Trade War with China


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supercat

Junior Member
It seems the hawkish faction in the Trump administration is trying to derail the trade-war truce. It's those chicken-hawks' dreams to fight a trade war with China in the past decade. They will not let this opportunity to slip without a fight (against the more open-minded faction).

Did Trump’s enemies try to derail a trade deal with China?
The arrest of Huawei CFO in Canada for violating US sanctions on Iran has stunned markets and raised questions on who gave this the green light

Equity markets fell sharply in Asia after news media reported the arrest in Canada of Huawei’s chief financial officer Meng Wanzhou, pending extradition to the United States on charges of violating US sanctions against Iran.

The news has stunned financial market participants and policy analysts, for two reasons.

First, never before has the United States attempted the extraterritorial rendition of a foreign citizen – Meng is a Chinese national – in connection with sanctions violations. It has imposed travel and banking restrictions, but seeking an arrest warrant for this is entirely without precedent.

Earlier this year, the US government banned exports of US computer chips to the Chinese telecommunications equipment ZTE in retaliation for violations of sanctions against Iran, but sought no arrests.

Second, Meng was arrested on December 1, the day that President Trump and his economic team dined with President Xi Jinping and his advisers at the Group of 20 Summit in Buenos Aires. Trump has every interest in striking a deal with China that would enable him to declare some measure of victory in a trade war, and China has shown every indication that it is willing to make concessions to the United States on intellectual property protection, financial market opening and, at least in rhetoric, on industrial policy, while increasing its imports from the United States.

Who ordered arrest?
The question is: Who ordered the arrest, and why?

It is possible that President Trump knew about it and sanctioned the arrest, to be sure. But it is unlikely that the president would escalate the conflict with China with the arrest of a senior executive of China’s flagship high-tech manufacturer on the same day that he sought to de-escalate the trade war.

If Trump did not initiate the arrest, who did? There are two alternative possibilities.

The first is that the order came from administration officials who believe that the United States must provoke a confrontation with Beijing now, before China becomes too powerful to intimidate. Some parts of the permanent bureaucracy and the intelligence community believe that China’s economy is fragile and that an economic war would produce an economic crisis and political instability, perhaps even toppling Xi Jinping.

That view may seem fanciful, but it is argued seriously, for example by some former senior officials of the Trump administration.

The second possibility is that Trump’s enemies in the permanent bureaucracy simply want to prevent the president from negotiating a deal with China that would enhance his image and remove risks to economic growth.

The Trump administration has been uncharacteristically silent about the matter. Trump and his closest advisers have shown no hesitation to comment about China trade matters.

Beijing demands release
The only public comment from an American politician came from Senator Marco Rubio (R-FL), who earlier this year fought the Trump administration’s efforts to reach a settlement with ZTE. Rubio “celebrated the arrest” in an email to the website
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.

The US Department of Justice declined to comment. The sanctions regime against Iran is the responsibility of the Treasury’s Office of Terrorism and Financial Intelligence, now directed by Undersecretary of Treasury Sigal Mandelker, a law enforcement veteran who served in the Bush Administration after the 9/11 attacks and advised Homeland Security Secretary Michael Chertoff during the George W. Bush Administration.

The Office of Terrorism and Financial Intelligence is a joint project with the Central Intelligence Agency. Undersecretary Mandelker’s predecessor in the position, attorney David Cohen, subsequently became a deputy director of the CIA. Ms Mandelker’s office initiated the administration’s sanctions against ZTE earlier this year. The
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reported on April 25 that the Justice Department was investigating whether Huawei violated American sanctions against Iran.

For its part, China expressed outrage at the arrest, and its embassy in Canada demanded the release of Meng.

Most of all, China’s government was taken by surprise, and is trying to understand what happened and why.

In any case, the Vancouver arrest raises serious issues. If the White House is behind the action, it casts doubt on the administration’s desire to come to any sort of accommodation with China.

Or, if the arrest was initiated by rogue elements in the administration, it would suggest that Trump is having difficulty controlling his own government.
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Today at 11:48 AM
I'm wondering what the charges (in Brooklyn? Today at 8:35 AM) against Ms. Meng will be
anyway
Dow slides 700 points after Huawei executive's arrest renews trade fears

Updated 11:17 AM ET, Thu December 6, 2018
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Market sentiment is so fragile that news of an arrest is enough to set off a selling wave.
The Dow plunged 700 points, or 2.8%, on Thursday. The S&P 500 lost 2.6%, while the Nasdaq fell 2%.
The
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in Canada at the request of the United States renewed doubts about the US-China truce.
The latest sign of tension between Washington and Beijing also
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. Hong Kong's Hang Seng plunged 2.5% overnight, while European stock markets declined sharply as well. Germany's DAX is flirting with a bear market.
Companies like Apple (
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) and Boeing (
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) that have significant exposure to China fell sharply. Alibaba (
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), the Chinese e-commerce giant, tumbled 3%. The Dow and S&P 500 have once again turned negative on the year. The S&P 500, down 9% in the fourth quarter, is on track for its worst quarter in seven years.
The arrest of Meng -- the daughter of the founder of one of China's most important companies --
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that
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, despite the
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Tariffs already imposed remain in place and new ones loom if talks fail to result in a breakthrough or at least an extension within 90 days.
"This comes at a truly delicate time," Win Thin, global head of currency strategy at Brown Brothers Harriman, wrote to clients on Thursday. "We think this will force China to take a more aggressive and confrontational approach with the US."
Renewed trade jitters, along with worries about an economic slowdown, sent the Dow
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That selloff wiped out a chunk of last week's rally, which was the S&P 500's biggest weekly gain in seven years. US markets were closed on Wednesday in honor of President George H.W. Bush.
"The Huawei arrest just adds to concerns that this trade situation could deteriorate further," said Kristina Hooper, global market strategist at Invesco.
Hooper said investors have become more concerned about the US-China trade standoff because the negative impacts have become more apparent. Supply chains have been disrupted, raw material costs are on the rise and businesses may be delaying investment decisions.
"Almost none of us lived through the full-blown trade wars that erupted in the 1930s," Hooper said.
President Donald Trump spooked investors on Tuesday when he called himself a "Tariff Man" in a tweet. Trump also suggested tariffs will "MAKE AMERICA RICH AGAIN" -- even though these levies are paid by American companies and consumers.
"The market will need to see tangible progress -- both in policy and negotiations -- before fully embracing the trade truce narrative," Isaac Boltansky, director of policy research at Compass Point Research & Trading, wrote in a note to clients. "We struggle to see how a comprehensive agreement can emerge in the next 3 months and instead expect trade tensions to resurface in earnest early next year.
Energy stocks retreated in tandem with plunging oil prices. Pioneer Natural Resources (
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) and Baker Hughes (
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) slumped more than 4%. US oil prices tumbled 3% on concerns that OPEC and its allies, in a major meeting in Vienna Thursday, will fail to cut output enough to balance the market.
Saudi Arabia, the leader of OPEC, hinted that the reduction could be
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Khalid Al Falih, the kingdom's energy minister, told reporters that a
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Sources told CNN's John Defterios that talks are so tense that a final decision could be delayed until Friday.
Investors are also nervously watching a recession indicator in the bond market: the slope of the yield curve. The gap between the two-year and 10-year Treasury yield shrank this week to levels unseen since just before the Great Recession. An inversion -- where short-term rates are higher than long-term ones -- has been a reliable prognosticator of recessions in the past.
 
now I read
MOFCOM: China confident it will reach agreement with U.S. in 90 days
Updated 2018-12-06 22:54 GMT+8
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The meeting between China and the U.S. on trade relations was very successful with highly overlapping interests between the two countries, and China is confident it will reach an agreement on trade with the U.S. side in the next 90 days, according to the spokesperson of China's Ministry of Commerce (MOFCOM) Thursday during a regular news briefing.

"China has reached a consensus with the U.S. on agriculture, energy and cars. In the following 90 days, China and the U.S. will negotiate on various issues including the protection of intellectual property rights, technical cooperation, market access and trade balance in accordance with a clear timetable," said MOFCOM spokesperson Gao Feng.

Specific negotiation areas will cover agricultural products, energy, manufactured goods, and service sector.

"The ultimate goal in China-U.S. trade talks is to remove all tariffs," added Gao.

In response to query that China is currently making major concessions to Washington amid trade frictions, Gao noted that it is not a zero-sum game given shared desire of protecting intellectual property rights and widening market access to each other.

"It also highly coincides with China's trend to deepen reforms and push for openness. China will conduct negotiations with the U.S. on the groundwork of mutual respect, equality and mutual benefit, as a way to foster better business climate for both sides."

Regarding expanding market access, experts point out that China has been emphasizing greater openness this year. The country will further reduce tariffs and relax restrictions on foreign shares in education, healthcare and other sectors. Over the next 15 years, imports of goods are expected to exceed 30 trillion U.S. dollars, and in imports of services the figure will stand at 10 trillion U.S. dollars.

No specific items in the affected industries were mentioned in the briefing. But using soybeans as an example, China's soybean imports from the United States fell 85 percent in September this year. If imports expand in the future, both sides stand to benefit.

Last year, China imported 95.54 million tons of soybeans, 53.3% from Brazil and 34.4% from the U.S. China retaliated with a 25 percent levy on U.S. soybeans in July as a trade war escalated in the first half of the year.

China's soybean imports from the United States fell 85 percent in September, while China's imports from Brazil rose 28 percent. But for American fruit, nut and vegetable growers, the spring of trade has not yet arrived, because the consensus reached this time does not include the elimination of the previous tariff increase, currently the additional tariff increase of 50 to 60 percent for American exports of fruits and nuts to China.

Besides, a total of 38 Chinese government agencies have signed a memo of cooperation for joint efforts to strengthen punishment for IP infringements.

China's National Development and Reform Commission (NDRC) and dozens of other ministries and commissions have issued a Memorandum of Understanding (MoU) on joint disciplinary action against serious unreliable subjects in the field of intellectual property (patent).

According to the document, China's Intellectual Property Office will provide a list of serious, unreliable subjects in the area of intellectual property rights (patents) to other departments and entities who signed this memorandum under the law and strictly punish illegal acts.

This can be seen as the beginning of Beijing's swift implementation of the consensus.
 

localizer

Senior Member
Registered Member
my stocks...
theres an article saying trump's plans are getting derailed by deep state or some bullshit
truth is they've been playing good cop bad cop
market responds similarly with volatility
 

B.I.B.

Senior Member
Just heard on the radio news that BT are not using Huawei euipment for its 5g rollout.I would not be surprised most of the European countries and Canada followed suit, thus thtowing a monkey wrench in Hwaweis.plans.
 

SinoSoldier

Colonel
It seems that Huawei is being charged for bank fraud, specifically, manipulating banking systems in order for it to circumvent US sanctions on Iran.
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WASHINGTON (Reuters) - Chinese telecoms giant Huawei Technologies Co Ltd’s chief financial officer was arrested as part of a U.S. investigation of an alleged scheme to use the global banking system to evade U.S. sanctions against Iran, according to sources familiar with the probe.

The United States has been looking since at least 2016 into whether Huawei Technologies Ltd violated U.S. sanctions against Iran. More recently, the probe has included the company’s use of HSBC Holdings Plc to make illegal transactions involving Iran.

Huawei CFO Meng Wanzhou, the daughter of the company’s founder, was arrested in Canada and faces extradition to the United States, sparking fears it could reignite a Sino-U.S. trade dispute and roiling global stock markets.

In 2012, HSBC paid $1.92 billion and entered a deferred prosecution agreement with the U.S. Attorney’s office in Brooklyn for violating U.S. sanctions and money-laundering laws.

An HSBC spokesperson declined to comment. HSBC is not under investigation, according to a person familiar with the matter.

Huawei also declined to comment. After news of the arrest, Huawei said it has been provided little information of the charges against Meng, adding that it was “not aware of any wrongdoing by Ms. Meng.”

A spokesman for the U.S. Attorney’s office in Brooklyn, which Reuters has reported is investigating Huawei, declined to comment.

U.S. and Asian shares tumbled as news of the arrest heightened anxiety over prospects of a collision between the world’s two largest economic powers, not just over tariffs but also over technological hegemony.

HSBC’s U.S.-listed shares initially fell as trading volume rose, dropping as much as 6 percent after Reuters reported the bank’s link to the case, and were subsequently down 4.7 percent.

Huawei is already under intense scrutiny from Washington and other western governments over its ties to the Chinese government, driven by concerns it could be used by Beijing for spying. It has been locked out of U.S. and some other markets for telecom gear, but has repeatedly insisted Beijing has no influence over it.

Reporting by Karen Freifeld; editing by Chris Sanders, Jonathan Oatis and Dan Grebler
It's amazing that Huawei hasn't learnt a single thing from the preceding ZTE saga, instead choosing to continue with illicit activity in the face of US retaliation and repercussions; now it's about to face a fate likely unsimilar to that of ZTE.
 

Equation

Lieutenant General
It seems that Huawei is being charged for bank fraud, specifically, manipulating banking systems in order for it to circumvent US sanctions on Iran.


It's amazing that Huawei hasn't learnt a single thing from the preceding ZTE saga, instead choosing to continue with illicit activity in the face of US retaliation and repercussions; now it's about to face a fate likely unsimilar to that of ZTE.
Or rather it is the US making up excuses. I'm still waiting for that "weapons of mass destruction" that was responsible for 9/11 movement.
 

chlosy

New Member
Registered Member
It seems that Huawei is being charged for bank fraud, specifically, manipulating banking systems in order for it to circumvent US sanctions on Iran.


It's amazing that Huawei hasn't learnt a single thing from the preceding ZTE saga, instead choosing to continue with illicit activity in the face of US retaliation and repercussions; now it's about to face a fate likely unsimilar to that of ZTE.

Is Huawei charged, or already proven guilty?
 
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