Trade War with China

gelgoog said:

It might not be currency. If the treasuries are ending up in the hands of the Saudis then they might just be swapping treasuries for oil. As for the Saudis they use USD for their weapon purchases and oil rig equipment so holding dollars or dollar equivalents makes sense for them I guess.

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Finally same analysable idea : )

So let see.
Saudi makes 10 million barrel / day, current price is 80$/barrel.
China treasury stock is around 1700 billion $.

To be able to stock other users has to stop to use oil, so say China has to pay premium, say 20$/barrel.
It means it takes 1700 days to convert the treasury to oil, and during the process China immediately loose 20% of the treasury value during conversion.
Afterwards, there is cost of transport /storage, that means China has to make a lot of storage capacity.

By quick google, the annual storage cost of oil is 4$/barrel, means at the end of "treasury transform" China paid already 25% of the price of oil for the first barrel purchased for storage.
So, it is safe to say during the transaction China will loose around 30% of the value its treasuries, and afterwards in 15 years time the whole transaction value will be negative. Or way earlier.

manqiangrexue said:

There is no "if"; it is a fact that Chinese people are consuming more beef and less pork than before even if consumption of beef is still far less than pork. You are making another bad mistake by guessing at China's meat consumption by looking at soy. Firstly, soy is used for much more than animal feed; if reduced usage i.....

.... the shipping requirement.
3. China's high speed rails have left many older trains that take 16 hours to go from Shanghai to Nanjing without passengers so they have become cargo trains. Although trucks still have to load and unload them from their origin and destination, that means these trucks are driving 15 miles instead of 500 miles. That increased their longevity significantly.

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So , you say that the consumers give up say 2 calories of pork for 1 calories of beef?
Because the soybean usage showing that.

And same for car, three car sold for three person in the past, but now two car sold for three person?

Are you aware of that it doesn't make sense ?

If I living better then I replace the calories consumed with more expensive ones.
More pensive means more primary ( animal feed) food source required.

Same for cars, if I live better then I have same / more amount of cars, and as average more expensive ones.

If my family replace our two cars for a single one that cost 50% more than the previous one then we have less money for cars than before.

Anlsvrthng said:

So , you say that the consumers give up say 2 calories of pork for 1 calories of beef?
Because the soybean usage showing that.

And same for car, three car sold for three person in the past, but now two car sold for three person?

Are you aware of that it doesn't make sense ?

If I living better then I replace the calories consumed with more expensive ones.
More pensive means more primary ( animal feed) food source required.

Same for cars, if I live better then I have same / more amount of cars, and as average more expensive ones.

If my family replace our two cars for a single one that cost 50% more than the previous one then we have less money for cars than before.

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LOL Yes, that's exactly what I'm saying. Calories of pork are replaced with calories of beef, seafood, etc.... Poor people tend to calculate calories for money, like $1 mac n' cheese. Richer people eat more expensive food items that give less calories. If you are saying that Chinese people are suffering with decreasing calories overall, you need to cite a source.

Also, I need a source from you said said 2 calories of pork for 1 calorie of beef. It makes it sound like intake is down 50%. I need to see your source.

Also, living better doesn't mean more "amount" of cars. A family of 3 needs 3 cars at most; they don't need more and more small cheap cars. They need just 3 expensive EV cars at most. 3 cars for 2 is a 50% drop. 2 EV cars for 3 regular ones is pretty much the same in value; to get 3 EV cars over 3 regular cars is a 50% increase in buying power. Your claim of a 50% drop is not supported by evidence.

manqiangrexue said:

LOL Yes, that's exactly what I'm saying. Calories of pork are replaced with calories of beef, seafood, etc.... Poor people tend to calculate calories for money, like $1 mac n' cheese. Richer people eat more expensive food items that give less calories. If you are saying that Chinese people are suffering with decreasing calories overall, you need to cite a source.

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: D

Average adult needs 2500 calories per day. If a person doing exercise, then he needs more calories. Example, if a person spend few hours with personal trainer in the gym then he will needs 4000 calories for that day.
The cheapest way to satisfy this calorie requirement is by eating grains, like rice. 1 calories of grain 1 calories of human energy.
If a person eats say beef then he will needs ten calories worth of grain as animal feed to get one calorie of meat. 10 calories of pork/beef feed will translate to 1 human consumed calorie.
So, as a person get more rich he will have more free time , many cases with increased energy expenditure , and more expensive (in the term of calorie demand as prime grains)

So, if a country get richer ( not small part of it, but everyone) then the grain/animal feed requirement grow ( like soybean )

manqiangrexue said:

Also, I need a source from you said said 2 calories of pork for 1 calorie of beef. It makes it sound like intake is down 50%. I need to see your source.

Click to expand...

You saying this. Decrease of animal feed demand, with change of meat preference from cheaper to more expensive ( in calories required by animals) means the Chinese eat less meat in sum, and more primary grain.

manqiangrexue said:

Also, living better doesn't mean more "amount" of cars. A family of 3 needs 3 cars at most; they don't need more and more small cheap cars. They need just 3 expensive EV cars at most. 3 cars for 2 is a 50% drop. 2 EV cars for 3 regular ones is pretty much the same in value; to get 3 EV cars over 3 regular cars is a 50% increase in buying power. Your claim of a 50% drop is not supported by evidence.

Click to expand...

The sum of sold cars decreased, it can not be explained by preference shift.

now I read in Facebook

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"View China's role in the world fairly

(By Zhong Xuanli)

What has China's development brought to the world? It's not a difficult question, but the United States has recently answered it in an absurd way. Some American observers think that what has come with a rising China are economic aggression, geopolitical expansion and damaged international rules. This is now taken as the official line of the US government. US President Donald Trump said on Sept 17 that Chinese practices "plainly constitute a grave threat to the long-term health and prosperity of the United States economy". On Oct 4, Vice-President Mike Pence attributed China's economic success largely to "American investment in China", saying the US rebuilt China over the last 25 years. But that is not true.

Driver of global growth, not economic aggressor

In his speech, Pence accused China of carrying out "economic aggression", saying China has used "an arsenal of policies inconsistent with free and fair trade" that "have built Beijing's manufacturing base, at the expense of its competitors－especially the United States of America". He alleged that these actions of China have contributed to the huge trade deficit with the US and urged China to change the "unfair" practices.

But trade is a two-way activity based on mutual agreement. China has never sought to buy from or sell to the US by force, neither has it eyed a trade surplus only. According to the UN statistics, the US exported $129.89 billion worth of goods to China in 2017, an increase of 577 percent compared with 2001, much higher than the 112 percent rise in US global exports over the same period. This happened against the backdrop of tight US restrictions on the types of goods exported to China, especially on high-tech products.

In that sense, a slight easing of the restrictions would reduce the US trade deficit significantly. According to a study by the Carnegie Endowment for International Peace in April 2017, if the US were to liberalize its export barriers against China to the same level as those applicable to Brazil, the US-China trade deficit would be narrowed by up to 24 percent.

Similarly, should the US adjust its export barriers against China according to those applicable to France, its trade deficit with China would decrease by as much as 34 percent. Obviously the US has witnessed such a high trade deficit because it doesn't want to sell products to China, not the other way around.
The service trade between China and the US also needs to be counted in. US statistics show that from 2007 to 2017, US service exports to China grew by 3.4 times from $13.14 billion to $57.63 billion, while its service exports to other countries and regions increased by 1.8 times. The US surplus with China in services multiplied by a factor of $30 billion to $40.2 billion.

The gains and losses of China-US trade, being part of economic globalization, should be calculated from a global perspective. Over the past decades the US has moved its manufacturing industry such as processing and assembly to other parts of the world while keeping services such as design and marketing. China, being the largest receiver of international industrial relocation, has a large part of its exported goods actually produced by multinational companies from countries such as the US. In the value chain, multinational companies take the majority of profits while Chinese ones only take a tiny share for their processing payment.

With dynamic development, China has become an important engine for international economic growth. China's contribution to world economic growth has stayed around 30 percent since 2013, topping other countries, and reached 34.6 percent in 2017, twice that of the US.

China's development has also created a larger market for the world. From 2001 to 2017, China's imports of goods grew at an average rate of 13.5 percent, twice that of the world's average. In the same period China's service imports rose by 16.7 percent on average, 2.7 times that of the international average. From 2011 to 2017, the share of China's total imports of goods and services in the world's total increased from 8.4 percent to 10.1 percent, while that of the US dropped by 0.5 percentage point in the same period.

China is also an important creator of jobs worldwide. So far it has set up more than 80 overseas economic and trade cooperation zones in countries along the Belt and Road routes, creating about 244,000 local jobs. And, according to Ernst& Young, China created over 130,000 jobs in Africa from 2005 to 2016, more than three times the number of jobs created by the US. And a study by the International Labour Organization released in 2017 found that between 1990 and 2016, at least 1.8 million jobs were created as a result of China's trade, investment and infrastructure projects in Latin America and the Caribbean.

Some Americans allege that China has stolen American jobs because some American factories were relocated to China. Yet this allegation doesn't hold water. A report by the US-China Business Council released in early 2017 said the bilateral trade relationship actually supported roughly 2.6 million jobs in the US. And the US has lost more than 7 million factory jobs since manufacturing employment peaked in 1979, with 88 percent of the lost jobs taken by robots and other homegrown factors that reduce factories' need for human labor, according to a 2015 study by Ball State University's Center for Business and Economic Research. Where to set up factories is decided by US companies on profit-driven consideration, not by China.

It's fair to say that China has not been an aggressor in its development, but a contributor to the world and a strong supporter of the UN Millennium Development Goals and 2030 Agenda for Sustainable Development. It has demonstrated a new path toward modernization for developing countries that are home to more than 80 percent of global population, and provided an option never seen before for countries that want both development and independence. Raphael Tuju, secretary-general of the ruling Jubilee Party of Kenya, said that China's achievement has no precedent in the history of mankind and gives African people "a flicker of hope and light at the end of the tunnel".

China's development achievement is not driven by American investment, but the diligence and hard work of 1.3 billion Chinese people. Even in terms of investment, the US is not the largest investor in China. Since the 1980s, US investment has accounted for just 7-10 percent of foreign investment in China, while it has in return earned handsome profits.

Builder of world peace that does not seek geopolitical expansion

The US has accused China of conducting "debt diplomacy" to expand its influence, and Pence specifically referred to Sri Lanka. However, Karunasena Kodituwakku, Sri Lanka's ambassador to China, said in early October that "If anybody is saying that the Chinese government gave its money to put Sri Lanka into a 'debt trap', I don't agree with that. It's an absolutely wrong conclusion". The ambassador clarified that the security of Hambantota Port is entirely a matter for Sri Lankan security forces. Unfortunately in the US' geopolitical mindset, a country is an ally or a rival, there is no other option.

Instabilities and uncertainties are currently the main threats to world peace. To tell threats from efforts to promote world peace, we need to tell behavior that creates conflicts from safeguarding stability. The Belt and Road Initiative accused by the US of being a scheme with "geopolitical intent" has attracted 103 countries and international organizations to sign 118 cooperation agreements under the Belt and Road framework with China. The initiative, together with its core concepts, has been incorporated into outcome documents of important international mechanisms such as the United Nations, G20, Asia-Pacific Economic Cooperation, and Shanghai Cooperation Organization. It is in fact a "chorus" beyond zero-sum mentality in the spirit of "peaceful cooperation, openness and inclusiveness, mutual learning, mutual benefit and win-win results", fundamentally different from the concept of geopolitical expansion.


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the rest of
from the post of right above:

"China is committed to safeguarding peace and security and promoting global peace and stability through its own development and prosperity. China is the UN Security Council permanent member that dispatches the most peace-keeping troops, and it advocates and is committed to the Five Principles of Peaceful Co-existence. Till the first half of 2017, China had dispatched 35,000 peace-keeping military personnel who participated in 24 UN peace-keeping missions, and it has been praised as a "key factor and key force of peace-keeping" by the international community. China has never waged a war for the sake of oil or resources, nor has it used languages such as "evil" "loser" or "shithole" that are of no use except for triggering conflicts to attack other countries.

Domestically speaking, China is among the main economies with the best public security. According to a survey by Gallop's 2018 Global Law and Order Report, China ranks among the top 10 safe tourist destinations globally, and among them it is the only main economy. The US, however, suffers from a woeful domestic security situation. Statistics show that from 2014 to 2017, deaths and injuries from gun crimes in the country have risen annually by 5 percent. In 2017 alone, the number reached 61,813, of which 15,637 people have died. On average, 170 people were killed or injured as a result of gun crimes every day in the US.

As the self-appointed global sheriff, the US should have seen peace-keeping as its greatest responsibility, but it has all along been waging wars in the name of "safeguarding world peace". Since World War II, the US has started or participated in more than 30 wars. Its bellicosity has brought disasters for the world and even for its own people.

The Iraq War launched by the US caused the deaths of 655,000 Iraqi people and 2,765 American soldiers from 2003 to 2012, leaving over 20,000 American soldiers injured or maimed. The US has meddled in the chaos in Syria, displacing large numbers of people. Till August 2018, there have been 5.6 million Syrian refugees registered by the United Nations High Commissioner for Refugees. The crisis has created profound implications for the whole world. The Afghanistan War started by the US in 2001 has caused over 300,000 deaths and injuries, and is still a "bleeding wound" today.

New factors including economic security have become vital parts of global peace. Lower trade barriers work to enhance cooperation and foster economic stability. An increasingly open China has never initiated trade conflicts and has fully fulfilled its promises upon joining the World Trade Organization. China has also increased assistance to developing WTO members, especially the least developed countries, to close the development gap between the South and the North. By March 2018, it had implemented zero-tariff policies on 97 percent tax items from 36 least developed countries with diplomatic relations with China. This year, China has again declared that it will expand openness and widen market access, while speeding up all-sector openness in services, the finance industry in particular.

On the other side of the world, however, the US in the name of "reciprocal openness" abuses "national security" and set up the Committee on Foreign Investment in the United States that includes members from several government departments such as intelligence organs, constantly expanding its coverage and making "national security" a tool to block foreign companies trying to enter its market.

In 2017 alone, CFIUS blocked more than 20 foreign companies from entering the US market in the name of "national security", over half of which were Chinese companies. Both the US and China are WTO members, so economic and trade issues between them should be resolved within the WTO framework. But the US has arbitrarily dealt with trade frictions with China according to its domestic laws despite the WTO's dispute settlement mechanism. This deviates from the basic principles of the WTO and runs against its obligations for tariff concession and most-favored-nation treatment. The US president even threatened China by saying, "if China takes vindictive actions against our farmers or other industries, we will immediately take a third step: imposing customs on an extra $267 billion of imports from China". This is exactly the modern example of the saying "one may steal a horse while another may not look over the hedge".

China safeguards rather than breaks the international order

The US often accuses China of "not obeying international rules" and slanders China's role in the international community, calling it a revisionist state. Many things China does are labeled actions that "break international rules."

The fact is, however, China has directly participated in building the post-World War II global order as a founding member of the UN. China's representative Dong Biwu was the first to sign the UN Charter. Since it took its lawful seat in the UN and all its affiliated organizations in 1971, China has continually joined international organizations. Currently, China has joined more than 400 multilateral agreements, all UN organizations and about 90 percent of inter-governmental ones, fully involved in the current global order.

According to the Yearbook of International Organizations 2017-18, China's participation rate in international organizations, the fastest growing among the main economies, is rapidly nearing those of France and Germany. Many studies have concluded that China has been fully integrated into the international system and it stands as a steadfast upholder of and contributor to the global order.

More and more countries expect China to play a greater role in global governance. In recent years, China has proposed the Belt and Road Initiative in the spirit of achieving shared growth through consultation and collaboration and started the Asia Infrastructure Investment Bank, which is conducive to the current global order.

China has also hosted major events such as the APEC Economic Leaders' Meeting, G20 Hangzhou Summit, first Belt and Road Forum for International Cooperation, and the ninth BRICS Summit. It has reiterated the concept of deepening reform and expanding opening-up and welcomed other countries to take a ride on China's development. It has been well received by the international community. China's circle of friends keeps expanding.

The US as the leader in global order after WWII, on contrary, now keeps breaking the global order by "exiting", threatening to exit, or even "disbanding organizations". For example, it has withdrawn from Paris Agreement against climate change, United Nations Human Rights Council, UNESCO, Global Compact on Migration, and the Iran nuclear deal. The G7 led by the US used to play an important role in global governance. Nowadays, however, internal rifts have become its focus. Besides, the US intends to reshore industries such as automobile manufacturing, and iron and steel that enjoy a well-established global order, sending shocks through the EU and Japan. It is China that is safeguarding the global order, and the US is the spoiler.

Unilateralism and a zero-sum mentality have no future. However the world may change, China will stay steadfastly with the international community and remain devoted to building a new type of international relations, a community with a shared future for mankind and make greater contributions to the progress of mankind."

Anlsvrthng said:

: D

Average adult needs 2500 calories per day. If a person doing exercise, then he needs more calories. Example, if a person spend few hours with personal trainer in the gym then he will needs 4000 calories for that day.
The cheapest way to satisfy this calorie requirement is by eating grains, like rice. 1 calories of grain 1 calories of human energy.
If a person eats say beef then he will needs ten calories worth of grain as animal feed to get one calorie of meat. 10 calories of pork/beef feed will translate to 1 human consumed calorie.
So, as a person get more rich he will have more free time , many cases with increased energy expenditure , and more expensive (in the term of calorie demand as prime grains)

So, if a country get richer ( not small part of it, but everyone) then the grain/animal feed requirement grow ( like soybean )

Click to expand...

Everything was fine until the very last part of your last sentence. I've already said this before; animal feed does not have to grow with increased beef consumption because it's called directly importing beef. That is growing in China, as a fact. Also, a shift to more expensive seafood and away from cheaper meats will decrease animal feed; it will increase fishing and importing seafood. More advanced countries tend to import more food and shift their own resources to more enviable endeavors like research and high tech manufacturing.

Anlsvrthng said:

You saying this. Decrease of animal feed demand, with change of meat preference from cheaper to more expensive ( in calories required by animals) means the Chinese eat less meat in sum, and more primary grain.

Click to expand...

I see you are having a huge amount of trouble understanding that Chinese people eat other things than domestic meats (specifically pork in your case) and grains. China's beef and seafood imports are growing every year. This contradicts your guess that Chinese people are turning away from pork because it is too expensive. If I eat less pork and more steak/lobster, would you think I am having financial problems with affording the pork or probably that I've got more money? LOL Also, here is an article that details China's rising consumption of meats in total so basically, you supposed wrong, again.

Here is another graph to summarize it:

This whole thing is completely ridiculous that you look at just pork because it is the only thing declining in China and try to avoid looking at the rise of all the more luxurious food items to imagine China's economic "problem".

I have to also show you a second article, which details that the CCP is trying to cut Chinese meat consumption dramatically because high meat diets are not healthy and also, as you stated, it is more expensive, both economically and environmentally to eat so much meat. If the diet can be more vegetarian, resources in farming and meat import money can be freed up for other areas. So although we see China's rising meat consumption now, if it falls, it may well have to do with this government initiative, and the CCP would consider that a very good thing.

Anlsvrthng said:

The sum of sold cars decreased, it can not be explained by preference shift.

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First of all, I've already explained the decline in cargo truck sales.

The world right now is shifting from conventional vehicles to EV and/or hybrid energy vehicles. It is still a relatively new concept and these cars are improving rapidly compared to conventionally-fueled vehicles, which are very mature technology. What happens right before the new iphone or Samsung or Huawei comes out? Sales of the current models drop off in anticipation for improvement. This drop in sales can in no way be interpreted as under-performance or economic disaster for the company.

Car sales are basically declining in every major economy around the world now. I believe another factor is that with the maturation of traditionally-fueled vehicle technology, the cars of today are lasting longer than the cars of the past and that is causing the replacement rate to drop.

The average cost of electric vehicles is indeed expected to be overall higher than an existing ICE equivalent, so that is going to factor in purchase numbers over the immediate and long term.

manqiangrexue said:

Everything was fine until the very last part of your last sentence. I've already said this before; animal feed does not have to grow with increased beef consumption because it's called directly importing beef. That is growing in China, as a fact. Also, a shift to more expensive seafood and away from cheaper meats will decrease animal feed; it will increase fishing and importing seafood. More advanced countries tend to import more food and shift their own resources to more enviable endeavors like research and high tech manufacturing.

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The import is 10% of the beef consumption.
I am the only one who check the data?

manqiangrexue said:

I see you are having a huge amount of trouble understanding that Chinese people eat other things than domestic meats (specifically pork in your case) and grains. China's beef and seafood imports are growing every year. This contradicts your guess that Chinese people are turning away from pork because it is too expensive. If I eat less pork and more steak/lobster, would you think I am having financial problems with affording the pork or probably that I've got more money? LOL Also, here is an article that details China's rising consumption of meats in total so basically, you supposed wrong, again.

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Here is another graph to summarize it:

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This whole thing is completely ridiculous that you look at just pork because it is the only thing declining in China and try to avoid looking at the rise of all the more luxurious food items to imagine China's economic "problem".

Click to expand...

We talk about recent events/trends.

This is not bout single person trends.
There are always guys who do better than others.

The interesting is the situation of the masses, and I think at least 700 million Chinese can be happy to mop up the leftover pork from the lucky ones that swapped over to lobster.

China is bigger than any Chinese can imagine : P

manqiangrexue said:

I have to also show you a second article, which details that the CCP is trying to cut Chinese meat consumption dramatically because high meat diets are not healthy and also, as you stated, it is more expensive, both economically and environmentally to eat so much meat. If the diet can be more vegetarian, resources in farming and meat import money can be freed up for other areas. So although we see China's rising meat consumption now, if it falls, it may well have to do with this government initiative, and the CCP would consider that a very good thing.

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First of all, I've already explained the decline in cargo truck sales.

The world right now is shifting from conventional vehicles to EV and/or hybrid energy vehicles. It is still a relatively new concept and these cars are improving rapidly compared to conventionally-fueled vehicles, which are very mature technology. What happens right before the new iphone or Samsung or Huawei comes out? Sales of the current models drop off in anticipation for improvement. This drop in sales can in no way be interpreted as under-performance or economic disaster for the company.

Car sales are basically declining in every major economy around the world now. I believe another factor is that with the maturation of traditionally-fueled vehicle technology, the cars of today are lasting longer than the cars of the past and that is causing the replacement rate to drop.

Click to expand...

No, you can't explain the heavy duty drop, apart from a decrease in shipping demand.

There is no visible shift in the sales/production numbers. There is only marginal change from internal combustion to electric.

And yeah, there is a global drop back. Will be interesting to see how weather China.

Bovine cattle can be grass fed. It is kind of a misnomer to consider everything in terms of caloric intake. China has a lot of unoccupied land it can use for grazing cattle. As people move more and more into cities that becomes even more of a reality. It comes to little surprise that hogs are a major part of the Chinese way of eating because you can easily grow them in densely packed farms close to the cities with leftover food and the like. I think the whole soy import issue is overblown. Soy can be replaced with other kinds of feed, and China has alternative import sources for soy other than the USA, as they clearly showed, which can satisfy its entire import demand with even more coming online.
Also, like I said, I think the Chinese agricultural sector is poorly developed and they could be growing a lot more food than they are now.