China needs to triple its shipbuilding industry. For domestic market, it needs to make all its semiconductors, and aircraft engines. For export markets, it needs to create Chinese luxury brands in cosmetics and fashion.
Chinese Economics Thread
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Nominal GDP is ridiculously stupid. It treats the entire GDP as being a part of the international exchange market which is completely brain dead. The international exchange value of your next haircut is completely meaningless. Further, the US economy will probably grow faster than China's this year solely because US inflation is 6% whereas China's CPI is only 1.3%. If a country's currency exchange rate drops overnight by 10% the economy "shrinks" by 10% even if it literally produced all the exact same things as it did yesterday.
I wish journalists would stop using nominal GDP and just admit that China is already the world's largest economy and everyone else would stop obsessing over nominal GDP too. But I guess that won't happen.
I wish journalists would stop using nominal GDP and just admit that China is already the world's largest economy and everyone else would stop obsessing over nominal GDP too. But I guess that won't happen.
A large part of why journalists and economists use nominal GDP is because it makes the US look good, and the people who pay the salary of journalists and economists want the US to keep looking good.
Alternate ways of looking at the health of an economy are only supported if it makes the US look good. I know this from first-hand experience. Seriously. I've personally seen research on potential economic indicators shut down because the initial results were going to suggest the US was not as dominant and the US economy was not as healthy as commonly believed.
Because a pretty big part of capitalism is actually dependent on confidence. Literally, the choice of where to put capital (the entire thing the system's named after) is based on how healthy you seem, and you always want capital to come your way. Hence... the lies.
Don't worry, when China over takes the US in nominal GDP too the journalists will switch to per capita GDP, and when China is ahead in that they will probably pick so other stats to make US first.
Common, we all know how this works by now. Remember Bloomberg's "Covid Resilience Ranking" where US was ranked number 1?
CNBC article about how the US will press china to enforce the phase one deal:
Lets what happens in the future ahead. IMO, i dont think that the US will move to add more tariffs to chinese products in the near term, given the fragility of the world economy, weak supply chains, and even scenarios of stagflation. But it is something that people should keep in mind going forward. The US will not acept the status quo indefinitely, no matter who is in the white house.
Lets what happens in the future ahead. IMO, i dont think that the US will move to add more tariffs to chinese products in the near term, given the fragility of the world economy, weak supply chains, and even scenarios of stagflation. But it is something that people should keep in mind going forward. The US will not acept the status quo indefinitely, no matter who is in the white house.
Well the US is in a bad position when it comes to the trade war. The trade deficit is not from foreign trade partners stiffing the Americans but rather from America's own domestic policies. It comes from policies that encourages speculation and consumption over production, savings and investments. And since the coronavirus the US has only doubled down on these policies and the trade deficit has gotten worse. The trade deficit with China is growing despite the 25% tariffs on hundreds of billions of dollars of Chinese goods still in place. And the trade deficit with the rest of the world is growing even faster. The trade war hasn't brought back production to America as expected. America is trapped.
And stagflation in the US is no longer a scenario but a fact.
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@Franklin So bro this threat enforcement is a bluff? If the Chinese said no what will they do add additional tariff? the way I see it as they broadcast it publicly means its part of Mengs release deal and China will buy additional, meat, coal ( see how China initiated the problem as a justification) planes (not the 737 but the 787) and other agricultural product and maybe iron ore (sorry Aussie). Its a dog and pony show, this deal had been made a few weeks ago when Kerry visited China.
The US was wounded by Trade War 1, then with covid it is now heavily bleeding.
If it even dares to do something that causes Trade War 2 with China, then US will get seriously seriously damaged or get knocked out economically.
Thats the current state of the US economy, which is why you see Biden and his team only talking tough about China and not daring to do anything
America is no longer a nation that is thinking rationally. This is especially true when it comes to China. So it could be that they will restart the trade war over this.
But that is only going to worsen the plight of the Americans and the rest of the world.
I believe they are looking put tariff on something like 250 billion dollars a year of import? Say they apply something like 40% tariff, that's what, 150 billion in tariff revenue to the government a year.
Yeah, it's kind of a lot, but then again how much money has Biden printed this year so far? Something like 4 trillion dollars? See the difference in magnitude of the problem here.