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  1. #1
    Abner is offline Registered User
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    Spurned by Trump, China and Mexico talk about a trade deal

    Spurned by Trump, China and Mexico talk about a trade deal - Jul. 5, 2017

    "But as long as the fate of U.S.-Mexico relations remains uncertain, the trade chatter with China reinforces Mexico's message to Trump: We're looking elsewhere."


    'For example, Mexico is accelerating trade talks with the European Union to update an agreement. Both sides hope to finish talks by the end of this year. Mexican officials also want stronger ties to Argentina and Brazil. Those two nations produce two big products -- corn and soy -- that Mexico mostly buys from the United States."

    "But as long as the fate of U.S.-Mexico relations remains uncertain, the trade chatter with China reinforces Mexico's message to Trump: We're looking elsewhere. For example, Mexico is accelerating trade talks with the European Union to update an agreement. Both sides hope to finish talks by the end of this year."


    Sounds like a win win for Mexico.

  2. #2
    b4cz28 is offline Registered User
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    That sounds real good to me. Real bad for them as we are the largest consumer of goods In the world. I think you could add everyone else up and we are still the biggest. If the US stopped buying from China they would implode in a year. If we stopped buying drugs from Mexico the same thing would happen.
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  3. #3
    heirophant is offline Registered User
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    Both China and Mexico occupy a similar ecological niche, that of low-cost manufacturer for the United States and the whole 20th century developed world market. Trading with each other wouldn't work nearly as well.

    The Chinese in particular use trade as an old style mercantilist geopolitical weapon, managing things so as to run huge trade surpluses each year with the United States. That benefits China in several ways. It funds China's rise and the development of all those shiny new cities in China. And it de-industrializes the United States, weakening the US as a long-term military-industrial rival.

    Conversely, China allows its Asian neighbors to run trade surpluses with China, tying their prosperity to China's continued benevolence and giving the 'Middle Kingdom' a huge lever to ensure their cooperation. That's the plan with Taiwan, make the island so dependent on trade with Beijing that Taipei has to agree to eventual communist rule.

    If China ever lost the continual flow of money from the US, the whole 'rise of China' project would collapse and their economy would probably collapse along with it.

  4. #4
    Abner is offline Registered User
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    Quote Originally Posted by heirophant View Post
    Both China and Mexico occupy a similar ecological niche, that of low-cost manufacturer for the United States and the whole 20th century developed world market. Trading with each other wouldn't work nearly as well.

    The Chinese in particular use trade as an old style mercantilist geopolitical weapon, managing things so as to run huge trade surpluses each year with the United States. That benefits China in several ways. It funds China's rise and the development of all those shiny new cities in China. And it de-industrializes the United States, weakening the US as a long-term military-industrial rival.

    Conversely, China allows its Asian neighbors to run trade surpluses with China, tying their prosperity to China's continued benevolence and giving the 'Middle Kingdom' a huge lever to ensure their cooperation. That's the plan with Taiwan, make the island so dependent on trade with Beijing that Taipei has to agree to eventual communist rule.

    If China ever lost the continual flow of money from the US, the whole 'rise of China' project would collapse and their economy would probably collapse along with it.
    All good points.

  5. #5
    Stanislav is offline Registered User
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    Trading with each other may not work as well, but it helps. Since trade is not zero-sum as Trumpian argument seems to assume, reduced trade between US and China (and everyone else) is bad for both, in aggregate.
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  6. #6
    Johann is offline Registered User
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    Quote Originally Posted by b4cz28 View Post
    That sounds real good to me. Real bad for them as we are the largest consumer of goods In the world. I think you could add everyone else up and we are still the biggest. If the US stopped buying from China they would implode in a year. If we stopped buying drugs from Mexico the same thing would happen.
    Yes, US is biggest importer - but China itself is second, with 10.3% of the world's imports - and there are some big players. Overall (imports plus exports) China is still the largest trader; U.S is second. And no - you couldn't "add everyone else up" and have U.S. exceed them. Here's the list.

    https://www.austrade.gov.au/News/Eco...rading-nations

    J.
    Last edited by Johann; 07-06-2017 at 04:19 PM.

  7. #7
    b4cz28 is offline Registered User
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    Quote Originally Posted by Johann View Post
    Yes, US is biggest importer - but China itself is second, with 10.3% of the world's imports - and there are some big players. Overall (imports plus exports) China is still the largest trader; U.S is second. And no - you couldn't "add everyone else up" and have U.S. exceed them. Here's the list.

    https://www.austrade.gov.au/News/Eco...rading-nations

    J.
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