http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/ Is the Trade War about to Get Worse? The G-20 leaders are heading to Buenos Aires, Argentina and on the sidelines President Trump is expected to meet with the Chinese leader, Xi Jinping. On one hand there is the remote possibility that the two leaders will come to an agreement to defuse or resolve the escalating trade war. On the other hand, it is more likely that things will just get worse as neither side is prepared to give ground. Is the trade war about to get worse or better? Business Insider reports that Goldman Sachs believes the meeting will make the trade war much worse. “We currently see ‘escalation’ as the most likely outcome in the next few months, with slightly over a 50% probability,” the note from a Goldman team led by Andrew Tilton said. That scenario, according to the report, would mean tariff rates rise to 25% on all imports currently under tariff, while tariffs are extended to remaining Chinese imports. The other, less likely, near-term scenarios Goldman Sachs outlines in the note are a ‘pause,’ and a ‘deal.’ “The chances of a comprehensive deal are pretty low in the near term (10%), though rising over the course of 2019,” the bank said. “By late 2019, however, we think it is likely we will have at least reached a ‘pause.’” According to Goldman Sachs, the worst effects of a worsening trade war will be on the Chinese currency and on equities. What other outcomes are in the wings if the trade war escalates?

1. Is the Trade War
about to Get
Worse?
By www.ForexConspiracyReport.com

2. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
The G-20 leaders are heading to
Buenos Aires, Argentina and on the
sidelines President Trump is
expected to meet with the Chinese
leader, Xi Jinping.

3. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
On one hand there is the remote
possibility that the two leaders will
come to an agreement to defuse or
resolve the escalating trade war.

4. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
On the other hand, it is more likely
that things will just get worse as
neither side is prepared to give
ground.

5. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
Is the trade war about to get worse
or better?

6. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
Business Insider reports that
Goldman Sachs believes the
meeting will make the trade war
much worse.

7. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
“We currently see ‘escalation’as
the most likely outcome in the next
few months, with slightly over a
50% probability,” the note from a
Goldman team led by Andrew Tilton
said.

8. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
That scenario, according to the
report, would mean tariff rates rise
to 25% on all imports currently
under tariff, while tariffs are
extended to remaining Chinese
imports.

9. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
The other, less likely, near-term
scenarios Goldman Sachs outlines
in the note are a ‘pause,’and a
‘deal.’

10. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
“The chances of a comprehensive
deal are pretty low in the near term
(10%), though rising over the
course of 2019,” the bank said.

11. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
“By late 2019, however, we think it
is likely we will have at least
reached a ‘pause.’”

12. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
According to Goldman Sachs, the
worst effects of a worsening trade
war will be on the Chinese currency
and on equities.

13. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
What other outcomes are in the
wings if the trade war escalates?

14. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
Trade War Concerns
among China’s Economists

15. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
NPR reports that even in China
there is concern among China’s
economists that the trade war will
visit lasting damage.

16. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
“This trade war is not between
China and the U.S.,” says
economist Sheng Hong.

17. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
“It’s a war between China’s most
powerful political interest group on
one side, while the U.S. and the
people of China are on the other.”

18. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
We wrote about this dilemma in our
most recent article, Can China
Make the Changes Necessary to
End the Trade War?

19. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
The bottom line for the leaders of
the Chinese Communists Party is
that they want to hold on to power.

20. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
But, the route out of a trade war
includes opening up their economy
to foreign investment and loosening
the rules for private entrepreneurs
in China.

21. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
Both of these actions and especially
the second are threats to the
Communist Party.

22. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
Mr. Sheng explains that Chinese
economic growth has come
primarily from private businesses.

23. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
Nevertheless, state owned
companies are on the rise and
protected by the government
despite their rising debts, lower
production, and lack of innovation.

24. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
“The so-called ‘China Model’
assumes economic growth is due to
government control and the
contribution of state-owned
enterprises,” says Sheng.

25. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
“This is not in line with the facts.
One hundred percent of Chinese
companies were owned by the state
in 1978, and our economy was
terrible.

26. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
As the state gave up market control
to the private sector, our economy
grew. We must keep doing that.”

27. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
Despite the fact that ninety percent
of China’s economic growth has
come from the private sector, the
leadership under Mr. Xi is intent on
following a path of centralized
control.

28. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
The bottom line is that the folks in
charge in China do not want to give
up their power or their perks
despite the damage there actions are
visiting on the people of China!

29. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
Is the Trade War about to
Get Worse?

30. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
If you read this situation from the
perspective of short term politics,
you might be able to see an
agreement to pause in the escalation
of the trade war.

31. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
But, from the standpoint of long
term national and global power,
neither side wants to give ground.

32. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
The USA sees its power slipping
away because of a lopsided balance
of trade with China and it sees its
technical and scientific dominance
being stolen by the Chinese
government and by Chinese
companies with the blessing of the
Chinese government.

33. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
China has tasted a miraculous rise
in economic and political power
and does not want to give that up.

34. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
The Chinese people have been
“bought off” by economic gains
while remaining in the “bird cage”
of government control.

35. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
The legitimate concern of the
Communist Party is that when the
economic gains go away social
unrest will follow as the people will
figure that the government has
fulfilled their part of the social
contract.

36. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
If the trade war gets worse we can
expect to see the Yuan depreciate
farther and stocks in China as well
stock markets around the world fall
in value.

37. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
Commodities are already taking a
hit as noted by Reuters as soybean
producer, Argentina, buys
discounted US soybeans that were
originally destined to be sold to
China.

38. http://www.forexconspiracyreport.com/is-the-trade-war-about-to-get-worse/
Of course, Argentina may just turn
around and sell those soybeans at a
markup to China!