Trish Regan: Trade war is on with China, we have upper hand, it’s now or never
The U.S. is preparing our next moves as China fires back with a new round of tariffs. This is economic war, which makes it the kind of war President Trump is very willing, and quite able, to fight.
The market lost 617 points Monday on the Dow Jones Industrial Average and the mainstream media seems to be reveling in the stock’s market jolt, almost as though the media were delighted to report on the sell-off. Despite the apparent glee, we're still up on the Dow for the year. The smart money knows this blip today is temporary and that President Trump can pull this off. When that happens, the U.S. will be better positioned going forward.
Remember: We have the leverage. China buys more from us than we buy from them. We are their No. 1 customer at over a half-trillion dollars a year. If we stop buying, they stop earning: This is our weapon, and it's a weapon President Trump isn’t afraid to use.
Meanwhile, we don’t really have a choice, do we? President Trump could take the easy way out, as other presidents have before him, and play nice, and tell China that we’re simply happy to be doing business with them. That's certainly what most presidents — from Clinton to both Bush presidents to Obama — have done.
That kind of attitude in the past led to many of the trade problems we have with China today. One of the smartest things President Trump has said is that we’ve been in a trade war for decades, and he’s right. Instead of fighting back, we’ve allowed China to prosper and prosper, at our expense. As a result, China’s GDP growth outpaces even our own.
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China has gotten away with stealing $600 billion in intellectual property from us every year. From logos to software -- you name it, the Chinese have stolen it — and they’ll keep stealing it, if left unchecked.
But now, we have the upper hand. A deal will happen, and though it may mean volatility in the markets in the near term, a market sell-off is a small price to pay for the sake of our future and our children's future.