DawgTalkers.net Forums DawgTalk Palus Politicus Trump just blinked, giving China a possible edge in trade war

In backing off on China tariffs Tuesday, President Donald Trump showed just how much pain the U.S. could tolerate — and China may use that to its advantage, key voices on Wall Street say.

Markets rallied on the announcement by the U.S. Trade Representative office that certain items were being removed from the new tariff list, while duties on others would be delayed until mid-December.

The short-seller Jim Chanos, who tweets under the alter ego “Diogenes,” hinted that Chinese President Xi Jinping may take this as a sign that the U.S. may cave with enough pressure.

“So then tell me why Xi should not continue to wait out The World’s Greatest Negotiator, who keeps ‘dealing’ with himself?” tweeted Chanos, founder and managing Partner of Kynikos Associates.

Some investors took Tuesday’s announcement as a sign that despite the White House’s claim that China would bear the brunt of tariff impacts, the trade war was indeed hurting consumers. The products in the group exempt from tariffs include cellphones, some apparel, and video games — all of which are crucial to the U.S. consumer market, especially during the holiday shopping season. Trump announced on Aug. 1 that 10% tariffs would go into effect on Sept. 1 on the remaining $300 billion worth of Chinese imports that had not been slapped with U.S. duties.

Trump told reporters Tuesday afternoon that he postponed tariffs for the Christmas season “in case it had an impact on shopping” and the delay would “help a lot of people.”

Hedge fund manager and Hayman Capital Management founder Kyle Bass said based on the tariff de-escalation, “it does look like President Trump has blinked.” While Trump has been vocal in the tariff fight, Bass said “every time it makes the stock market go down a few hundred points” the president “backs away.”

“It looks like he doesn’t want the price of iPhones going up into Christmas,” Bass said on CNBC’s “Squawk Alley ” Tuesday. “The Chinese are going to read this as a key weakness.”

China meanwhile, has not publicly backed off. It announced last week that it would not resume buying U.S. agricultural products, despite assurances otherwise by Xi to Trump at the June G-20 summit. It also has retaliated with its own tariffs on U.S. goods and set off more worries about the trade war on Friday by letting its currency weaken.

John Rutledge, chief investment officer of global principal investment house Safanad, said the trade war is causing pain on both sides. In China, Rutledge said Xi is feeling pressure to show strength in the trade war, while Washington is grappling with mounting political pressure and costs to consumers.

But that can change quickly, Rutledge said, depending on which of Trump’s trade advisors have his ear at the moment.

“There’s a battle of the bands among advisors — this may be just a tick up as the rational group prevailed,” Rutledge said, referring to White House economic advisor Larry Kudlow, Secretary of Commerce Wilbur Ross and Treasury Secretary Steven Mnuchin, whom he calls “market thinkers” in opposition to trade hawk and advisor Peter Navarro.

Still, Rutledge said its nearly impossible to predict the White House’s next move and investors should take this as “one day and one data point.”

“We shouldn’t extrapolate or draw a trend, since it might get revered,” Rutledge said.

The president’s top priorities — a strong stock market and a tough China trade deal — have been at odds. Uncertainty around the trade war has weighed on financial markets. Stocks saw their worst day of the year on Aug. 5 after China let its currency weaken below 7 yuan to the dollar and made its announcement about U.S. farm products.

“The White House is now delaying the tariffs and removing some items. Did some acronym called the SPX cause someone to blink?,” David Rosenberg, chief economist and strategist at Gluskin Sheff & Associates, said in a tweet.

China’s Commerce Ministry said Vice Premier Liu He had a phone call with U.S. Trade Representative Robert Lightizer and Mnuchin. Trade talks are set to continue in two weeks. According to Chinese news outlet CGTN, the call for the world’s two largest economies to meet again on trade came from Lighthizer, not China.

So far, the pain felt by the stock market has not been that exaggerated. At its low point for this sell-off, the S&P 500 was down only a little more than 6% from its high.

“These developments are modestly positive, especially compared to the recent torrent of negative news, but we caution against viewing the tariff delay as anything more than an attempt to partially shield the American consumer heading into the holiday season,” Isaac Boltansky of Compass Point Research wrote in a note to clients. “We continue to believe that a broad deal will not emerge prior to the 2020 election.”

Trump, himself, accused China last week of trying to wait out the 2020 election for a trade deal.

https://www.cnbc.com/2019/08/13/trump-ju...others-say.html

So finally he's beginning to realize that trade wars aren't easy to win and that China isn't who is paying for it.

the education from Wharton is really paying off, isn't it?

i said it in the other thread yesterday, he blinked first. i mean think about the blatant lying he did, and the maga hatters defended?

if china is paying for the tariffs, then how would our christmas markets be effected? why back out of the 10%? if our economy is as strong as trump claims, why is he BEGGING for a rate cut?

you dont cut rates when the economy is booming.

the economic slowdown is not on trump, lets be clear. but his management of the economy is gonna make everything a hell of a lot more painful than needed. an economic slowdown, and you're only heating things up in your trade war? you're pressing the fed to cut rates? what happens when we actually get into a recession, and the feds cant cut any more rates?

its gonna get ugly.

A temporary truce for the health of our Christmas shopping season is not a blink, just a delay.

Yeah, rate cuts are designed to help stimulate a poor economy. Not to try to stimulate a good economy. It's a safeguard that won't be there if Trump gets his way.

A "tax cut stimulated" economy is a temporary thing. The evidence of that is clear by how much they had to raise the deficit. According to some, "the tax cuts would pay for themselves". They keep repeating that same fake BS every time.

But the American consumer wasn't who Trump said would pay the cost of the tariffs. Trump has said repeatedly that China, not the United States, will bear the cost of US tariffs on Chinese imports. Are you saying he was lying?

No but the next round of tariffs during the holiday season, especially on clothes and phones could hit our pocketbooks.

Why risk it? Trump has time.

So, Trump has our back once again, just like he does with the Farmers, as he takes care of getting China to play by the rules.

and lets not forget the trade aspect from the EU.

Trump has been threatening Germany and others with tariffs for a while now. Germanys economy contradicted in the 2nd quarter, so that means Germany is feeling the pressure, which will hurt us as well.

its gonna be a ripple effect, and instead of leaning our on allies for real trade deals, i fear that trump will just continue this scorched earth policy making and drag everyone down with him.

its an admission that he was lying when he said that china was paying for the tariffs, not the american consumer.

But Trump said repeatedly that China, not the United States, will bear the cost of US tariffs on Chinese imports. It sounds like you're saying that American consumers would bear the cost of the tariffs.

That would mean that Trump was lying.

Oh, and yes, that new welfare farm program helps farmers. Once again, it's the American tax payer that pays for those tariffs, not China. And it isn't nearly enough to make up for what they're losing.

And round two of that farmer welfare program is getting ready to be paid out.

I thought he said that the trade wars would be over quickly and were easy to win?

Dow dropping hard today.

‘It’s really, really getting bad out here’: Farmers hit back as USDA Chief Sonny Perdue mocks those harmed by Trump trade war as ‘whiners’

“He doesn’t understand what farmers are dealing with, and he’s the head of the Department of Agriculture. He’s supposed to be working for farmers.”

Farmers facing record bankruptcies and collapsing incomes due to President Donald Trump’s escalating trade war with China were not amused by U.S. Agriculture Secretary Sonny Perdue’s joke about their economic pain during an event in Minnesota last week.

“I had a farmer tell me this in Pennsylvania,” Perdue told an audience of thousands of farmers gathered in a barn near Morgan, Minnesota. “What do you call two farmers in a basement? A whine cellar.”

Some laughed at the agriculture secretary’s joke, but other farmers booed and denounced Perdue’s wisecrack as callous and tone-deaf mockery of the real hardship caused by the Trump administration’s trade policies.

“It was definitely not an appropriate thing to say,” Gary Wertish, president of the Minnesota Farmers Union, told HuffPost on Monday. “It was very insensitive. It took everyone by surprise. He doesn’t understand what farmers are dealing with, and he’s the head of the Department of Agriculture. He’s supposed to be working for farmers.”

Perdue’s characterization of struggling farmers as “whiners” came after the Trump administration announced it will impose a 10 percent tariff on $300 billion of Chinese goods starting Sept. 1, a significant escalation in the ongoing trade war between the two global powers.

China quickly retaliated by canceling all purchases of U.S. agricultural products, a move American Farm Bureau Federation president Zippy Duvall called “a body blow to thousands of farmers and ranchers who are already struggling to get by.”

With farmers suffering from his trade policies, Trump has attempted to tamp down backlash with targeted aid packages—but, according to the Environmental Working Group (EWG), most of the assistance has gone to wealthy farmers.

Meanwhile, as HuffPost reported on Monday, “Net farm income in America has plunged by nearly half over the last five years from $123.4 billion in 2013 to $63 billion last year. It plummeted by 16 percent last year alone.”

Roger Johnson, president of the National Farmers Union, said last week that Trump’s “strategy of constant escalation and antagonism” toward China has “made things worse.”

“It’s really, really getting bad out here,” added Bob Kuylen, a North Dakota farmer, in an interviewwith CNBC. “Trump is ruining our markets.”

https://www.rawstory.com/2019/08/its-rea...war-as-whiners/

China has borne the brunt of the Tariffs, not the US.

Relax, Trump got this.

After Trumps reelection, China will be ready to sign and play by the rules.

Future generations will hail the President who had the guts to take them on and win.

how can you say this as farmers are filing bankruptcy in massive numbers?

go tell them china got the brunt of the tariffs. you'd get laughed at.

the trade deficit with china INCREASED. do you understand that? its WORSE under trump's leadership, not better.

jesus freaking christ

Mostly False.

On ABC’s This Week, Heidi Heitkamp said the economy is starting to show weak spots.

"One of the leading indicators in the economy is agriculture," she said. "We have record bankruptcies in farming country."

Are there really "record bankruptcies in farming country"?

We found that the farm bankruptcy rate is exceeding historical norms in the upper Midwest, which includes Heitkamp’s home state of North Dakota. But experts told us the term "farming country" has no official definition, making the national picture the most relevant measurement.

And nationally, the farm bankruptcy rate has been fairly steady, and in fact sits well below the highs of just a few years ago.

Our ruling
Heitkamp said, "We have record bankruptcies in farming country."

In her backyard, the upper Midwest, farm bankruptcies have indeed reached their highest level in at least a decade. But nationally, farm bankruptcies are holding steady, perhaps even falling slightly, and they sit below the levels seen as recently as 2009 to 2012.

We rate the statement Mostly False.

https://www.politifact.com/punditfact/st...s-farm-country/

Sure. China has just manipulated their currency again to minimize any impact the tariffs had.

First you say that he cut back the tariffs to help the American consumer. Farmers are on their second helping of, "Trump's Farm Welfare" program and then you say that China is paying more than Americans are?

You can't even keep Trump's lies straight.

interesting:

https://www.wsj.com/articles/this-one-he...ing-11549468759

https://www.npr.org/2019/04/03/708664013...any-u-s-farmers

https://www.forbes.com/sites/jessecolomb...t/#30e99dba65a7

and they arent quoting that lady.

also, lets not forget the....oh yea, how many billions of dollars worth of socialism we've given them already?

thanks to trump and the trade war.

No, that is not what I said, that is what you twisted my statement into, in order to try to win a losing argument.

but you're wrong. we're paying for the tariffs.

You guys are funny. Those links are from November of 2018, Feb of 2019 and April of 2019.

???

your link was from February of 2019, so two of my links that you just as current as yours.

also, it doesnt account for those who have filed for bankruptcy since then, nor does it account for china announcing that they will no longer purchase us agricultural goods recently.

are you current on anything? are you like...not paying attention?

Try again grasshopper.

Trump gets re-elected and I'm going to buy me one of those soybean farms for pennies on the dollar at bankruptcy sale, then kick back and get my Trumpian socialism checks...

The Perdue family has bankrupted plenty of chicken farmers over the years.

i have a moral question:

so when a recession happens, should i feel bad about buying all the cheap stock and rubbing my hands together like Mr. Burns?

i mean, i didn't vote for this, afterall.

When the Aliens land you should hug them.

Just time it right because it's going to fall hard if it goes... house of cards.

fox business right now already has the new narrative out. check this out.

apparently what you maga hatters need to roll with now is that a recession is gonna happen, it will be possibly worse than 2008. its gonna cause the people to elect a socialist, which will make the economy worse during the recession, so you need to reeelect trump, even though he caused it.

make sure you and your roommate diam download the new update.

Rumor is they're traveling in a caravan. Or were you talking about different aliens?

Space drugs, space racists, space murderers and I suppose some good aliens?

What's trump going to run on if the market/economy tanks?

you have to ask?

what do cons/republicans do everytime there's problems in the economy?

blame it on black and brown people. the takers. the peasants. also, liberal lesbians.

So let me get this straight. The new lie is, "We did it bad but they will do bad even worse"?



Obama saved a bad economy. So now if Trump screws up that good economy, they say the same party that Obama was elected by can't fix it.

You couldn't make that BS up if you tried.

fox news use to have a debt clock on both channels under obama. taken off under trump.

better believe its going right back up the moment trump loses.

Yeah, it's gone up by trillions already with his give away to the rich tax cuts and they won't talk about it.

OMG can you imagine Trump facing a crash like Obama did? We'd be screwed.

In the first instance we have Obama who saved us from a crash. In the second instance you would have Trump who created a crash.

And they would still being lying about that trickle down economics BS.

They would blame the 'freeloaders' receiving entitlements.

https://marketsanity.com/the-average-u-s...ory-is-upon-us/
We haven’t seen anything like this since the Great Depression of the 1930s. Leading up to this year, farm incomes had been trending lower for most of the past decade, and meanwhile farm debt levels have been absolutely exploding. So U.S. farmers were desperate for a really good year, but instead 2019 has been a total disaster. As I have been carefully documenting, due to endless rain and catastrophic flooding millions of acres of prime farmland didn’t get planted at all this year, and the yields on tens of millions of other acres are expected to be way, way below normal. As a result, we are facing the worst farming crisis in modern American history, and this comes at a time when U.S. farms are drowning in more debt than ever before. In fact, the latest numbers that we have show that the average U.S. farm is 1.3 million dollars in debt…
Debt-to-asset ratios are seeing the same squeeze, with more farms moving into a ratio exceeding 80%. Barrett notes each year since 2009 has seen an increase in the average amount of total debt among farmers, and 2017 was no exception. Average debt rose 10% to $1.3 million. The biggest increase was in long-term debt, such as land.

Farming in the 21st century has become an extraordinarily risky business, and countless U.S. farmers were already on the verge of going under even before we got to 2019.

Now that this year has been such a complete and utter disaster, many farms will not be able to operate once we get to 2020.

Minnesota farmers Liz and Bob Krocak were hoping for better days ahead as this year began, but things have been really tough and their debts have become overwhelming. During a recent meeting with their creditors, Liz was so distraught that she literally burst into tears…

They had to face their creditors at a mediation. There was Del, the mechanic, whom they owe $28,000 and who now can’t help his son buy a home. There was Steve, the feed store guy, who is 64 and has delayed his retirement because of the Krocaks’ $311,000 bill.

Liz recalled the mediator opening the meeting by saying, “This is going to be an emotional day. I can see everybody really likes this family.” Liz had burst into tears then – and she was crying again now, describing the scene seven months later.

“We just hope there’s a farm left at the end of it,” she said.



In total, the Krocaks just happen to be 1.3 million dollars in debt.

At this point, there isn’t a prayer that all of that debt will ever be paid off. All they can really hope for is more patience from their creditors, because without it the farm is going under.

The Krocaks recently received a check for about 12,000 dollars from the federal government, and they are very grateful for the money, but the truth is that it isn’t even going to make a dent in their 1.3 million dollar debt.

If the horrific weather and endless flooding wasn’t enough, about a week ago the Chinese government announced that they would be ending all “purchases of U.S. agricultural products”, and that was a devastating blow for farmers all over the nation.

In particular, soybean farmers are going to see demand for their crops absolutely collapse. In recent years, China has purchased approximately 60 percent of all U.S. soybean exports.

And even if a trade deal is eventually reached, it is unlikely that all of that demand is ever going to come back. Right now, the Chinese are spending enormous amounts of money “to build transportation infrastructure to ship soybeans grown in what used to be rain forests” in Brazil. They aren’t going to abandon all of that just because Trump suddenly changes his mind.

And the truth is that it is extremely unlikely that Trump will change his mind and cave in to the Chinese.

So for the foreseeable future, U.S. farmers are going to be facing weaker markets and lower prices, and that is going to be the final straw for many of them.

Have you ever been at a point in your life where you have endured problem after problem and then one day a final crushing blow comes along that takes away the last shred of hope that you were holding on to? That is precisely what has happened to farmers like Bob Kuylen of North Dakota…

“It’s really, really getting bad out here,” said Bob Kuylen, who’s farmed for 35 years in North Dakota.

“Trump is ruining our markets. No one is buying our product no more, and we have no markets no more.”

We keep hearing about “government bailouts”, but they aren’t going to be nearly big enough for most farmers. Kuylen has worked as hard as he possibly could, but he was not able to overcome the challenges he was facing, and now he is facing financial disaster. He would walk away, but he says he can’t because “I’ve invested everything I have in farming”…

Kuylen, who farms roughly 1,500 acres of wheat and sunflowers, lost $70 per acre this year, despite growing good crops. Current government subsidies only cover about $15 per acre, he said.

“There’s no incentive to keep farming, except that I’ve invested everything I have in farming, and it’s hard to walk away,” he said.

It would be nice to think that all of these farmers will somehow bounce back next year, but that isn’t likely. It is very doubtful that there will be any sort of a trade agreement with China before the 2020 presidential election, and global weather patterns are not going to be getting any more stable. Sadly, it is entirely possible that next year could be even tougher for U.S. farmers than this year was.

So please say a prayer for our farmers. They grow the food that we all eat on a daily basis, and their hard work is rarely recognized on a national basis. They are unsung heroes, and right now most of them are really, really hurting.

It's odd how that works isn't it?

There are 100 cookies. A very small portion of our society controls 98 of those cookies. Yet they somehow manage to convince the vast majority the problem is the other people who only have one of the cookies.

The name 'entitlements' being used to describe benefits people worked for, earned and paid into...smdh

That's the next GOPer target, crash or no crash.

China has been in a trade war with the world since the Ming dynasty. This is child’s play for them. They got this game won before it started.