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Friday, December 13, 2019

China, US agree on text of phase one trade deal

Contrary to President Trump's bullish, self congratulating statements on a new China US Trade Deal, the official China News Agency posted a more sober worded report noting "China and the United States have agreed on the text of a phase one economic and trade agreement based on the principle of equality and mutual respect".

The text includes nine chapters: the preface, intellectual property rights, technology transfer, food and agricultural products, financial services, exchange rate and transparency, trade expansion, bilateral assessment and dispute settlement, and the final terms, according to a statement issued by the Chinese side Friday night.

Both sides have reached consensus that the U.S. side will fulfill its commitments to phase out its additional tariffs on Chinese products, so as to achieve a switch from hiking to cutting additional tariffs.

"The Chinese side believes that China and the United States, the world's two largest economies, must deal with bilateral economic and trade relations with the big picture in mind. Reaching the agreement will serve the fundamental interests of the people of the two countries and the world, and is expected to bring positive influences on areas including economy, trade, investment and the financial market.

The agreement is generally in line with the main direction of China's deepening reform and opening up as well as the internal needs for advancing the high-quality economic development".

Read more at: China, US agree on text of phase one trade deal - Chinadaily.com.cn

Thursday, December 12, 2019

WTO: EU to give themselves new powers after WTO deadlock

Brussels might soon be able to bypass the US-crippled WTO to impose punitive tariffs on trade partners. The EU cannot afford to be "defenseless", said the bloc's trade commissioner Phil Hogan.

Read more at: 
https://www.dw.com/en/eu-to-give-themselves-new-powers-after-wto-deadlock/a-51646530

Wednesday, December 11, 2019

China-US Trade Relations: Washington's disruptive trade practice knows no bounds - Opinion - by Chen Weihua

The punitive tariffs announced by the United States against importsfrom Brazil, Argentina and France on Monday are nothing but the latestdisplay of its unilateral, protectionist and bullying trade policy and practice.

US President Donald Trump tweeted on Monday morning that he would slap tariffs on steel and aluminum from Brazil and Argentina because the two countries "have been presiding over a massive devaluation of their currencies". The two largest South American economies had been exempted
from US tariffs last year.

Just like the US' false accusation in August that China manipulates its currency, its allegation against Brazil and Argentina has not been supported by facts. The two currencies have been depreciating due to the poor economic performance of the two countries. In fact, both governments have tried to prop up their currencies.

Read more at: Washington's disruptive trade practice knows no bounds - Opinion - Chinadaily.com.cn

Tuesday, December 10, 2019

U.S. and Chinese trade negotiators planning for delay of December tariffs - MarketWatch

U.S. and Chinese trade negotiators are laying the groundwork for a delay of a fresh round of tariffs set to kick in on Dec. 15, officials on both sides said,...

Read more at:

https://www.marketwatch.com/story/us-and-chinese-trade-negotiators-planning-for-delay-of-december-tariffs-2019-12-10-191035918

Monday, December 9, 2019

USA - the economy and the nation will face a "perfect storm" politically and economically:the 2020s will see 'real turmoil' as US debt woes come home to roost, says Gundlach - by Julia La Roche

Influential bond investor Jeffrey Gundlach, the CEO of $150 billion DoubleLine Capital, sees trouble brewing in the debt market, despite interest rates hovering near historic lows.

In a recent discussion with Yahoo Finance, Gundlach compared the current expansion to the boom that took place nearly 100 years ago. But the next decade will be the opposite of the roaring 1920s, he said, as the debt bomb the U.S. is sitting on becomes untenable in the next economic downturn.

"It's pretty interesting because the 20s in the 20th century, the 20s were super boom times. And weirdly, I think the 20s this time will be very much different than that, with real turmoil," the 60-year-old billionaire said in a recent wide-ranging interview with Yahoo Finance.

In Gundlach's view, the 2020s will see "the crescendo" of many unattractive trends that have been talked about for years, but finally come home to roost. 

"[We're] going to have to face Social Security, health care, all of these things, deficit-based spending — all of that is going to have to be resolved during the 2020s because the compounding curve is just so bad," the billionaire added.

According to the Congressional Budget Office, the federal deficit will top $1 trillion every year beginning in 2022. Yet Gundlach said the agency’s forecast may be too rosy, given that it assumes a "pretty benign future" with no recession and interest rates that are not very high. 

Interest costs to the government, as a percentage of gross domestic product are expected rise from 1.25% to at least 3% by 2027. “That's a big, big increase. And that's coming,” the investor told Yahoo Finance.

“And when you do that, it kind of says, ‘Hey, GDP is going to be knocked by 2%-2.5% because we have to pay interest,’” he added.

Note EU-Digest: these economic problems will be compounded by a totally inept Trump Administration, which has turned the Republican party of Lincoln, Eisenhower and Reagan into a Trump loyalist party which is now based on State Planning and Crony Capitalism

Read more at: Gundlach: The 2020s will see 'real turmoil' as US debt woes come home to roost

Sunday, December 8, 2019

China-US relations: U.S. bill on China's Xinjiang violates international law, regional official says

Recent U.S. legislation on Xinjiang is a severe violation of international law and gross interference in China's internal affairs, the governor of the far western region said on Monday, accusing the United States of launching a smear campaign.

Read more at:
https://uk.reuters.com/article/uk-china-xinjiang/u-s-bill-on-chinas-xinjiang-violates-international-law-regional-official-says-idUKKBN1YD05C

Saturday, December 7, 2019

British Elections - Voodoo Economics: Sterling soars against dollar as traders bet on Johnson election win

The Pound raced to a seven-month high against the dollar on Wednesday as City traders bet that Boris Johnson was on course for victory in the general election.

Sterling jumped above $1.30 to hit 1.311, its highest level since May, while the euro rate moved above €1.18 from close to parity in the ummer when the Conservative leadership contest triggered a fresh round of Brexit uncertainty.

Read more at: Sterling soars against dollar as traders bet on Johnson election win | Business | The Guardian