Chinese Economics Thread

[Wangxi]

China's real nuclear option is to restrict the sale of rare earths to certain US companies

 

[Gatekeeper]

The sanctions on Huawei including sanctions on staff working for Huawei! So much for freedom!

 

[s002wjh]

Hi s002wjh

That's it objective, Navarro is the one framing the policy, since most US corporation hate him and will not abandon the huge Chinese Market, It will be China disadvantage if they retaliate with a ban, they are China allies and also bring in needed technology like what Tesla had done with its factory.

thats true, US company want to access china market, and indeed willing to cozy up with china. which is more reason china shouldn't ban the like of apple etc. if china ban apple, it basically push US company into trump camp, and trump want decouple with china.

 

[ansy1968]

The sanctions on Huawei including sanctions on staff working for Huawei! So much for freedom!

hi Gatekeeper

they are getting desperate, the target is Germany, remember that the German proceed with the NORD STREAM project with Russia even with the threat of sanction, hopefully they will do the same with Huawei. If Germany withstand the threat other European nation will follow.

 

[Gatekeeper]

Its all about winning the election, whoever win, things will go back to normal cause they need China for their economic salvation.

from beijingwalker (PAKISTAN DEFENSE FORUM)

‘US election shaping up as contest between which candidate hates China more’
July. 17 2020
Tokyo [Japan], July 18 (ANI): As relations between Washington and Beijing worsen over a range of issues, the upcoming US election is shaping up as a contest between which candidate hates China more, suggests William Pesek.

The relations between US and China have been on a downward spiral over issues ranging from coronavirus pandemic to Hong Kong to human rights abuses in Xinjiang.

In an article in Nikkei Asian Review, Pesek said: “The U.S. election is shaping up as a contest between which candidate hates China more: President Donald Trump or former Vice President Joe Biden?”

For now, Pesek noted, the advantage is Trump’s, who on Tuesday ended Hong Kong’s special status with the U.S., which allowed the city direct access to key U.S. sectors like technology and defense. “He also signed legislation requiring sanctions against Chinese officials involved in Beijing’s crackdown in the former British colony and the banks they deal with.”

US President Donald Trump had on Tuesday signed a legislation and executive order authorising sanctions against China for its oppressive actions against the people of Hong Kong.

“Today, I signed legislation and an Executive Order to old China accountable for its oppressive actions against the people of Hong Kong,” Trump had said.

China’s move to impose national security law in Hong Kong has drawn fierce criticism, with many saying it is aimed at crushing dissent in the erstwhile British colony which saw massive pro-democracy protests last year.

“Trump’s actions demonstrate the extent to which November 3 will be a race to the bottom to see who can be harsher toward China. Your move, Joe,” the article read.

Pesek said the Central question for this election should be who has the best plan to keep the U.S. on top of the great power struggle. Americans trying to decide might consider why China’s President Xi Jinping seems to fear Biden more than another four years of Trump, he stated.

While noting that the ruling Chinese Communist Party (CCP) “loathes the trade war, the Twitter tantrums and Trump’s racist remarks about the coronavirus’ origins”, Pesek said the “more Trump damages America’s global standing, the closer China is to realizing its hegemonic aspirations.”

“In sharp contrast, a Biden presidency promises a return to the Democratic Party’s traditional approach toward Beijing. That means using a multilateral approach that puts human rights, environmental concerns and government censorship at the front end of trade talks, not as retaliatory cudgels to bash China,” he said.

China has been trying to bully its smaller neighbours with its muscle power. Its territorial claims have aggravated tensions in the region.

Pesek, however, also cautioned that Biden must not overplay his hand. “He is not an economic guru. Foreign policy is his comfort zone and he will need some semblance of a relationship for his approach to work,” he said.

He stated that Biden, who has earlier served as Vice-President, would reengage the world, would keep US in WHO, reenter Paris Climate Accord and the Iran Nuclear Deal.

“He would reach out to the remaining 11 TPP nations to revive a deal China hoped would stay dead. Odds are, Biden would lobby Bangkok, Jakarta, Manila, New Delhi, Seoul and others to join the pact,” he said.

Earlier this month, Donald Trump administration, which has been critical of UN health body over its handling of the coronavirus pandemic has formally withdrawn US from the WHO.
Yet, Pesek said, Biden risks repeating Trump’s mistake of losing sight of the bigger picture when it comes to dealing with an “ascendant” China.

“Trump’s efforts to color his opponent as soft on China clearly pushed the Biden campaign’s efforts to out China-bash Trump,” he said, while adding that China “deserves” it too.

Referring to Xi’s “chilling clampdown” in Hong Kong, exploits in South China Sea, appalling treatment of Uighur Muslim minority in Xinjiang and clampdown on media, Pesek said these actions have won Beijing little goodwill.

“A Group of Seven nation like the U.S. should help to ensure the world’s second-biggest economy plays by the rules,” said Pesek.

He also warned that taking on China alone will not build American economic muscle nor will it suddenly restore the manufacturing sector to its 1980s heyday or end the struggle to compete with Asia’s low wages. “It will not magically improve crumbling infrastructure nor reduce inequality or improve the education system,” he said.

“So will building a more equitable and collaborative trade relationship with China. Trump’s approach has been starting economic food fights. A President Biden will have to work with Xi, not just hurl platitudes,” added Pesek. (ANI)

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I beg to differ. The elections does plays up the rhetoric. But it goes beyond that. Both parties in the USA have the same foreign policy. As can be seen from Obama's pivots to Asia. Clinton's twin carriers down Taiwan strait. Bombing of Chinese embassy. Stop and search of Chinese flagged ship. Shall I go on?

The USA have one thing in mind with regards to foreign policy towards China. And that's to stop China overtaking USA in anything so China gain an edge. Its afraid that China will be the next world police, and might do to USA what USA has done to China in the past.

So these talks of USA is behaving this way is due to election is nonsense.

 

[Gatekeeper]

@s002wjh @ansy1968 @BMEWS The problem I hear is that the US bans will force Tiktok and Wechat to be removed from Google and Apple app stores of all countries.

So it’s like a Huawei sanction.


US is sayin: China shall not own businesses that compete with US businesses on the world stage.

China can stay “Open” but US will sanction those open businesses globally.



The correct response would be to spend the US reserves and treasuries and stop trying to placate the US. Chinese will have no need for the dollar if its dollar transactions and holdings get invalidated. This will happen naturally as Chinese realize the dollar is less and less useful to them. Chinese will soon be prevented from buying assets in the US and will be forced to hold inflationary dollars. Thus forgoing the Dollar should be accelerated.

Yes, that'll be great. But it is not as simple as that. Most of the reserve is not actually in money. It is holding in treasury bills. Which needs to be sold back to the market place. And a sudden sell off of treasury bills will reduced the value China get for those bills. It doesn't affect USA per we, as the bills are in private hands. Someone else will buy it up at a cheaper price. It will however, affects USA's new treasury bill price. But it'll just issue more to cover the short fall in pricing. (Because it is being paid for in the future).

And when China gets the actual dollars from the sell off, what is China going to do with It? It can't bring back home to use. It can buy oil, etc. In the international market. But it is limited. If it sells it and buys yuan in order to bring it home. It will loose more value as dollar would decrease and the yuan increased. Think what happened when you go holiday abroad and the currency move against you. Well this is going to be magnify many times.

The only course is to do it stealthily little bit at a time. But the USA authority is watching China closely all the time. China is caught at the moment with the foreign holdings.

@ansy1968

they are getting desperate, the target is Germany, remember that the German proceed with the NORD STREAM project with Russia even with the threat of sanction, hopefully they will do the same with Huawei. If Germany withstand the threat other European nation will follow.

Yes, definately. The USA is after Germany to change like UK did. This will change the calculus as the rest of Europe is sure to follow. Lucky for China, Germany has a lot more to loose than the UK. As China is their largest market, both exports and German companies selling within China.

I'm hoping that is enough to halt this Huawei madness. It s now being openly admitting that it was never about security. Because if it is, 3G and 4G would need to be stripped out.

One country I find disappointing, it is Poland, I don't know what USA has offer them, but they are an enthusiastic cheer leader for baning Huawei. Like Australia, China shouldn't forget that!

 

[localizer]

Yes, that'll be great. But it is not as simple as that. Most of the reserve is not actually in money. It is holding in treasury bills. Which needs to be sold back to the market place. And a sudden sell off of treasury bills will reduced the value China get for those bills. It doesn't affect USA per we, as the bills are in private hands. Someone else will buy it up at a cheaper price. It will however, affects USA's new treasury bill price. But it'll just issue more to cover the short fall in pricing. (Because it is being paid for in the future).

And when China gets the actual dollars from the sell off, what is China going to do with It? It can't bring back home to use. It can buy oil, etc. In the international market. But it is limited. If it sells it and buys yuan in order to bring it home. It will loose more value as dollar would decrease and the yuan increased. Think what happened when you go holiday abroad and the currency move against you. Well this is going to be magnify many times.

The only course is to do it stealthily little bit at a time. But the USA authority is watching China closely all the time. China is caught at the moment with the foreign holdings.

It will have to be done I think.

Dollar assets are becoming more of a liability than a store of value.

Look at all the movement into the stock market as savings rates go to 0. Gold is going to record soon.

Everything on Amazon feels more expensive.

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Better to buy stuff (Food, resources, companies, infrastructure...) than let dollars sit there and evaporate.

 

[Gatekeeper]

It will have to be done I think.

Dollar assets are becoming more of a liability than a store of value.

Look at all the movement into the stock market as savings rates go to 0. Gold is going to record soon.

Everything on Amazon feels more expensive.

Please, Log in or Register to view URLs content!

Better to buy stuff (Food, resources, companies, infrastructure...) than let dollars sit there and evaporate.

Yes, it would. But we should do it stealthily, so as not to loose too much. Just think about it. I think on top if my head, China own USA Financial instruments to the tune of say, US$4 trillion. If we loose just 25% of value (easily possible due to pricing of sell off and currency appreciation. Plus transactions cost). That's US $1 trillion gone down the drain. (Just think how long it'll take to earn that. That's all profit, not selling price! ie: not turover)

 

[ansy1968]

I beg to differ. The elections does plays up the rhetoric. But it goes beyond that. Both parties in the USA have the same foreign policy. As can be seen from Obama's pivots to Asia. Clinton's twin carriers down Taiwan strait. Bombing of Chinese embassy. Stop and search of Chinese flagged ship. Shall I go on?

The USA have one thing in mind with regards to foreign policy towards China. And that's to stop China overtaking USA in anything so China gain an edge. Its afraid that China will be the next world police, and might do to USA what USA has done to China in the past.

So these talks of USA is behaving this way is due to election is nonsense.

hi Gatekeeper

Yes the Anti China crowd has Bi-partisan support, and yes I agreed with you about the arrogance of the US policy. But right now China need to bide its time to achieve its COMPREHENSIVE NATIONAL POWER. The US power as of now is supreme, but this pandemic and also of TRUMP is a turning point for a major decline. The sign of US imperial overreach is evident that it cant influence its Allies, instead must resort to using threat to advance its policy. that is why China must not use sanction indiscriminately, both Republican and Democrat are under the influence of US corporation and wall street , they are China only allied left and need to be nurture.

 

[localizer]

Yes, it would. But we should do it stealthily, so as not to loose too much. Just think about it. I think on top if my head, China own USA Financial instruments to the tune of say, US$4 trillion. If we loose just 25% of value (easily possible due to pricing of sell off and currency appreciation. Plus transactions cost). That's US $1 trillion gone down the drain. (Just think how long it'll take to earn that. That's all profit, not selling price! ie: not turover)

Currently the Fed says they’re willing to buy all treasuries.


I just hope CCP doesn’t go retarded and burn fruits of decades of Chinese blood and sweat labor.