick of NatWest Markets. And China is nowhere near on track to meet its target of increasing imports from the U.S. under the partial deal (also called “phase 1”) to end the trade conflict, the signal accomplishment of Trump’s tariff tit-for-tat.

Look at China’s powerfully resurgent GDP, the result of its vastly more effective response to the pandemic that began there. China, McCormick notes, is the only country among 48 to have reported a second-quarter gross domestic product number that was higher than at the end of 2019. In the U.S., the worst country when it comes to the coronavirus (as measured by death and infections), the economy shrank 9.5% in the second quarter, a drop that equals an annualized pace of 32.9%, its sharpest downturn since at least the 1940s.

And now the Chinese currency is on a tear, climbing for the eighth week in a row, its longest run of gains since February 2018. Global bond funds are pouring into the country—one that still offers yields. Meanwhile, the dollar is slumping.

Behind these headline numbers also are deeper industrial trends, which again work in China’s favor, helping it pick up global market share in the aftermath of Covid-19 lockdowns. Increasingly, China is supplying the kind of sophisticated machinery that German manufacturers once dominated, like high-end tunnel borers and hydraulic valves and pumps used in wind turbines.

“It’s only a mat­ter of time un­til Chi­nese firms are No. 1,” says Ul­rich Ack­er­mann, man­ag­ing di­rec­tor for for­eign trade at Germany’s VDMA Me­chan­i­cal En­gineer­ing In­dus­try As­so­ci­a­tion. 

 

Take the race to develop batteries, a key to the future of transport, defense and other industries. By 2025, China will have battery facilities with maximum production capacity of about 1.1 terawatt-hours’ worth of cells annually, almost double the rest of the world combined. The White House response? So far, inertia, said Cathy Zoi, chief executive officer of charging-network operator EVgo, and an assistant secretary at the U.S. Department of Energy under President Barack Obama.

The net result of Trump’s efforts to decouple the U.S. and Chinese economies is to push China even further toward self-sufficiency, a strategy set to be enshrined in China’s new five-year plan at a meeting of the Chinese Communist Party Central Committee next month. 

This new economic direction is described by the official phrase “dual circulation,” an ambiguous reference to the outward and inward drivers of the Chinese economy. Bottom line: The term “looks set to mark a drive to reduce dependence on imports, particularly of high-end manufacturing equipment and inputs,” writes economist Alicia Garcia-Herrero. “Dual circulation,” she said, is import-substitution by another name.

 

 

 

[Thebowflexbody]

1 minute ago, HipKat said:

Bloomberg New Economy: China is Winning the Trade War With Trump

After four years of relentless effort by President Donald Trump to push back against China, his campaign reached new heights (or lows) Friday when he sought to ban new downloads of WeChat, China’s ubiquitous messaging and payments app, and the wildly popular video-sharing app TikTok.

Nevertheless, the final scorecard is already in: On just about every metric that matters, China is ahead. At every turn, Trump seems to have been outplayed and outsmarted throughout the global trade war that began shortly after he took office. 

Consider the trade balance, which Trump seems to regard as the most important measure of success in his effort to get China to play by global trading rules.

China’s trade surplus with the U.S. has grown almost 25% since the start of the Trump presidency, exceeding $300 billion on an annualized basis, writes Jim McCormick of NatWest Markets. And China is nowhere near on track to meet its target of increasing imports from the U.S. under the partial deal (also called “phase 1”) to end the trade conflict, the signal accomplishment of Trump’s tariff tit-for-tat.

Look at China’s powerfully resurgent GDP, the result of its vastly more effective response to the pandemic that began there. China, McCormick notes, is the only country among 48 to have reported a second-quarter gross domestic product number that was higher than at the end of 2019. In the U.S., the worst country when it comes to the coronavirus (as measured by death and infections), the economy shrank 9.5% in the second quarter, a drop that equals an annualized pace of 32.9%, its sharpest downturn since at least the 1940s.

And now the Chinese currency is on a tear, climbing for the eighth week in a row, its longest run of gains since February 2018. Global bond funds are pouring into the country—one that still offers yields. Meanwhile, the dollar is slumping.

Behind these headline numbers also are deeper industrial trends, which again work in China’s favor, helping it pick up global market share in the aftermath of Covid-19 lockdowns. Increasingly, China is supplying the kind of sophisticated machinery that German manufacturers once dominated, like high-end tunnel borers and hydraulic valves and pumps used in wind turbines.

“It’s only a mat­ter of time un­til Chi­nese firms are No. 1,” says Ul­rich Ack­er­mann, man­ag­ing di­rec­tor for for­eign trade at Germany’s VDMA Me­chan­i­cal En­gineer­ing In­dus­try As­so­ci­a­tion. 

Take the race to develop batteries, a key to the future of transport, defense and other industries. By 2025, China will have battery facilities with maximum production capacity of about 1.1 terawatt-hours’ worth of cells annually, almost double the rest of the world combined. The White House response? So far, inertia, said Cathy Zoi, chief executive officer of charging-network operator EVgo, and an assistant secretary at the U.S. Department of Energy under President Barack Obama.

The net result of Trump’s efforts to decouple the U.S. and Chinese economies is to push China even further toward self-sufficiency, a strategy set to be enshrined in China’s new five-year plan at a meeting of the Chinese Communist Party Central Committee next month. 

This new economic direction is described by the official phrase “dual circulation,” an ambiguous reference to the outward and inward drivers of the Chinese economy. Bottom line: The term “looks set to mark a drive to reduce dependence on imports, particularly of high-end manufacturing equipment and inputs,” writes economist Alicia Garcia-Herrero. “Dual circulation,” she said, is import-substitution by another name.

Bloomberg, huh?  Your sources are rotten to the core.  Another article to skip right over.  Wishing and hoping again I see.  Trust me, this ain't changing any minds.   

[HipKat]

@Meathead Stalking me agan

[Thebowflexbody]

That's bullshit and you know it.  Haven't responded to a post of yours in days.  So let me get this straight, to respond to any of your stupid posts is stalking?  You are way too sensitive, guy.  Grow a pair and stop with the constant whining.

[Thebowflexbody]

13 minutes ago, HipKat said:

@Meathead Stalking me agan

Not so at all, Meat.  This guy is making a concerted effort to get me suspended.  I hope you don't fall prey to this crap.  Is the new rule I can NEVER respond in any way to one of his posts?

[HipKat]

@Meathead 2 more examples

[Thebowflexbody]

Please weigh in Meat.  This guy is out of his mind.  What a crybaby.

[HipKat]

1 hour ago, Thebowflexbody said:

Please weigh in Meat.  This guy is out of his mind.  What a crybaby.

@Meathead

this getting old yet? It will stop as soon as he stops or he gets banned for stalking my posts

[Thebowflexbody]

I'm not "stalking" anyone.  Some thin skinned idiot has a persecution complex.  Please feel free to check all my recent activity.  Darn right his whining is getting old.  He's on every thread.  There would be no need to "stalk" him.

[LIBills]

1 hour ago, Thebowflexbody said:

I'm not "stalking" anyone.  Some thin skinned idiot has a persecution complex.  Please feel free to check all my recent activity.  Darn right his whining is getting old.  He's on every thread.  There would be no need to "stalk" him.

Holy shit Bow, you are dealing with a pure asshole.

[Thebowflexbody]

8 minutes ago, LIBills said:

Holy shit Bow, you are dealing with a pure asshole.

Tell me.

[SackMan518]

Just now, Thebowflexbody said:

Tell me.

I don't even know why you respond to him, he's irredeemable and will not change his mind no matter what proof you show. He has no understanding of complex systems, can't step back to see the big picture, and just grabs on MSM bait everytime.

[Thebowflexbody]

4 minutes ago, SackMan518 said:

I don't even know why you respond to him, he's irredeemable and will not change his mind no matter what proof you show. He has no understanding of complex systems, can't step back to see the big picture, and just grabs on MSM bait everytime.

I think I will finally heed this good advice.  It's just hard to let all the bullshit and lies he spews go unchallenged.  

[LIBills]

6 minutes ago, SackMan518 said:

I don't even know why you respond to him, he's irredeemable and will not change his mind no matter what proof you show. He has no understanding of complex systems, can't step back to see the big picture, and just grabs on MSM bait everytime.

Here's who you are talking about......

[LIBills]

13 minutes ago, Thebowflexbody said:

I think I will finally heed this good advice.  It's just hard to let all the bullshit and lies he spews go unchallenged.  

Or do what I do, just make fun of them.

Nick Di Paolo would have a field day with the likes of BrokenHip.

[Thebowflexbody]

14 minutes ago, LIBills said:

Or do what I do, just make fun of them.

Nick Di Paolo would have a field day with the likes of BrokenHip.

Making fun is pretty much what I've been doing, but now he's trying to get Meat to suspend me for "stalking" - which is absurd.  I mean you can't avoid the guy and he loves to bait with all his nonsense.  He's the definition of a guy who can dish it out, but can't take it.  

[LIBills]

3 minutes ago, Thebowflexbody said:

Making fun is pretty much what I've been doing, but now he's trying to get Meat to suspend me for "stalking" - which is absurd.  I mean you can't avoid the guy and he loves to bait with all his nonsense.  He's the definition of a guy who can dish it out, but can't take it.  

He's the gerbil that goes anal.

[Meathead]

8 hours ago, Thebowflexbody said:

Not so at all, Meat.  This guy is making a concerted effort to get me suspended.  I hope you don't fall prey to this crap.  Is the new rule I can NEVER respond in any way to one of his posts?

you need to stop responding to him for like a week straight to establish you have reversed your previous pattern of stalking

then you can go back to a NORMAL level of responding to someone, which is about one in every five posts in that topic forum

i should have told you this earlier but frankly i didnt think of it. just leave him alone for a while and you can resume normal response frequency

[Thebowflexbody]

3 hours ago, Meathead said:

you need to stop responding to him for like a week straight to establish you have reversed your previous pattern of stalking

then you can go back to a NORMAL level of responding to someone, which is about one in every five posts in that topic forum

i should have told you this earlier but frankly i didnt think of it. just leave him alone for a while and you can resume normal response frequency

One week it is then.  For the record, I have never stalked this guy. Have explained this elsewhere if you care to look.  I can do a week standing on my head.  LOL