US-China Trade War: On The Brink

Posted July 21, 2018

President Trump believes China poses a grave threat to the United States. His demands for trade concessions from China are designed to eliminate that threat. China cannot possibly meet those demands, however, since a large reduction in its trade surplus with the United States could cause the Chinese economy to spiral into a severe Depression.

Not surprisingly, trade negotiations have stalled.  Therefore, it is time to consider the possibility of an all-out, no holds barred Trade War between the United States and China. 

A US trade war with China has the potential to ignite geopolitical tensions on a scale that hasn’t existed since the collapse of the Soviet Union.  Economically, a trade war has the potential to bring about a global economic crash at least as bad as that of 2008, and possibly much worse.

Today, Macro Watch has published the first of a three-part video series on this subject. It explains the background to this crisis and how President Trump came to view China as a threat that must be stopped.  Macro Watch subscribers can log in and watch “On The Brink” now.  The video is 13 minutes long and contains 27 downloadable charts.

Parts 2 and 3 of this series will consider a number of scenarios of how this crisis could play out, as well as the potential consequences and the possible investment implications of each scenario.

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