America: The Beatings Will Continue Until Morale Improves
As irrational as trump is, — it may well get worse.
Tonight, the U.S. in its ultimate wisdom is about to double tariffs on Chinese products at a whopping 104%.
Of course, this will hurt China, however while it will hurt China, what may come in response may well devastate America.
China may embargo the United States, shipping virtually nothing to the U.S.
Can you even imagine the response?
America imported 440 Billion dollars worth of Chinese products. But with respect to manufactured goods, America imports almost all its consumable, everyday items from China.
For Americans the effect will be immediate and consequential, so consequential, a significant number of America’s lower income earners, will not be able to afford.
The everyday consumables are literally too many to itemize. Americans will be paying double what they now pay for these items.
As for American farmers, many will go bankrupt, pure and simple, particularly those selling soybeans.
The list above illustrates how harmful it will be for select industries in the U.S., but it won’t end even when the tariffs are removed, because the market will have been filled by other countries.
In relation to each commodity above, there are other countries already in trade talks with China who will replace whatever products are heavily tariffed, such as soybeans by Canada, or oil and pharmaceuticals by Canada.
And why not?
Trump has torn up the agreements he previously signed with Canada, in turn imposing additional tariffs of 25% on select goods, without any rationale or valid reason.
None.
But the nuclear option, besides an embargo resides with China, and Japan, who between them hold 2 Trillion dollars of U.S. debt.
If the U.S. had to pay buy back its debt from China, America would have an immediate financial downturn, devaluation of the American dollar and imports would again go up in price.
The question remains, however, ‘what if other nations are unwilling to buy American debt in the form of treasury tools’?
China, and other nations have strategically been building their gold reserves in a hedge against U.S. treasuries somehow reducing dramatically.
While Japan now holds more American debt than China, any major shift may well imbalance the world’s financial markets.
BRICS is already destabilizing the world’s reserve currency holder, and will attempt to continue to do so, however, were another currency be chosen as the world’s reserve currency, the impact on America, American debt and America’s economic fortunes would plunge.
If Trump’s idiotic tariff tax on Americans continues, inflation will undoubtedly rise. If that happens, it may well call into question the security and stability of the dollar for long-term savings and investments.
“This change could incrementally diminish the role and importance of the U.S. dollar while creating a multipolar financial world where the next tier of economies would have significantly more say in global affairs.”
Central banks around the world, based on Trump’s weaponization of financial markets, are diversifying and may do so much more rapidly as ‘trust’ in America diminishes, which it obviously has.
America, if it continues its global trade war, may find itself in deep financial trouble, – a recession being the ‘best’ case scenario. If this should happen, America will have huge issues to overcome as it will have lost allies, friends, investors and economic partners.
Trump will have bought about America’s inevitable collapse as the world’s leader and reserve currency of choice.
America elected a clown.
It now is watching the circus in action.
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