For a long time, President Trump threatened to throw down a trade war with China. He cited the fact that America is over $500 billion in the red concerning trade with China. The United States of America runs a $750 billion deficit in trade worldwide. But Ted Bauman, an author and economy expert, says that America actually runs in the black after you consider corporate profits.
Ted Bauman believes a trade war with China could be devastating to the American economy. He points to t
Ted Bauman believes that China will crackdown on regulations when it comes to trade. This could have devastating economic impacts on some of the biggest companies in the world. Apple is one of these companies. Increased regulation could make it more expensive to produce gadgets in China and to sell goods in Asia’s biggest market. This would cost many companies hundreds of millions of dollars.
China may resort to boycotting American products altogether. This would have devastating impacts on the entire American economy as China shuts the door on hundreds of billions of dollars worth of goods and services. This would throw the American economy into turmoil and the markets would be challenged.
China is also looking to set up new trade partners in an effort to avoid American tariffs. Ted Bauman believes this will take the trade war global as America would continue to shift its tariff schedule. Take Mexico, for instance. China could increase its exports to Mexico but America would simply raise tariffs on Mexico in a response. This could conflate the trade war even further.
Many of America’s strongest companies will not be affected as markets are challenged by the trade war. But the economy as a whole could come grinding to a halt. This is how a bullish market dies, according to Ted Bauman. There are sure to be some fireworks so let’s sit back and watch the show.
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