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The proposed 45% tariff on Chinese goods 

Donald Trump’s stand on China is well known. He blames the country for all American woes. From stated sponsored hacking, climate change to undermining of United States competitiveness.

Since Trump was elected president, he has stopped blaming China for the American problems. The only action he has taken was to post a video on twitter of his grandchild reciting a poem in Mandarin. This poem has become a great hit in China.

Possibilities

If Chinese imports get blocked, prices of goods will rise exponentially. This will compromise consumption. This will have a negative effect on economic growth. This may result to US loosing manufacturing jobs to Bangladesh and Vietnam which Keyu Jin says have cheaper labour costs than China.

China is the largest spender on US treasuries. This fact is mostly assumed. The money generated is used to finance investments and consumption. 

Trump has promised to warm the US-Russia relationship which had weakened after Russia’s efforts to annex Crimea. 

  

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