{"id":19639,"date":"2020-01-18T00:57:54","date_gmt":"2020-01-18T00:57:54","guid":{"rendered":"https:\/\/thepatientinvestor.com\/?p=19639"},"modified":"2020-01-18T01:14:00","modified_gmt":"2020-01-18T01:14:00","slug":"trump-gets-his-deal","status":"publish","type":"post","link":"https:\/\/thepatientinvestor.com\/index.php\/2020\/01\/18\/trump-gets-his-deal\/","title":{"rendered":"Trump gets his Deal"},"content":{"rendered":"<p>Donald Trump signed the Phase One US-China trade deal with China&#8217;s Vice-Premier Liu He in Washington D.C. on Wednesday.<\/p>\n<p>The deal is important for Trump politically as he needs to disrupt media focus on his impeachment playing out in the Senate.<\/p>\n<p>China attempted to downplay the significance of the deal by sending their Vice-Premier rather than Xi Jinping for the signing ceremony. But the deal is no less important for them in order to halt\/slow the relocation of manufacturing jobs by multinationals to avoid US tariffs.<\/p>\n<p><a href=\"https:\/\/triviumchina.com\/\">Trivium China<\/a> sum up the outcome:<\/p>\n<ol>\n<li><strong>We are still in a trade war. <\/strong>Tariffs remain levied on hundreds of billions of USD worth of goods.<\/li>\n<li><strong>A phase two deal looks dead in the water. <\/strong>US President Trump has already said that he might wait until after the November election to negotiate the next phase. More importantly, there is little appetite in China to make concessions on any of the remaining issues.<\/li>\n<li><strong>Third countries are getting screwed. <\/strong>China\u2019s overall import bill is unlikely to jump by USD 200 billion over the next two years, so increased purchases of US goods will come at the expense of producers in other countries.<\/li>\n<li><strong>This deals another blow to the multilateral trading system. <\/strong>The world\u2019s two largest economies just bypassed the multilateral rules-based system to negotiate a deal that undermines the principles of free trade.<\/li>\n<li><strong>China is downplaying the deal. <\/strong>The fact that Liu He \u2013 not Xi Jinping \u2013 signed the deal sent a strong signal domestically that this is not a big deal. And Chinese officials have said that most of these measures would have happened irrespective of a deal.<\/li>\n<li><strong>Finally, the deal is a positive for stability. <\/strong>This will serve to halt \u2013 or at least slow\u00a0\u2013 economic decoupling. That\u2019s a positive for the global economy and security.<\/li>\n<\/ol>\n<p>Rhodium Group in <a href=\"https:\/\/rhg.com\/research\/phase-1-the-good-the-bad-and-the-missing\/\">The Good, The Bad and The Missing<\/a> focus on what should have been in the deal but isn&#8217;t:<\/p>\n<ol>\n<li>Chapter 1 Pledges greater protection for a handful of specific products \u2013 pharmaceuticals, medicines and unlicensed software \u2013 and generally more enforcement against counterfeit products but the <strong>concerns of other industries<\/strong> are not addressed<\/li>\n<li>There are <strong>no robust enforcement<\/strong> mechanisms in Chapter 7. It provides a forum for discussion and consultation but not arbitration. If unable to resolve the issue, the aggrieved party can withdraw from the Agreement. This creates little incentive to resolve issues and may result in a logjam.<\/li>\n<li>The managed trade approach does not even start to remedy <strong>systemic concerns<\/strong> like the predominance of state enterprises, the prevalence of foreign investment limitations in the vast set of industries that did not get early attention in this deal, the lack of consistency in competition policy treatment and the general asymmetry of information and the playing field for private firms foreign and domestic.<\/li>\n<li>Phase One fails to address growing <strong>challenges at the intersection of economics and national security<\/strong>: Huawei and 5G telecommunications, detentions and pressure on expatriates and travelers from the other side, foreign investment screening and export controls, and the threat of financial decoupling.<\/li>\n<\/ol>\n<p>Rhodium concludes:<\/p>\n<blockquote><p>The agreement is a limited one, primarily capping the potential for further escalation of protectionism on both sides rather than taking serious steps to address long-standing issues in Chinese trade practices. The managed trade outcomes in which China promises additional US imports are the most significant substantive commitments made, but China\u2019s capacity and willingness to meet these targets remains in question. Significant tariffs remain in place on both sides, uncertainty about the future path of the US-China relationship will persist, and the broader decoupling trends in security-sensitive areas of the bilateral relationship will continue. Progress toward any Phase Two agreement is likely to be minimal in 2020. (The Chinese side immediately said after the January 15 signing that it wanted to go slow before any further talks.)<\/p><\/blockquote>\n<p>The deal attempts to head off further escalation but falls well short of addressing long-standing issues with Chinese trade practices. Trade tensions and decoupling are likely to continue.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Donald Trump signed the Phase One US-China trade deal with China&#8217;s Vice-Premier Liu He in Washington D.C. on Wednesday. The deal is important for Trump politically as he needs to disrupt media focus on his impeachment playing out in the Senate. China attempted to downplay the significance of the deal by sending their Vice-Premier rather &hellip; <\/p>\n<p class=\"link-more\"><a href=\"https:\/\/thepatientinvestor.com\/index.php\/2020\/01\/18\/trump-gets-his-deal\/\" class=\"more-link\">Continue reading<span class=\"screen-reader-text\"> &#8220;Trump gets his Deal&#8221;<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[41,3778,34],"tags":[4180,4181],"class_list":["post-19639","post","type-post","status-publish","format-standard","hentry","category-china-hk","category-international-trade","category-us-canada-countries-regions","tag-phase-one","tag-us-china-trade-deal"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.2 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Trump gets his Deal - the patient investor<\/title>\n<meta name=\"robots\" content=\"noindex, follow\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Trump gets his Deal - the patient investor\" \/>\n<meta property=\"og:description\" content=\"Donald Trump signed the Phase One US-China trade deal with China&#8217;s Vice-Premier Liu He in Washington D.C. on Wednesday. The deal is important for Trump politically as he needs to disrupt media focus on his impeachment playing out in the Senate. 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He\u2026","rel":"","context":"In &quot;China &amp; HK&quot;","block_context":{"text":"China &amp; HK","link":"https:\/\/thepatientinvestor.com\/index.php\/category\/countries-regions\/china-hk\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":19052,"url":"https:\/\/thepatientinvestor.com\/index.php\/2019\/10\/12\/trade-talks-extend-and-pretend\/","url_meta":{"origin":19639,"position":1},"title":"Trade talks: &#8216;Extend and pretend&#8217;","author":"Colin Twiggs","date":"October 12, 2019","format":false,"excerpt":"Donald Trump has been weakened by the impeachment process, with more than half the respondents in a recent Fox News poll wanting the troubled President impeached: \"A new high of 51 percent wants Trump impeached and removed from office, another 4 percent want him impeached but not removed, and 40\u2026","rel":"","context":"In &quot;China &amp; HK&quot;","block_context":{"text":"China &amp; HK","link":"https:\/\/thepatientinvestor.com\/index.php\/category\/countries-regions\/china-hk\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":19572,"url":"https:\/\/thepatientinvestor.com\/index.php\/2019\/12\/14\/trade-deal-announced\/","url_meta":{"origin":19639,"position":2},"title":"Trade deal announced","author":"Colin Twiggs","date":"December 14, 2019","format":false,"excerpt":"Donald Trumps latest tweets on a trade deal with China: As Trish Nguyen predicted, Trump was never going to introduce the Dec15 tariffs as they directly impact on US consumers, not producers as in earlier rounds of tariffs. Prof Aaron Friedberg (Princeton) gives an interesting summary of the impact this\u2026","rel":"","context":"In &quot;China &amp; HK&quot;","block_context":{"text":"China &amp; HK","link":"https:\/\/thepatientinvestor.com\/index.php\/category\/countries-regions\/china-hk\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":19458,"url":"https:\/\/thepatientinvestor.com\/index.php\/2019\/11\/16\/stretching-credulity\/","url_meta":{"origin":19639,"position":3},"title":"Stretching credulity","author":"Colin Twiggs","date":"November 16, 2019","format":false,"excerpt":"Fed Chairman, Jay Powell says the US economy is strong. But they have cut interest rates three times this year. And it's all hands to the pump below decks. The Fed expanded their balance sheet by $288 billion since September and broad money (MZM plus time deposits) growth has almost\u2026","rel":"","context":"In &quot;Banks &amp; Interest Rates&quot;","block_context":{"text":"Banks &amp; Interest Rates","link":"https:\/\/thepatientinvestor.com\/index.php\/category\/economy\/the-fed-banks-interest-rates\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":63117,"url":"https:\/\/thepatientinvestor.com\/index.php\/2025\/11\/19\/yttrium-what-trade-deal\/","url_meta":{"origin":19639,"position":4},"title":"Yttrium &#8211; what trade deal?","author":"Colin Twiggs","date":"November 19, 2025","format":false,"excerpt":"Key Points Supplies of rare earth element yttrium have dwindled, sending prices soaring. China has not lifted export controls imposed in April as retaliation for US tariffs. China is squeezing the supply of rare-earth element yttrium, sending the semiconductor and aerospace industries into a panic. The October meeting between President\u2026","rel":"","context":"In &quot;China &amp; HK&quot;","block_context":{"text":"China &amp; HK","link":"https:\/\/thepatientinvestor.com\/index.php\/category\/countries-regions\/china-hk\/"},"img":{"alt_text":"Yttrium Oxide","src":"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2025\/2025-11-18-yttrium.png?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2025\/2025-11-18-yttrium.png?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2025\/2025-11-18-yttrium.png?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/www.incrediblecharts.com\/images\/2025\/2025-11-18-yttrium.png?resize=700%2C400&ssl=1 2x"},"classes":[]},{"id":18191,"url":"https:\/\/thepatientinvestor.com\/index.php\/2019\/05\/11\/sp-500-no-deal\/","url_meta":{"origin":19639,"position":5},"title":"S&#038;P 500: No deal","author":"Colin Twiggs","date":"May 11, 2019","format":false,"excerpt":"It looks like there will be no trade deal any time soon. \"Trade talks between China and the United States ended on Friday without a deal as President Trump raised tariffs on $200 billion worth of Chinese imports and signaled he was prepared for a prolonged economic fight..... Trump is\u2026","rel":"","context":"In &quot;China &amp; HK&quot;","block_context":{"text":"China &amp; HK","link":"https:\/\/thepatientinvestor.com\/index.php\/category\/countries-regions\/china-hk\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]}],"_links":{"self":[{"href":"https:\/\/thepatientinvestor.com\/index.php\/wp-json\/wp\/v2\/posts\/19639","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/thepatientinvestor.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/thepatientinvestor.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/thepatientinvestor.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/thepatientinvestor.com\/index.php\/wp-json\/wp\/v2\/comments?post=19639"}],"version-history":[{"count":3,"href":"https:\/\/thepatientinvestor.com\/index.php\/wp-json\/wp\/v2\/posts\/19639\/revisions"}],"predecessor-version":[{"id":19642,"href":"https:\/\/thepatientinvestor.com\/index.php\/wp-json\/wp\/v2\/posts\/19639\/revisions\/19642"}],"wp:attachment":[{"href":"https:\/\/thepatientinvestor.com\/index.php\/wp-json\/wp\/v2\/media?parent=19639"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/thepatientinvestor.com\/index.php\/wp-json\/wp\/v2\/categories?post=19639"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/thepatientinvestor.com\/index.php\/wp-json\/wp\/v2\/tags?post=19639"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}