Hong Kong's wealth came from funnelling and facilitating trade between mainland China and the first world. With China's opening up, Hong Kong's decline in prominence was inevitable. But this does not mean that Hong Kong is going to cease to be important.
In this case, the question is more of a political one than economic. HK is accustomed to a meritocracy. However, it now exists within a nation-state where Loyalty To The Party is the most important factor.
@@kimpeater1 Since you are acknowledging that Hong Kong's economic growth is a fait accompli, would you like to expound on exactly which countries in the world do not first and foremost prioritize loyalty to the country for its public servants?
@@unifieddynasty nice but invalid strawman attempt. Loyalty to the Party in HK applies to the formerly meritocratic business community not public servants.
@@unifieddynasty nice strawman attempt but invalid. Loyalty to the Party in this case is being imposed on the formerly meritocratic business community, separate from the public servants.
@@unifieddynasty All of Western "public servants" work for a set of interests other than the nations thy nominally "serve". For instance, all of Washington DC in the United States anwers only to the City of London and Beijing. Also, you have "country" confused with "government".
The problem is tariffs will not USA manufacturers more competitive. USA has plenty of oil and has no motivation of clean energy. On the contrary, China has energy crisis and puts all efforts in pushing the limit or energy industry. China wishes to use technology to overcome China's greatest national security threat. Now they want nuclear fusion and mining He-3 on the Moon.
Don't get your hopes up too high, you will be disappointed over and over and over again. All the US political landscape has to offer the voter is geriatric, dementing old sods that are deaf for the urgent needs of the American people.
American politicians have common sense, but they are controlled by various interest groups and have to do things that go against common sense to get funds. This is the beauty of American democracy, so China does not adopt this stupid politics.
tarrifs are BS. BYD new car that can go 2000km on a single tank of gas, for $14k. that is what the US is missing out on. Everyone in the US is used to paying a high price on cars, with lower technology.
@@西瓜不太圆 It is true - they did the test drive. Just a correction - it is a hybrid - 2000 km on one charge and one tankful of gas. You can drive from NYC to Miami on that. I suggest you google for this instead of dismissing it outright.
Survey 6mths ago of europeans showed 24% willing to buy China EVs. last month 50% willing to buy chinese EVs. De-risk from nonsensical schizo USA policies. De-risk from US$. De-risk from USA war culture. The 80% global south is heading there with BRICS begging China and Russia to get alternate things in place for everyone’s sake. Everyone wants EV ChinA Made bcos technically everyone admits that they are the best. This is HARD to say for some people.
@@lordbendtner7021 : sure, China sell more units, but less value. The avg price of a new vehicle in China $20K vs. US $50K. Even if China sells twice more cars, the US market is still greater in value.
in the short-run sure, but also more economic growth, less need to issue debt due to a lower trade deficit, more wage growth etc, and then in the long-run don't even have the inflation anymore, with much more export opportunities because we establish supply chains with developing countries who actually allow us to sell to them in return and don't get free access to our R&D every year.
Tariff or Tax. But direct me to where is the Tariff/Tax money go. I have Never heard a Tariff reduces our federal wage tax, builds roads, supports social security or reduces the National Debt. How can the government place a Tariff but Not have to detail where and what it will be used for.
@@jbranche8024 most federal programs are payed for from general revenue, you don't assign each and every tax to a specific spending outlay. Only ones we do that with is payroll taxes for social security, medicare & unemployment insurance.
Only the countries that it couldn't directly influence. Cause well, the good life we have in the US the past 50 years really depended on the dollar being the world reserve currency and us being able to use that to print and borrow trillions of dollars.
China is resetting its economy, gone the growth model that rely on property bubble, and export oriented economic model is also being restructured gradually to more domestic consumption based and high value added export oriented model. China knew that free trade is facing headwind, so the old model of exporting low margin goods is unsustainable. That's why China is investing heavily in new industrial revolution, like renewable energy, robotics, chips, 5G, etc. Of course it won't be painless, there will be a lot of strain and pain for the next 10 years. For HK, HK need to remember, it is a gate to China first and foremost. Without China, HK is a gate to nowhere. Needless to say, HK prosperity is tied to China. For the past few decades, HK have practiced unbridled capitalism that brought wealth to HK, but also high inequality, especially in housing sector. This inequality created resentment toward central gov. There is an easy way to solve the housing problem, let HKers who can't afford housing to purchase housing in Mainland. Pearl Delta River Region integration is the solution to HK problem. But this will take time.
HKers have been buying properties for decades in the great bay area ..recently , they have allowed the banks to faciltate the fundings of transfers from within a HK bank to mainland banks for house purchases .
China wants to escape the middle income trap and become a developed country. Along with China's rise, China wants the under developed countries to also aspire for economic well being. By doing so, China thinks world peace can be achieved. The fly in the ointment is the US. The US believes that as the hegemon of the world, it rules the world and will do anything in its power to stay number one.
The capitalists are still having a strong grip over HK economy. And there are also a lot of "Anti-China" govt administrators in HK govt who drag their feet when it comes to change for the good of HK especially in providing public goods & services (like land reform, urban planning & healthcare).
The problem with the USA & Europe is that they don't know their basic Economic principles of Comparative advantage. China gets things done whereas other countries in the West have to debate everything before they do anything.
No the western leaders don't have to detabe things and do them slowly if it's of enough priority to them!! Did you get any consultation or much debating before they decided to invade Iraq? To bail out the big banks with your tax payers money? To send weapons and monies to Ukraine and Israel? Wake up and admit you are just not the priority!!!
Just knowing about comparative advantage doesn't really matter... You can't just double your population overnight, which is at the core of China's comparative advantage. Only time will tell whether this current massive population focused around relatively tight age range could become a problem later on...
Finally, an adult in the room. The US needs to: - invest in STEM education to grow its manufacturing industries so as to export more. - reduce overseas military bases to reduce the deficit
Overseas military bases + the troops stationed on them are about $150 billion a year, and that's if you got rid of the all the associated forces, and got rid of all of it, which would be monumentally retarded. So in reality you're talking about tens of billions, against the backdrop of a deficit that's nearly $2 trillion.
No, the US should lower their expectations on salaries. People haved earned more than they should for a long time. No matter from which country, people can produce the same products at a much lower cost. You cannot keep this forever. Innovation is important but not that important.
@@kevinxie5762 You have the opposite way round. China should allow its currency to appreciate, let its people start importing more, stop subsidizing so much and let households take home a larger share of the pie, and thus the manufacturing sector shrink. We’ve subsidized your development for decades now, you guys like to say you’re a superpower now, so time to get up and walk on your own two feet like a big boy.
U.S. is losing time with missteps after missteps. From industrial policies to trade to geopolitics. While at home mired by all sorts of problems from immigration, border security, gun control, education and dilapidated infrastructure. Americans are suffering.
After watching the financial system being used as a weapon against users, China has no choice but to create a safe international alternative … and they have chosen HK for this role because it already has international roots.
@@tooltalk Any nation with precious resources will guard them. That is natural and expected. However, the US weaponizing their SWFT network is something very different because it is a *voluntary* and *trust-based* network. No one has to join the American financial system, but most of the world does because the US guaranteed fairness and equality. This network benefits you as an American greatly. It makes your inflation lower than it should be. It makes oil cheaper for you than it should be. But once they weaponize it, then that trust is severely damaged. The Chinese have their competing financial network, and they're attracting more users because they don't pull rugs like the Americans do, at least not yet.
No. Population of HK will spread into the mainland. Hongkongers are already going over the border for shopping and food as it is cheaper and for better service. HK will not be the BRICS hub for anything too many running dogs living there.
he only told half truth, ie. the 1st part of China beating US in almost every industry sector - this is the truth. The 2nd part is a lie about China's economy.
Hong Kong may or may not be over. But if it is over, it's because of the US placing artificial sanctions, boycotts, and whatnots on HK. Not because of China.
Hong Kong was always going to be over. Much of its appeal and function was as a conduit into China. A lot of that can simply be handled within China now.
@@308_Negra_Arroyo_Lane Yes that's also true. But I'm pretty sure that if the people of HK were not so rebellious and prone to anti- China riots, the mainland government would do everything it can to prop up HK. So HK's status and importance would diminish, but it certainly would not be 'over'.
China was already waging a trade war with us, we merely responded. And not responding, that is to say continuing to empower Beijing, also makes war more likely.
Stephen Roach provided sensible responses to queries raised by the 3 individuals. Unfortunately, he will not be able to change congressional leaders who are in debt to the many lobbies in the country.
Given the pace that China is decoupling and derisking from the US (and the West as a whole) in every way possible (agriculture, industrial supply chain, petrodollar, international moneytary exchange systems, bonds&loans, etc...) the risk on a forever war with China is not a real possibility. China planned to have its global south network at cruising speed by 2030, but as things are going, the decoupling and derisking task will be realised by the mid of the decade.
Do you travel to Asia much? Koreans are some rude, racist mo fos that hate Americans. Not the older generations, but the one that benefitted growing up and their kids when we saved their ass
Another great achievement of our government is: we have successfully forced a mutual trading partner to be our biggest enemy. I can clearly see that the Chinese is extremely unwilling to take that role, but we have kept pushing them and humiliating them to a point that they have no other choices.
Let’s see: After 6 years of our trade war against China, has the US overall trade deficit (with the entire world) been reduced? Have we broug6ht lots of manufacturing jobs back home? If not, then I believe our goal is to weaken China, and not about making America better or stronger. Let’s see whether China’s overall trade surplus has been reduced after 6 years. If not, then our goal is basically failing.
That’s usually what happens when one country’s top industry is financial services and the top export is “conflict equipment”… Unless you have a global war, you’ll never have a market big enough to balance your trade deficit
Taiwan is China, China is Taiwan. You are talking about trade deficit between US and China. Taiwan is not a country. Google it, There are only a mere less than 15 countries in the world that supports Taiwan as a country, most of those countries are tiny countries with population less than 500000. Taiwan is not even in UN, so it is not a country by any standard. Taiwan is just one of China's provinces.
@@censorshipagainstthemiddle6198 - Mike Bloomberg is all-in on China, and that's why his news channel parrots him. Falling growth, aging demographics, opaque system prone to capital misallocation - sort of like Bloomberg
it seems like there is an overcapacity of the fed printing press to satisfy the budget deficit leading to massive trade deficits and damaged credibility of the usd.
FYI -Survey of European intention to buy CHINA EV cars was 25% 6 months ago, last month's survey it is 50% intention to buy China EV. Sick of Bloomberg doom and gloom propaganda on China. Even Bloomberg became politicised. Not much value in such a business service.
@@ssuwandi3240 It is so funny that, in 1999, they were worried about no deficit because Clinton's budget was so efficient. So, I wouldn't say no president doesn't care; good thing Bush did tax breaks and 2 wars to ensure there was a debt...LoL
HK will have a bright future. It’s the envy. HK = Singapore + Huge Hinterland (China) Why wouldn’t HK thrive when China is bent on accelerating its development and becoming the world’s No 1?
The big difference between the US capitalist model and the Chinese use of capitalism is in China, the government controls and harnesses capitalism to produce for the Public Good. In the US, big business runs the government to produce a benefit for those at the top, leaving out 99% of the populace to fend for themselves as in health care, child care, wages, etc. China has raise 600M people out of poverty doing it their way, something that has never been done this quickly. The US has neglected most of us and now China is going to kick our ass!
China is setting up HK to be the international financial center alternative safe from being weaponized for political purposes. This includes the alternative to Swift and commodity exchanges
Hong Kong prospered because it was the PORTAL through which foreigners did business with China till China truly opened notably after the Hand Over in 1997. Thereafter, Shanghai took over from Honkong, which was inevitable. Without China, Hongkong isn't very important.
I can't wait to share this video link with my friends. I am conducting research on green business, focusing on power batteries and electric vehicles (EV). This video can help me understand more about how people view productivity and capacity. I agree that there is no such thing as overcapacity or excessive capacity. It is a strategy to use capacity locally and globally from a marketing and economic perspective (supply and demand).
Hong Kong will have to reinvent itself, due to natural limits such as the lack of land and small population, especially in the context of the Greater Bay Area, as the Monaco of China. Hong Kong, due to its legacy high land price policy inherited from the Brits, has the most expensive property market in the world and it translates to extreme high cost of living and doing business. In this regard, the city has to focus its development around the goal of justifying that high cost of living. Unfortunately it will become somewhat of a domicile playground of the rich, and amenities and service industries will have to be built around them, which is not dissimilar to modern day London.
Look all we have to do is flip the script of the Chinese. For 30 years the Chinese forced American companies to partner with a A . Chinese Company, B. Manufacture in China, C. Export some of the Production. So America should tell the Chinese fine you can compete in America but now you will partner up with a US company. You MUST manufacture in America and Export the your products from the US factory aboard. Ta Da !!
Yeah you’re a brain surgeon. China has a population of 1.5bn people, they don’t need the us market, over the last 30 years the us has been quite happy to sell millions of cars etc in China. Us business have been happy to see increased profits through chinas scale of manufacturing. The importance of the USA is on the wane, it’s just your utter arrogance that is in the way now.
Cheap consumer goods require cheap labor. High US consumption requires low exporter nation consumption. Tariffs equalize this imbalance. But requiring each nation to consume its own production is a knife in the heart of globalism, the financial class, who Roach represents.
I've read that a country that has the world's reserve money has to run a trade deficit. So if China or some other country had the world's reserve currency, they to would have to run a trade deficit. Don't know if it's correct though.
The US trade policy of re-shoring/near-shoring is coherent, but it's not favorable to continued globalization which means it's contrary to the interests of globalized/globalizing businesses. Regarding tariffs, most people don't realize that the US Constitution limits the government tax power to tariffs, taxes on alcohol, cigarettes, etc., and (by amendment) income taxes. So tariffs are one of the few available sources of revenue (one reason for US government deficits).
Chinese overcapacity in EV and green energy? Why, because they dominate the market in these industries? What about US ‘overcapacity’ in smart phones (Apple), printers (Hewlett-Packard-Packard), aviation (Boeing), AI chips Nvidia, etc? If the US will not allow China to dominate certain industries due to ‘overcapacity’, it should prepare itself for retaliation from China against US ‘overcapacity’... or, the US could actually learn how to implement same and sound industrial policies again, rather than resorting to politically convenient but counter-productive bans and tariffs.
The US "overcapacity" is mostly farmed to other countries. Apple iPhones are still mostly made in China (though most high-value components are made all over the world outside China), as does HP's printer/cartridge business. There is actually shortage in AI chips/nVidia and long waiting list at TSMC that fabs them. This is all part of de-coupling that many seem to ignore here.
If my economics do not fail, when the US sent 300B in aid to Israel totalling 600B now, there is a also a trade disparity too, right? That more than the US-China trade disparity.
Flat one for one tariff. China has 25% on all US goods, flat 25% on theirs. End the tit for tat with the exception being companies shipping fentanyl precursors for cartels and companies engaging in IP theft.
Trade with China is predominantly about the use of China as a way to keep the assets of US corporations off-the-books, so that their capital-to-asset ratios are as high as possible and most favourable to Wall Street as a comparable and tradable debt instrument on the international market. In addition, the US is keen to have the Chinese as a sink for US national debt, so that China pays for US consumers to be able to afford cheaper US goods made in China to be sold to Americans. This is the policy of the US, in alliance with others of Europe. The fix comes with a cost, for which, the Americans and their European counterparts, whose economies now operate via the printing of money to create money, in lieu of creating items of value to trade for money, have zero appetite: Reindustrialise, get a grip on the money supply and extend the length of time preferences :-)
This isn't a trade war, it's a real war. It isn't about economics but security. If you look at it from a purely economic point of view, yes the tariffs don't make sense. But cheaper products while strengthening an enemy that seeks to undermine your society is a bad trade. They US Govt simply doesn't want to say it as it can be spun around and they be made unpopular because of it. I don't think Roach is stupid enough to not realize this. I question if he is acting in good faith.
@@bumbengtey8464 who designated who first as an enemy? Who wanted trade wars to begin with? The kid got himself in deep doo doo , and i crying and trying to play the victim.
Good analysis. I wonder what mr. Roach views are about the ongoing division of the world into the west part, the G7 and allies, and the global south, Brics and allies. How far will this go?
The number of pure electric passenger cars exported from China to the United States is 12400, and the proportion of both the quantity and total amount exported to the United States is less than 1%. Raising tariffs is just for the sake of votes
Thank you Professor Stephen Roach for sharing, informative information & perspective insights the issues between the U$A and China. Bless you, Sir.👍🙏🇨🇳🐲🐼☯️☮️🌏🙂‼️
SLIGHT CORRECTION: We will have two economic areas: BRICS (ca 85% of the world) and the US Empire (15%). Parallel worlds in many ways. However the much bigger one will have far stronger economies of scale and innovation from plurality and diversity. As the US empire rapidly becomes a centralised monopolistic structure innovation will wane. Regresseion is visible everywhere in the empire for the last 25 years already. The lack of competition always leads to decay. Besides the dual economic areas will lead to considerable price increases in the empire. Things will get more expensive as empires operate based on the central needs of a small establishment at the core of the Hegemon, which will make the empire work much more like the Soviet Union. Centralised, monopolistic, ideological and removed from reality- drawing its 5% free rent (Piketty, 2012) from its colonies, which get ever less trickle down from the massive pyramid scheme they have become part of. 500 years of European imperial models are running out of time. They have brought no development to the world and in fact cost us 500 years of progress. BRICS is the answer: Ricardo based, UN Charter ruled, multipolar, pluralistic with polypole market and financial platforms. We are at the threshold of a Golden Age and the only thing we need to make sure is to confine the empire to a quiet corner and make sure its thrashing about does not hurt anyone outside its domain. That is how it will happen over the next decades.
The problem with HK is that they were slow to adjust from being the only gateway to China to competing with other Chinese cities. Before in the 60s and early 90s when China is still mostly closed and people were reluctant to directly go to China to invest and make deals, HK was used as a middleman to do business in China. This made HK very rich especially as there was a rush in the 80s and 90s to get a foot into China through HK. However the British at that time knowing they will be handing HK back to China did not bother to make an adjustment to prepare it into the future and instead just operated HK as is till they handed it back to China. By the time they handed HK back to China, a lot of people were already bypassing HK and directly flying to Shanghai, Beijing, Guanzhou, Nanjing etc. to do deals and make business. This problem continues today because a lot of people in HK still refuses to accept the change. I think the proposal before to merge/integrate HK to either Guanzhou or Shenzen is best. But they rejected it so now they need to think how they can compete without being the only gateway to China.
The US actually has a trade surplus once you add in services. We couldn't sustain a trillion a year in trade deficits for years. This is patently absurd to think otherwise. While we have a good deficit, we have a service surplus.
Thank you! Like everything that we do, we STILL maintain strategic ambiguity! It doesn't work, does it?! How much longer must we be our own worst enemy?
Trade deficit is not necessarily bad, it only means one country is better at producing products than the other country. High tariffs only burdens US consumers more and worsen income inequality and increase inflation.
The aim of the trade war and the military contest should be to contain China to a regional power, that is part of the US political and economic system and no threat to US militarily.
One of the few times Bloomberg allows somebody to tell truth
Roach has been dead wrong about China and the US economy for the last 15 years year over year.
Finally, a guest who owns common sense and knowledge…rare these days on Anglo-Saxon media when covering China
He's a fairly well known Cee See Pee plant.
@@tooltalk you're a Cee Eye Ey plant?
@@tooltalk And you are well known NSA plant. 😂
The anglo Saxon term tells where this moron is coming from
@@ibcyt You mean CIA? NSA is a spy agent -- their agents don't reveal their ID. I guess your wumao school never taught that.
So rare to see a rational person like this gentleman these days. It's a shame 50%+ of the US population won't listen.
Try 90%
Try 95%
Never mind if they are rational or not. China going to decouple from the US forever
Most Elite schools Professors are indeed very biased these days. This one is truly a rare Gem esp in Yale and made it into this biased channel
Only if Roach can start the other 50% of the real story between US-China trade.
Hong Kong's wealth came from funnelling and facilitating trade between mainland China and the first world. With China's opening up, Hong Kong's decline in prominence was inevitable. But this does not mean that Hong Kong is going to cease to be important.
In this case, the question is more of a political one than economic. HK is accustomed to a meritocracy. However, it now exists within a nation-state where Loyalty To The Party is the most important factor.
@@kimpeater1 Since you are acknowledging that Hong Kong's economic growth is a fait accompli, would you like to expound on exactly which countries in the world do not first and foremost prioritize loyalty to the country for its public servants?
@@unifieddynasty nice but invalid strawman attempt. Loyalty to the Party in HK applies to the formerly meritocratic business community not public servants.
@@unifieddynasty nice strawman attempt but invalid. Loyalty to the Party in this case is being imposed on the formerly meritocratic business community, separate from the public servants.
@@unifieddynasty All of Western "public servants" work for a set of interests other than the nations thy nominally "serve". For instance, all of Washington DC in the United States anwers only to the City of London and Beijing. Also, you have "country" confused with "government".
Tariff is a hidden tax, but unlike tax it is politically favorable.
It is the money that government takes from the businesses. It is the punishment on the business.
Yes true. It's a bipartisan sport to hate on China for the happiness of laypeople while they complain of inflation.
@@annan7728 Or consumers, in this case
@@pgdaszzz7399 Money transfers from the consumers and businesses to government.
Yes paid by consumers.
Green technology Overcapacity? We need all the capacity we can get to limit climate change
🎉🎉nice to hear that from an American
The problem is tariffs will not USA manufacturers more competitive. USA has plenty of oil and has no motivation of clean energy. On the contrary, China has energy crisis and puts all efforts in pushing the limit or energy industry. China wishes to use technology to overcome China's greatest national security threat. Now they want nuclear fusion and mining He-3 on the Moon.
clear hypocrisy...
Because US can't compete with China, so they just made up this lousy excuse that nobody with a primary school degree really believes...
Still drive F150 to office work,alone.
Cancel green.
I only wished US politicians had some common sense like this man.
The root causes of the US problem are the carrot head politicians 😅
Don't get your hopes up too high, you will be disappointed over and over and over again. All the US political landscape has to offer the voter is geriatric, dementing old sods that are deaf for the urgent needs of the American people.
US politicians are bought by Israel. What do you expect?
American politicians have common sense, but they are controlled by various interest groups and have to do things that go against common sense to get funds. This is the beauty of American democracy, so China does not adopt this stupid politics.
Well he's clueless about what China did in 2018. The red line was crossed. No need to be cower
tarrifs are BS. BYD new car that can go 2000km on a single tank of gas, for $14k.
that is what the US is missing out on.
Everyone in the US is used to paying a high price on cars, with lower technology.
BYD cars are cheap Chinese junk. In Mexico they are already 50% off and no one wants them still.
Dude, it's too much.BYD is good, but it's not that good.Why didn't you say 20 thousand kilometers?
I watched the test drive video, the final number was 2409 km! That is crazy! I can fill it up & forget it about until 6 months later charge again 😂!
@@西瓜不太圆事实是2400多公里..BYD Seal 06 还有QIN Ｌ 你可以搜索一下
@@西瓜不太圆 It is true - they did the test drive. Just a correction - it is a hybrid - 2000 km on one charge and one tankful of gas. You can drive from NYC to Miami on that. I suggest you google for this instead of dismissing it outright.
US doesn't want free trade when they can't compete... and 'Rule-based order' is the new fashion🤣🤣🤣
Rule based since we ended WWII.
@@tedmoss Then apparently free trade has been taken out from it.
can someone pls teach Blinkin grammer: "Rule-based" as an adjective, and not "Rules-based".
When is China going to allow foreign battery competitors to compete in China's local EV market?
@@tooltalk When didn't China allow that? The problem is those foreign companies do not offer competitive options.
Simple, avoid the US as much as you can.
good idea! China is going to miss out on the most lucrative auto markets, the US/EU, in the world!!
Survey 6mths ago of europeans showed 24% willing to buy China EVs. last month 50% willing to buy chinese EVs. De-risk from nonsensical schizo USA policies. De-risk from US$. De-risk from USA war culture. The 80% global south is heading there with BRICS begging China and Russia to get alternate things in place for everyone’s sake. Everyone wants EV ChinA Made bcos technically everyone admits that they are the best. This is HARD to say for some people.
@tooltalk China has more drivers than US population. Try again.
@@lordbendtner7021 : sure, China sell more units, but less value. The avg price of a new vehicle in China $20K vs. US $50K. Even if China sells twice more cars, the US market is still greater in value.
@@tooltalk Hahaha... Such arrogance and ignorance is hilarious. Period.
Slapping tariffs on Chinese products will lead to higher inflation rates here in the US.
It is the punishments on American Businesses and the cause of inflation.
in the short-run sure, but also more economic growth, less need to issue debt due to a lower trade deficit, more wage growth etc, and then in the long-run don't even have the inflation anymore, with much more export opportunities because we establish supply chains with developing countries who actually allow us to sell to them in return and don't get free access to our R&D every year.
opportunity for local companies & entrepreneurs to step-up & build!
Tariff or Tax. But direct me to where is the Tariff/Tax money go. I have Never heard a Tariff reduces our federal wage tax, builds roads, supports social security or reduces the National Debt. How can the government place a Tariff but Not have to detail where and what it will be used for.
@@jbranche8024 most federal programs are payed for from general revenue, you don't assign each and every tax to a specific spending outlay. Only ones we do that with is payroll taxes for social security, medicare & unemployment insurance.
Roach is an excellent guest. Glad he came on the show . And his statement " that not many politicians have taken an economic course " is spot on!
applies to both sides. politicians in democracies & politicians under the thumb of autocrats in communist states or dictatorships.
Yellon is an economics professor.😅
@@akakakakakak3084she’s employed by Biden; hence, can’t speak the truth anymore.
@@akakakakakak3084Even as an economic professor she has to act and talk stupid to keep her job.
He doesn’t even know the difference between a trade deficit and a budget deficit.
America needs more people like Stephen Roach who knows what he's talking about.
As a American citizen, i am just thinking why 🇺🇸 have problem with every single country on this planet earth🌏. Just why bro 😕.
the planet earth 🌍 is evil
The U.S think they can stay number one by bullying every country..But they are uniting…
Not true.
Only the countries that it couldn't directly influence. Cause well, the good life we have in the US the past 50 years really depended on the dollar being the world reserve currency and us being able to use that to print and borrow trillions of dollars.
Incompetent leaders who can't lead America to be on the right path, need to fool the masses by directing the blame on China. Hate blinds voters.
China is resetting its economy, gone the growth model that rely on property bubble, and export oriented economic model is also being restructured gradually to more domestic consumption based and high value added export oriented model. China knew that free trade is facing headwind, so the old model of exporting low margin goods is unsustainable. That's why China is investing heavily in new industrial revolution, like renewable energy, robotics, chips, 5G, etc. Of course it won't be painless, there will be a lot of strain and pain for the next 10 years.
For HK, HK need to remember, it is a gate to China first and foremost. Without China, HK is a gate to nowhere. Needless to say, HK prosperity is tied to China. For the past few decades, HK have practiced unbridled capitalism that brought wealth to HK, but also high inequality, especially in housing sector. This inequality created resentment toward central gov. There is an easy way to solve the housing problem, let HKers who can't afford housing to purchase housing in Mainland. Pearl Delta River Region integration is the solution to HK problem. But this will take time.
HKers have been buying properties for decades in the great bay area ..recently , they have allowed the banks to faciltate the fundings of transfers from within a HK bank to mainland banks for house purchases .
China views the United States as its enemy and its ally; the United States' friendship with China is a one-sided fantasy
could not agree more, very insightful.
China wants to escape the middle income trap and become a developed country. Along with China's rise, China wants the under developed countries to also aspire for economic well being. By doing so, China thinks world peace can be achieved. The fly in the ointment is the US. The US believes that as the hegemon of the world, it rules the world and will do anything in its power to stay number one.
The capitalists are still having a strong grip over HK economy. And there are also a lot of "Anti-China" govt administrators in HK govt who drag their feet when it comes to change for the good of HK especially in providing public goods & services (like land reform, urban planning & healthcare).
THERE IS A HUGH DIFFERENCE BETWEEN POLITICIANS AND LEADERSHIP. AMERICA HAS POLITICIANS AND CHINA HAS LEADERS.
“ALL politicians have NEVER taken an economic class!!” That is soooo true!! 😂
The problem with the USA & Europe is that they don't know their basic Economic principles of Comparative advantage. China gets things done whereas other countries in the West have to debate everything before they do anything.
No the western leaders don't have to detabe things and do them slowly if it's of enough priority to them!! Did you get any consultation or much debating before they decided to invade Iraq? To bail out the big banks with your tax payers money? To send weapons and monies to Ukraine and Israel? Wake up and admit you are just not the priority!!!
Yes, but at the same time, the US and the EU have had the opportunity to pillage their respective colonies for ages.
@@vgstb Oh the CCP's national motto -- the century of humiliation is alive and well. LOLL
@@vgstb….that era is long gone. Amerikkka USED to be powerful….NOT ANYMORE
Just knowing about comparative advantage doesn't really matter... You can't just double your population overnight, which is at the core of China's comparative advantage. Only time will tell whether this current massive population focused around relatively tight age range could become a problem later on...
Finally, an adult in the room.
The US needs to:
- invest in STEM education to grow its manufacturing industries so as to export more.
- reduce overseas military bases to reduce the deficit
Agreed. 💯
Overseas military bases + the troops stationed on them are about $150 billion a year, and that's if you got rid of the all the associated forces, and got rid of all of it, which would be monumentally retarded. So in reality you're talking about tens of billions, against the backdrop of a deficit that's nearly $2 trillion.
Plus: stop smearing others and lying to the people all the time by the MSM and the politicians.
No, the US should lower their expectations on salaries. People haved earned more than they should for a long time. No matter from which country, people can produce the same products at a much lower cost. You cannot keep this forever. Innovation is important but not that important.
@@kevinxie5762 You have the opposite way round. China should allow its currency to appreciate, let its people start importing more, stop subsidizing so much and let households take home a larger share of the pie, and thus the manufacturing sector shrink.
We’ve subsidized your development for decades now, you guys like to say you’re a superpower now, so time to get up and walk on your own two feet like a big boy.
The only high paying job in the world that does not need qualification is govt ministers.
U.S. is losing time with missteps after missteps. From industrial policies to trade to geopolitics. While at home mired by all sorts of problems from immigration, border security, gun control, education and dilapidated infrastructure. Americans are suffering.
Gun control? As in just have the government armed and trust tgem to protect you??
After watching the financial system being used as a weapon against users, China has no choice but to create a safe international alternative … and they have chosen HK for this role because it already has international roots.
You mean like China's weaponization of rare earth metal against Japan in 2010?
@@tooltalk Any nation with precious resources will guard them. That is natural and expected. However, the US weaponizing their SWFT network is something very different because it is a *voluntary* and *trust-based* network. No one has to join the American financial system, but most of the world does because the US guaranteed fairness and equality. This network benefits you as an American greatly. It makes your inflation lower than it should be. It makes oil cheaper for you than it should be. But once they weaponize it, then that trust is severely damaged. The Chinese have their competing financial network, and they're attracting more users because they don't pull rugs like the Americans do, at least not yet.
he is so good with his info, data and answer that the hosts seem careful to ask questions... respect for the intelligent and knowledge!
Roach has been dead wrong about China and the US economy for the last 15 years year over year.
HK can be BRICS financial hub.. also the earmarked development of the southern great bay area will boost opportunities for HK
All the banks that would be involved in BRICS are in the mainland, there's no need for HK.
No. Population of HK will spread into the mainland. Hongkongers are already going over the border for shopping and food as it is cheaper and for better service. HK will not be the BRICS hub for anything too many running dogs living there.
Good analysis by Stephen Roach.....A man I respect...
he only told half truth, ie. the 1st part of China beating US in almost every industry sector - this is the truth.
The 2nd part is a lie about China's economy.
roach is objective, unbiased and straight forwardly on point
You actually mean to say objective, not subjective, right?
Very intelligent.
@@zhaokwong5544 Yes, intelligent economists tell the powers that be what they want to hear. Screw the hoi poli.
Roach has been dead wrong about China and the US economy for the last 15 years year over year.
All consumers in the USA and all other Western countries are paying high prices for the U.S. sanctions and high import tariffs.
Hong Kong may or may not be over.
But if it is over, it's because of the US placing artificial sanctions, boycotts, and whatnots on HK.
Not because of China.
Hong Kong was always going to be over. Much of its appeal and function was as a conduit into China. A lot of that can simply be handled within China now.
@@308_Negra_Arroyo_Lane Yes that's also true.
But I'm pretty sure that if the people of HK were not so rebellious and prone to anti- China riots, the mainland government would do everything it can to prop up HK.
So HK's status and importance would diminish, but it certainly would not be 'over'.
Trade Wars lead to Real Wars!!!!
That's inevitable
It terminates capitalism.
China was already waging a trade war with us, we merely responded. And not responding, that is to say continuing to empower Beijing, also makes war more likely.
@@Cotswolds1913 how did you come to the understanding that China is waging an economic war on US? Inferiority complex?
@@Cotswolds1913 What a retarded. Who started the trade war?
Well done Roach . A well REASONED and sensible argument.❤❤
这也不准卖，那也不准卖。我看了很多美国人说车很贵，但是我们的便宜汽车又进不来，最终损害的是美国竞争力。
美国车不应该很便宜吗？这次去美国，基本的生活物价确实非常贵。不知道是不是加州的原因。
It's not forever, when china stop trading in dollar is gonna be over.
Stephen Roach provided sensible responses to queries raised by the 3 individuals. Unfortunately, he will not be able to change congressional leaders who are in debt to the many lobbies in the country.
I am so glad that the truth being told in the USA’s media!
The good thing is people around the world are becoming aware of the truth.
Given the pace that China is decoupling and derisking from the US (and the West as a whole) in every way possible (agriculture, industrial supply chain, petrodollar, international moneytary exchange systems, bonds&loans, etc...) the risk on a forever war with China is not a real possibility. China planned to have its global south network at cruising speed by 2030, but as things are going, the decoupling and derisking task will be realised by the mid of the decade.
Stephen is as objective as it can be for an economist 💯 one of my favourite economist around
Koreans never forget to thank many countries for their help during the Korean War. Even children.
Do you travel to Asia much? Koreans are some rude, racist mo fos that hate Americans. Not the older generations, but the one that benefitted growing up and their kids when we saved their ass
I don't think the news anchors are happy that this guy is so blunt and honest about the truth, haha!
This man is a genius
Another great achievement of our government is: we have successfully forced a mutual trading partner to be our biggest enemy. I can clearly see that the Chinese is extremely unwilling to take that role, but we have kept pushing them and humiliating them to a point that they have no other choices.
Haha.... US debts had been a 'death sentence' for US & it will drag the American citizens along.... 😢😢😢
When our economy is built on consumption you will forever be at a deficit.
When your central bank is private and owns your currency, you will forever have a defecit
How many lesson do you need before you know that politic and economy dont go hand in hand.
Let’s see: After 6 years of our trade war against China, has the US overall trade deficit (with the entire world) been reduced? Have we broug6ht lots of manufacturing jobs back home? If not, then I believe our goal is to weaken China, and not about making America better or stronger.
Let’s see whether China’s overall trade surplus has been reduced after 6 years. If not, then our goal is basically failing.
Who would want to invest in us manufacturing.
Look at us car manufacturers(
Excluding Tesla) or Boeing.
It's not a risk, it's a policy shift to address a hegemonic shift.
He is what the US I used to know, was taught, and admired. Hope he can still keep his job after the interview.
Finally someone well education and intelligent speaking the truth
@0:45 the leaders call that “strategic ambiguity” which causes me to wheeze with laughter
I remember Roach once said he will never visit China/Hongkong again.
The reporters here are way out of their depth...
Businesses reporters who don't get economics101😊
their cowards that cant tell the truth to the public
@@mattburritoYes!
They're really thinking about their beloved inflatable boy scout.
Trade deficit not just with China but Taiwan also...???
And the rest of the world.
That’s usually what happens when one country’s top industry is financial services and the top export is “conflict equipment”… Unless you have a global war, you’ll never have a market big enough to balance your trade deficit
Taiwan is China, China is Taiwan. You are talking about trade deficit between US and China. Taiwan is not a country. Google it, There are only a mere less than 15 countries in the world that supports Taiwan as a country, most of those countries are tiny countries with population less than 500000. Taiwan is not even in UN, so it is not a country by any standard. Taiwan is just one of China's provinces.
@@DC-qn4wz Yes, it's not sanctions. It's just isolationism. Uncle Sam has become a giant North Korea.
@@geraldkohar BKTWTWTP153 is Swift Code of promisor of value worth 4.47(today) to 1 Chinese Yuan...???
In related news, Bloomberg All-In On China
You’re not? What pathway todo you see for American prosperity compared to China?
@@censorshipagainstthemiddle6198 - Mike Bloomberg is all-in on China, and that's why his news channel parrots him. Falling growth, aging demographics, opaque system prone to capital misallocation - sort of like Bloomberg
it seems like there is an overcapacity of the fed printing press to satisfy the budget deficit leading to massive trade deficits and damaged credibility of the usd.
No trade war is forever, fact.
FYI -Survey of European intention to buy CHINA EV cars was 25% 6 months ago, last month's survey it is 50% intention to buy China EV. Sick of Bloomberg doom and gloom propaganda on China. Even Bloomberg became politicised. Not much value in such a business service.
50%? That's also the expected CVD (countervailing duty) to be imposed on all Chinese EVs (retroactively since March).
As a local, i dont agree with every single word that Stephen said. China is too complicated and large for Westerners to comprehend.
The big question is who will evetually pay for the additional tariffs bu US?
Forever is a nonsense word in this discussion
Extensive, trade, dispute?
His concern was Forever Deficit as no politicians addressed it. Only Trump!
@@ssuwandi3240 It is so funny that, in 1999, they were worried about no deficit because Clinton's budget was so efficient. So, I wouldn't say no president doesn't care; good thing Bush did tax breaks and 2 wars to ensure there was a debt...LoL
US politicians are fine as long as it is not labeled made in China,made in any other countries by China companies are totally fine.
HK will have a bright future. It’s the envy.
HK = Singapore + Huge Hinterland (China)
Why wouldn’t HK thrive when China is bent on accelerating its development and becoming the world’s No 1?
The big difference between the US capitalist model
and the Chinese use of capitalism is in China,
the government controls and harnesses capitalism
to produce for the Public Good.
In the US, big business runs the government to produce
a benefit for those at the top, leaving out 99% of the populace
to fend for themselves as in health care, child care, wages, etc.
China has raise 600M people out of poverty doing it their way,
something that has never been done this quickly.
The US has neglected most of us and now China is going
to kick our ass!
Hello Professor Roach, still benefiting from your class when i was in School
sometimes you just can not see a nation as a single entity.
tariff may do no good to overall strategy, but it collect money for the government.
china already selling the Hybrid that can travel 2000km and selling for 14k. Much better than Tesla 500km range
You’re talking about a test vehicle, it’s nowhere near production ready.
@@12time12selling car ，not test
@@12time12 No. it’s already available to the general market.
Oh wow, is the only person who speaks the true! This is why items are so expensive in the US than ever before!!
Roach qualifies brilliantly as President of US unlike the other 2 senior presidential candidates !!
Intelligent people won't become the leaders of countries -- that's simply a rule and a fact
Why US has lost the know how that it had during the 50 ' s and 60 ' s ?
China is setting up HK to be the international financial center alternative safe from being weaponized for political purposes. This includes the alternative to Swift and commodity exchanges
Hong Kong prospered because it was the PORTAL through which foreigners did business with China till China truly opened notably after the Hand Over in 1997. Thereafter, Shanghai took over from Honkong, which was inevitable. Without China, Hongkong isn't very important.
Imagine trying to stop a country growing economy with almost two billion people in it, what a joke
I can't wait to share this video link with my friends. I am conducting research on green business, focusing on power batteries and electric vehicles (EV). This video can help me understand more about how people view productivity and capacity. I agree that there is no such thing as overcapacity or excessive capacity. It is a strategy to use capacity locally and globally from a marketing and economic perspective (supply and demand).
Hong Kong will have to reinvent itself, due to natural limits such as the lack of land and small population, especially in the context of the Greater Bay Area, as the Monaco of China. Hong Kong, due to its legacy high land price policy inherited from the Brits, has the most expensive property market in the world and it translates to extreme high cost of living and doing business.
In this regard, the city has to focus its development around the goal of justifying that high cost of living. Unfortunately it will become somewhat of a domicile playground of the rich, and amenities and service industries will have to be built around them, which is not dissimilar to modern day London.
Hong Kong can only do the things that Shanghai and Shenzhen can't, and that's not a lot of things anymore.
Now I am really confused. Are you telling me that the Silver Spoons and the opportunists that suck up to them aren't all geniuses?
Nothing lasts forever, and if it did then businessmen wouldn’t care about it.
So true
Look all we have to do is flip the script of the Chinese. For 30 years the Chinese forced American companies to partner with a A . Chinese Company, B. Manufacture in China, C. Export some of the Production. So America should tell the Chinese fine you can compete in America but now you will partner up with a US company. You MUST manufacture in America and Export the your products from the US factory aboard. Ta Da !!
Yeah you’re a brain surgeon.
China has a population of 1.5bn people, they don’t need the us market, over the last 30 years the us has been quite happy to sell millions of cars etc in China.
Us business have been happy to see increased profits through chinas scale of manufacturing.
The importance of the USA is on the wane, it’s just your utter arrogance that is in the way now.
5:48 they should first take care of their people like China does. Make competitive products, be helping hand, not dictatorship.
Cheap consumer goods require cheap labor. High US consumption requires low exporter nation consumption. Tariffs equalize this imbalance. But requiring each nation to consume its own production is a knife in the heart of globalism, the financial class, who Roach represents.
I've read that a country that has the world's reserve money has to run a trade deficit. So if China or some other country had the world's reserve currency, they to would have to run a trade deficit. Don't know if it's correct though.
The US trade policy of re-shoring/near-shoring is coherent, but it's not favorable to continued globalization which means it's contrary to the interests of globalized/globalizing businesses.
Regarding tariffs, most people don't realize that the US Constitution limits the government tax power to tariffs, taxes on alcohol, cigarettes, etc., and (by amendment) income taxes. So tariffs are one of the few available sources of revenue (one reason for US government deficits).
Wisdom from a seasoned economist and MS ex-chairman.
Nice, congratulations and thank you for your advice! Your Telegram Channel is amazing!
I regret that I won't be able to see these develpments, I am too old (82) and the world has become ever more interesting from day to day.
Great point about trade deficit mirroring irresponsible fiscal policy.
Chinese overcapacity in EV and green energy? Why, because they dominate the market in these industries?
What about US ‘overcapacity’ in smart phones (Apple), printers (Hewlett-Packard-Packard), aviation (Boeing), AI chips Nvidia, etc?
If the US will not allow China to dominate certain industries due to ‘overcapacity’, it should prepare itself for retaliation from China against US ‘overcapacity’... or, the US could actually learn how to implement same and sound industrial policies again, rather than resorting to politically convenient but counter-productive bans and tariffs.
The US "overcapacity" is mostly farmed to other countries. Apple iPhones are still mostly made in China (though most high-value components are made all over the world outside China), as does HP's printer/cartridge business.
There is actually shortage in AI chips/nVidia and long waiting list at TSMC that fabs them.
This is all part of de-coupling that many seem to ignore here.
If my economics do not fail, when the US sent 300B in aid to Israel totalling 600B now, there is a also a trade disparity too, right? That more than the US-China trade disparity.
Flat one for one tariff. China has 25% on all US goods, flat 25% on theirs. End the tit for tat with the exception being companies shipping fentanyl precursors for cartels and companies engaging in IP theft.
Trade with China is predominantly about the use of China as a way to keep the assets of US corporations off-the-books, so that their capital-to-asset ratios are as high as possible and most favourable to Wall Street as a comparable and tradable debt instrument on the international market. In addition, the US is keen to have the Chinese as a sink for US national debt, so that China pays for US consumers to be able to afford cheaper US goods made in China to be sold to Americans. This is the policy of the US, in alliance with others of Europe. The fix comes with a cost, for which, the Americans and their European counterparts, whose economies now operate via the printing of money to create money, in lieu of creating items of value to trade for money, have zero appetite: Reindustrialise, get a grip on the money supply and extend the length of time preferences :-)
This isn't a trade war, it's a real war. It isn't about economics but security. If you look at it from a purely economic point of view, yes the tariffs don't make sense. But cheaper products while strengthening an enemy that seeks to undermine your society is a bad trade.
They US Govt simply doesn't want to say it as it can be spun around and they be made unpopular because of it.
I don't think Roach is stupid enough to not realize this. I question if he is acting in good faith.
They’ve already got us beat economically and militarily. I’m sure we disagree on military so we just have to wait til we lock horns and see.
Yesterday we were best friends, but suddenly we have now been designated as an enemy. What gives?😅
@@bumbengtey8464 who designated who first as an enemy? Who wanted trade wars to begin with? The kid got himself in deep doo doo , and i crying and trying to play the victim.
Good analysis. I wonder what mr. Roach views are about the ongoing division of the world into the west part, the G7 and allies, and the global south, Brics and allies. How far will this go?
pretty fair commentary
The number of pure electric passenger cars exported from China to the United States is 12400, and the proportion of both the quantity and total amount exported to the United States is less than 1%. Raising tariffs is just for the sake of votes
Thank you Professor Stephen Roach for sharing, informative information & perspective insights the issues between the U$A and China. Bless you, Sir.👍🙏🇨🇳🐲🐼☯️☮️🌏🙂‼️
SLIGHT CORRECTION: We will have two economic areas: BRICS (ca 85% of the world) and the US Empire (15%). Parallel worlds in many ways. However the much bigger one will have far stronger economies of scale and innovation from plurality and diversity. As the US empire rapidly becomes a centralised monopolistic structure innovation will wane. Regresseion is visible everywhere in the empire for the last 25 years already. The lack of competition always leads to decay.
Besides the dual economic areas will lead to considerable price increases in the empire. Things will get more expensive as empires operate based on the central needs of a small establishment at the core of the Hegemon, which will make the empire work much more like the Soviet Union. Centralised, monopolistic, ideological and removed from reality- drawing its 5% free rent (Piketty, 2012) from its colonies, which get ever less trickle down from the massive pyramid scheme they have become part of.
500 years of European imperial models are running out of time. They have brought no development to the world and in fact cost us 500 years of progress.
BRICS is the answer: Ricardo based, UN Charter ruled, multipolar, pluralistic with polypole market and financial platforms. We are at the threshold of a Golden Age and the only thing we need to make sure is to confine the empire to a quiet corner and make sure its thrashing about does not hurt anyone outside its domain.
That is how it will happen over the next decades.
1,5 billion people. Highly educated. No race hate. Lower cost of living. And intelligent leaders What do you think......?
The problem with HK is that they were slow to adjust from being the only gateway to China to competing with other Chinese cities. Before in the 60s and early 90s when China is still mostly closed and people were reluctant to directly go to China to invest and make deals, HK was used as a middleman to do business in China. This made HK very rich especially as there was a rush in the 80s and 90s to get a foot into China through HK. However the British at that time knowing they will be handing HK back to China did not bother to make an adjustment to prepare it into the future and instead just operated HK as is till they handed it back to China. By the time they handed HK back to China, a lot of people were already bypassing HK and directly flying to Shanghai, Beijing, Guanzhou, Nanjing etc. to do deals and make business. This problem continues today because a lot of people in HK still refuses to accept the change. I think the proposal before to merge/integrate HK to either Guanzhou or Shenzen is best. But they rejected it so now they need to think how they can compete without being the only gateway to China.
The US actually has a trade surplus once you add in services. We couldn't sustain a trillion a year in trade deficits for years. This is patently absurd to think otherwise. While we have a good deficit, we have a service surplus.
Thank you! Like everything that we do, we STILL maintain strategic ambiguity! It doesn't work, does it?! How much longer must we be our own worst enemy?
Trade deficit is not necessarily bad, it only means one country is better at producing products than the other country. High tariffs only burdens US consumers more and worsen income inequality and increase inflation.
The aim of the trade war and the military contest should be to contain China to a regional power, that is part of the US political and economic system and no threat to US militarily.