Why not, it's basic. If you start to sell bonds at this scale the value will go down. And even if you sell them, other countries would buy these bonds at a lower price.
If government force hand on Chinese companies to sell their assets, who do you think the losers will be?
Yes, Chinese government could retaliate on US companies in China like Apple, Intel Qualcom. But, let me ask you, who would suffer more when consumer electronics prices in China goes up and these production centers shift to Vietnam or any any other country.
If China reduces Yuan's value, why would any government buy that currency if the prices are artificially controlled by the Chinese government? That's not something the Chinese government wants who looks to replace Dollar someday with RMB.
So, the options for Chinese are limited, the US will easily get the Chinese to the negotiation table. It has happened in the past, it will happen even now. You simply don't know the influence of the US.
im not keen in knowing Economist Southie's 'what if' theories- im talking about the options china has vs the US.
Lets look at facts for now:
1)Western stocks are sent crashing down by China's mere threats
http://www.euronews.com/2018/04/07/us-stocks-tumble-on-china-trade-war-fears
Fears of a possible trade war between Washington and Beijing rattled markets on Friday after Wall Street saw one of its biggest single-day drops this year. The Dow Jones Industrial Average closed 572 points down, or around 2.3%.
American giants Boeing and Caterpillar both lost 3.1 percent and 3.5 percent of their value respectively. The two firms are seen as vulnerable in any trade dispute between the world's two largest economies.
"While analytically we can say they won't have much of an impact on the economy, it creates risks. And the biggest thing that investors hate, and the biggest thing that markets hate is uncertainty. Big scary tariff announcements create a lot of uncertainty which is what we're seeing in the market the past couple of weeks," said Andy Kapyrin, RegentAtlantic's Research Director.
President Trump's threat to impose additional tariffs, on top of those he already recently announced on Chinese steel and aluminium imports, came after Beijing unveiled its own measures against US products on Wednesday.
But China says the US has picked the wrong target.
"If the US continues with its unilateralism and protectionism in total disregard of the opposition from China and the international community, China will see it through to the end at any cost," Chinese Ministry of Commerce spokesman Gao Feng told reporters.
United Nations Secretary-General Antonio Guterres has voiced his concerns over a trade war ahead of a five-day visit to China:
"Trade wars are always bad for those involved in the trade war and for the international economy as a whole. We need to have international cooperation wherever there is a problem. There must be dialogue."
2)US companies have way more to lose than Chinese companies(contrary to Economist Southie's claims)
http://money.cnn.com/2018/04/06/news/economy/china-options-trade-war-us/index.html
U
S companies in China at risk
China could also take another page out of the playbook it used on South Korea by making life difficult for big US companies operating in its territory.
During the tensions with South Korea, Chinese officials closed down dozens of stores belonging to Lotte, a big South Korean conglomerate. The sales of South Korean auto brands Hyundai(HYMTF) and Kia also plunged in China as state-run media helped whip up anti-South Korean sentiment.
If Beijing's trade tit-for-tat with Washington keeps escalating, some experts think American companies doing business in China should buckle up for a rough ride. The fast growing Chinese economy is a massive market for top US brands such as Apple (AAPL) and Starbucks (SBUX).
"Much fewer Chinese companies have large operation in the United States," said Hu, the Macquarie analyst.
3)Conglomerates with influence in the US senate are wetting their pants at Trump's decisions:
https://www.cnbc.com/2018/04/06/koch-brothers-network-breaks-with-trump-over-china-trade-war.html
President
Donald Trump is so far unwilling to back down from a trade war with China, but that may change as pressure mounts from the influential political and donor network backed by the conservative billionaire Koch brothers.
Executives at Americans for Prosperity, just one part of the ever-growing Koch influence empire, said that tariffs will only hurt American consumers and possibly cancel out positive effects from the Republican tax cut bill passed in December.
"From the beginning we've said that tariffs and protectionism is a bad idea," Tim Phillips, president of Americans for Prosperity, said in an interview Friday. "It's a tax on American consumers because a lot of the product they're buying will cost more and it hurts American industries when countries retaliate."
The group has also expressed its concerns directly with the White House.
Charles and
David Koch, the leaders of Koch Industries, one of the largest private corporations in the world, exert vast political power and influence on the right for an array of pet conservative issues, such as tax cuts.
4)The Trade war of words between the big boys are already affecting everyone:
https://sg.news.yahoo.com/china-urges-eu-act-together-against-us-protectionism-115300739.html
EU feels heat in China, US trade row
China reached out for Europe's support in its bitter trade war with the US, leaving the EU at risk of getting entangled in a conflict with repercussions around the world.
The European Union is caught in a bind as it too shares many of Washington's grievances with Beijing's trade practices, but is also under a threat of protectionist measures ordered up by US President Donald Trump.
In a rare diplomatic plea, China on Friday called on the EU to take a joint stand against US protectionism as Trump warned that he could slap another $100 billion (86 billion euros) of extra tariffs on China's imports.
"China and the EU... should take a clear stance against protectionism, jointly preserve the rules-based multilateral trade order, and keep the global economy on a sound and sustainable track," Zhang Ming, the head of the Chinese mission to the EU, said in a statement sent to AFP.
"This is a joint responsibility of China and the EU. We must act together to make that happen," Zhang said.
The EU declined to respond directly to the envoy's invitation, insisting only that trade conflicts should be resolved at the World Trade Organization, the Geneva-based body set up to resolve disputes.
The bloc is "firm in the belief that free and fair trade is one of the most powerful engines for growth, supporting millions of jobs and contributing to prosperity," European Commission spokesman Daniel Rosario said in a response to AFP.
The EU and the US themselves nearly descended into a trade war after Trump in March threatened to impose tariffs on steel and aluminium imports that would, if confirmed, punish European manufacturers.
But Trump granted Europe a last-minute exemption, giving EU negotiators until May 1 to come up with a solution to unfair trade policies alleged by the US leader.
The Europeans reject Trump's allegations, which have mostly circled on Germany's auto industry, and prepared a list of counter-measures in case the US reverses course and slaps on the tariffs.
The European Commission, which handles trade for the EU member states, said contacts with the US would continue next week, though French President Emmanuel Macron has angrily said that Europe should refuse to negotiate "with a gun to your head."
- 'Fruitless' -
Complicating matters, European leaders are largely in agreement with Trump that China fails to play fairly when it comes to international trade, not only for metals exports, but also market access for European companies and respecting intellectual property.
Many Europeans also rail against cash-flush Chinese tycoons that have snapped up European companies, sports clubs and airports, all while foreigners are barred from investing in equivalent industries in China.
China ranked 84th globally -- behind Saudi Arabia and Ukraine -- in the World Bank's ease of doing business index for 2016, and second to last in an OECD report on the restrictiveness towards foreign investment.
"The problem is the method," a European official told AFP, when asked about Trump's hardball approach to Beijing.
"The US is completely ignoring WTO rules. Until now they at least kept up appearances, but no longer," the source said.
Against China, the Europeans have always chosen the soft approach -- through lures of investment deals and closer cooperation -- said Economist Fredrik Erixon, director of the European Centre for International Political Economy in Brussels.
But this strategy will remain "fruitless, partly because there isn't any degree of confrontation, there is no bad cop next to the good cop and we need that," he said.
However he added: "While confrontation with China is necessary, Trump's way of doing it has too much collateral damage and does not deal with the issue in a rational way."
while every nation tied to the US's fiscal status panics and braces themselves all around the world, only India as her usual, delusive self- expects 'faster growth'
https://www.hindustantimes.com/busi...e-war-looms/story-MVWQjaNTNr0hAIGtHlZRBN.html
"
RBI optimistic about Indian economy as trade war looms
Slowing inflation, accelerating growth and an economy that relies on domestic consumption may help cushion India from the escalating trade war between the US and China.
= Rothschild-controlled India expects to 'grow' by lying
China
Vietnam
Adding to that, the Bond market is already worth half a trillion a day.
