Wall Street Journal (August 24)
“Not long ago it would have been hard to imagine a Republican President demanding government ownership in a private company, but here we are. And now the Trump Administration is toying with a tax on patents too—meaning, a tax on innovation.” Very bizarrely, to compete with China, “the U.S. is imitating its model of state-run business. Washington is becoming Chinatown” as, disturbingly, “corporate statism is riding high.”
Tags: China, Chinatown, Compete, corporate statism, Government ownership, Imitating, Innovation, Patents, Private company, Republican, State-run, Tax, Trump, U.S., Washington
Bloomberg (August 24)
“China’s economy is being strained by US tariffs and a deep-rooted property crisis, yet stocks are extending their bull run — a disconnect that’s stirring doubts on the rally’s staying power. In just the past month, onshore stocks have added almost a trillion dollars to their market value, the Shanghai Composite Index has hit a decade-high and the CSI 300 Index has taken its advance from this year’s low to more than 20%. That’s when nearly every recent economic indicator — from consumption trends, home prices to inflation — has brought red flags for investors.”
Tags: Bull run, China, Consumption trends, CSI 300, Disconnect, Doubts, Economic indicator, Economy, Home prices, Inflation, Investors, Market value, Property crisis, Rally, Red flags, Shanghai, Staying power, Stocks, US tariffs
Barron’s (August 14)
“Investors have typically penalized emerging markets such as Turkey, Argentina, and China due to concerns about the independence of the central bank, government intervention in the private sector, and rampant overspending.” Now these concerns are focused on “the U.S., which has historically been the paragon of a developed market.” Investors are reevaluating “the premium that U.S. assets have long commanded” and this could lead to “weaker long-run returns for stocks or, more immediately, higher bond yields and a continuation in the weakness of the dollar that has emerged this year.”
Tags: Argentina, Bond yields, Central bank, China, Developed market, Emerging markets, Government intervention, Independence, Investors, Overspending, Paragon, Penalized, Premium, Private-sector, Rampant, Reevaluating, Returns, Stocks, Turkey, U.S. assets
The Atlantic (August 14)
“After making a show of getting tough on China, President Donald Trump desperately needs a trade agreement to prove that his disruptive tactics get results.” This desperation has again postponed additional tariffs on China, which “would have hurt business between the world’s two largest economies. But the president’s newfound willingness to allow the export of vital AI chips to China indicates that an eventual deal could imperil American interests. Eager for a pact, Trump may give up more than he receives.”
Tags: AI chips, American interests, China, Desperation, Disruptive tactics, Eager, Export, Imperil, Pact, Postponed, Results, Tariffs, Tough, Trade agreement, Trump
Wall Street Journal (August 12)
“President Trump views tariffs as a toll that he alone gets to set for access to U.S. markets. Now he’s charging fees on U.S. companies for the purported privilege of exporting artificial-intelligence chips to China. Mark this as another step toward government control of private business.”
Tags: Access, Artificial intelligence, China, Chips, Companies, Exporting, Fees, Government control, Private business, Privilege, Tariffs, Toll, Trump, U.S. markets
Fortune (July 27)
“Now that trade deals have been clinched with the European Union and Japan, the U.S. looks to focus on China as the world’s two biggest economies prepare for high-stakes talks.” Some think “China will be less willing to cave,” which could send tariffs “back to prohibitively high levels that would effectively cut off trade.” On the other hand, with legal challenges set to commence in August, the “U.S. tariffs could be invalidated.” In fact, many suspect the promised investment from Japan and the EU was pledged with this in mind…and that it will never transpire.
Tags: August, China, Clinched, Economies, EU, High stakes, Invalidated, Investment, Japan, Legal challenges, Pledged, Tariffs, Trade, Trade deals, U.S.
New York Times (July 23)
“G.M. was the second automaker this week to show the toll that the Trump administration’s trade policies are taking on the industry. Stellantis, the maker of Chrysler, Jeep and Ram vehicles, said on Monday that it lost 2.3 billion euros ($2.7 billion) in the first half of the year partly because of tariffs and other Republican policies.” Automakers employ roughly “one million manufacturing workers. Eroding profits will make it harder for them to invest in new technologies to withstand growing competition from Chinese automakers that have been expanding abroad.”
Tags: $2.7 billion, Automakers, China, Chrysler, Competition, G.M., Industry, Invest, Jeep, Manufacturing, Profits, Stellantis, Tariffs, Technologies, Trade policies, Trump, Withstand, Workers
Bloomberg (July 22)
“China has increasingly relied on third countries for the manufacturing of final products or components,” which has softened the blow of the tariff war. If, however, Trump succeeds “in targeting transshipments via higher levies or supply chain requirements, it would threaten 70% of China’s exports to the US and more than 2.1% of the Asian country’s gross domestic product,” with “a risk of additional economic damage if the restrictions weigh on countries’ desire to do business with China.”
Tags: China, Components, Economic damage, Exports, Final products, GDP, Levies, Manufacturing, Relied, Supply chain requirements, Tariff war, Threaten, Transshipments, Trump, U.S.
Reuters (July 22)
“China’s hardened rhetoric against price wars among producers is raising expectations Beijing may be about to kick off industrial capacity cuts in a long-awaited, but challenging, campaign against deflation that carries risks to economic growth.” Such a campaign would “echo” similar successful “reforms a decade ago to reduce the production of steel, cement, glass and coal, which were crucial to ending a period of 54 consecutive months of falling factory gate prices.” Success may prove elusive this round. “The fight against deflation will be much more complicated and poses risks to employment and growth” while U.S. trade war ”is intensifying price wars, squeezing factory profits.”
Tags: Beijing, Cement, China, Coal, Complicated, Deflation, Economic growth, Employment, Expectations, Glass, Growth, Industrial capacity, Price wars, Producers, Rhetoric, Risks, Steel, Trade war, U.S.
Washington Post (July 18)
“President Donald Trump’s disruptive trade and security policies are producing some big aftershocks.” Amid the fallout and complaints, there’s a common theme: “Rivals such as China seem to be faring better in dealing with Trump’s challenge to the global order than are traditional U.S. allies including Japan and European nations. Except for Britain, countries are often finding that the reward for being a loyal partner is a punch in the nose.”
Tags: Aftershocks, Britain, China, Complaints, Disruptive, European nations, Global order, Japan, Loyal partner, Punch, Reward, Rivals, Security, Trade, Trump, U.S. allies
