Running a Long Game

2019 August 25
by drdog09

Sloven also had work to do in China.

His suppliers in Shenzhen, Dongguan and Guangzhou were certain the trade conflict would blow over and were reluctant to negotiate deals that would send components and raw materials abroad for assembly.

But Sloven kept pressing ahead with the Thailand plan, concerned about the toll the trade war was taking in China.

In early April, Sloven invited Reuters to meet his trade lawyer, Sally Peng of Sandler, Travis & Rosenberg.

Peng described how Chinese factory floors were emptying out as workers were laid off. Few owners had the expertise or resources to automate or find new export markets, so most were riding it out, hoping for a trade deal. They were “losing money every day,” she said.

They were “losing money every day,” she said. “They believe that eventually it will all come back,” Sloven said.

“I think within five years, it will all be gone,” Peng replied.

Source

This has played out before folks. First time was the starting the 1870’s. Before the Civil War England was the top machinery source for much of the world. Within a decade the US had risen to par with England on that score. South Bend made a better lathe. Pittsburgh was for a period THE place for scientific instrumentation thanks to Dr. John A. Brashear. 50% better precision than anything made in Europe. Needed a steam locomotive? US producers could make them in half the time at better cost. Our ability to make top grade steel rivaled that of Germany and England combined.

Being on the flip side was not comforting for either England or Germany. They were losing volume to the upstart Americans.

The second time was after WWII. Essentially Europe had either been leveled by bombing and war or exhausted by the same. The only intact economies were Argentina and the USA. For thirty some years we were the primary supplier for many goods world wide.

Well since the 1970’s we Americans have been on the losing end of the trade equation. First Japan and now China have been eating our lunch. Our political class being complicit in the process. Using favored nation status as a plum for certain political behavior by the counter party. Sam Walton was a early adopter of the outcome of such thinking. His firm, WalMart, suggesting to suppliers they source overseas to reduce price points else they be denied access to WalMart shelves. In the end we did it to ourselves.

Trump to his credit recognizes two facts. 1/ The economy has been hollowed out and some point it will collapse. We all cannot survive trading services, producing nothing physical. At a given level it becomes a national security issue. (Do you really think we can make 1 F35 per hour like our forefathers did with B24’s?) 2/ A massive trade imbalance over the long term reduces the USA to a third world economic power. Trading wheat and soy and nothing else like some third world countries today. That is a citizenry that lacks a future.

Trump is playing a long game. The bet is he can get China concessions, leveling the playing field before he leaves office. The Chinese are also playing a long game. Their play is their economy can hold out to 2024 to continue their advantage. Right now the advantage is to Xi in this. Trump has to win reelection, Xi does not. That is the short window. Trump wins reelection and the game is a dead heat. The problem for Xi is that China has run up a massive amount of debt that is serviced by production. Should the world go into a recession Xi has a problem. Yes we recognize that the US has a debt problem too. The difference is most of that debt is owed to ourselves in pension funds, munis, etc while China’s is principally external to the country.

Americans have two exposures:

A/ Trump loses reelection and the winning Dim concedes everything. B/ Trump blinks just before he fills the inside straight.

Pray neither come true.

36 Responses leave one →
  1. 2019 August 26 5:48 am
    [1]
    bc3b permalink

    Winning the long game is the key. That’s what the left has successfully done in the US. 50 years ago, who would have thought that men who thought they were women would have been considered anything except insane? Who would have thought that same-sex marriage would have seriously been considered? That reparations would have seriously been discussed? Or, that a Marxist would be pope?”

  2. 2019 August 26 6:30 am
    [2]
    justrand permalink

    China appears to have blinked. The media is VERY depressed by this news. 🙂

  3. 2019 August 26 8:16 am
    [4]
    JimNorCal permalink

  4. 2019 August 26 8:26 am
    [5]
    justrand permalink

    drdog, I don’t think Trump will blink…but I DO think China, Russia and North Korea (chiefly) are trying to game out whether Trump wins or loses in 2020. If they think he will lose then they will delay any and everything they can, since they KNOW a Democrat will concede EVERYTHING.

  5. 2019 August 26 8:28 am
    [6]
    justrand permalink

    btw, assuming RBG does depart this Earthly coil in time for Trump to replace her before the election, he MUST do so. Otherwise her replacement becomes the best rallying cry the Dems would have to turn out “voters” (living or dead). But if he’s already filled her seat, then the urgency goes down, even as the ire goes up. 🙂

  6. 2019 August 26 8:35 am
    [7]
    drdog09 permalink

    6,

    Yep, totally.

  7. 2019 August 26 8:40 am
    [8]
    drdog09 permalink

    4,

    Nice meme. In 1776 a rifle was a dear thing indeed. Most were generally custom made in the period. A musket was still the dominant firearm in most military.

  8. 2019 August 26 9:20 am
    [9]
    bc3b permalink

    JR #5 –

    Kind of like Obama saying, “Tell Vladimir I will have more flexibility after the election.”

  9. 2019 August 26 10:03 am
    [10]
    JimNorCal permalink

    6, good point!

  10. 2019 August 26 10:30 am
    [11]
    bc3b permalink

    Week 1 BJG College Football

    Lurkers Welcome!

    Welcome to BJG College Football 2019. Highlight the teams you think will win and return to bjgsports@gmx.com by 7 pm Friday.

    Utah State @ Wake Forest
    Wisconsin @ South Florida
    Massachusetts @ Rutgers
    Colorado State @ Colorado
    Purdue @ Nevada

    Ball State @ Indiana
    Akron @ Illinois
    Toledo @ Kentucky
    Mississippi @ Memphis
    Eastern Michigan @ Coastal Carolina

    South Carolina @ North Carolina
    Northwestern @ Stanford
    Virginia Tech @ Boston College
    Syracuse @ Liberty
    Boise State @ Florida State

    Virginia @ Pittsburgh
    Oregon @ Auburn
    Fresno State @ Southern Cal

  11. 2019 August 26 10:31 am
    [12]
    bc3b permalink

    With Arizona being beaten by Hawaii, it could be a long season for PAC 12 fans.

  12. 2019 August 26 11:48 am
    [13]
    fight on permalink

    BC,
    You are right long year for Pac 12 and for me

  13. 2019 August 26 12:19 pm
    [14]
    JimNorCal permalink

  14. 2019 August 26 12:20 pm
    [15]
    JimNorCal permalink

  15. 2019 August 26 12:21 pm
    [16]
    JimNorCal permalink

    Heh.
    Love this one!

  16. 2019 August 26 12:22 pm
    [17]
    JimNorCal permalink

  17. 2019 August 26 12:23 pm
    [18]
    JimNorCal permalink

  18. 2019 August 26 12:24 pm
    [19]
    JimNorCal permalink

  19. 2019 August 26 12:24 pm
    [20]
    JimNorCal permalink

  20. 2019 August 26 12:25 pm
    [21]
    JimNorCal permalink

  21. 2019 August 26 12:28 pm
    [22]
    JimNorCal permalink

    Note regarding above meme: Euro propaganda posters show distressed mothers with small kids.
    Actual demographics of refugees show a preponderance of military-aged men.

  22. 2019 August 26 12:28 pm
    [23]
    bc3b permalink

    fight on #13 –

    Things have to be better for MIC’s and my Central Michigan Chippewas this year. Last year they were 1-11 with the only win coming against FCS Maine. New coach is Jim McElwain, who led Florida to two SEC East titles before a losing season and running afoul of the alumni. He was wide receivers coach for Michigan last season and since he’s 57, he will likely be in his 60s by the time he re-builds the program. Besides, he will be getting $1-million buyout from the Gators for the next three years. McElwain is originally from Montana so cold winters and lots of Indians (real Chippewas, not Lie-a-watha-type) should make him feel at home.

    McElwain purchased a barn just off campus and had it totally re-built with the living quarters upstairs and huge team meeting room downstairs. Thanks Gators!

    With a population of 26,000 (not counting 20,000 CMU students), Mount Pleasant would be the fifth largest population center in Montana.

  23. 2019 August 26 12:29 pm
    [24]
    JimNorCal permalink

  24. 2019 August 26 12:30 pm
    [25]
    JimNorCal permalink

  25. 2019 August 26 1:33 pm
    [26]
    Eph permalink

    24 Jim

    “Comments section closed”

    … Get used to that when you see that piece on her.

  26. 2019 August 26 3:17 pm
    [27]
    drdog09 permalink

    More likely, all the advanced nations will make that downward journey together. The US is well on its way, despite all the MAGA bravado. The country is reeling in bad faith, delusion, official corruption, porno-pharmaceutical vice, and ethnic rancor. The people who live in FlyoverLand style themselves like Visigoths, all tatted up and armed to the teeth, moiling angrily at the edge of the Rome-like coastal enclaves. The elites want to stuff themselves inside their phones and live there. Guess what: that won’t be a “safe space.”

    Interesting close about the US that may in fact be reasonably accurate. The fate of the rest of the world? Maybe — https://www.zerohedge.com/news/2019-08-26/can-trump-re-industrialize-america-without-blowing-world

  27. 2019 August 26 3:42 pm
    [28]
    justrand permalink

    drdog, I love the imagery…though I have no “tats”: The people who live in FlyoverLand style themselves like Visigoths, all tatted up and armed to the teeth, moiling angrily at the edge of the Rome-like coastal enclaves.”

    in fact, now that I’m retired I don’t technically “moil

    but I am pissed off and well armed! 🙂

  28. 2019 August 26 4:03 pm
    [29]
    JimNorCal permalink

    I may be retired but, by God, I *still* moil!
    Particularly when an annoying Dem opens his yap.

    No tats though, and I haven’t lived in Flyover Country for years and years.

    OK. Just looked up “moil”. I don’t moil much anymore but I still roil.

  29. 2019 August 26 4:17 pm
    [30]
    bc3b permalink

    Biden claims he accrued $300,000 in college debt> When Biden went to college, state school tuition was under $1,000 and private universities was under $3,000:

    https://www.louderwithcrowder.com/joe-biden-says-he-went-into-massive-debt-from-college-except-thats-not-true/

  30. 2019 August 26 4:53 pm
    [31]
    justrand permalink

    Jim, I had to look “moil” up as well! 🙂

    Ya gotta appreciate someone who can use “moil” and “Visigoths” in the same sentence!

  31. 2019 August 26 8:06 pm
    [32]
    JimNorCal permalink

    I sometimes get quantities of memes from my Inbox.
    If it’s distracting I can cut WAY back, no offense taken, just let me know!

  32. 2019 August 26 8:08 pm
    [33]
    JimNorCal permalink

    On a CNN show a guest literally said Trump killed more than Hitler and Stalin.
    The host did not laugh in his face, the host let the guy ramble.

  33. 2019 August 26 8:10 pm
    [34]
    JimNorCal permalink

  34. 2019 August 26 8:11 pm
    [35]
    JimNorCal permalink

    So … I guess AOC was right to buttkick Amazon out of NYC.

  35. 2019 August 27 2:17 am
    [36]
    drdog09 permalink

    Keep’em coming jim….

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