Cornell University professor Eswar Prasad joins Market Domination to give insight into the potential for increased tariffs imposed on China from the US and what the US-China trade war could look like. Both President Biden and former President Trump favor tariffs, with the latter campaigning on even steeper import taxes.
Now, there is going to be a change, though, in terms of the tactics and strategy, if there was to be a trump, probably much higher tariffs. But the reality, of course, is that if one limits imports from China, that does have effects on US inflation. Because we speak to a number of investors and money manager and there there is a fair amount of of obvious scepticism there.As I mentioned earlier, what China has been able to do, which a command economy is very good at doing is stoking production.
Private enterprises feel that the government has become much more hostile, so we have seen household consumption and private investment not doing very well, and that creates a real imbalance in the Chinese economy.