tyb
==Why An Economic War With The US Blows China Up(Op-Ed-RaboBank-actually decent)
So say we all
“By putting more barriers in China’s path to US markets and, in the process, risking some short-term damage to the domestic and global economies, President Donald Trump could exact a heavy long-term cost on the world’s second-largest economy. Indeed, he may even threaten China’s chances of eventually entering the ranks of high-income countries. Chinese leaders have long known that they need to change their development model if they are to make this difficult transition, powering through the dreaded “middle-income trap” that’s tripped up so many other developing countries…
With external tailwinds turning into headwinds, China will need to rely far more on domestic demand to generate prosperity. To do so without building up risks in the financial system, Beijing would need to promote far greater household consumption and private investment, rather than relying on the debt-fueled government investment and inefficient state owned enterprises that have helped drive domestic engines of growth for most of the last several decades.”
So says Mohamed El-Erian, writing for Bloomberg, after the US shut Huawei out of its markets, legislation to apply the same export restrictions to ALL firms listed under ‘Made in China 2025’ progresses through Congress, and suggestions fly the US might even go as far as placing Iran-style sanctions on any third party that IS prepared to sell crucial inputs to Huawei. Given Chinese households are swimming in debt and its housing bubble is the world’s largest, and that boosting lending to private firms is out of line with local banks resources, I say “Checkmate, Mr Trampoline.”
( El-Erian is a bit disingenuous as he worked at PIMCO alongside Bill Gross and tried to pour water on the 2008 crash by saying the banks "never saw it coming", nor did he-but what he says here is solid.
if you want some good entertainment value look up Bill Gross' divorce-shit they did to each other is classic.
“China’s economic growth could tumble, debt surge and foreign companies flee in a deepening trade war, economists warn as a week of escalating tensions forces them to ponder worst-case scenarios…Analysts are assessing the damage to China’s role as the world’s supply hub as tariffs drive manufacturers overseas.”
(see Cap#2)
So says Bloomberg in ‘China’s Trade Worst Case: Growth Slows, Debt Rises, Companies Exit’.
“Altogether, an economic war with the US blows China up. China would be cut off from Western markets, ideas, technology, and US dollar-flow long, long before it’s ready to replace the US for real.”
So say I in the aforementioned article, echoing something I have been pointing out to a then-skeptical audience since late 2017.
“President Donald Trump’s new tariffs are helping to erode China’s appeal as a place where stuff gets made…a chorus of executives…are citing the trade war as the final straw in their shift out of China, with margins already squeezed by rising labour costs, tougher environmental standards and domestic competition. Last week Trump hiked tariffs on USD200 billion of Chinese imports and the US is readying the expansion of that treatment to the remainder. Even Chinese firms are moving to dodge the tariffs….”
(good luck with that-eventually they will run out of places to move to,especially with the reputation they have-kill a deal over a small amount of money playing the chest-thumping game.)
So say brokers in the US–for a change–where the Dow closed up 0.8% regardless, while Shanghai dared to see some slight selling (I want names!) after a large rally yesterday that was in no way intended by the authorities to display to the world that China-will-be-just-fine-regardless-of-the-trade-war, thank-you-very-much. CNH touched 6.9464 on Friday, which is perhaps of more interest, as is AUD breaking below 69c and staying there at the time of writing. That doesn’t match its January low of 0.6740. But we will get there soon enough, trust me.
And how did it end this way on friday?-a recycled news story from 18 hours prior.
Anything that makes Gartman (Fartman) right should be viewed with a grain of highly radiated salt.
https://www.zerohedge.com/news/2019-05-18/why-economic-war-us-blows-china
See cap #3 for the current level of US Gov't debt holders.
After China and Japan the number's drop off drastically, key point/takeaway-Russia not even on the list.
https://ticdata.treasury.gov/Publish/mfh.txt
Libya Government Gets Arms Shipment as Tripoli Offensive Stalls
Libyan forces loyal to the internationally recognized government in Tripoli said they’ve received a shipment of weapons and armored vehicles after announcing that Turkey would help fend off an assault on the capital by strongman Khalifa Haftar.
Forces loyal to the Government of National Accord published pictures on their official “Volcano of Anger” Facebook page of what appeared to be Turkish-made Kirpi combat vehicles. They also received ammunition and “quality weapons,” the group said in the Facebook posting. A spokesman for the Turkish presidency in Ankara wasn’t immediately available for comment.
The United Nations had warned of the conflict turning into a bloody proxy war as foreign backers of Haftar and the Tripoli government send arms shipments despite a UN weapons embargo on the North African OPEC state.
GNA spokesman Mohanad Younes had told reporters earlier in May that Turkey and other countries would be delivering military and humanitarian assistance.
Haftar is supported by Egypt and the United Arab Emirates. His forces have deployed precision guided Blue Arrow 7 missiles manufactured by China and known to have been sold to the United Arab Emirates, say experts who have examined the missiles’ remnants.
At least 400 people have been killed in the offensive, which has ground to a halt at the outskirts of Tripoli.
The United Nations and European countries have called for a ceasefire but officials say neither side is prepared for a truce. Haftar met Italian Prime Minister Giuseppe Conte on Thursday and is expected to meet French President Emmanuel Macron next week.
Two diplomats with knowledge of the matter said Haftar was planning to continue his offensive. The LNA, which took control of the east and the south before attacking Tripoli, had predicted a quick victory in the capital when it first launched its campaign in early April. Haftar wants at least a foothold in Tripoli before accepting a truce, one of the officials said.
rest at link
https://www.bloomberg.com//news/articles/2019-05-18/libya-government-gets-arms-shipment-as-tripoli-offensive-stalls?srnd=markets-vp
keep me rockin' anon.
many times ready to call it a night and you provide just the righ tunes to keep me around for that.
respect