|Forum - Wall Street Pit
||Stock Due Diligence for All|
|From: alectric (Rep: 177) reply to franconia||Date: 05/31/2019 16:34|
|Forum: Wall Street Pit - Msg #2788574||Thread #674084033 (Rec: 0) |
|Re: China countering tariffs with "Unreliable Entities" List....He's right in...I would add that the US is a mature economy with diminishing returns in revenues. The international corporations saw newly industrializing China as a potential goldmine, a way to boost revenues and lower costs significantly, leading to much improved profit margins. And if a critical mass of corporations shifted manufacturing to China, the rest would have to follow to remain competitive. |
But the Chinese didn't want a replay of what happened in the 1800's when western powers and Japan, took over large swaths of the Chinese economy. That's why they insisted on no foreign ownership. Under the Clinton and GW Bush administrations, China was given most favored nation status and that is what spelled the end of US manufacturing. The relationship with China was symbiotic in that China would keep US inflation at bay (due to the transfer of labor, which is one of the major costs of manufacturing) and would keep US interest rates low by buying up US debt in the form of Treasuries.
So it's extremely difficult if not impossible to extricate ourselves from China. I was reading today that the Chinese produce 80% of our generic drugs. There are many ways they could stick it to us.
| Reply to franconia - Msg #2788475 - 05/31/2019 09:58|
Re: China countering tariffs with "Unreliable Entities" List....He's right in...
First, I'd suggest its not the governments job to induce recessions, purge inefficient companies, its certainly not Trumps charter as Commander and Chief.
What Santelli's comment suggests is that socialism is OK, which he has railed against his whole life. He was caught trying to excuse Trump's blundering. Imagine if OBama had said recessions are therapeutic? Santelli would have had a tantrum the size of Chicago.
Second, I agree with your sentiments about how we created the China monster. Thirty years ago China didn't exist. US corporations created China. The Chinese didn't build themselves, we did. It was our greed that caused a rush to invest in China even with their owning 51% of every co-enterprise. It was our US corporations that screwed the American worker pitting our middle class salaries against super cheap 3rd world labor... and for each new factory we built and for each employee fired here, our corporate heads gave themselves a raise and bonus.
I listened to one US Corporate head at a shareholders' dinner in the 90's claim "the Chinese and Vietnamese are too backward to figure out how to design and engineer our products."
So if you want a culprit, a guilty party causing all the troubles we have today, look to your 1% who benefited by shifting our wealth generation industrial production, our life-blood employment overseas. The tax bill rubbed salt in the wound by permanently lowering corporate taxes while our average Jo's taxes will revert in a few years. And best of all, the Trump Tax Bill helps one industry most of all... big real estate.
No, the tariffs are not the solution. Its a weapon that hurts the average American and Trump can't just call it off and pretend he won. Long term damage is being done, trade relationships, international channels are all being torn apart. Look at our allies for the last 70 years. Trump is running the US like one of his golf clubs. He thinks he's charging the Chinese and Mexicans and Europeans and Canadians and everyone... admission to the US... a fee (tariff) for playing here
Unfortunately he's making all of U.S. caddies and groundskeepers.
TheLion.com | About Us | Agreement & Disclaimer | Privacy | Twitter
© 1999- TheLion.com, Inc.