US Lawyers rejoice at Trump’s trade war on China, EU
Become a VT Supporting Member Today
Please keep VT Radio and VT Foreign Policy alive! Donate today to make sure VT stays on the internet free and clear of Big Tech control! Donate today:Please Donate - Click Here
Lawyers and accountants in Washington DC are licking their lips at the thought of the money they will make from the trade war incoming US president Donald Trump will wage on China, the European Union and other countries, even if it pushes the interest rates in the economies of US allies to “emergency levels” and hurt ordinary American citizens.
The director of bond giant Pimco, Andrew Balls, expects there to be “multiple rounds of the game” regarding tariffs, a policy repeatedly threatened by Donald Trump.
“The worst version of the trade situation would be difficult [for Europe],” Balls told the Financial Times.
However, as the scenario approaches, European assets have been the biggest losers so far. In anticipation of further interest rate cuts by the European Central Bank (ECB), which is hitting investment returns, the euro had fallen by more than 5% against the dollar by the end of September.
In his view, the euro will likely fall further against the dollar as the bet is on the ECB’s deposit rate, falling to 1.75% from the current level of 3.25%. This is because European interest rates have already been negative and have only had to be tightened to contain post-COVID-19 pandemic inflation.
According to the British daily, some investors saw Trump’s nominee for Treasury Secretary, hedge fund manager Scott Bessent, as a moderating influence on the future US president’s more radical economic policies, which partly justifies the dollar’s decline following the US election. But overall, according to Balls, the looming global trade war leaves room for lower so-called terminal interest rates.
He added that a hit to the UK’s economy from a global trade war would also leave “plenty of room” to lower so-called terminal interest rates. Investors currently expect the Bank of England to make three quarter-point cuts by the end of next year, which would take British rates to 4%.
The same outlet also reported that lawyers and accountants in Washington are set to be busy as companies prepare for tariffs, export controls and trade wars when Trump enters the White House next month.
“I said to my colleagues — we’re bringing sexy back to trade,” said Nicole Bivens Collinson, managing principal at law firm Sandler, Travis & Rosenberg. Bivens Collinson said the firm was looking at international expansion. “We are getting a lot of new clients, a lot of new people approaching us.”
Last month, Trump won a sweeping electoral victory after campaigning on a pledge to apply levies of up to 20 percent on all imports and 60 percent on those from China. He has also threatened to hit Mexico and Canada with 25 percent levies.
During the last Trump administration, companies were offered a chance to apply to be “excluded” from having tariffs applied to their imports from China. Between 2018 and December 2020, the Office of the US Trade Representative processed 53,000 requests. However, a review of the process found that almost 90 percent of those requests were denied. Nonetheless, some companies today are exploring ways to sidestep potential tariffs.
“It’s been busy since 2016, but I can tell you already that overnight it’s exploded,” said one trade lawyer for a major firm, who did not want to be named. “There is a lot of interest in suing the Trump administration, everyone around town is preparing a lawsuit.”
It is recalled that Trump also threatened on November 30 to impose “100% tariffs” on BRICS countries if they do not abandon their plan to create an alternative currency to the US dollar.
“The idea that the BRICS Countries are trying to move away from the Dollar while we stand by and watch is OVER. We require a commitment from these countries that they will neither create a new BRICS currency nor back any other currency to replace the mighty US dollar or they will face 100% tariffs and should expect to say goodbye to selling into the wonderful US economy,” Trump said on Truth Social.
In effect, Trump has threatened to impose tariffs on enemies and allies.
While lawyers and accountants in Washington are set to make great profits by helping their clients avoid expected tariffs and export controls, ordinary Americans, and not just the citizens of tariffed countries, will be economically hurt.
The nonpartisan Peterson Institute for International Economics has estimated that Trump’s new proposed tariffs would lower American incomes, ranging from around 4% for the poorest fifth to around 2% for the wealthiest fifth. The think tank estimates that a typical Middle-Class household would lose around $1,700 each year.
Yet, despite the predicted negativity that tariffs will bring to US enemies, allies and citizens alike, it appears Trump is determined to impose them once he enters office next month.
VT Condemns the ETHNIC CLEANSING OF PALESTINIANS by USA/Israel
$280+ BILLION US TAXPAYER DOLLARS INVESTED since 1948 in US/Israeli Ethnic Cleansing and Occupation Operation150B direct "aid" and $ 130B in "Offense" contracts
Source: Embassy of Israel, Washington, D.C. and US Department of State.
https://www.vtforeignpolicy.com/2024/12/us-lawyers-rejoice-at-trumps-trade-war-on-china-eu/
Geen opmerkingen:
Een reactie posten