I Think China Wants The United States To Impose %25 Tariff on Chinese Goods in March!

I don’t like to get political and hopefully what I’m writing isn’t too political. I’m thinking that even if president Trump is really wanting to have a trade deal with China to avert the upcoming tariff deadline in March on the Chinese goods, China might not want to see a trade deal gets done even the United States concedes something great.

How come? Well, let pretend to put yourself in a Chinese shoe and think about this for a second. So, if you’re Chinese and you know that the Americans will up the tariff on your $200 billion goods in March from 10% to 25% if the trade deal between China and the United States won’t happen, and so the big question is should you concede to the United States in a big way in order for a trade deal to be happening and the tariff to go away? Well, I think if you’re smart you probably would want the United States to impose the 25% tariff on your $200 billion of goods.

I think China knows that the United States economy is not on a solid foundation otherwise the United States won’t have a government shutdown and such. Furthermore, inflation would go through the roof since the interest rates cannot be raised appropriately. To keep the interest rates low the United States has to continue to print more money. Normal people in the United States will continue to see rising inflation which would cost them dearly in acquiring daily things in local grocery stores and so on. A hamburger meal usually costs like $3 but now is like $7 to $8. So, if you’re the Chinese you would think that higher tariff on the $200 billion Chinese goods must be a great thing for China!

Meanwhile, China is weaning off the reliance on American consumers because of the hostility between the United States and China! This could push China to be more aggressive in finding new markets throughout the world such as in Africa, India, Asia, Europe, South America to replace the North American consumer base. Some other regions might see this as a good opportunity to negotiate with China to get a great deal so they could enter China’s huge growing middle-class consumer base. China may pretend to resist this but could end up agreeing to concede something to these players so they could diversify away from the American consumer base.

I think the long term picture is what China is sought after because China wants to better itself in the overall big picture. This means China doesn’t care if the United States is upping the tariff to 25% or even to 75% or to 100%. When the United States is upping the tariff on Chinese goods, the Americans have to pay more for daily things in their lives. This would put even more stress on the Americans and make the Americans go into debts even more. More Americans in debts could mean a weaker market overall for the United States in the long run. This means more Americans will have to be more prudent on what they will spend so they could have money to pay off their debts. This means the American market will soon see a big cut back from spending by the American consumers. Either this or the Americans who are already in too many debts won’t have money to spend anyway!

Meanwhile, China could just sit pretty and wait out to see another financial crisis that will hit North America. So, in a Chinese shoe, do you think you want to have a trade deal done with the United States? Meanwhile, president Trump may not even want a trade deal done with China since president Trump thinks that he will get more votes for the next presidential race if he goes anti-China even more. In summary, I don’t think by the end of February we will see a trade deal between China and the United States. So, if you’re on the side of wanting to see a trade deal done, you should hope that I’m wrong. So, if you’re on the side of not wanting to see a trade deal done between China and the United States, you would probably want that I’m right. In my opinion, a trade war between China and the United States is not a good thing for the long term economic health of the United States.

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Just An Obvious Thought: Advertising In The Age Of Streaming!

Streaming is proliferating nowadays, and so people are slowly switching from watching traditional TV contents to streaming contents.  In fact, whatever that is streaming can also be duplicated on TV and vice versa.  The big difference is that TV is scheduled and streaming is an on-demand kind of things.

For advertisers, streaming is something radically different than traditional TV because streamers may not accept forced advertising contents.  TV viewers may not care how long or how many advertisements get push through during a viewing experience.  The big words here are may not since TV viewing experience is about potato couching.  On the other hand, the streamers want contents quickly and sometimes prefer the shorter the content the better.  When advertisers push through advertisements in streaming contents, the streamers often get turned off.

The puzzle here is all about how to get viewers who stream to watch advertisements!  We’ve seen clever advertisements been done in movies such as marrying a brand into the content of the movie itself.  For an example, let’s create a fictitious brand of soft drink known as Blahboulous and we marry this Blahboulous can of soft drink with a character in the movie who often loves to carry the can of Blahboulous soft drink around.  This tactic could also make a brand viral since a famous actor or actress is being associated with such a brand!

The question is how to marry multiple brands into streaming contents!  Doing this too obvious would also be a turnoff.  Perhaps, there would be a better method?  I think forced advertising contents can still be done in streaming contents, but this gotta be super concise and short and the fewer the better!  Meanwhile, advertisers should marry their sponsors’ brands into the streaming contents more often.  The combination of both could elevate the advertising streams while irritating the streamers less.

Could Trade War Be A Blessing In Disguise For China?

What I’m about to write could be controversial for the time we’re living in now.  As we all know president Trump’s tariffs on China are the means to push China to negotiate a fairer trade — at least this is how the president promotes to the public.  So far China isn’t willing to be a pushover and so they decide to retaliate pound for pound.  This means whoever blinks first would lose a lot more in the long run, but in the end, both the United States and China would lose in short-term — well, at least this is how the news programs promote this.

I’m thinking that could tariff be a blessing in disguise for China?  How come?  China has been known as the factory for the world since they opened up their market and joined the World Trade Organization.  This means China can ramp up production of almost anything!  As Trump’s tariffs hit China, companies that want to avoid tariffs from the United States and still want to export to the United States would move their operations out of China.  Nonetheless, there are Chinese and foreign companies in China that produce the same stuff but have yet to export their products to the United States would find the vacuum suddenly is a lot more pleasant to navigate and do business.

The Chinese government could also be more lenient toward companies that decide to keep their operation within China, thus allowing these companies to prosper while China’s internal consumer market ought to grow bigger in time.  Remember Google?  Google left the Chinese market a long time ago but now Google has shown signs that it wants to grab a chunk of the Chinese’s huge consumer market.  Unfortunately, Google isn’t making much progress in this front and allowing similar Chinese homegrown companies to grow unchallenged within China.

Since Chinese companies that are going to stay in China could ramp up their production unchallenged as the trade war between the United States and China heats up, these companies ought to grow bigger in a more empty but lucrative Chinese consumer market.  Perhaps some European companies may want to open up their operations in China to give the Chinese companies some competitions.  Anyway, I think Chinese companies could grow unchallenged in their home market and mass produce even cheaper products to saturate the world market even more.  In the end, I think trade war could only harm a weaker foe who got no means to fight back and could not ramp up production.  In the case of China, I think trade war could be a blessing in disguise for the reasons I surmised thus far.

 

Could The Yuan’s Sliding Allow China To Unload Treasury Bonds?

I’m just wondering!  Lately, the headlines are screaming that China is devaluing the Yuan to help cushion the blow of Trump’s tariff on China’s exports to the United States.  Although this is a legitimate concern that the headlines raise, I’m wondering if there is another hidden motive for the Yuan to slide.

Could it be that the Chinese government is letting the Yuan slides so the treasury bonds that the Chinese own which Americans are in debt to China could stay valuable?  This way China can begin to sell the treasury bonds while the treasury bonds are still valuable.  Once China unloads enough of the treasury bonds onto the market, whatever value China receives from such transaction could then be converted to other favorable assets, investments, and currencies.

Of course, China could always convert the selling of treasury bonds into Yuan and then raise the Yuan’s buying power back up to stave inflation — but then it could begin a deflation.  How?  Well, if too many Yuans that are chasing the same thing could raise the price of whatever, but when the buying power of Yuans get push up the Chinese government then could lend out these Yuans to other countries and International projects such as Belt and Road Initiative projects to stave inflation.  A more powerful Yuan could also allow the Chinese to get more bang for the buck whenever they use the Yuans to acquire whatever.  Thus they also have to be careful about the deflation.

I’m no economist and so I could be wrong on what I’m suggesting.  Nonetheless, I would love to hear other people’s opinions on the suggestion that I’m suggesting.  Am I wrong?  Am I even close?

Basic Income Is Dead. Long Live Basic Equality!

As earth’s population grows larger and automation gains traction each day, how many job categories and niches would dwindle each time before there would be none left for onlookers?  More people mean more jobs are needed to sustain a vibrant society where equality gap could be lessened instead of widening.  More automation means more people will lose jobs.  These two factors are like pouring gasoline onto the fire.

Unethically, such a society could demand people to have fewer children, but such a society needs a strong authoritarian government.  In the West, most governments are democratic, and so such demand would be outrageous.  Furthermore, such a demand is for a weak society, because the society doesn’t have a solution thus resolving into forcing a reduction of population headcount.

A wiser society would not demand a reduction of population headcount — it got a solution for what’s coming!  What solution?  As of now, there is no clear solution for the two detrimental factors I stated in the first paragraph!  By the way, what is a society?  In my opinion, a society is a group of people that stick together for the benefits of the majority.  The two detrimental factors I described earlier would chip away most benefits of the majority in our modern societies.

Few governments and groups are trying out basic income as a testing case for trying to solve the inequality gap between classes of groups of people in our modern societies.  Nonetheless, small-scale basic income test trials most likely won’t yield any good result.  Furthermore, basic income for large countries like the United States and China would be an insane proposition.  No amount of money would be enough to give out to each person in a large country.

I think basic income is kind of screwy too!  For an example, the more money the government prints to give out the more people will spend thus requiring the money printers to print even more money so the government could have enough doughs to give out to even more people.  Get the gist?  Once the government tightens the belt such as stopping giving out money, the basic income scheme would collapse immediately.  A society that is addicted to basic income could also collapse!

By the way, how inflation would work in a basic income society?  I don’t think I know the answer to this as I’ve seen nothing like it has ever applied to a large country like the United States or China.  We all know that if inflation goes north too much everything would become rather pricey because the supply of money is too large — simply put, too many dollars would chase too few demands.

As job loss number increases and automation gains worldwide prominent, the tipping point would become too real when a society becomes desperate and mad.  Nonetheless, as an advanced society could produce just about anything with little effort using automation, the tipping point once again could occur positively as people would no longer require making a living by working the field, factory, office and so forth.

The question is, in the between the transition from a working society to a leisure society, how many people would have to die and how many revolutions would have to occur before the storm could pass and peace could form?  The basic income could work as a dirty solution till the modern society could completely transform into a leisure society!  The question is, will the governments of the world dare to print an unlimited amount of money before inflation hits and destroys the hope and dream of attaining a transformation of a modern society into a leisure one?

Perhaps, basic income is too draconian and would not work.  Perhaps, providing a fair playing field for the newcomers would work?  What do I mean?  Imagine basic income is not basic income but a one-time thing for the poor and the newborns!  What do I mean again?  Well, basic income is too hard to carry out as it requires the governments of the world to continuously print an unlimited amount of money each year.  Instead of basic income, why not basic equality for the poor and the newborns?

What do I mean by basic equality for the poor and the newborns?  Well, let’s say the government would go about to calculate the right amount of money each person needs to have a fulfilling life as long such a person would not do anything too crazy to destroy the money cache quickly such as using drugs, gamble, and whatnot — then a government would give a one-time basic income to all the poor in his/her own country so to provide a fair level of playing field.  Obviously, the rich won’t need any basic income so the government can save money by not giving any to the rich through basic income channel!

Basic equality would save the prudent government a lot of money and yet his/her society would be able to function in a jobless era.  All the newborns could also receive one-time basic income in a form of a trust fund that the government would create for them.  The trust fund would go out to the parents of the newborns for a while till the newborns become adults.  Once the newborns reach adulthood, the government then could give them basic equality (one-time basic income) according to the inflation rate in their time.

Of course, the hope is that the basic equality would buy time for modern societies to transform into leisure societies across the world.  The idea of basic equality, one-time basic income, is to leave nobody behind yet buy time for the governments of the world to see their societies transform into leisure societies where automation would provide everything everyone needs.  When everybody got everything and more, money would become so irrelevant!  In such a society, money won’t buy anything!  In a leisure society, only the smart, funny, easy going, talented ones could become real assets of the world!

 

 

Could Blockchain Be Used More Appropriately To Facilitate Cashless Society?

Thinking out loud is often done in a haste hints the nature of it.  Thus my thinking out loud in this post isn’t solid, but I like to dabble on here.  One thing people fear about a cashless society is that once the digital numbers are being erased somehow, their worth would be gone without any trace for recovering.  Thus, people are definitely still preferring cash as a mean for emergency backup.  After all, if their digital world is being shut down, they got cash to help them survive daily such as buying foods and whatnot.

Bitcoin is probably going to be an enemy of the banks since banks want to be the middlemen of the transactions.  Bitcoin takes out the middlemen role and allows people to have a direct transaction between the two parties.  In order for the bank to receive commission and gain liquid fund, the bank needs to be able to insert itself into the deal.  Simply put, Bitcoin is against a traditional bank which isn’t accepting Bitcoins!

Banks can accept Bitcoins, but people won’t use banks as of how they would use a traditional bank.  Bitcoin users may want a bank to behave as a trustful Bitcoin exchange to facilitate the Bitcoin transactions in safety manners.  This way any Bitcoin bank can still insert a banking role in a non-traditional way into the deal.  Since Bitcoin will be more transparent — plus demoting a traditional banking role somewhat, I don’t think the banks will be able to create more creative derivative means for creative investments.  I could be wrong since this is thinking out loud session.

Bitcoin is also very similar to a cashless society because it isn’t cash and it’s digital medium.  Taking away Bitcoin, underneath it all is the technology itself which is the blockchain.  The blockchain technology is more important than the clothes it is wearing such as a crypto coin (i.e., Bitcoin).  Why?  I think blockchain technology is good at keeping transactions honest.  This honesty is rather important for cashless society don’t you think?  Nonetheless, current Bitcoin way isn’t helpful for blockchain technology since the implementation is rather crude, allowing people to hack and steal each other Bitcoin without a clear way to trace back to the original owner of the lost Bitcoins.

If I’m not wrong, a will be successful cashless society could use the blockchain technology to keep cashless money honest so the original owner of the money won’t fear the tyranny of a cashless society shutdown event.  By that I mean the only way for a person in such a society to lose wealth is being incriminated with evidence and wealth get confiscated by a court of law.  In such an orderly way the blockchain technology could be used to keep track what money belongs to whom before the exchange takes place and long afterward so a cashless society shutdown event which occurs by any other mean besides the legal ones such as the one I stated just a moment earlier would be a futile effort.

I think people would be able to accept a cashless society when their wealth won’t be suddenly disappeared overnight in a mysterious event.  Of course, people are still going to fear that if they’re innocent and being convicted wrongly; their wealth got confiscated in such a rude event — they could be helpless as they would not be able to survive daily when their digital wealth got shut down in a cashless society.  I think once one accepts a cashless society, one has to accept such possibility as there won’t be any legal cash laying around to act as a legal tender for acquiring daily things.

By writing this blog post, it doesn’t mean I support a cashless society!  I just merely thinking about the possibilities and effects of it all when such a society occurs.  Although China isn’t a purely cashless society, because paper money is still going to be a legal tender within China.  Nonetheless, China is one of those countries that is leading the race in facilitating the use of money through digital devices such as the smartphone.  I think once the money becomes digital numbers, money is indeed facilitating a cashless society.  A cashless society is definitely taking some shapes or forms around the world, and so I’m writing this to amuse myself with both negative and positive possibilities of such a phenomenon.