Read more at https://www.channelnewsasia.com/news/world/trump-accuses-china-eu-of-currency-manipulation-10549118
(Updated: )
Ricky Lim
Trump did not know that if China, EU cooperate - it can hit US Economy hard.
Trump did not know that if China, EU can get Asia, and other parts of the World cooperate - US Economy will be hit hardest.
Is Trump mad?
Trump did not know that if China, EU can get Asia, and other parts of the World cooperate - US Economy will be hit hardest.
Is Trump mad?
Like · Reply · 1m
Ricky Lim
Trump said the Fed's course of tightening monetary policy "now hurts all that we have done."
Fed has raised the benchmark lending rates twice this year, after three increases in 2017, and two more rate hikes are expected this year as the central bank removes stimulus from the economy to keep a lid on inflation.
The chance inflation might accelerate has increased after the massive tax cut Trump championed last year, which has raised the US debt and budget deficit.
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Trump are you trying to play economist?
Trump is playing with fire by meddling with Fed's job - and he may cause US Economy to plummet.
Posted on:- 20 Jul 2018 01:41AM
Ricky Lim
Trump is not aware that US Economy is overheating - due to its expansionary fiscal policies of cutting taxes when the Economy is already booming.
Fed raise interest rate to cool the Economy - to prevent overheating and to prevent forming bubbles that will cause Economic Boom and Bust.
Like · Reply · 1m · Edited
Ricky Lim
If Fed did not increase interest rate or worst reduce the interest rate - as what Trump suggest - the booming and overheating US Economy - will overheat very quickly and inflation will go over the moon - causing US Economy to bust very quickly ---- as consumers will overspent due to easy credit from the banks.
Banks will go bust very quickly as business over borrow and consumers over borrow due to easy credit and cheap interest - and then business cannot pay back due to oversupply with falling demands or consumers strain their credit limit too much but can't repay the loans.
Fed has raised the benchmark lending rates twice this year, after three increases in 2017, and two more rate hikes are expected this year as the central bank removes stimulus from the economy to keep a lid on inflation.
The chance inflation might accelerate has increased after the massive tax cut Trump championed last year, which has raised the US debt and budget deficit.
--
Trump are you trying to play economist?
Trump is playing with fire by meddling with Fed's job - and he may cause US Economy to plummet.
Posted on:- 20 Jul 2018 01:41AM
Ricky Lim
Trump is not aware that US Economy is overheating - due to its expansionary fiscal policies of cutting taxes when the Economy is already booming.
Fed raise interest rate to cool the Economy - to prevent overheating and to prevent forming bubbles that will cause Economic Boom and Bust.
Like · Reply · 1m · Edited
Ricky Lim
If Fed did not increase interest rate or worst reduce the interest rate - as what Trump suggest - the booming and overheating US Economy - will overheat very quickly and inflation will go over the moon - causing US Economy to bust very quickly ---- as consumers will overspent due to easy credit from the banks.
Banks will go bust very quickly as business over borrow and consumers over borrow due to easy credit and cheap interest - and then business cannot pay back due to oversupply with falling demands or consumers strain their credit limit too much but can't repay the loans.
Like · Reply · 1m
Ricky Lim
Think EU and China may be able to defeat Trump's trade war using trade tariff - and burn Trump real bad.
That is why EU and China are not compromising.
That is why EU and China are not compromising.
Like · Reply · 1m · Edited
John Low
USA is trying to get money invested by private companies overseas to return to US. They have been successful so far but with US dollars rising whatever tariff imposed wont be attractive for these companies to return as it will be better to remain overseas. That is his concern.
Ricky Lim
John Low - Trump may find out later that he is digging a hole - for him to jump in later.
Trump may ended in a total defeat - and US economy become his collateral.
(1) Trump try to start a global trade war opening up multiple front - this is a deadly mistake.
He did not know that US companies rely on Global Supply Chain - to provide the most cost effective product. He is killing his US companies competitiveness.
(2) Trump want to force his MNCs abroad to come home - another deadly mistake.
(i). US MNCs sell worldwide for a $80 trillion market of 6 billion people market - not his US $19 trillion market of 500 million people market.
Imagine microsoft not selling its product worldwide, Coca-cola, macdonald, facebook, amazon web service, apple, google, boeing etc ---- the US MNCs revenue will plummet 90% in total revenue.
(ii). Even if all US MNCs go home, the World will not buy from them as their cost will be too high - and instead will look to buy cheaper alternative products.
(3) Trump by waging global trade war using trade tariff on China and EU is another deadly mistake.
(i) Both China and EU depreciate their currency - it will compensate for Trump tariff and both China and EU continue to sell at the same price to US consumers because US need to convert strong US dollar to cheaper yuan or euro - and US consumers with strong dollars don't feel that the prices of China and EU goods have increase.
(ii) Trump cannot force Fed to reduce interest rate so that US dollar depreciate to match China and EU to make US competitive in export market - because Trump is forcing US economy to overheat due to tax cut when US economy is already booming.
By reducing interest rate to depreciate the value of US dollars - will drive up inflation due to the easy credit, high demand of US consumers - that will cause a runaway inflation like what US has gone through with ex-Nixon past similar interference in Fed driving up high inflation that cause US economy to bust.
Trump may ended in a total defeat - and US economy become his collateral.
(1) Trump try to start a global trade war opening up multiple front - this is a deadly mistake.
He did not know that US companies rely on Global Supply Chain - to provide the most cost effective product. He is killing his US companies competitiveness.
(2) Trump want to force his MNCs abroad to come home - another deadly mistake.
(i). US MNCs sell worldwide for a $80 trillion market of 6 billion people market - not his US $19 trillion market of 500 million people market.
Imagine microsoft not selling its product worldwide, Coca-cola, macdonald, facebook, amazon web service, apple, google, boeing etc ---- the US MNCs revenue will plummet 90% in total revenue.
(ii). Even if all US MNCs go home, the World will not buy from them as their cost will be too high - and instead will look to buy cheaper alternative products.
(3) Trump by waging global trade war using trade tariff on China and EU is another deadly mistake.
(i) Both China and EU depreciate their currency - it will compensate for Trump tariff and both China and EU continue to sell at the same price to US consumers because US need to convert strong US dollar to cheaper yuan or euro - and US consumers with strong dollars don't feel that the prices of China and EU goods have increase.
(ii) Trump cannot force Fed to reduce interest rate so that US dollar depreciate to match China and EU to make US competitive in export market - because Trump is forcing US economy to overheat due to tax cut when US economy is already booming.
By reducing interest rate to depreciate the value of US dollars - will drive up inflation due to the easy credit, high demand of US consumers - that will cause a runaway inflation like what US has gone through with ex-Nixon past similar interference in Fed driving up high inflation that cause US economy to bust.
Like · Reply · 1m · Edited
Ricky Lim
That is why, Trump is not an economist - but play economist.
The World have bigger firepower to hit Trump hard and yet Trump still very cocky - and don't know danger is swallowing up......
The World have bigger firepower to hit Trump hard and yet Trump still very cocky - and don't know danger is swallowing up......
Like · Reply · 1m
Ricky Lim
In short, layman term :-
(1) China and EU only need to sell to US - but don't need to buy from US (can buy elsewhere).
Thus, China and EU weak currency can be used to compensate for US tariff.
US need to buy - and need strong dollar (to attact cashflow - due to large debt) to pay for purchase.
US cannot depreciate its dollar - because of runaway inflation and no cash to service its spending due to fiscal deficit and high debt.
(2) China and EU has strong firepower of reserves.
China has at least $3 trillion.
US has no reserve but huge debt of $21 trillion and US can only hit China tariff of $500 billion - which is a sup-sup-water.
China firepower reserve will hit US until the cow come home.
(1) China and EU only need to sell to US - but don't need to buy from US (can buy elsewhere).
Thus, China and EU weak currency can be used to compensate for US tariff.
US need to buy - and need strong dollar (to attact cashflow - due to large debt) to pay for purchase.
US cannot depreciate its dollar - because of runaway inflation and no cash to service its spending due to fiscal deficit and high debt.
(2) China and EU has strong firepower of reserves.
China has at least $3 trillion.
US has no reserve but huge debt of $21 trillion and US can only hit China tariff of $500 billion - which is a sup-sup-water.
China firepower reserve will hit US until the cow come home.
Like · Reply · 1m
Ricky Lim
No wonder why 大军杀到面前来了 - 为何 both China and EU 还按兵不动 ---- now realise 螳螂捕蝉，麻雀在后。
大家把身家也压上了。
高招，高招。
大家把身家也压上了。
高招，高招。
Like · Reply · 1m · Edited
Ricky Lim
Also because both China and EU maintain a big network of trading Nation, when China and EU depreciates its currency, other Countries cannot maintain too strong a currency - as both can buy from other sources.
Thus other Nations in order to maintain their trade with both China and EU will also need to maintain currency exchange with China and EU to ensure competitiveness.
Trump-led US is really in a deep shit...
Thus other Nations in order to maintain their trade with both China and EU will also need to maintain currency exchange with China and EU to ensure competitiveness.
Trump-led US is really in a deep shit...
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