“It is difficult not to marvel at the imagination which was implicit in this gargantuan insanity. If there must be madness something may be said for having it on a heroic scale."
John Kenneth Galbraith. The Great Crash: 1929.
If any of this insanity
actually happens, stocks will likely take the elevator straight to the
basement, led by Daimler (Mercedes) and Boeing. If the trade war goes nuclear, the US dollar
and the EUSSR Euro currency war will become a race to the basement too.
EU Threatens Iconic U.S. Brands After Trump Opens Door to Trade War
By Joe Deaux, Andrew Mayeda, Toluse Olorunnipa, and Erik Wasson
2 March 2018, 19:13 GMT Updated
on 3 March 2018, 18:25 GMT
Donald Trump set the stage for a trade war by slapping tariffs on steel and
aluminum imports, daring other countries to retaliate and leading the European
Union to warn that it would target iconic American brands. In turn, the U.S.
president put the European auto industry in his sights.Hours after Trump said in a Twitter message that “trade wars are good, and easy to win,” European Commission President Jean-Claude Juncker said the bloc was prepared to respond forcefully by targeting imports of Harley-Davidson Inc. motorbikes, Levi Strauss & Co. jeans and bourbon whiskey from the U.S.
Juncker’s threat heightened the prospects of a global free-for-all, as the World Trade Organization said the potential of escalating tensions “is real” and the International Monetary Fund warned the restrictions would likely damage the U.S. and global economy.
Trump tweeted on Saturday that “If the E.U. wants to further increase their already massive tariffs and barriers on U.S. companies doing business there, we will simply apply a Tax on their Cars which freely pour into the U.S.”
The president faces anger from manufacturers and trade partners in Asia and Europe, as well as from allies such as Republican lawmakers, after announcing tariffs of 25 percent on imported steel and 10 percent on aluminum for “a long period of time.”
He’s expected to sign the formal order as early as the coming week after certain formalities are completed, Peter Navarro, director of the National Trade Council at the White House, said Saturday in an interview on satellite radio. Commerce Secretary Wilbur Ross said on Friday the president has chosen to impose the tariffs on all countries and products, dimming the hopes for nations such as Australia still pressing for an exemption.
----The EU is prepared to retaliate against select U.S. imports in a way that would maximize political pressure on American leaders. Harley-Davidson is based in House Speaker Paul Ryan’s home state of Wisconsin, while bourbon whiskey hails from Senate Majority Leader Mitch McConnell’s home state of Kentucky. San Francisco-based Levi Strauss is headquartered in House Minority Leader’s Nancy Pelosi’s district.
The chief executive officer of Germany’s Siemens AG was the latest to slam the tariff plan. “After a great tax reform aimed at creating jobs, now a lousy approach on fair trade,” Joe Kaeser said on Twitter on Saturday. “Not good for customers, not good for jobs. Not good for a free world.”
March 3, 2018 / 8:09 PM / Updated 4 hours ago
Trump threatens to tax European auto imports
WASHINGTON
(Reuters) - U.S. President Donald Trump kept up pressure on trading partners on
Saturday, threatening European automakers with a tax on imports if the European
Union retaliates against his plan to slap tariffs on aluminum and steel.
Trump’s
tweet suggested he is refusing to yield to U.S. business interests and foreign
trading partners alarmed at the prospect of a trade war that rattled financial
markets this week.
“If the E.U.
wants to further increase their already massive tariffs and barriers on U.S.
companies doing business there, we will simply apply a Tax on their Cars which
freely pour into the U.S.,” Trump wrote on Twitter.“They make it impossible for
our cars (and more) to sell there. Big trade imbalance!”
The United
States imposes a 2.5-percent tariff on cars assembled in Europe and a
25-percent tariff on European-built vans and pickup trucks. Europe imposes a
10-percent tariff on U.S.-built cars.
Trump
criticized Europe in remarks at a fundraiser, according to video posted online
Saturday, and suggested they would not increase tariffs.
“The
European Union: brutal. They’ve been brutal to us,” Trump said at a Florida
fundraiser.“They’ve banded together in order to beat the United States in
trade.”
In a speech
Friday night at Harvard University, European Commissioner for Competition
Margrethe Vestager said the EU will respond to the tariffs“to defend European
industry, and the world trading system,” according to a copy of her remarks.
She called the Trump action“one-sided protectionist measures, which hurt, not
just jobs, but the whole system of rules that makes our global economy work.”
German
automakers Volkswagen AG, Daimler AG and BMW AG build vehicles at plants in the
United States. BMW employs more than 9,000 workers in South Carolina and is one
of the state’s largest employers.
The United States accounts
for about 15 percent of worldwide Mercedes-Benz and BMW brand sales, while it
accounts for 5 percent of VW brand sales and 12 percent of Audi sales.
The United States had a
$22.3 billion automotive vehicle and parts trade deficit with Germany in 2017
and a $7 billion deficit with the United Kingdom, according to U.S. government
data.
More
March 4, 2018 / 4:29 AM / Updated 34 minutes ago
China says it does not want a trade war with U.S
BEIJING
(Reuters) - China does not want a trade war with the United States but will
defend its interests, a senior Chinese diplomat said on Sunday, after U.S.
President Donald Trump announced a plan to put tariffs on steel and aluminium
imports.
----Negotiations
and mutual opening of markets were the best ways to resolve trade frictions,
Chinese Vice Foreign Minister Zhang Yesui said at a briefing ahead of China’s
annual session of parliament, which opens this week.
“China does
not want to fight a trade war with the United States, but we absolutely will
not sit by and watch as China’s interests are damaged,” Zhang, who is a
spokesman for parliament and was formerly an ambassador to the United States,
said.
“If policies
are made on the basis of mistaken judgements or assumptions, it will damage
bilateral relations and bring about consequences that neither country wants to
see,” he said.
Trump
believes the tariffs will safeguard American jobs, but many economists say the
impact of price increases for users of steel and aluminium, such as the auto
and oil industries, will destroy more jobs than curbs on imports create.
Nonetheless,
there is growing bipartisan consensus in Washington, and support within the
U.S. business community, for the U.S. government to counter what are seen as
Beijing’s predatory industrial policies and market restrictions on foreign
firms.
More
Protectionism will do little
to create jobs and if foreigners retaliate, we will surely lose jobs.
Alan Greenspan.
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