American Economics Thread

AssassinsMace

Lieutenant General
This is not a Trump spin. In fact, the US has consistently stated that the Phase I deal is not enough. It’s constantly pushing China for more. On the other hand, the deal was an embarrassment for China. The terms of the deal was barely reported in Chinese media.

But the fact is $200B over two years is an enormous win for the US. If China doesn’t meet the terms of the deal, trump gets his pretext to slap China with more tariffs. If China does meet the deal, US just got $200 billion out of China, and narrowed the deficit.

What did China get? Sure it wants to buy US soybean and natural gas anyway. But it didn’t buy any favors with the administration. US piled on the pressure even more. Relationship is worse now than before the deal.

China should realize by now that singing trade deals, selling ticktock, or any other concessions is not going to appease the US.

Then why hasn't Trump carried out his threat to slap tariffs on the rest of China's exports...
 

manqiangrexue

Brigadier
This is not a Trump spin. In fact, the US has consistently stated that the Phase I deal is not enough. It’s constantly pushing China for more. On the other hand, the deal was an embarrassment for China. The terms of the deal was barely reported in Chinese media.

But the fact is $200B over two years is an enormous win for the US. If China doesn’t meet the terms of the deal, trump gets his pretext to slap China with more tariffs. If China does meet the deal, US just got $200 billion out of China, and narrowed the deficit.

What did China get? Sure it wants to buy US soybean and natural gas anyway. But it didn’t buy any favors with the administration. US piled on the pressure even more. Relationship is worse now than before the deal.

China should realize by now that singing trade deals, selling ticktock, or any other concessions is not going to appease the US.
China gets to keep racking up a huge trade surplus on the US. If that's an enormous win for the US, then they'll keep winning. If China doesn't meet the terms of the deal, Trump can slap the tariffs he already had the power to slap anyway; China already bought the tariff-free time. If China does meet the terms, the trade deficit is still enormous. I'll leave the calculations on which is better to the CCP but right now, it seems that China is not meeting these goals but the US is saying it's satisfied anyway, probably because Trumps needs some deal to still be intact rather than take another hit to the crumbling economy right before elections.

Reread: American Economics Thread

China's not selling TikTok; the Chinese guy who owns TikTok is considering selling the US branch, which is worth less than 2% in terms of revenue.

If these things were concessions for appeasement, the CCP would have retracted them seeing their failure to yield returns; there's even text for it. Instead, it's pretty clear to me that China is using this to drag out the time that it keeps running a massive trade surplus on the US while developing itself into an ever-more formidable power.
 
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Petrolicious88

Senior Member
Registered Member
Then why hasn't Trump carried out his threat to slap tariffs on the rest of China's exports...
Covid 19 happened of course. But thats not the point because that wasn’t part of the calculus when US designed the Phase I deal back in December.

Covid 19 bought China more time.
 
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AssassinsMace

Lieutenant General
Covid 19 happened of course. But thats not the point because that wasn’t part of the calculus when US designed the Phase I deal back in December.

Oh Trump is being generous by not placing that burden on China over COVID-19...? China is not upholding its part in the Phase 1 dealing so where's the slapping of the tariffs on the rest of China's exports to the US? It's because China didn't collapse like Trump said would happen on day one of his trade war with China. Yes Trump had to move the goal post so much because he was wrong that they're out of the stadium not be seen at all so he can say he scored a goal with no one actually having witnessed it.
 

Petrolicious88

Senior Member
Registered Member
Oh Trump is being generous by not placing that burden on China over COVID-19...? China is not upholding its part in the Phase 1 dealing so where's the slapping of the tariffs on the rest of China's exports to the US? It's because China didn't collapse like Trump said would happen on day one of his trade war with China. Yes Trump had to move the goal post so much because he was wrong that they're out of the stadium not be seen at all so he can say he scored a goal with no one actually having witnessed it.
American economy is under stress because of Covid19. That’s the only thing holding US back at the moment. Escalating the trade war in the middle of the pandemic, which the US has failed to control, is more detrimental to the Us economy than to China’s.
 

AssassinsMace

Lieutenant General
American economy is under stress because of Covid19. That’s the only thing holding US back at the moment. Escalating the trade war in the middle of the pandemic, which the US has failed to control, is more detrimental to the Us economy than to China’s.


Oh you mean the US does want China robbing the US blind by not slapping those tariffs? That's "slaves were a necessary evil because the US saw itself as the champion of human rights hundreds of years later" kind of logic there.
 

AssassinsMace

Lieutenant General
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You know the US will be expecting China to pay reparations even though China didn't enslave Africans. They'll leave that part out because as usual Americans only understanding of other cultures is you either do it more or you do it less, whichever is worse. China is more evil so by default China had to have enslaved Africans more. You better believe there are people in the US that will conclude that. It's just like over a decade ago the New York Times was calling for China to have to pay reparations to the Jews. Why? Because when the Chinese communist revolution happened, the Jews were forced from their homes in Shanghai and leave China. Ignore the part where China was the only refuge for Jewish refugees fleeing the Nazis in Europe while every other country refused them and they were living in homes of Chinese who were kicked out to make room for them. Yeah, China is suppose to pay reparations.
 

Tam

Brigadier
Registered Member
US retail sales are now HIGHER than January and February, before the pandemic in the US.

(Meanwhile Chinese retail sales are still 1.1% lower than last July).

Tell me how China recovered better from the pandemic again? I'm sure this is great news for "recirculation"

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Because of massive printing of money and free checks.

Yet American store closings are the highest in hears. over 13,200 this year alone beats previous years by far and the year is only half way. And you think 2019 was record already, and closures in 2013-2018 birthed the term retailpocalypse.

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Store closures in 2020

Ascena Retail Group: 1600 Stores (bankruptcy)

Brooks Brothers: 75 Stores (bankruptcy)

Catherines: 320 (bankruptcy)

Chuck E Cheese: 54 U.S. stores (bankruptcy)

Coldwater Creek: 334 Retail, 31 factory, 7 Day Spa (bankruptcy

Destination Maternity: 90 stores (bankruptcy)

GNC: 1,200 stores (bankruptcy)

G Straw Raw: (bankruptcy) 24 stores

J. Crew: 54 stores (bankruptcy)

JCPenney
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: 152 stores (bankruptcy)

K-Mart: 45 stores (bankruptcy)

Lord & Taylor: 19 stores (bankruptcy)

Modell’s Sporting Goods: 153 stores (bankruptcy)

Muji USA : 5 stores (estimated) (bankruptcy)

Neiman Marcus (Last Call): 20 stores + 4 main stores(bankruptcy)

New York & Co: 378 stores (bankruptcy)

Papyrus: 254 stores (bankruptcy)

Pier 1 Imports
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: 936 stores (bankruptcy)

Roots USA: (bankruptcy) 7 stores

Sears: 51 stores (bankruptcy)

Stage Stores
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: 738 stores (liquidating)

Stein Mart
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: 250 est. stores (Bankruptcy)

Sur la Table: 51 stores (bankruptcy)

Tailored Brands: 500 stores (bankruptcy)

The Paper Store: 86 stores (bankruptcy)

Tuesday Morning: 230 stores (bankruptcy)

***

AC Moore: 145 stores

Art Van Furniture: 190 stores

AT&T
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: 250 stores

Bath & Body Works: 50 stores

Bed Bath & Beyond: 200 stores

Bloomingdale’s: 1 store

Bose: 11 stores

Chico: 100 stores (estimated)

Children’s Place: 200 stores

Christopher Banks: 30-40 stores

CVS Pharmacy: 22 stores

Earth Fare: 50 stores

Express: 66 stories

Frye Shoe stores: 16

Forever 21: 15 stores (estimated)

GameStop
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: 320 stores

Gap: 230 stores

Guess: 100 stores

Hallmark: 16 stores

Lord & Taylor: 30 or 40 stores

Lowe’s Canada: 34 stores

Lucky Market: 32 stores

Macy’s
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: 125 stores (over 3 years)

Microsoft: 77 stores

New York & Co: 27 stores

Nordstrom: 16 stores

Office Depot: 90 stores

Olympia Sports: 76 stores

Party City: 21 stores

PVH
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-Heritage Brands: 162 Stores

Signet Jewelers
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: 232 stores

Starbucks
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: 400 stores (over 18 months)

Ulta Beauty
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: 19 stores

Victoria’s Secret: 250 stores

Walgreen: 100 stores (estimated)

Walmart: 2 stores

Wilson Leather & G.H. Bass: 199 stores

Zara: 1,000 stores worldwide (over 2 years)
 

j17wang

Senior Member
Registered Member
He is satisfied with the deal because the Phase I deal was a lopsided deal for China. It’s forcing China to buy $200B worth of US products in just 2 years. This is a shockingly high amount, and a massive win for the US.

For comparison, Chinese investments in a group of African countries only totaled $120B from 2008 -2017.

China was forced to sign the deal. It was an extremely unfair deal. But China signed and hoped it would ease tensions between the two countries. We all know this didn’t happen. The US actually increased sanctions on Chinese companies. The Phase I deal bought China nothing. It was another unfair deal imposed on China by the West.

Guys, always remember that for a chinese economy of $15 trillion, the extra $100BN a year of imports from the US is not a "waste". China basically reallocated its purchases from other countries around the world, but since china has such high levels of trade with other countries as well, there wasn't as much of a targeted hit to individual countries. Would china have gotten a better deal by purchasing from efficient markets... sure its possible but since these are commodity products even the commodity price differentials wouldn't have been that much, maybe 5% of price. So at most, China would have "lost" $5BN a year from signing Phase I, and Americans can still tout some win in factory jobs. Frankly if $5BN was the price to be paid each year so china could "buy time" to more fully build its own tech platforms across sensitive sectors, I'm glad it was paid. Works out to just under $4 a person in china per year :)

The US is losing way more than $5BN a day on its ineffective COVID response...
 

plawolf

Lieutenant General
The $200bn purchase agreement was mitigated by two factors. The first was China’s need to diversify away from its US treasuries holdings. China selling off $200bn of US treasuries would cause massive waves in the market. China buying $200bn worth of goods, which just happens to be paid using US T-Bills, or funds generated from the sale of such, would not.

Also, it is worth noting that China buying $200bn more goods from the US does not mean China buying $200bn more imports overall. What China did was to stop buying from the most aggressive American lapdogs like Australia and Canada, and instead buy the same goods from the Americans. A neat demonstration to the lap dogs of just how much their loyalties are valued by Washington.

Besides, there were rumblings from the start that the Chinese were not buying enough, because it was written explicitly in the agreement that Chinese purchases would be made based on market conductions and prices, with a force majeure clause to boot.

That $200bn was actually just a best case scenario figure, meaning China would only buy that much more if it needed it all, which was frankly never going to happen anyways.

So basically all China promised was that if things went amazingly well and somehow the Chinese market needed $200bn more US imports it would happen, but if there was not enough demand or something hugely unexpected happen, well tough cookies.

It was a sign of Trump’s desperation that he signed such an empty deal.

Basically, China got him to suspend his trade war for some non-committal, vague promises with plenty of escape clauses.

China is just going about is business as normal and effectively treating the Phase I deal as if it didn’t happen. It’s Trump who is afraid to call time of death of the deal and making endless excuses for China, so China is happy to play along and let him keep the act up.

But the second America actually tries to enforce the deal, China will just trigger Force Majeure and suspend the deal outright.

I suspect Trumps moves against Huawei, TikTok and WeChat do have some roots in how shitty his Phase I deal is, so true to American tradition, instead of coming to the negotiating table on good faith with offers, they instead create problems for the other side and offer to solve said problems for major concessions from the other side.

American negotiating tactics have always been mafia like, the only difference is that Trump is just being open and upfront about it while traditional US leaders also had the cheek to make it sound like America robbing you blind was them bending backwards to do you a huge honour.
 
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