By Selina Stoller, Summit Consumer Receivables Acquisitions, LLC
America’s trade war is becoming a major topic of conversation around the world. President Trump so far has a clear and major trade advantage: The U.S. economy is booming.
“We have to realize that perhaps China isn’t as strong as when we at first think. China is still figuring out also how to deal with this trade situation, how to ensure the stability of its domestic economy,” says Curtis Chin of the economic think tank, Milken Institute.
“And that works to the advantage of President Trump, and I think what’s really working to the advantage of President Trump is the state of the U.S. economy right now. Really, the U.S. economy is firing on all cylinders,” he told CNBC’s “Squawk Box” on Monday.
Chin, who was also U.S. ambassador to the Asian Development Bank, does not think the White House’s policies have backfired. He points out that Beijing has not been as aggressive towards President Trump as expected – the second largest economy is still figuring out its game plan.
America’s strong economy is helping its labor market weather any possible trade tensions between China, Mexico, Canada, and the European Union.
Currently, the US is seeing record employment with the number of Americans filing for unemployment benefits unexpectedly falling last week. This current economic strength would give President Trump, if necessary, a “backstop” should the trade situation deteriorate in the long run.
What will it look like for America to win the trade war? America has been running a chronic trade deficit, which means the current international system is not fiscally beneficial to America.
It seems the goal of this trade war would be to eliminate America’s trade deficit and create a U.S. trade surplus.
President Trump has made it clear he has been elected as “president of Americans, not of the world.” Overall, decisions from China’s leadership will ultimately impact more than just the U.S.
- 17 Aug, 2018
- Josh Smith