Tag Archives: China

The United States are growing faster than China

The world`s biggest economy is the United States followed by China, and sooner or later, China will replace the locomotive and be the biggest economy in the world. You can delay it, but it will happen in this century anyway.

They are both in conflict with each other with tariff tensions and a trade war. A strategy that is bad for both of them in the long run. The U.S is waiting for China to come to the table and make a fair deal. Today is the first day of talks to renegotiate the trade dispute between them. A deal that President Donald Trump repudiated.

Take a look at the chart above. Surprisingly, the U.S is more productive than China. Twice as much. The US economy advanced an annualized 3,4 percent on quarter in the third quarter of 2018 while the Chinese economy grew by “only” 1,6 percent quarter-on-quarter in the three months to September last year.

The Chinese economy is slowing and this has been going on for a while. But it`s not because of the trade war. China obviously have some problems and the China-U.S tension is one of them, but this is not the first time China and the U.S are in conflict with each other.

Deng Xiaoping and President Jimmy Carter signed a historic accord in 1979 and then reversed decades of China-U.S tension. Deng Xiaoping was a Chinese revolutionary and veteran of the Communist Party and he was eager to adopt capitalist methods and reforms in order to stimulate economic growth and restore confidence in the party.

Today, China has embraced capitalism but remains Leninist at heart. The founder of the Soviet Union, and his Bolshevik revolution, Vladimir Lenin changed China`s economic and political landscape.

Lenins Russian revolution in 1917 have a causal relationship with the birth of Chinas Communist Party in 1921 and the founding of the People`s Republic of China in 1949. As Mao Zedong once said: “The salvoes of the October revolution brought Marxism-Leninism to China.”

Lenin has played a much bigger role in China than Karl Marx and Friedrich Engels. The wholesale execution of enemies inspired Mao`brutal dictatorship and his launch of the Cultural Revolution under the theory of “continuous revolution under the dictatorship of the proletariat.”

Now, China has changed dramatically since Deng Xiaopings free-market reforms and Maos terrifying Leninist experiment in utopia. Now, China is the world`s second largest economy. 70 percent of the “socialist” economy is privately owned and nobody have more billionaires than China right now.

China is more a Leninist capitalist state than a Marxist socialist one. 800 million people in the middle class has jumped on the consumerism train in only a couple of decades under the stewardship of communist totalitarianism. Leninism`s lasting legacy.

On the other side, China has a debt crisis and a real estate bubble, so the question is; when will China collapse, and will it cause a global crisis? China is declining and it will continue to do so. Lending money to Kenya or Venezuela to name a few, are putting them all in a debt trap and it remain to see that Beijing can afford it. I`m in doubt.

Xi Jinping and his leaders know that they are in a very weak position, so they have to come to the table and make a deal with the U.S.

The stock market is in a correction territory at the moment. Investors have priced in two rate hikes this year and some U.S-China tension fear, but Trump reports “Big Progress” in trade talks with China were top trained negotiators came to the table earlier today.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

 

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Wilbur Ross said China is running out of bullets in trade dispute

Wibur Ross said China is running out of bullets in trade dispute. The U.S made a great deal with Mexico and Canada have a few days left to make a new deal. In the meantime, the tariffs on China is now 10 percent, or $200 billion on Chinese exports.

The U.S exports less to China than China exports to the U.S. Therefore, this trade war will hurt China more than the U.S, and President Trump`s regulations and tax cuts is whats really driving the U.S economy right now.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

 

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Trump`s tax cuts and reforms are working, and 4,1 percent growth means the strongest growth rate since the third quarter of 2014

America is growing fast. The United States are growing faster than China. The U.S economy advanced an annualized 4,1 percent on quarter in Q2 of 2018, while China grew by «only» 1,8 percent. That`s a bomb.

The Chinese economy advanced 6,7 percent YoY in June quarter of 2018. Last year, the economy expanded by 6,9 percent, beating the government target of around 6,5 percent and following a 26 year low of 6,7 percent in 2016. But, the United States can come up to that level very soon.

Trump`s tax cuts and reforms are working, and now we can all see right in front of us. The U.S economy advanced in the second quarter of 2018 and it will continue. This is just the beginning. The growth can reach 6 percent and compete with China.

The U.S exports jumped 9,3 percent (3,6 percent in the previous quarter), and imports rose at a much slower pace. 0,5 percent compared to 3 percent. The impact from trade was 1,06 percent, which is much better than -0,02 percent in the first quarter, and this is the highest contribution since the last three months of 2013.

4,1 percent growth means the strongest growth rate since the third quarter of 2014 amid higher consumer spending and soybean exports while business spending slowed. Spending of durable goods rebounded 9,3 percent compared to -2 percent and rose faster for nondurable goods; 4,2 percent compared to 0,1 percent and services; 3,1 percent compared to 1 percent.

Larry Kudlow said in his speech today that this is just the beginning. They have fixed a world broken trade system, and business investment is booming. 9 to 10 percent in the beginning of this year.

This is important because it is the key to productivity which is the key to growth which is the key to real rising wages. Big corporations like Apple are also coming back to the U.S.

This is a boom that is sustainable, Kudlow said.

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We are now standing at a crossroad were two different visions of humanity`s future compete

Former President Barack Obama had a speech in Johannesburg on Tuesday. In an address Tuesday in honor of the late Nelson Mandela ahead of the 100th anniversary of his birth, Obama criticized populist movements toward authoritarianism around the world.

He was warning against protectionism, climate change and closed borders. Obama said “The politics of fear and resentment and retrenchment began to appear. And that kind of politics is now on the move. It`s on the move at a pace that would have seemed unimaginable just a few years ago.”

“I can`t find common ground if somebody says that climate change just isn`t happening, when almost all the world`s scientists tell us it is. I don`t know where to start talking to you about this. If you say it`s an elaborate hoax, where do we start?”, Obama said in the speech.

Strong man politics is on the rise. In the west you have far right parties that are based on closed borders, protectionism and nationalism. Many developed countries are now looking at China`s model of a totalitarian control combined with capitalism.

The free press is under attack. Censorship and state control of the media is on the rise. Social media once seen as a mechanism to promote knowledge, understanding and solidarity, has proved to be just as effective promoting hatred, paranoia, propaganda and conspiracy theories.

We are now standing at a crossroad. A moment in time in which two very different visions of humanity`s future compete. Two different stories and two different narratives. About who we are and who we should be.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

 

 

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Trump`s Trade War against China started with tariffs on $34 billion worth of Chinese goods

President Donald Trump`s trade war against China has started, and after midnight Eastern Time, Mr Trump raised tariffs on $34 billion worth of Chinese goods. In two weeks, the number will increase to $50 billion.

This is not only a zero sum game. In the long run it will turn into negative territory. So far, the numbers are low. When it hit about $200 billion I think it will be heavy. China`s Commerce Ministry said the Chinese side promised to make the necessary counterattack.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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