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Winning the Trade War Doesn’t Mean Victory

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photo :US Dollar vs Chinese Yuan 1 Year Currency Chart (via XE Corporation)

Barring unforeseen circumstances, the United States will likely win the trade war with China. However, the end result may not be as great for the United States as President Trump and his supporters may hope.

When all is said and done, the United States will likely come out of this trade war as the unanimous victor. Economically, China simply cannot keep up with the United States when it comes to handling tariffs. Although both countries may see their exports suffer, the results for China will be much worse, given that 14% of the Chinese economy is dependent on exports to the US, compared to just 4% of the US economy that is dependent on exports to China. This trade imbalance will cause the Chinese economy a lot more pain than what their counter tariffs can possibly inflict on the United States. If China doesn’t take the necessary steps to end this trade war, their economy will suffer massively in comparison to the United States. Continue reading Winning the Trade War Doesn’t Mean Victory