James Lewis

We Should Be Fighting a Trade War with China, Not Mexico

It seems like many people arguing in this forum don't actually understand what is truly happening. Most probably have not spent any significant amount of tme in China and most do not truly understand that the USA and China are at war and have been for at least the past 9 years. This is a very complicated affair and our feelings around it are influenced by how we look at the world and the brain washing we have all been subject to. I always try to take a step back.

It is not a war in the conventional sense. It has been mainly fought out in the economic arena. But China's overiding goal in everything they do is to become the richest and most powerful country in the world. Regardless of the consequences and impact upon the rest of the world, the enviroment and so everyone is clear on my objectivity the Chinese people. The chinese people as a whole are not benefiting from China's rise. They are being paid nothing to work, have very poor standard of living and can not even eat for fear of the food being contaminated.The air they breath is toxic and they have very little freedoms or social safety nets. Having lived in China for 4 years and travelled all over China I can tell you I feel very sorry for the Chinese people and feel the CCP have let them down greatly, they are not better off and certainly not happier. Be very clear that the chinese workers are being exploited for the good of Chinese export competitiveness and for the good of making a select few very very rich. This is not a new phenomina in China or the west but should not be happening at this time of evolution. I have to say this but policies that keep the poor without rights/healthcare/decent standard of living is part of the overall economic strategy.

China's trading policies are mercantilist and they are so because they want economic and political dominance in the world. However lets be very clear the USA is not an innocent party and many innocent men, women and children have died in pursuit of their power dominance in the world. I think there are some differences and the USA's principles and objectives overall are better (but only very slightly). But let me go back to the point that many people lives have been made hell because of the USA's rise to global dominance. Lets be fair though, people in power are very rarely spiritually whole doing their life's work for the better of man kind. Which is something that greatly upsets me on many levels.

I would for the record argue that the political system in China is not something that I want colonialised around the world (which is a desire of many in the CCP and I believe the USA political system of democracy should be a reason that we all hope China does not become the dominant power in the world. Of course we have to remember that George Bush fraudelently became the president of the USA through voter fraud orchestrated by the cia and other secret services in order to allow Dick Cheeny to pull the strings and wage the next stage of war with Iraq as part of his 20 year plan. Saying this the 'War Cronies' were over-thrown in the latest election wich would not have happen in a closed political system.

I would like to comment on the trade balance arguement between Mr Richman and Maklo. Japan and other asian exporters as well as USA companies do use China as their assembly base and therefore the figures are skewed. However there is no doubt that China's mercantilist policies have created a very unbalanced and unfair trade regime between the USA and China. Which was not part of the agreement set up between Deng Xiaoping and Jimmy Carttyer. And also lets not forget that if all trade was fair that some of these Japanese/USA companies who are based in China would be making more of their goods in the USA. Which would have a positive economic effect for the US. Really it could be argued that the trade figures should not be watered down in meaning because they contain exports from Japan being re-exported; because China is still gaining from the assembly trade at the expense of the USA and other trading partners.

I would also like to share my experience in China with regards to US products. The Chinese love foreign goods because they know they are far superior. But there is certainly more protectionism placed on US goods than other countries goods. And it is done on purpose. In all fairness USA made goods (except technology/ medical and military/aerospace products) are not that great as compared to lets say germany. Cars for example. And the chinese know this, but it is much more ameniable to let imports of german goods prosper rather than US goods. This protectionism is very apparent and there is certain rivarly between USA and Chinese companies and in business-business exchanges.

The Chinese have a lot more respect for germans than americans, And I do get the sense that they are more xenophobia towards amercians than other foreigners. Of course maybe that is justified based on past historical developments. This dislike of americans (especially in business) is subtle but certainly present. One could argue that many different countries dont like amercians because of their 'arrogance' and their governments past activites in medling with the politics of their countries. However for the record I think that the amercian people are very generous and caring on the whole and are very friendly. From my experience they are also the most respectful tourists in China towards the chinese culture. Even though a lot of the times this is exploited, because they can be a little naive.

China needs to be held to account for its mercantilist policies, especially as the people of China as a whole are not benefiting and people in other countries are losing their manufacturing jobs. It also worries me that China's financial development has been made at the expense of developing in other areas. And with continued devlopment of prosperity comes justification for political policies that make me sick to the stomach (Tibet to name one)

But China is not the only country that needs to do some soul searching. Indeed the USA and Mr Richman, Israel have also got some developing to do. Indeed you know what the whole world has a lot of work to do.

China is the Tiger in the East, but the USA is not the dragon.

Global Returns: Stocks Down, Bonds Down

Trading Russia/Brazil is the same as trading commodities.
If commodities carry on their rise or stabilise then Brussia is the way foreward. You start getting a drop in oil etc, then China is the market to be in.

Shortly we will start to see PE ratios in the region of 13-15 in some stocks in China. That suggest that China will improve its dismal performace, we just need the market to capitluate.