The Trump administration believes that the U.S., as the world's largest consumer, has the stronger bargaining hand in negotiations with key trading partners. Meanwhile, China, the world's largest manufacturer, is under the impression that it can weather the tariff storm and force the Americans to ultimately back down. Global growth is threatened as the world's two largest economies battle it out.
“If you know the enemy and know yourself, you need not fear the result of a hundred battles. If you know yourself but not the enemy, for every victory gained you will also suffer a defeat. If you know neither the enemy nor yourself, you will succumb in every battle.”
Background readings:
Why Xi holds a stronger hand than Trump
https://www.ft.com/content/2112e995-3b76-4886-ad45-5fc8991cd120
The White House has miscalculated the balance of power in its tariff war with China.
China is well positioned to weather Trump’s trade war
https://www.ft.com/content/87461979-9d61-4ecb-a560-ecc661208946
Five years of export controls have helped it get very good at making things without American technology.
https://www.ft.com/content/2112e995-3b76-4886-ad45-5fc8991cd120
The White House has miscalculated the balance of power in its tariff war with China.
https://www.ft.com/content/87461979-9d61-4ecb-a560-ecc661208946
Five years of export controls have helped it get very good at making things without American technology.
The U.S. and China Are Going to Economic War—and Everyone Will Suffer
https://www.wsj.com/economy/trade/us-china-tariffs-trade-war-6f143252
Untangling the two economies has profound implications for businesses and consumers in both countries, as well as the rest of the world.
Trump’s approach to geoeconomics carries dark echoes, writes Maurice Obstfeld
https://www.economist.com/by-invitation/2025/04/08/trumps-approach-to-geoeconomics-carries-dark-echoes-writes-maurice-obstfeld
Choosing guns over butter in trading relationships will make America both poorer and less safe.
https://www.wsj.com/economy/trade/us-china-tariffs-trade-war-6f143252
Untangling the two economies has profound implications for businesses and consumers in both countries, as well as the rest of the world.
Trump’s approach to geoeconomics carries dark echoes, writes Maurice Obstfeld
https://www.economist.com/by-invitation/2025/04/08/trumps-approach-to-geoeconomics-carries-dark-echoes-writes-maurice-obstfeld
Choosing guns over butter in trading relationships will make America both poorer and less safe.
The ‘China Shock’ Offers a Lesson. It Isn’t the One Trump Has Learned.
https://www.nytimes.com/2025/04/11/business/economy/tariffs-trump-china-shock.html
Economists say the U.S. manufacturing decline in recent decades was not mainly about free trade, but about the pace of change without time to adjust.
https://www.nytimes.com/2025/04/11/business/economy/tariffs-trump-china-shock.html
Economists say the U.S. manufacturing decline in recent decades was not mainly about free trade, but about the pace of change without time to adjust.
How the U.S. Lost Its Place as the World’s Manufacturing Powerhouse
https://www.wsj.com/economy/us-manufacturing-decline-service-economy-ee97a1e2
Trump says his tariff plan will restore American manufacturing might, but economists are skeptical.
https://www.wsj.com/economy/us-manufacturing-decline-service-economy-ee97a1e2
Trump says his tariff plan will restore American manufacturing might, but economists are skeptical.
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