The rapidly escalating trade dispute between the U.S. and China is taking its toll on equity investors around the globe.
Following U.S. President Donald Trump’s imposition of up to US$60 billion in tariffs on Chinese goods, Beijing quickly responded with a 25 per cent levy on imports of U.S.-made goods. They total US$3 billion on select items such as pork, fruit, wine, soybeans, steel pipes and recycled aluminum.
However, it may not be the size of the tariffs that markets are most worried about, but rather the response itself, which suggests more retaliation is coming.
I do wonder what Trump is up to. Although he does say that we are exempt from this trade war games he is playing I can't help but wonder if this is a bigger strategy that could affect our economy in the long term.
Have to applaud him for following through on his promise to his base. It's safe to say he will reerse is position by year's end due to the domino effect this will have, but it will certainly win the hears of his base for reelection purposes.
It would make for interesting theatre to see how far this goes. I doubt the Conservative right would allow it to go deeper. If i recall my studies, the US Congress needs 2/3rds majority to pretty much cripple their President's actions.
Most of my investments are tied into Apple's stock and so I am very aware this US/China fiasco could hurt me.
But honestly, i doubt this is anything beyond hot air. He just is pounding his chest to see what China does. He has no intentions of following through.
Mentioning Facebook as one of these 5 stocks is irrelevant. China has traditionally blocked most non-local apps. Looking to clone their own so they can keep the money in their own economy.
Right now WeChat and QQ own their Social Network market. And it won't be changing any time soon. Their people are even bred to only want homegrown products, even if their are inferior to other brands.
Anyone read how China products can ship to North America for cheap but the reverse is not true? It's because we subsidize China to allow their products to come here on the cheap.