Emerging Markets Investor | Believer in Free Speech | Architect of Enterprise | Building Tanzania’s Future Together | Belgian with Middle Eastern Spice
What if @realDonaldTrump were to announce that China tariffs would immediately be reduced to 20% and then escalate thereafter by 0.5% per month for next 12 months, and then by 1% per month for the next 12 months, and then by 1.5% per month for the next 12 months and so on?
To the extent that China modifies its unfair trade practices, the increases could stop and potentially be reversed depending upon the degree of improvement in its trade policies.
This approach would incentivize companies to relocate their supply chains from China while enabling them to continue to operate profitably during the transition.
China would be incentivized to make a good deal with @realDonaldTrump as promptly as practicable while the risk of a dramatic shock to the US and global economies would be greatly reduced if not eliminated.
A thought experiment.
Imagine if:
Within the next 89 days, the US, Europe, and Japan agree to go zero/zero on tariffs and remove all trade barriers.
Then Europe and Japan join the US in raising tariffs on China to 145%.
Then the US, Europe and Japan as a united front negotiate with China to remove tariffs and trade barriers, and put in place strong structural protections for IP.
@BillAckman You are the type of person who truly gets it - that 1% who truly have their feet on the ground. Keep the background noise to a minimum as pleasing everyone is impossible (tried that, didn’t work).