Who wins in a Trade War? China or US?

[curiousGeorge8]

To discuss win or loss, you have to consider the objective of Trump. Trump's objective is to move the jobs from China to US by punishing the business which outsourced production to China. What will happen is up to guess, but my guess is that the business will move the production to other countries, which however will take a lots of time since the supply chain is complicated.

So in the end, it is likely US will not get the jobs Trump promised and its business and consumers pay the higher tariff for several years, and China will loss the some of the jobs to other countries. Neither country wins.

 

[smallfil]

To discuss win or loss, you have to consider the objective of Trump. Trump's objective is to move the jobs from China to US by punishing the business which outsourced production to China. What will happen is up to guess, but my guess is that the business will move the production to other countries, which however will take a lots of time since the supply chain is complicated.

So in the end, it is likely US will not get the jobs Trump promised and its business and consumers pay the higher tariff for several years, and China will loss the some of the jobs to other countries. Neither country wins.

Did you read the article of Bloomberg on what is actually, happening to Chinese businesses? It is right there. They are going bankrupt. Whether we get a trade deal or not, US will win. By forcing US manufacturers to move to Vietnam, Thailand, etc. That costs China jobs and bankrupts their businesses. In addition, US buyers are not willing to absorb the tariffs giving Chinese manufacturers the choice of eating the tariffs and suffering huge losses if they want to keep the business relationship or sourcing the same products produced by Chine elsewhere! Lots of choices, Vietnam, Sri Lanka, Malaysia, Thailand produce similar products as China. Now, those products would be way cheaper!

 

[smallfil]

Here is one more article on US-China trade war and how it is actually, affecting China.

https://www.yahoo.com/news/why-tariff-war-threatens-beijings-142436487.html

 

[Stocktracker]

Both lose, but the U.S has the buying power, thus the upper hand

Who will be buying the US debt then?
The same idiot who told you that Mexico is going to pay for the wall is now telling you that China is going to pay for the tariffs and not the American people!
Give me a break!

 

[hoffmanw]

....... of choices, Vietnam, Sri Lanka, Malaysia, Thailand produce similar products as China. Now, those products would be way cheaper!.....

China a virtual monopoly on rare earth metals, high graded and low graded. They control 98% of the market and almost all the refining and extract patents.

Rare earth minerals are used in producing everything from electronics to livestock and fertilizers. A typical car nowadays has at least 60 lbs of these metals. Extracting and refines these metals produce millions and millions tons of wasted byproducts like radioactive materials, carcinogens and other toxins harmful to life. The byproduct acidity released during the process will poison the water supply and render the land barren.

If manufacturers are moving out of China, I don't think China is willing to sacrifice their environments to produce such cheap rare earth metals. Probably China will cut the supply down to the world by 90%. Very soon you will see the price of computers, the laptops, the Iphones, the cars and the foods you eat will increase very significantly. Malaysia was trying to challenge China on the monopoly, but they failed because it was causing many environment issues. They banned it recently. No ones really want to turn their land from fertile to barren in a year or two.

During a dispute with Japan in 2010, China cut the supply by 30% to Japan for even couple months. It almost destroyed Japan's economy. Their economy has such a reliance on high tech products and manufactures. Immediate afterward Japan vowed to become the producer of the metals. They spent a lot of money on R&D and tried to extract the metals in Vietnam. So far they have not been successful.

 

[GRULSTMRNN]

While you point out an interesting issue re rare earth metals, Japan's economy did not take any massive hit as you suggested and certainly did not get close to being destroyed. Should China want to play with rare earth metal supplies I am pretty sure WTO will have a say, if that won't work, an escalation and possibly cutting China off from major trade flows by not just the US but Japan, Europe, Australia,... Oil disruptions and deliveries to China might also work wonders.

China a virtual monopoly on rare earth metals, high graded and low graded. They control 98% of the market and almost all the refining and extract patents.

Rare earth minerals are used in producing everything from electronics to livestock and fertilizers. A typical car nowadays has at least 60 lbs of these metals. Extracting and refines these metals produce millions and millions tons of wasted byproducts like radioactive materials, carcinogens and other toxins harmful to life. The byproduct acidity released during the process will poison the water supply and render the land barren.

If manufacturers are moving out of China, I don't think China is willing to sacrifice their environments to produce such cheap rare earth metals. Probably China will cut the supply down to the world by 90%. Very soon you will see the price of computers, the laptops, the Iphones, the cars and the foods you eat will increase very significantly. Malaysia was trying to challenge China on the monopoly, but they failed because it was causing many environment issues. They banned it recently. No ones really want to turn their land from fertile to barren in a year or two.

During a dispute with Japan in 2010, China cut the supply by 30% to Japan for even couple months. It almost destroyed Japan's economy. Their economy has such a reliance on high tech products and manufactures. Immediate afterward Japan vowed to become the producer of the metals. They spent a lot of money on R&D and tried to extract the metals in Vietnam. So far they have not been successful.

 

[smallfil]

China a virtual monopoly on rare earth metals, high graded and low graded. They control 98% of the market and almost all the refining and extract patents.

Rare earth minerals are used in producing everything from electronics to livestock and fertilizers. A typical car nowadays has at least 60 lbs of these metals. Extracting and refines these metals produce millions and millions tons of wasted byproducts like radioactive materials, carcinogens and other toxins harmful to life. The byproduct acidity released during the process will poison the water supply and render the land barren.

If manufacturers are moving out of China, I don't think China is willing to sacrifice their environments to produce such cheap rare earth metals. Probably China will cut the supply down to the world by 90%. Very soon you will see the price of computers, the laptops, the Iphones, the cars and the foods you eat will increase very significantly. Malaysia was trying to challenge China on the monopoly, but they failed because it was causing many environment issues. They banned it recently. No ones really want to turn their land from fertile to barren in a year or two.

During a dispute with Japan in 2010, China cut the supply by 30% to Japan for even couple months. It almost destroyed Japan's economy. Their economy has such a reliance on high tech products and manufactures. Immediate afterward Japan vowed to become the producer of the metals. They spent a lot of money on R&D and tried to extract the metals in Vietnam. So far they have not been successful.

Eventually, it comes down to choice and I am sure scientists and engineers will figure out how to manufacture what the US needs. Maybe, they will recycle more products and extract whatever materials in it without relying on China. As for food, the US manufactures enough food to feed Americans. Computers, laptops? How many do you need? As long as your computer runs, I do not see most people buying a new one. There is also, a huge supply of used computers you can buy cheap. Cars? My Toyota Corolla is 27 years and still runs good. Only the paint is bad being parked outdoors on the streets. Used cars are plentiful too. We shall see. Chinese businesses are already going bankrupt over the tariffs. I doubt they will be able to survive for long since, most of their orders come from the US.

 

[themickey]

World production in 2013 of rare earth oxides was 110,000 tonne, with main production from China of 100,000 tonne, USA at 4,000 tonne and Australia at 2,000 tonne, mainly from the Mount Weld deposit in Western Australia. World resources are dominated by deposits rich in the minerals bastnasite, and monazite., with the largest resources of these minerals in China and the USA.

 

[smallfil]

Looks like it is going to be all out trade war which is what China wants. Just announced more tariffs on US exports to China. President Donald Trump has already ordered more tariffs to be readied against all Chinese products now. He gave them 4 weeks to sign a trade deal. That is more than reasonable, as the trade issues has been discussed and agreed upon the past 6 months atleast, but, the Chinese backed out of it the last minute. It only gets worst from this point on!

 

[nooby_mcnoob]

Already made max return on Friday's options trade. Now I have no trading position

I need to handle this stuff better.