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Generational Dynamics World View
** 07-May-2019 World View: US-China trade war has no resolution in sight

Today's market selloff is being blamed on a growing realization that
Trump was serious about imposing large new tariffs on Friday, meaning
that a US-China trade deal will not be reached soon.

There's very little confirmed information available about what the
disagreement is in the US-China trade talks, but various reports say
it has to do with theft of intellectual property. Incidentally, this
is not a Trump-only concern. Trump is getting advice to "hang tough"
from Chuck Shumer and other Democratic leaders, and there's very
little criticism from other Western nations, since they've all been
screwed by China's theft of intellectual property, and refusal to
comply with international law and commitments it had already made in
writing.

More specifically, reports indicate that Chinese negotiators had
agreed to end theft of intellectual property, and to put that
agreement into Chinese law.

Apparent Xi Jinping pulled the plug on this a few days ago, and said
that the agreement wouldn't go into Chinese law, but would only be
made some vague "regulation." In other words, the Chinese had no
intention of abiding by their own signed agreement.

In the last few months, I've seen Trump economic advisors on TV, such
as Larry Kudlow and Kevin Hassett, repeatedly say that the US-China
trade negotiations were going very well. I watched these statements
in increasing disbelief, wondering which side was backing down -- the
Chinese or the Americans. Now we can see what happened. The Chinese
negotiators made concessions with regard to stealing intellectual
property, and Xi Jinping pulled the plug, causing Trump to announce
the new tariffs. This is the kind of thing that leads to world wars.

As long-time readers know, Generational Dynamics predicts a stock
market crash and global financial crisis with 100% certainty. This
would begin with a full-scale panic. What's going on today is the
first signs of a panic, but it could reverse tomorrow, as investors
begin to calm down and decide that a delay in the US-China talks is
not serious.

At times like this, I like to repeat what happened in the stock market
panic that occurred on October 28, 1929. This year will be the 90'th
anniversary of that panic, and yet, to this day, nobody knows why the
panic occurred on that particular day, or why it didn't occur a few
months earlier or later. A panic had to occur, since the stock market
was a huge bubble (as it is today), but the panic nonetheless was
completely unexpected.

The other thing to remember is that the 1929 panic was not the same as
a stock market crash and, in fact, the stock market recovered in the
next few days much of what it had lost. What the panic did was to put
in train a long, grinding process of margin calls and bankruptcy
chains, and this was the stock market crash. An investor who had
borrowed money on high-risk stocks would have to sell his blue chip
stocks to meet the margin calls. When one person or company went
bankrupt, then its lenders were suddenly also exposed to bankruptcy.
This chain of bankruptcies continued for four or five years, as the
stock market fell 90%.

History doesn't repeat itself, but it rhymes. "It's different this
time" is a lie. The next financial crisis won't be an exact repeat of
the 1929 crisis, but the general elements (stock market bubble, panic,
margin calls, bankruptcy chain) will be the same.
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Messages In This Thread
RE: Generational Dynamics World View - by radind - 05-14-2016, 03:21 PM
RE: Generational Dynamics World View - by radind - 05-23-2016, 10:31 PM
RE: Generational Dynamics World View - by radind - 08-11-2016, 08:59 PM
RE: Generational Dynamics World View - by SomeGuy - 01-18-2017, 09:23 PM
RE: Generational Dynamics World View - by tg63 - 02-04-2017, 10:08 AM
RE: Generational Dynamics World View - by Galen - 03-13-2017, 03:33 PM
RE: Generational Dynamics World View - by SomeGuy - 03-15-2017, 02:56 PM
RE: Generational Dynamics World View - by SomeGuy - 03-15-2017, 03:13 PM
RE: Generational Dynamics World View - by Galen - 05-30-2017, 01:04 AM
RE: Generational Dynamics World View - by Galen - 07-08-2017, 01:34 AM
RE: Generational Dynamics World View - by tg63 - 08-09-2017, 11:07 AM
RE: Generational Dynamics World View - by tg63 - 08-10-2017, 02:38 PM
RE: Generational Dynamics World View - by Galen - 10-25-2017, 03:07 PM
RE: Generational Dynamics World View - by rds - 10-31-2017, 03:35 PM
RE: Generational Dynamics World View - by rds - 10-31-2017, 06:33 PM
RE: Generational Dynamics World View - by noway2 - 11-20-2017, 04:31 PM
RE: Generational Dynamics World View - by Galen - 12-28-2017, 11:00 PM
RE: Generational Dynamics World View - by Galen - 12-31-2017, 11:14 PM
RE: Generational Dynamics World View - by JDG 66 - 06-22-2018, 02:54 PM
RE: Generational Dynamics World View - by JDG 66 - 07-11-2018, 01:42 PM
RE: Generational Dynamics World View - by JDG 66 - 07-11-2018, 01:54 PM
RE: Generational Dynamics World View - by JDG 66 - 07-19-2018, 12:43 PM
RE: Generational Dynamics World View - by JDG 66 - 07-25-2018, 02:18 PM
RE: Generational Dynamics World View - by JDG 66 - 07-11-2018, 01:58 PM
RE: Generational Dynamics World View - by Galen - 08-18-2018, 03:42 AM
RE: Generational Dynamics World View - by Galen - 08-19-2018, 04:39 AM
RE: Generational Dynamics World View - by John J. Xenakis - 05-11-2019, 12:51 PM
RE: Generational Dynamics World View - by tg63 - 09-25-2019, 11:12 AM
RE: Generational Dynamics World View - by JDG 66 - 03-09-2020, 02:11 PM
RE: Generational Dynamics World View - by Camz - 03-10-2020, 10:10 AM
RE: Generational Dynamics World View - by tg63 - 03-12-2020, 11:11 AM
RE: Generational Dynamics World View - by JDG 66 - 03-16-2020, 03:21 PM
RE: 58 year rule - by Tim Randal Walker - 04-01-2020, 11:17 AM
RE: 58 year rule - by John J. Xenakis - 04-02-2020, 12:25 PM
RE: Generational Dynamics World View - by Isoko - 05-04-2020, 02:51 PM
RE: Generational Dynamics World View - by tg63 - 01-04-2021, 12:13 PM
RE: Generational Dynamics World View - by CH86 - 01-05-2021, 11:17 PM
RE: Generational Dynamics World View - by mamabug - 01-10-2021, 06:16 PM
RE: Generational Dynamics World View - by mamabug - 01-11-2021, 09:06 PM
RE: Generational Dynamics World View - by mamabug - 01-12-2021, 02:53 AM
RE: Generational Dynamics World View - by mamabug - 01-13-2021, 03:58 PM
RE: Generational Dynamics World View - by mamabug - 01-13-2021, 04:16 PM
RE: Generational Dynamics World View - by mamabug - 01-15-2021, 03:36 PM
RE: Generational Dynamics World View - by galaxy - 08-19-2021, 03:03 AM
RE: Generational Dynamics World View - by galaxy - 08-21-2021, 01:41 PM
RE: Generational Dynamics World View - by galaxy - 02-27-2022, 06:06 PM
RE: Generational Dynamics World View - by galaxy - 02-27-2022, 10:42 PM
RE: Generational Dynamics World View - by galaxy - 02-28-2022, 12:26 AM
RE: Generational Dynamics World View - by galaxy - 02-28-2022, 04:08 PM

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