So much for months and months of constant leaks, headlines, tweets, and press reports that US-China trade talks are going great, and are imminent amid an ocean of “optimism” (meant solely to sucker in amateurs into the most obvious bull headfake since 1987).
Just after noon on Sunday, President Trump tweeted that 10% tariffs paid by China on $200 billion in goods will rise to 25% on Friday, and that – contrary to what he himself and his chief economist, Larry Kudlow has said for months, talks on a trade deal have been going too slowly.
And, just to underscore his point, Trump also threatened to impose 25% tariffs on an additional $325 billion of Chinese goods “shortly.”
….of additional goods sent to us by China remain untaxed, but will be shortly, at a rate of 25%. The Tariffs paid to the USA have had little impact on product cost, mostly borne by China. The Trade Deal with China continues, but too slowly, as they attempt to renegotiate. No!
— Donald J. Trump (@realDonaldTrump) May 5, 2019
With the tariff rate on numerous goods originally set at 10% and set to more than double in 2019, Trump postponed that decision after China and the US agreed to sit down for trade talks; following Trump’s tweet it is now confirmed that trade talks have hit an impasse and that escalation will be needed to break the stalemate.
It was as recently as Friday that Vice President Mike Pence told CNBC that Trump remained hopeful that he could strike a deal with China (at the same time as he was urging for a rate cut from the Fed).
Curiously, on Wednesday, the White House – clearly hoping to sucker in even more naive bulls to buy stocks at all time highs – said the latest round of talks had moved Beijing and Washington closer to an agreement. Press secretary Sarah Sanders said, “Discussions remain focused toward making substantial progress on important structural issues and re-balancing the US-China trade relationship.”
In recent weeks there were multiple reports that China and U.S. were close to a trade deal, and an agreement could come as soon as Friday. Major sticking points the U.S. and China have been intellectual property theft and forced technology transfers. There has also been disagreement as to whether tariffs be removed or remain in place as an enforcement mechanism.
While it was not clear why Trump has decided to escalate his tariff policy, the most obvious explanation is that for a White House, which has been obsessed with pushing the S&P to record levels, this was the last lever it had at its disposal. And now that the S&P is back at all time highs, the lies can end, if only for the time being.
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And all this money goes where? Into the pockets of those industries currently being hurt by these foreign products? Yeah….right. Just more money for the worthless federal government to piss down some rat hole (not that I would support giving the money to the impacted industries – free trade is the ONLY moral answer).
China will just swap their dollars for Euros. Making the Euro stronger against the Yen as well as the Dollar.
This in turn will make it easier for that Coca Cola plant and all those other products on a supermarket shelf made by Protector and Gamble, manufactured and sold in Argentina, to pay back their loans . Their loans that originated at a bank in Argentina that are denominated in US Dollars.
There is a reason why the story of Jesus and the money changers made it into the gospels.
It seems to me that tariffs are nothing but an indirect tax on us consumers. I could have supported these tariffs if the tax cuts given the corporations would have resulted in new manufacturing facilities here. But that did not happen.
I am skeptical of the motives of the president.
Trump is a businessman in a political chess game. From my point of view in the real world it looks like he will fail as long as he listens to the three swamp creatures he has as advisers; that is, Bolton, Pomppeo and abrams. In fact he can bring some very serious consequences to america if he continues to listen to them.
My recommendation is he fire them and act on his own instincts.
American consumers pay the increase in tariffs. That’s all you need to know to understand it. Bend over, Vaseline just doubled in price.