It means the market expected a far larger currency devaluation than is actually taking place. Which I agree with; keeping the yuan stable is much more important than trying to boost exports right now.
Chinese Economics Thread
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It means the market expected a far larger currency devaluation than is actually taking place. Which I agree with; keeping the yuan stable is much more important than trying to boost exports right now.
Not just for China, for everyone.
An incredibly stupid position to take, of course, but it also means all the grovelling from Vietnam or Taiwan or wherever is pointless. There's no way the US can run a goods surplus with every other country in the world (amusingly, he completely ignored the US services surplus), and trying is just going to cause huge amounts of pain.
The strong will do what they will, and the weak will suffer what they must.
The vassals and the sycophants will lead the mercy begging because they have no choice; and in doing so, show their people just how pathetic they really are.
This is a once in a century opportunity to reset the hierarchy of nations. The strong will be separated from the weak by their responses to the US's blatant bullying. Pay attention - history is watching.
The vassals and the sycophants will lead the mercy begging because they have no choice; and in doing so, show their people just how pathetic they really are.
This is a once in a century opportunity to reset the hierarchy of nations. The strong will be separated from the weak by their responses to the US's blatant bullying. Pay attention - history is watching.
Hang Seng Index dropped a lot today. 14 points, last I heard.
To add extra context, America's 340 million population makes this impossible even if the everything else is equal. This is what makes Trump's obsession with trade deficit dumb. Ignoring the fact that most countries are a lot poorer than america, the population difference alone makes it impossible to have to have a trade surplus with America. It's like asking like a 20 kg child to eat as much food as a 200 kg adult.
Let's see, if Trump really is playing 4d chess, he will extract whatever concessions he can get and remove tariffs afterwards. If he's really obsessed with the trade deficit, there's no way any country can meaningfully reserve within the next 4 years even if they really really commit to buying everything american, so the tariffs stays on no matter what.
Ohh yeah the trade deficit will shrink but not because US is making more stuff but because purchasing power of people in the US will suffer a big collapse.
The US make 15% of China exports, smaller than Japan, Vietnam and Europe. The share to US is smaller than I thought.
Also the US has a hefty trade surplus in services to China.
Also the US has a hefty trade surplus in services to China.