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  1. #1
    Thailand Expat David48atTD's Avatar
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    Trade war escalation could smash global economy and equities: UBS

    Global share markets plummeting more than 20 per cent, economies shrinking and inflation re-ignited is the gloomy prognosis
    for a trade war from giant investment bank UBS.

    Key points:
    • A full trade could see global equities tumble by more than 20pc and global GDP tumble according to UBS
    • The escalation to a full-out war with a blanket 30pc tariff on Chinese imports plus retaliation could start as early as October
    • Key protagonists US and China likely to be the biggest losers


    While the current situation is bad, the fully-blown "trade war" scenario where the US imposes all the actions it has so far threatened
    and China retaliates as expected things would become decidedly ugly.

    Global GDP growth would fall by 1 percentage point and inflation would rise by 0.3 percentage points.

    The biggest losers would be the key protagonists the US and China with GDP falling with a thud, down 2.5 and 2.3 percentage
    points respectively.
    The US and China would also be hit with higher-than-average inflation spikes.



    On UBS's modelling, the 10 per cent tariff would see the key US equities benchmark, the S&P500, fall 10 per cent.
    The full-blown trade war would more than double that decline, plunging US equities deep into bear territory as average
    earnings fall by around 15 per cent.
    Asian equities would fall by 24 per cent and Europe by 25 per cent.

    US hardest hit

    There are plenty of other consequences too.
    Global interest rates would fall, US 10-year bonds would drop around 50 basis points and the expected hikes from the
    US Federal Reserve next year would be taken off the table.
    Lower growth would also translate to demand for oil falling by around 500,000 barrels per day and prices tumbling
    back under $US60 a barrel.

    While mutually assured pain is inevitable, the US may suffer the most in the case of an all out trade war.

    Our fingerprints never fade from the lives we touch

  2. #2
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    Good for BRICS

  3. #3
    Member mark45y's Avatar
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    I have an education in economics. All I can tell you is because of the trade imbalance, the U.S. has the potential to hurt China more than the other way around through the tariffs. China can expect bankruptcies higher unemployment and less money for travel. I'd imagine this would effect European travel more than Thai tourism. In fact as Thailand is a cheaper alternative it may mean more business for Thailand.

    I think if you query any economist not grinding an ax you will get the same opinion. This is a win for Trump. Media and left wing universities will try to spin it in the other direction. Did you expect anything else?

    This happened to me a number of times in college as economics professors sometimes make god like pronouncements to match political leanings and have to be reminded 2 + 2 = 4.

    Not rocket science. USA buys a lot from China. China does not buy much from USA.
    Last edited by mark45y; 12-07-2018 at 02:41 PM.

  4. #4
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    Quote Originally Posted by mark45y View Post
    I have an education in economics. All I can tell you is because of the trade imbalance, the U.S. has the potential to hurt China more than the other way around through the tariffs. China can expect bankruptcies higher unemployment and less money for travel. I'd imagine this would effect European travel more than Thai tourism. In fact as Thailand is a cheaper alternative it may mean more business for Thailand.

    I think if you query any economist not grinding an ax you will get the same opinion. This is a win for Trump. Media and left wing universities will try to spin it in the other direction. Did you expect anything else?

    This happened to me a number of times in college as economics professors sometimes make god like pronouncements to match political leanings and have to be reminded 2 + 2 = 4.
    Spot-on. However, the Chinese consumers (on the street-levels) are considerably more resourceful, and resilient, than are their U.S. counter-parts.
    Last edited by TuskegeeBen; 12-07-2018 at 02:50 PM.

  5. #5
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    Quote Originally Posted by David48atTD View Post
    oil falling by around 500,000 barrels per day and prices tumbling
    back under $US60 a barrel.
    Which has it's own set of repurcussions, not least that it completely undermines Trump's NATO designs WRT Germany.

  6. #6
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    Those who run things couldn't care less about their subjects.

  7. #7
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    Quote Originally Posted by TuskegeeBen View Post
    China can expect bankruptcies higher unemployment and less money for travel.
    Do you think Xi cares? More peasants on the soybean farms. Xi doesn't need votes like Trump does. China winning all the way.
    Also, China has it's 5, 10, 15, 20, 50 year plans....this is probably a blip in the plan, and maybe even a predicted one.

    Xi does not need votes and doesn't give a hoot about the peasants or the middle class, and that is where China's strength lies. Of course China will win out in the end. And just deserts to Trump's America and his voters.

  8. #8
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    Quote Originally Posted by mark45y View Post
    I have an education in economics.
    Not a very good one as you have been tripping over your own dick in the Trump thread in SC.

    Quote Originally Posted by mark45y View Post
    All I can tell you is because of the trade imbalance, the U.S. has the potential to hurt China more than the other way around through the tariffs.
    An incredibly naive assumption that does not take into account that these tariffs will affect almost all US companies as the supply chains do to globalization are interwoven. Not to mention that China owns trillions of dollars in US debt all they have to do is start liquidating that and it will have a terrible effect on the US economy.

    Quote Originally Posted by mark45y View Post
    This is a win for Trump.
    Spoken from your right wing echo chamber and as usual you are wrong AGAIN. No wonder you have most of us in ignore. You do not really want an honest debate do you Mark?

    Quote Originally Posted by mark45y View Post
    Not rocket science. USA buys a lot from China. China does not buy much from USA.
    Actually it is complex. Very complex and if you had an actual clue about economics you would understand this.

  9. #9
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    Quote Originally Posted by Maanaam View Post
    Do you think Xi cares? More peasants on the soybean farms. Xi doesn't need votes like Trump does. China winning all the way.
    Also, China has it's 5, 10, 15, 20, 50 year plans....this is probably a blip in the plan, and maybe even a predicted one.

    Xi does not need votes and doesn't give a hoot about the peasants or the middle class, and that is where China's strength lies. Of course China will win out in the end. And just deserts to Trump's America and his voters.
    Hello, there, Mr. "Stalker". Fyi ~ TB did not post what you've highlighted as a quote. Despite your academic response being spot-on, your personal obsession (with me), is clearly obvious. Get a grip, man!

  10. #10
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    Quote Originally Posted by TuskegeeBen View Post
    Hello, there, Mr. "Stalker". Fyi ~ TB did not post what you've highlighted as a quote. Despite your academic response being spot-on, your personal obsession (with me), is clearly obvious. Get a grip, man!
    Ben, if you think I'm stalking you you've got more ego issues than Lulu!
    Even a simple person having used this forum will realise that the quote function quotes the last person to quote some words, thus if you quote Mark (who I have on ignore but that's neither here nor there) and I then quote you quoting Mark, it shows as I am quoting you.
    No nested quotes on this forum.

    Get a grip!
    And learn how the forum works.

    BTW, it's actually the opposite of stalking: When I see a new post is from you, I don't go to the thread as a matter of keeping my sanity unless I'm following that thread despite your contributions.

  11. #11
    Thailand Expat David48atTD's Avatar
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    Quote Originally Posted by bsnub View Post
    ... Not to mention that China owns trillions of dollars in US debt all they have to do is start liquidating that and it will have a terrible effect on the US economy ...
    A very valid point and a keystone to the complex issues that face the US economy and, in turn, the World economy.

  12. #12
    Member mark45y's Avatar
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    Quote Originally Posted by David48atTD View Post
    A very valid point and a keystone to the complex issues that face the US economy and, in turn, the World economy.
    Would China want the value of it's trillions of US securities (debt) to fall in value? Do you really think it wants to lower the value of it's trillion dollars in US debt? 555. That is just silly. The USA is sure to win. The markets will realize this soon. Did stocks go up or down in Europe and Asia today? So, now you know. You read it here. Remember this, the Russian and Chinese trolls want you to think Trump and the USA is in trouble so he will back down. Trump owns the Republican party. 90% support. Do you think his worried?

  13. #13
    Cenosillicaphobiac
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    You would expect that whoever started the trade war would have run the numbers beforehand and seen that the outcome was favourable.

    Given the amount of corruption and incompetency of many leaders, this cannot be actually be expected, maybe more wishful thinking.

  14. #14
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    Quote Originally Posted by mark45y View Post
    Would China want the value of it's trillions of US securities (debt) to fall in value? Do you really think it wants to lower the value of it's trillion dollars in US debt?
    You moron they would liquidate them all at once to disrupt the market. Do you really think that they are stupid enough to do anything otherwise?

    Quote Originally Posted by mark45y View Post
    That is just silly.
    Your childish understanding of economics sure is.

    Quote Originally Posted by mark45y View Post
    The USA is sure to win.
    Not this time trumpanzee.

    Quote Originally Posted by mark45y View Post
    the Russian and Chinese trolls want you to think Trump and the USA is in trouble so he will back down.
    You never stop with the idiocy and you continue to dig yourself into a deep hole of stupidity with every post. Russian trolls love your orange god you moron he is walking into every trap Putin sets.

    Quote Originally Posted by mark45y View Post
    Trump owns the Republican party. 90% support.
    Yep and why is that? They are a bunch of dogma slaves and racist. The only intelligent conservatives have left the party ala George Will.

    Quote Originally Posted by mark45y View Post
    Do you think his worried?
    I think he is very afraid. Everyday he wakes up the first thing he worries about is Mueller.

  15. #15
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    Quote Originally Posted by mark45y View Post
    This is a win for Trump
    ...Iowa/Nebraska/Kansas soy bean farmers who voted for him may wonder how this benefits them...Wisconsin dairy farmers may wonder the same thing...if these groups, and many others in agriculture, begin to understand what ignorant bloviating hucksters tRump and his B-team circle are, there is some hope for the US...otherwise, there is much worse to come...this is what happens when education fails...
    Majestically enthroned amid the vulgar herd

  16. #16
    Thailand Expat David48atTD's Avatar
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    Quote Originally Posted by David48atTD View Post
    A very valid point and a keystone to the complex issues that face the US economy and, in turn, the World economy.
    Quote Originally Posted by mark45y View Post
    Would China want the value of it's trillions of US securities (debt) to fall in value? Do you really think it wants to lower the value of it's trillion dollars in US debt? ...
    No, not for a second, hence my comment ... the complex issues that face the US economy


    Quote Originally Posted by mark45y View Post
    ... The USA is sure to win. ...
    Whoa there kemosabe ... not necessarily

  17. #17
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    Quote Originally Posted by David48atTD View Post
    Whoa there kemosabe
    ...you're dealing with an economics major, David...I believe Peter Navarro, captain of tRump's economics B-team, also majored in economics: both demonstrate the failure of education in the US...

  18. #18
    Member mark45y's Avatar
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    Quote Originally Posted by Plan B View Post
    You would expect that whoever started the trade war would have run the numbers beforehand and seen that the outcome was favourable.

    Given the amount of corruption and incompetency of many leaders, this cannot be actually be expected, maybe more wishful thinking.
    Not hard to figure. USA imports from China 506 billion. China imports from USA 130 billion. USA can replace all the Chinese imports costs pennies on the dollar. China can't create a market that will buy 506 billion dollars for the foreseeable future. USA exports 2.3 trillion dollars. How important is 130 billion. East to figure who is going squeal.

    There are interests that don't want the above information to become common knowledge.

  19. #19
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    Quote Originally Posted by mark45y View Post
    Not hard to figure
    Quote Originally Posted by mark45y View Post
    Easy to figure who is going squeal.
    ...tRump's sentiments I'm sure, though they aren't based on an economics degree...or international experience in economics...or anything except that such comments are...easy to tweet...

  20. #20
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    Quote Originally Posted by mark45y View Post
    Not hard to figure. USA imports from China 506 billion. China imports from USA 130 billion.
    It actually is far more complex. Did you or did you not plain to be a professor of Economics at a black college in the US?

    Quote Originally Posted by mark45y View Post
    USA can replace all the Chinese imports costs pennies on the dollar.
    HAHAHAHA! Let us watch the stock market.

  21. #21
    Thailand Expat David48atTD's Avatar
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    Quote Originally Posted by mark45y View Post
    Not hard to figure. USA imports from China 506 billion. China imports from USA 130 billion. USA can replace all the Chinese imports costs pennies on the dollar. China can't create a market that will buy 506 billion dollars for the foreseeable future. USA exports 2.3 trillion dollars. How important is 130 billion. East to figure who is going squeal.

    There are interests that don't want the above information to become common knowledge.
    Reference to confirm your Facts above please.

  22. #22
    เกี่ยวข้อง HuangLao's Avatar
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    Dreams worlds dangerously taken literally...
    Sums it up.

    Consider the sources.

  23. #23
    Member mark45y's Avatar
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    Quote Originally Posted by David48atTD View Post
    Reference to confirm your Facts above please.
    google USA China trade deficit google will give you any of the answers I have no secret sources. https://www.thebalance.com/u-s-china-trade-deficit-causes-effects-and-solutions-3306277

  24. #24
    Member mark45y's Avatar
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    Do you want to know in advance if the USA is winning the trade war? Look at the markets.

    https://www.cnbc.com/video/2018/07/0...-think-so.html

    Compare the
    Shanghai (.SSEC:Shanghai Stock Exchange) with the Dow or S&P last 3 months.


  25. #25
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    Quote Originally Posted by mark45y View Post
    Do you want to know in advance if the USA is winning the trade war? Look at the markets.

    https://www.cnbc.com/video/2018/07/0...-think-so.html

    Compare the
    Shanghai (.SSEC:Shanghai Stock Exchange) with the Dow or S&P last 3 months.
    Honestly, I'd place my bets on your side of the debate fence. Reason: You don't come across, as a know-it-all, on nearly every OP topic thread posted. Have a pleasant evening, sir. Cheers
    Last edited by TuskegeeBen; 12-07-2018 at 08:50 PM.

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