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John Kopke

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We're at War With China
« on: August 25, 2019, 08:42:29 PM »

Thought that was a rather provocative subject title, but it's true. China has  been waging an economic war against, mostly us, but also the rest of the world since the 1990's. Without going into detail, when they came out on the world trading scene they began screwing us, and everybody else, from the start.

Thinking was if we freely traded with China they would like the money and become a democratic country. OK, that's a little overstated, but they thought the trade could ameliorate a rigid authoritarian
regime to liberalize and become a reasonable member of the global club. They were wrong, hugely.

Our companies were on board because they could move manufacturing to China, which then enabled them to both lower consumer prices and also substantially increase their profit margins. What's not to like? Well being one of millions of Americans who lost their good paying job in the back wash wasn't such a wonderful thing.

I expect other contributors will add a ton of other stats, but here's a few. Note I'm doing this from memory from things I've read.

* Basically we export $ 160 billion to China and import $ 540 billion from them. Another plus on their
   side is they steal, or extort, hundreds of billion of dollars of our R&D/Intellectual property each year. 
   
   Note: Obama official estimated the Chinese stole $ 460 billion worth in one year! Folks the Chinese
            have a section of military that all they do is hack us and our companies. We spend billions to
            develop stuff and all they do is hack us and download it.

The first George Bush and Clinton brought this nightmare upon us, Bush II was patient waiting for China to liberalize, and the Obama administration, at least in the second term, said it might be a problem and then, as usual. did nothing.

Then came Trump
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John Kopke

blue2

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Re: We're at War With China
« Reply #1 on: August 26, 2019, 11:00:11 AM »

It was all brought on by Wall Street. Aren't they the source of all our problems?  Wall Street insisting on rising profits always threatens corporations CEO's and CFO's. 
One quick way to increase profits was to get rid of expensive American workers and regulations and shift manufacturing operations to China.  The Chinese were all over that as they needed jobs for their 300 billions people.  So while our corporations were excited to move operations the Chinese were excited to cooperate and took advantage of us and we knowingly allowed it.  Our Government was afraid of the Chinese.  I don't think Trump is going to give in on this. And I sure do hope he gets re elected.  The dems seem to have done everything to ensure it
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John Kopke

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Re: We're at War With China
« Reply #2 on: August 27, 2019, 06:11:49 PM »

In this trade war China just devalued their currency from 6 yuan to $ 1.00 to 7 yuan to $ 1.00. What does this mean? Well if an item imported from the U.S. to China cost 600 yuan one day it would now cost the Chinese people 700 yuan. Works out to about a 16% increase.
This is essentially a tariff on all imports from the U.S.

Conversely, it also means Chinese imports to the U.S. are 16% cheaper. But wait a minute.
Trump put a 10% tariff on many Chinese imports. So the net result is Chinese imports are roughly 6% cheaper. This means the Chinese are paying for Trump's tariffs not the American consumer.   

It also means the Chinese are panicking. The devaluation hits their people negatively in two
ways. First American made products cost a lot more and second their profit margin for exports to the USA are reduced. Now this will mean they'll buy less from us, which costs us some lost sales, but reeks havoc on their profit margins. Meanwhile Trump is bringing in up to $ 100 billion in tariffs, essentially paid for by the Chinese.

Bottom line is you don't fight with your best customer. The USA is far and away the best customer China has. The USA's best customer is its own people, not nearly China.

Just yesterday Chinese told Trump they were willing to resume trade negotiations on a calmer scale. What this means is they're getting hammered in the trade war and it's time
to talk, not fight a one sided battle. Clearly this indicates they realize Trump has them by the you know what's.




 

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John Kopke

John Kopke

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Re: We're at War With China
« Reply #3 on: August 27, 2019, 06:47:07 PM »

Something I don't understand is there has not been any urging from any source I'm aware of for the people the U.S.A. to make an effort to buy non-Chinese made products. Join in the effort so to speak. Just check the label on the alternative products and if it costs a little more to buy non-Chinese do it and feel good, you're a patriot.

And here's something. Check out the label on Proctor and Gambles popular dish washing soap, Dawn. It says distributed out of Cincinnati. I thinking if it was produced in the USA it would have said so. I Googled to find out where it was produced and in 20-30 minutes of effort I still didn't have an answer. Maybe I'm not an expert searcher, but come on, it shouldn't be that hard unless Proctor and Gamble wanted it to be that hard.   

Obviously, I don't know if Proctor and Gamble produces Dawn in China, but I'd say there's a really good chance it is along with a lot of their other products. I could be completely wrong, they could be produced in another country, but I know this. it ain't the USA.         
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John Kopke

Maverick

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Re: We're at War With China
« Reply #4 on: August 28, 2019, 12:20:14 AM »

One correction to your formula John. Almost everything that is subject to the new tariffs is at 25%. That somewhat reverses your formula and point about how the tariffs are effecting cheaper vs more expensive.
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blue2

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Re: We're at War With China
« Reply #5 on: August 28, 2019, 10:01:25 AM »

At one time my company had to label products with the country they were made in.  Apparently politicians have gotten paid off and made some changes to that.
I don't like buying products I suspect were made in China.  They have a really bad record of producing things that are bad for us.  Especially food products and even products like soaps that could eventually get into our systems.
Its been clear our politicians do a very bad job of protecting us..
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pkrbkr

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Re: We're at War With China
« Reply #6 on: August 28, 2019, 05:16:18 PM »

Proctor & Gamble is based in Cincinnati & has plants around the world including over 20 manufacturing facilities in the USA ... Dawn dish soap is manufactured in Kansas City, Kansas.
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John Kopke

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Re: We're at War With China
« Reply #7 on: August 28, 2019, 06:15:08 PM »

One correction to your formula John. Almost everything that is subject to the new tariffs is at 25%. That somewhat reverses your formula and point about how the tariffs are effecting cheaper vs more expensive.

Well good like having folks chip in with data. Appears I need to brush up on some things.
Your point does alter the equation I sighted. However, the 25% does not cover all Chinese exports to us. How does that factor in? Yet, the 16% percent devaluation of the yuan hits all their exports to USA across the board, and therefore hammers their profits margin hard, that is, unless they raise their prices.
« Last Edit: August 28, 2019, 06:17:00 PM by John Kopke »
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John Kopke

John Kopke

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Re: We're at War With China
« Reply #8 on: August 28, 2019, 06:23:47 PM »

Proctor & Gamble is based in Cincinnati & has plants around the world including over 20 manufacturing facilities in the USA ... Dawn dish soap is manufactured in Kansas City, Kansas.

Well you're a better searcher than I am. Where did you find Dawn was manufactured in Kansas City? And I still want to know why they say distributed out of Cincinnati rather than Made in the USA. Could it be only some percentage of Dawn is produced in USA and another percentage produced overseas so they can't say it's Made in USA?
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John Kopke

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Re: We're at War With China
« Reply #9 on: August 28, 2019, 06:32:22 PM »

In a Global Economy it is difficult to say what is made where.

You could have a "Made in USA" product totally assembled out of Chinese components.  Is that made in Merica?

I really don't think so.

The content comes from the last step in the manufacturing process.  This could be someone turning a screw a little and putting it in the "Made in USA" box.

If buying that box makes you feel good - more power to ya.
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I have learned that only two things are necessary to keep one's wife happy. First, let her think she's having her own way. And second, let her have it.
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You do not examine legislation in the light of the benefits it will convey if properly administered, but in the light of the wrongs it would do and the harms it would cause if improperly administered.
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blue2

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Re: We're at War With China
« Reply #10 on: August 28, 2019, 07:31:24 PM »

this whole global economy is cool as long as everybody plays fairly but it's been proven they don't
How many of our dogs did the Chinese kill a few years ago with their tainted dog food?
Anyone is a fool if they trust the Chinese.  And I don't like buying food produced in unclean Mexico either./
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Monroe Native

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Re: We're at War With China
« Reply #11 on: August 28, 2019, 08:25:03 PM »

this whole global economy is cool as long as everybody plays fairly but it's been proven they don't
How many of our dogs did the Chinese kill a few years ago with their tainted dog food?
Anyone is a fool if they trust the Chinese.  And I don't like buying food produced in unclean Mexico either./

I totally agree with you.

Fortunately we have a President now that understands the difference between a good deal and a bad deal.

It seems like some of the other politicians just worried about making sure they had millions when they left office.

They sold this country out cheap.
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I have learned that only two things are necessary to keep one's wife happy. First, let her think she's having her own way. And second, let her have it.
Lyndon B. Johnson

You do not examine legislation in the light of the benefits it will convey if properly administered, but in the light of the wrongs it would do and the harms it would cause if improperly administered.
Lyndon B. Johnson

blue2

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Re: We're at War With China
« Reply #12 on: August 28, 2019, 09:43:59 PM »

But I think we still have most politicians that think that way.  unfortunately enough voters haven't figured that out or dont care.
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Monroe Native

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Re: We're at War With China
« Reply #13 on: August 29, 2019, 07:08:36 PM »

But I think we still have most politicians that think that way.  unfortunately enough voters haven't figured that out or dont care.

Obama never had a real job in his life before being elected.

He is now a multi millionaire.

How exactly did that happen again?

Nah - no corruption at all I am sure.

Isolated case you say?  I give you the Clintons.
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I have learned that only two things are necessary to keep one's wife happy. First, let her think she's having her own way. And second, let her have it.
Lyndon B. Johnson

You do not examine legislation in the light of the benefits it will convey if properly administered, but in the light of the wrongs it would do and the harms it would cause if improperly administered.
Lyndon B. Johnson

John Kopke

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Re: We're at War With China
« Reply #14 on: August 29, 2019, 09:52:38 PM »

Obama never had a real job in his life before being elected.

He is now a multi millionaire.

How exactly did that happen again?

Nah - no corruption at all I am sure.

Isolated case you say?  I give you the Clintons.

Obama now has three multi-million dollar houses. He didn't have squat to buy them prior to his presidential election, or during his Presidency, now he does.   
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John Kopke
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