Trump Says "We Don't Need China" then "Orders" Businesses to Find Alternative

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After Beijing announced an additional $75 billion tariffs on the US, Trump demanded US Businesses find alternatives.

We Don't Need China

Trade and currency wars took another huge leap forward just one day after another oft-repeated message that a deal with China is coming.

The Wall Street Journal reports Trump Orders U.S. Businesses to Find Alternative to China.

President Trump said U.S. companies were “hereby ordered” to start looking for alternatives to doing business in China after Beijing said it would impose tariffs on $75 billion worth of additional U.S. products.

“Our Country has lost, stupidly, Trillions of Dollars with China over many years,” Mr. Trump wrote in a series of tweets. “They have stolen our Intellectual Property at a rate of Hundreds of Billions of Dollars a year, & they want to continue. I won’t let that happen! We don’t need China and, frankly, would be far better off without them.”

Mr. Trump’s comments came in response to China’s plan, laid out Friday, to impose tariffs of 5% and 10% on almost all the remaining U.S. imports on which it has yet to impose punitive taxes, including vehicles and car parts, in retaliation against U.S. moves to slap punitive tariffs on an additional $300 billion of Chinese goods.

The president demanded that U.S. companies “immediately start looking for an alternative to China, including bringing your companies HOME and making your products in the USA.”

Items China plans to impose tariffs on include agricultural products, apparel, chemicals and textiles.

Some major car companies will be hit hard by the increase in tariffs, particularly Tesla Inc.and Ford Motor Co., as well as Germany’s BMW AG and Daimler AG ’s Mercedes-Benz. These companies build a significant number of vehicles in the U.S. for export to China—mostly premium models—and a higher tariff could force them to raise prices.

Soon after President Trump announced his plans for fresh tariffs set for Sept. 1, Beijing responded by officially announcing the freezing of purchases of U.S. agricultural products and letting its currency drop to its lowest level in a decade. A weaker yuan makes Chinese exports cheaper.

China Tweetstorm

Wow

Bond yields are tumbling, the DOW is down 500 points, The Yuan is hitting new lows and gold is up $30.

Mike "Mish" Shedlock

Comments (48)
No. 1-22
Augustthegreat
Augustthegreat

Another win for the Chosen One

Realist
Realist

When you believe you are “the chosen one”, I guess you can “order” anything you wish: Trump can command the seas to part; he can command every woman he has ever molested to forget it happened; he can order US businesses to follow his wishes; he can declare he is “greatest” at anything he has ever done. Another fine example of why...

He is the worst President ever.

Tony Bennett
Tony Bennett

Well, not much to say at this point ... except ... Got Popcorn?

Webej
Webej

In contrast to the Communist Party which "controls" Chinese businesses, in America private businesses are not told what to do by the government. O wait...

LB412
LB412

This administration does not understand global trade. For example I order $10M of products to be delivered in September. $1M will ship to the USA to be sold to domestic customers. The $9M balance is drop shipped to the rest of the world. The entire $10M in revenue comes to the USA where it funds staffing, rent, profits are taxed, etc. This is highly beneficial to all parties involved.

The supply chain simply cannot be changed to the USA, Vietnam, or elsewhere over the short or midterm. In fact if possible at all it will take many years.