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Full Circle: Lessons of the Lost City in the Sands of Time, by Doug “Uncola” Lynn

via Full Circle: Lessons of the Lost City in the Sands of Time, by Doug “Uncola” Lynn

Comment by tonytran2015:

A really interesting story and there is an even older article by The Puzzler since 2008 April 25:

https://www.unexplained-mysteries.com/forum/topic/124435-atlantis-found-by-me-in-the-sahara/

The Parasites of Western Economy, Part 11: Vulture Funds

The Parasites of Western Economy, Part 11: Vulture Funds

by tonytran2015 (Melbourne, Australia).

Click here for a full, up to date ORIGINAL ARTICLE and to help fighting the stealing of readers’ traffic.

(Blog No. … ).

As the Central Banks of major countries sent interest rates to zero or even negative values, people in those countries had to take their retirement savings out of Government Bonds and they had been tempted into sending their money into the Stock Markets of their respective countries. The people are not verse in calculating return and risks so they may grab any “established names” on the Stock Exchange and pay outrageous prices for them only to find out that they had bought “Trojan horses”.

There are Vulture Funds who live off that ignorance and float the old loss making companies (called here Zombies companies) into the markets and do creative accounting tricks to hide the losses (for few years only). Those buying the Zombies at Initial Public Offer (IPO) usually lose most or significant parts of their money right after the contracts have been signed!

This blog reveals the tricks of selling Zombies on the Stock Exchanges.

#restructured company, #float, #zombie float, #zombie company, #IPO, #time-bomb loan

1. Outline of the tricks.

Company directors usually hide the assets from shareholders making them selling out their shares cheaply to vulture funds. Vulture funds then control those target companies, de-list them from the Stock Exchange, take away all profitable parts. Vulture funds then bind predatory, time-bomb loans to those target companies leaving them with just a bare chance of survival (even in the fairest weather) for the coming 3 years. Vulture funds then re-float target companies (already bound to time-bomb loans) by IPO’s on the Stock Markets as “revamped companies” but they are actually Zombie Companies.

The latter are financial traps for inexperienced Stock Markets investors. After 3 years, most Zombie companies would fail due to predatory loans from their own (Vulture Funds) floaters. As creditors, the Vulture Funds again would come in to take possession of most assets of Zombie Companies.

2. Details of the tricks.

1. A Vulture fund buys a long suffering loss making target company for next to nothing. It usually buys the target company when it goes into liquidation by insolvency.

2. Vulture fund sacks most low level employees. They would lose their job anyway by the liquidation. The company then ceases trading for few months.

3. The company books are then scanned for any realizable, significant assets for the Vulture fund to take.

4. Vulture fund draws up a predatory (lob-sided) management contract between the newly acquired target company with one of its subsidiary companies (a debt collecting company disguised as a management company). The management contract is an irrevocable, very expensive management for the target company. If the target company survive it has to pay very expensive management fees to the subsidiary of the Vulture fund.

(As management fees to another company at expensive rate are not classified as a debt, the restructured company is now debt free except for an expensive loan used as working capital. The irrevocable management contract just keeps sending money to the other company (debt collecting disguised as management company) whether the management is effective or not. The contract is effectively an obligatory debt repayment scheme but is OFF the BALANCE SHEET.)

5. Vulture fund provides a thin working capital to the acquired target company from an expensive, predatory, time-bomb loan from his other company (debt collecting disguised as management company). The loan is characterized by complex conditions such that prospective investors would not understand. The loan typically is locked in for decades and provides low interest for only  3 years, after that period interest rate will become exorbitant. This kind of loan is called time-bomb loan and is designed to bankrupt the target company.

6. New low level employees are hired and the target company with long established name re-open its doors for trading (in a way which is precarious but is hard to be noticed by prospective investors).

7. The company is then called “restructured” and floated on the Stock Exchange for naive, unwary investors to buy in.

8. The money from new investors helps paying back the loans from the Vulture fund and will make installments to pay the management fees (which are actually installments to pay off an additional debt to the schemer). (Most capital raised from the float of the zombie will be used to repay the loan for working capital and then sent to the “debt collecting disguised as management company” over the time.)

9. The target company usually go bankrupt after a short while of 3 years. The finance subsidiary of the Vulture fund that lend working capital to the target company then comes in as a creditor to claim most assets of the target company.

(The director of the zombie company is untouchable by any company law or security law as the management fault lies with the management company (outside his control) but he cannot revoke the management contract.)

3. Illustration by an every day example.

If someone got a wrecked car from a yard, refit it with an engine (on an expensive hire purchase plan from him) and sell it to you. Would you buy that car?

But why do you let your Pension Funds, Superannuation Funds buy the zombie companies on your behalf?

4. Well known Zombie floats.

Sears in USA is a typical case in USA. [3, 4]

The better known cases of zombie floats from the Australian Stock Exchange (ASX) are:

The Dick Smith Electronic Company (2015) [5, 6],

The Myers Company (2009) [7, 8].

The floating of the zombies does make the Stock Exchange look like an arena for rigged games where novice investors are ripped off by Vulture Funds.

5. Conclusions.

1. Investors should stay well clear of any “revamped company” floated by some Vulture Funds or Private Equities.

Investors have to check the trading records for the preceding three years of the floated company even if it is traded on the Stock Exchange.

A new float of an old company may be very risky as only the company name is established while the management and operation are totally untested. Investors are buying into only a dream, the dream may turn out to be a nightmare.

Any management contract of the floated company to any external company must be examined in details (How much fee per year, for how many year, whether it is revocable, what are the required termination conditions). The conditions are usually hard to obtained from any such prospectus. For this reason alone, any such float should be avoided.

Investors have to find out if the floater of the new float has a reputation in floating successful companies after claimed “restructuring”. Some floaters are known for only floating non-viable companies.

On the only basis of transparency, I would avoid any float of “restructured companies” [9, 10].

2. A reform on company laws is needed.

Vulture Funds should be regulated differently from other companies and banks. They should not be allowed to float company with locked in management contracts and with loans from their related companies.

References.

[1]. Avoid-buying-zombie-floats-on-the-stock-exchanges

[2]. The Parasites of Western Economy, Part 5: Company Asset Strippers and Conspirators

Vulture Fund kills Sears

[3]. https://riggedgame.blog/2018/10/17/sears-didnt-die-vulture-capitalists-killed-it/

[4]. https://m.huffpost.com/us/entry/us_5bc4b346e4b0bd9ed55c8a58?utm_source=nextdraft&utm_medium=email

[5]. dick smith blames-private-equity-owners-greed-for-collapse, http://mobile.abc.net.au/news/2016-01-06/dick-smith-blames-private-equity-owners-greed-for-collapse/7069604

[6]. dick-smith-class-action-ready-to-launch, au.wordpress.com/business/breaking-news/dick-smith-class-action-ready-to-launch/news

[7]. https://www.crikey.com.au/2010/03/18/myer-over-priced-as-shareholders-find-out-the-hard-way/

[8]. http://www.smh.com.au/business/lessons-from-the-myer-float-flop-20091102-ht8c.html

[9]. the-private-equity-giants-the-greek-target-and-a-trojan-horse, October 28, 2015

[10]. report-says-big-buyouts-are-likelier-to-default, date 05Nov2009

RELEVANT MONEY Blogs

The Parasites of Western Economy, Part 10: Greedy politicians overpaid with our tax money.

The Parasites of Western Economy, Part 9: Over-chargers for unfamiliar types of service.

The Parasites of Western Economy, Part 8: Body Corporate robbing owners of low cost dwellings.

The Parasites of Western Economy, Part 7: Providers of invented inefficient service from tax money.

The Parasites of Western Economy, Part 6B: Robbers of pension money in Australia.

The Parasites of Western Economy, Part 6: Robbers of pension money in Australia.

The Parasites of Western Economy, Part 5: Company Asset Strippers and Conspirators posted on 13 August 2017 ,

moneyd20.jpg,

, , , , , Cashless bartering for survival, Federal Reserve Bank charges undeserved fees to Americans., A satirical guide to signs of an impending crash for small investors, Your fiat money (Part 2), Your fiat money, Bankers given outrageous incomes by their boards, Signs pointing to an impending crash for small investors,Bankers earn more than interest margin on secured loans, Can most pension funds last?, all

 

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Sears Didn’t ‘Die.’ Vulture Capitalists Killed It.

Sears is a prime example of how hedge funds and private equity companies take over retailers and gradually bleed them dry for their own benefit. By Robert Kuttner and cross-posted from Huffington Post

via RIGGED GAME, https://riggedgame.blog/2018/10/17/sears-didnt-die-vulture-capitalists-killed-it/

Comment by tonytran2015:

Company directors usually hide the assets from shareholders making them selling out their shares cheaply to vulture funds. Vulture funds then control those target companies, delist them from the Stock Exchange, take away all profitable parts. Vulture funds then make contract for predatory loans to those target companies giving them just a bare chance of survival in the fairest weather for about 3 years. Vulture funds then refloat target companies by IPO’s on the Stock Markets as “revamped companies” but they are actually Zombie Companies.

The latter are financial traps for inexperienced Stock Markets investors. After 3 years, most Zombie companies would fail due to predatory loans from their own (Vulture Funds) floaters. As creditors, the Vulture Funds again would come in to take possession of most assets of Zombie Companies.

Investors should stay well clear of any “revamped company” floated by some Vulture Funds or Private Equities.

Avoid-buying-zombie-floats-on-the-stock-exchanges

The Parasites of Western Economy, Part 5: Company Asset Strippers and Conspirators

The parasites of Western economy part 11: Vulture funds

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Green Energy storage: Why not liquid air?

Green Energy storage: Why not liquid air?

by tonytran2015 (Melbourne, Australia).

Click here for a full, up to date ORIGINAL ARTICLE and to help fighting the stealing of readers’ traffic.

(Blog No. … ).

Green Energy storage: Why not liquid air?

#green energy, #storage, #liquid air, #lithium ion,

Solar energy is green but is available mostly around noon. Storing this energy for later use in the evening is a problem. Australian goverments (Victorian and South Australian in particular) are pushing for Lithium Ion battery technology, that is quite an expensive way for household energy storage. (Remember that Lithium Ion batteries were developed for the expensive weight averting laptops and smart phones and need replacement every few years).

Surprisingly no mention is made of an obvious established energy storage technology using liquid air (that had been shown in some scientific experiment from Holland documented in some films shown prior to 1980). That method was to efficiently make liquid air and store it until it is evaporated into air to run an air turbine producing electricity.

The past policies of Australian Federal Government on government subsidized pink batt thermal insulation, government subsidized Gas conversion for cars, “poor subsidizing rich” installation of domestic solar panels [1] have all been laughable financial failures. Governments subsidized Lithium Ion batteries (which are still expensive and have only few years of usable lives) may be another financial failure even more spectacular than those three previous failures on energy policies.

As with any infrastructure project, the governments concerned should provide convincing arguments for its choice of Lithium Ion technology over competing technologies such as Liquid Air Energy Storage, which is being tested for grid scale storage [2, 3] or reversible hydro-electric generation. Otherwise the choice of Lithium Ion batteries seems to be just another contract for “the boys”.

References.

[1].

[2]. Grid-Scale Liquid Air Energy Storage Plant Is Launched, Sonal Patel, 08/01/2018, https://www.powermag.com/grid-scale-liquid-air-energy-storage-plant-is-launched/

[3]. ‘Liquid Air’ Technology Offers Prospect Of Storing Energy For The Long Term, https://www.forbes.com/sites/mikescott/2018/06/08/liquid-air-technology-offers-prospect-of-storing-energy-for-the-long-term/#66b12daf622f

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Some Australian Politicians rely on foreign influence and immigrants.

Some Australian Politicians rely on foreign influence and migrants.

by tonytran2015 (Melbourne, Australia).

Click here for a full, up to date ORIGINAL ARTICLE and to help fighting the stealing of readers’ traffic.

(Blog No. … ).

The fundamental role of politicians is to govern. Now politicians are only a bunch of self-serving propagandists being incompetent at governing. They sell out the existing populations (whose people they are sworn to serve) of their respective nations (Russia, India and Japan may be the lucky exception) for their own individual or familial benefits. They are now using mass-immigration and foreign influence in treacherous ways to hide their incompetence in governing like heroine addicts using heroine to solve every of their problem.

Some Australian Politicians rely on foreign influence and migrants.

#immigration, #heroine of politicians, #corruption, #foreign influence,

1. Immigrants are good growing constituents to politicians.

Politicians who take immigrants into a country will be likely to have the votes of their children in the future. As immigrants are mostly from poor countries with high birth rates the number of their constituents will grow very fast if the immigrants keep their habits of having many children.

This is primarily why politicians like having immigrant constituents and they just keep coming back for more. The cycle is self-reinforcing. [1, 2]

2. Receiving financial benefits from foreign sources.

Politicians now don’t feel obliged to balance national incomes and expenses in national budgets. They would rather let their election rely on migrants and support from the old home countries of those migrants [3-9]. Some even plan to work for those foreign countries after leaving their elected positions.

It looks like those politicians are using immigrants to grow their own influence with the old countries of the immigrants. It is natural to expect that they will gradually work full time for those pay masters !

The whole thing looks like politicians are selling out their nation to make their own fortunes.

3. Foreign influence is inevitable

The cosy relationship between politicians and large group of immigrants and their old countries will inevitably lead to foreign influence issues [10-14].

4. Conclusions.

Politicians should be subjected to transparency requirements on their finance and daily conducts while in office plus many years after and should also be banned from working as lobbyists for few years after leaving office.

References:

A CHINESE community association chaired by a Labor MP will develop a new aged care facility after the Andrews Government tipped in $2.5 million. The taxpayer-funded boost has sparked concern from …

[1]. https://www.heraldsun.com.au/news/victoria/chinese-community-council-of-australias-victorian-branch-given-25-million-government-boost/news-story/e12b7e28556fc683da8311d0d6771f61

[2]. https://twitter.com/theheraldsun/status/1049246099406565376

[3]. https://www.smh.com.au/national/nsw/labor-mp-filed-documents-for-billionaire-alp-donors-chinese-business-association-20170618-gwtg5b.html

[4]. https://www.smh.com.au/politics/federal/this-sitting-labor-mp-has-been-cultivated-by-chinese-intelligence-20180627-p4znzp.html

[5]. https://www.smh.com.au/interactive/2017/chinas-operati

[6]. https://www.businessinsider.com.au/category/sam-dastayari

[6b]. https://www.theguardian.com/australia-news/2017/jun/05/sam-dastyari-contradicted-south-china-sea-policy-a-day-after-chinese-donors-alleged-threat

[6c]. https://www.nytimes.com/2017/12/12/world/australia/sam-dastyari-resigns-china.html

[6d]. http://newsroom.uts.edu.au/news/2014/04/bob-carr-lead-new-uts-australia-china-institute

[6e]. https://www.heraldsun.com.au/news/foreign-minister-kevin-rudds-1-million-power-trip/news-story/53f83e53ef72935ca6e9b120f4e30218

[6f]. http://mobile.abc.net.au/news/2018-05-05/why-is-rudd-using-weibo-to-slam-turnbulls-china-policies/9726756?pfmredir=sm

[6g]. http://www.dailymail.co.uk/news/article-5136643/Kevin-Rudd-calls-Malcolm-Turnbull-step-down.html

[6h]. https://www.afr.com/news/politics/world/diplomats-frozen-out-kevin-rudds-curious-meeting-with-donor-chau-chak-wing-20180524-h10ho8

[6i]. https://www.smh.com.au/politics/federal/kevin-rudd-quietly-met-chau-chak-wing-in-china-20180524-p4zh99.html

[7]. https://www.afr.com/news/nsw-labor-mp-fails-to-declare-company-directorship-alongside-china-donor-20160908-grbsgq

[8]. https://www.macrobusiness.com.au/2017/12/labor-follows-dastayari-chinese-trap/

[8b]. https://www.smh.com.au/politics/federal/labor-has-a-cancer-growing-in-it-that-must-be-cut-out-20180218-p4z0q4.html

[9]. https://www.theaustralian.com.au/national-affairs/foreign-affairs/mps-on-both-sides-go-to-billionaire-huang-xiangmos-party/news-story/48005965f389fb34d37f37926ee07bf2

Concern on foreign influence.

[10]. http://www.abc.net.au/news/2017-06-05/asio-china-spy-raid/8589094

[11]. https://www.smh.com.au/interactive/2017/chinas-operation-australia/hard-power.html

[12]. https://www.australianbookreview.com.au/abr-online/current-issue/4663-david-brophy-reviews-silent-invasion-china-s-influence-in-australia-by-clive-hamilton

[13]. https://www.afr.com/news/sam-dastyari-linked-to-chinese-patriotic-force-group-20160906-gra417

[14]. https://www.smh.com.au/politics/federal/foreign-interference-laws-chinese-russian-state-media-will-have-to-declare-as-foreign-agents-20171206-gzzyol.html

 

 

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Five Spice mixture

Five spices mixture.

by tonytran2015 (Melbourne, Australia).

Click here for a full, up to date ORIGINAL ARTICLE and to help fighting the stealing of readers’ traffic.

(Blog No. 1xx).

#five spice, #mixture, #star anise, #amomum, #cloves, #Sichuan pepper, #fennel seeds, #liquorice, #cinnamon.

Five spices mixture.

1. Five spices mixture.

Figure: A Five Spices mixture.

It is a special ingredient mixture for cooking to give the distinctive smell and taste of “Stewed roasted duck noodle soup” and Vietnamese rice noodle soup “Pho”.

2. Ingredients.

Figure: A Five Spices mixture. It is commonly a mixture made up of up to seven ingredients: 1.star anise, 2.amomum, 3.cloves, 4.Sichuan pepper, 5.fennel seeds, 6.liquorice, and 7.Chinese cinnamon.

The name implies that it is a mixture of five varieties of spices, with all having similar smells. The ready mixed mixtures sold in shops usually have six or up to seven ingredients. Only the first five ingredients listed here are present in most mixture bags. They may be the original five ingredients. They are: 1.star anise, 2.amomum, 3.cloves, 4.Sichuan pepper, 5.fennel seeds, 6.liquorice (later addition?), and 7.Chinese cinnamon (later addition?).

Liquorice is widely used in Orient as an agent to prevent cold and flu (proof required), overuse of liquorice may cause bleeding in the nose.

Cinnamon is also widely used in Orient as an agent to prevent cold and flu (proof required). When used as a spice, cinnamon seems to inhibit moulds from growing in soup broth.

Star anise gives the predominant smell of Five Spices mixture. Some people put star anise into Vietnamese sticky rice alcohol to make alcohol with anise flavor.

3. Cautionary notes.

Eating too much food cooked with five spice mixture will make your sweat and urine have its smell.

4. Where to find it.

Five spice mixture is sold in 100g bags in Chinese grocery store. Currently each bag costs about AUD 3.00

References.

[1]. https://www.thespruce.com/how-to-make-five-spice-powder-4065302

[2]. https://en.m.wikipedia.org/wiki/Spice_mix

[3]. Licorice, https://www.drugs.com/mtm/licorice.html

[4]. Licorice Root, National Center for Complementary and Integrative Health (NCCIH), https://nccih.nih.gov/health/licoriceroot

[5]. https://www.healthline.com/nutrition/10-proven-benefits-of-cinnamon#section4

[6]. Cinnamon, National Center for Complementary and Integrative Health (NCCIH), https://nccih.nih.gov/health/cinnamon

Please note that round worms are quite different from human beings.

[7]. Cinnamon Bark and Ginseng in Herbal Formulas Increase Life Span of Roundworms, https://nccih.nih.gov/research/results/spotlight/052510.htm

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The agonizing choice of Vietnamese food dishes, posted September 27, 2017

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Rice as emergency food., posted December 24, 2016

20161230_192839ricegrains2c60.jpg

Mung Beans as grains for self-reliance.

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(CINCINNATI) DOJ Report: Authorities Crackdown on Chinese Spying: Have charged Xu Yanjun, also known as Qu Hui and Zhang Hui, after he was extradited from Belgium to the U.S. Tuesday on two counts each of conspiring and attempting to commit economic espionage and theft of trade secrets it was announced at a news conference Wednesday #AceNewsDesk reports

via (CINCINNATI) DOJ Report: Authorities Crackdown on Chinese Spying: Have charged Xu Yanjun, also known as Qu Hui and Zhang Hui, after he was extradited from Belgium to the U.S. Tuesday on two counts each of conspiring and attempting to commit economic espionage and theft of trade secrets it was announced at a news conference Wednesday #AceNewsDesk reports

Comment by tonytran2015:

No surprise !

https://survivaltricks.wordpress.com/2017/08/24/understanding-foreign-trading-with-china-beware-of-strangers-bearing-gifts/

Fable of a donkey and the hut of his master

Fable of a donkey and the hut of his master.

by tonytran2015 (Melbourne, Australia).

Click here for a full, up to date ORIGINAL ARTICLE and to help fighting the stealing of readers’ traffic.

(Blog No. 1xx).

Fable of a donkey and the hut of his master.

#donkey, #hut, #cabin, #master

Figure: Two donkeys tied to a donkey transport vehicle.

I learnt of the following fable from a French book many many years ago:

Once there was a man who used to have his donkey tied near to the door of his hut.

On a cold night he heard the thumpings on his door.

When he opened the door, he saw the donkey doing the thumpimg. The donkey then said:

“Master, it is cold for my head, I want to put my head inside your hut.” The master thought that he should help his donkey and agreed to the request.

The following night, he woke up in the night to see the donkey squeezing him while saying to him: “Master, it is too cold outside, not only you but both of us had to be inside, I now only have my front half inside.” He felt upset but he had no strength to push the donkey out of the hut.

The morning came, he untied the donkey then went out for work. Late after work, he came back and saw the donkey sleeping comfortably in his hut. He told the donkey to get out, the donkey replied: “Master, it is too cold ouside for me, you should not upset me, you should sleep outside, there is not enough room inside for both of us !”

The morality is Always make clear to the recipients of your help that your help to them is not limitless.

Reference:

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Trade war tactics, Part 8: Pressuring opponent until cracks appear to reveal weak points for attack.

Trade war tactics, Part 8: Pressuring opponent until cracks appear to reveal weak points for attack.

by tonytran2015 (Melbourne, Australia).

Click here for a full, up to date ORIGINAL ARTICLE and to help fighting the stealing of readers’ traffic.

(Blog No. 1xx).

The engagement in the trade war between two opponents will reveal some weakness in each of both opponents. Each will do its best to break the other’s strength through the discovered weak points.

Now USA has won the first round of its trade war against China but it has to discover and exploit the weak points of Chinese economy to successfully pursue that war. An analysis of this trade war is offered here following a summary of its time line.

#trade war, #weak point,

Trade war tactics, Part 8: Pressuring opponent until cracks appear to reveal weak points for attack.

1. Time line of current trade war.

2018 January 23:

30% tariff on solar panels (most of them are from China) reducing to 15% after four years. 20% tariff on washing machines for the first 1.2 million units imported during the year.

2018March 22:

President Trump relied on Section 301 of the Trade Act of 1974 to propose tariffs on additional 60 Billion worth of Chinese export (over 1,300 categories including aircraft parts, batteries, flat-panel televisions, medical devices, satellites, and various weapons) to USA as “a response to the unfair trade practices of China over the years“, including theft of U.S. intellectual property.

2018 March 30:

On Monday, Brussels launched a safeguard investigation into how it could combat surges of steel imports… from inflows of Japanese, Chinese, Turkish and Russian steel that would be diverted away from the U.S. [1]

2018 April 2:

China imposed tariffs on 128 products it imports from America: 25% on aluminum, airplanes, cars, pork, and soybeans, 15% on fruit, nuts, and steel piping.

2018 April 5:

Trump responded saying that he was considering another round of tariffs on an additional $100 billion of Chinese imports as Beijing retaliates. The next day the World Trade Organization received request from China for consultations on new U.S. tariffs

2018 June 15,

United States impose a 25% tariff on $50 billion of Chinese exports ( with “industrially significant technology”). $34 billion start July 6, with a further $16 billion to begin at a later date

2018 July 13:

“The S&P 500 on Friday hit a four-month high … the Nasdaq close at a record high. The S&P 500, Nasdaq and the Dow Jones Industrial Average were also tracking for their second straight week of gains.” [2]

2018 July 17:

“Since the White House announced the first tariffs — on washing machines and solar cells on Jan. 22 — the Shanghai Index of Chinese stocks is down nearly 20 percent, while the S&P 500 is off less than 1 percent… Since the end of March,..the yuan has slid nearly 7 percent, again demonstrating the impact the trade war…” [3]

As at 2018 July, America has been the winner in the current trade war.

2018 Sept 23:

USA imposed new 10% tariffs on $200 billion of Chinese goods, spanning thousands of products, including food seasonings, baseball gloves, network routers and industrial machinery parts.

China retaliated immediately with new taxes of 5% to 10% on $60 billion of US goods such as meat, chemicals, clothes and auto parts.

2018 October 03:

The trade war is accompanied by a war maneuvering in the South East Asian sea. Chinese Navy unsuccessfully tried to cause a collision at sea with USS Decatur. USS Decatur (DDG-73) is an Arleigh Burke-class destroyer in the United States Navy, of the same class as USS Fitzgerald (DDG-62) which collided with a Phillipine registered ship MV ACX Crystal near Tokyo around 2017 June 17; US Navy had also suffered another collision between USS McCain (DDG) and Liberian merchant ship on 2017 August 21 [3b].

2018 October 08:

China has lowered its required reserve ratios, meaning its banks run low on cash. The problem began some time 2 years ago, before the beginning of the current trade war [4,5]. China now directs its activities to domestic home construction market [6].

2018 October 03:

China Wants To End Trade War [7],

2018 October 11:

China needed to borrow money and launched debt offering [7b, 7c, 7d].

2. American economy is self-sufficient while Chinese economy is all relying on trades.

After the trade war and the take jobs home movement, US economy has become strongest in 40 years. China is not doing well with import and export restrictions by the US [8,9].

3. China is running out of financial liquidity.

That is a sign of over-investment on foreign-dependent economic activities that has been non-voluntarily throttled down.

4. American tariffs on Chinese steel, aluminum, washing machines and Chinese junks are effective.

Currently the US may consider that solar panels and washing machines should provide an opportunity for American manufacturing industry. The current tariff are designed to give American solar panel and washing machine makers a chance to establish themselves. Tariffs on other Chinese junks will guide American consumers toward the use of more durable, environment friendly goods.

5. Chinese tariff on American soybeans is ineffective

They cannot reduce the consumption by Chinese people. China needs cheap soybeans from the US more than the US needs to sell them to China.

Conservation requires an increase in soybean prices: rising demand for meat has driven soy production to nearly 10 times what it was 50 years ago. A full 80 percent of the world’s soybean crop is fed to livestock.[10]

Sixty percent of all soybeans grown worldwide are now exported to China, [11]

6. Chinese tariff on American LNG has been ineffective

It cannot reduce the consumption of US LNG. Rather Chinese purchasers of US LNG ship their cargo to Europe, swap for a non-US cargo and ship the latter to China to avoid any tariff. In this way Europe will consume US LNG while sending its purchased LNG to China.

7. Chinese tariffs on American luxury goods are ineffective

Chinese tariffs on American luxury goods like hand phones, designer hand bags, airplanes, cars, etc…[12] only turn them into items for “status symbol” and may ultimately promote their sale to Chinese super-rich people.

So ultimately Chinese tariffs give free promotion to American luxury goods.

8. Plotting new course for economic attack.

a- Boycotting marketers of environmentally unfriendly products.

The tariff on washing machines also put a brake on the wasteful short life cycle assigned by Americans on their washing machines. The Green and the conservation movement are now conspicuously absent in their protest against the wasteful American habits of retiring their washing machines early.

The rethink on this wasteful practice may also encourage a reduction of American thirst on Chinese throw away (short life) junks. Reduction on the consumption of short life junks may even activate some conservation laws requiring products to be environment friendly and wear resistant, properties Chinese junks don’t have.

b- Boycotting spying equipment marketers.

The rethink on electronic espionage also dampen enthusiasm for Chinese electronic equipment. [12b-12i]

c- Boycotting markets with non-reciprocal access.

Americans have to wake up to any unfair trade practice and uneven playing fields in trade. [13]

d- Growing maize instead of soybeans

This move protects the environment.

E15 petrol has 15% alcohol content which comes from maize. In this way soybean farmers are less effected by any fluctuation in the soybeans market, they can rotate crops and produce maize instead of soybeans. Hence farmers can demand substantially higher price for soybeans.

e- Establishing alternative competing foreign manufacturing bases

Trump’s government even call for manufacturers exporting to US to move out of China to avoid tariff. [14,14b]

9. Employing patriotism to support the trade war.

President Trump can ride on the patriotism wave for his economic war and direct consumers to consume goods from allies while skipping goods from potential adversaries. [15].

9. Conclusions

America is winning on most economic fronts. It should press on with this war to force China to live within the accepted rules of the international world.

With its stronger economic position, America can require China to rectify both its unfair trading policy and its policy of land grabbing from its weaker neighbors and trading counter-parties [16,17,18,19,20,21,22]. This will earn praise on America and may reverse the erosion of its international standing for the last 40 years.

References:

[1]. https://www.politico.eu/article/president-donald-trump-winning-the-trade-war-for-now-steel-aluminum-tariffs/

[2]. https://www.cnbc.com/2018/07/13/cramer-trump-winning-china-trade-war-and-the-stock-market-confirms-it.html

[3]. https://thehill.com/opinion/finance/397447-trump-is-winning-the-trade-war-because-china-has-more-to-lose

[3b]. http://mobile.abc.net.au/news/2018-10-03/south-china-sea-encounter-between-us-warship-and-chinese-vessel/10333096?pfmredir=sm

[4]. China moves to boost liquidity amid US trade war, 8 October 2018, https://www.bbc.com/news/business-45780726

[5]. Global banking watchdog warns over Chinese banks, 18 September 2016, https://www.bbc.com/news/business-37403363

[6]. https://johnib.wordpress.com/2018/10/10/chinas-helicopter-money-to-support-homes-and-apartments-expected-to-keep-social-stability/

[7]. China Wants To End Trade War But ‘U.S. Position Keeps Changing,’ Ambassador Says, October 3, 2018 6:17 PM ET, Steve Inskeep Twitter, https://www.npr.org/2018/10/03/654084691/china-wants-to-end-trade-war-but-u-s-position-keeps-changing-ambassador-says

[7b]. https://www.wsj.com/articles/china-aiming-to-borrow-as-cheaply-as-apple-and-microsoft-launches-u-s-dollar-debt-offering-1539231229

[7c]. https://thedefenstar.com/2018/10/12/disclose-all-chinese-dept-if-you-want-a-bailout-package-imf-to-pakistan/

[7d]. https://www.devdiscourse.com/Article/headlines/214110-imf-asks-for-absolute-transparency-of-debts-from-pakistan

[7e]. https://nation.com.pk/15-Oct-2018/pakistan-to-share-china-debt-details-with-us-before-imf

[7f]. https://thedefenstar.com/2018/10/15/pakistan-finally-agrees-to-share-chinese-debt-details-with-us-to-get-imf-loans-approved/

[8]. Trump’s trade war advantage: The US economy is ‘firing on all cylinders,’ says expert, https://www.cnbc.com/2018/08/13/us-china-trade-war-us-economy-gives-trump-an-advantage-expert-says.html

[9]. How a US-China trade war could hurt us all
Karishma Vaswani Asia business correspondent @BBCKarishma, https://www.bbc.com/news/business-44706880

[10]. Blinding consumers to the true cost of soy?, https://superforest.blog/2018/10/08/blinding-consumers-to-the-true-cost-of-soy/

[11]. https://us-issues.com/2018/10/02/china-in-water-crisis/

[12]. https://wentworthreport.com/2018/07/02/the-china-trade/

[12b]. https://www.darkreading.com/attacks-breaches/chinese-intelligence-officer-under-arrest-for-trade-secret-theft/d/d-id/1333025

[12c]. Personnel on US military bases can no longer buy phones and other gear manufactured by Chinese firms Huawei and ZTE, after the Pentagon said the devices pose an “unacceptable” security risk.by AFP on May 05, 2018 Tweet, https://www.securityweek.com/us-military-bans-huawei-zte-phones

[12d]. https://www.theverge.com/2018/8/13/17686310/huawei-zte-us-government-contractor-ban-trump

[12e]. Chinese spy chips are found in hardware used by Apple, Amazon, Bloomberg says; Apple, AWS say no way, https://www.cnbc.com/2018/10/04/chinese-spy-chips-are-said-to-be-found-in-hardware-used-by-apple-amazon-apple-denies-the-bloomberg-businessweek-report.html

[12f]. China allegedly infiltrated US companies through implanted hardware backdoors,
Zeljka Zorz, Managing EditorOctober 4, 2018, https://www.helpnetsecurity.com/2018/10/04/implanted-hardware-backdoors/

[12g]. https://irishinfosecnews.wordpress.com/2018/10/04/china-allegedly-infiltrated-us-companies-through-implanted-hardware-backdoors/

[12h]. Report: In Huge Hack, Chinese Manufacturer Sneaks Backdoors Onto Motherboards, https://www.darkreading.com/network-and-perimeter-security/report-in-huge-hack-chinese-manufacturer-sneaks-backdoors-onto-motherboards/d/d-id/1332977

[12i]. https://irishinfosecnews.wordpress.com/2018/10/04/report-in-huge-hack-chinese-manufacturer-sneaks-backdoors-onto-motherboards/

[13]. https://www.reuters.com/article/us-usa-trade-china-diplomacy/u-s-ambassador-accuses-china-of-bullying-with-propaganda-ads-idUSKCN1MA0HW

[14]. Trump calls on Apple to move production from China to US, September 8, 2018, https://m.phys.org/news/2018-09-trump-apple-production-china.html

[14b]. Why foreign companies are shutting shop in China, Jane Li, Thu, 2 Feb 2017, https://www.cnbc.com/2017/02/02/why-foreign-companies-are-shutting-shop-in-china.html

[15]. https://ukgovernmentwatch.wordpress.com/2018/10/07/china-shonky-steel-rogue-chips-in-computers-what-else/

[16]. https://wentworthreport.com/2018/07/02/the-china-trade/

[17]. China Reshapes The Vital Mekong River To Power Its Expansion, https://superforest.blog/2018/10/06/china-reshapes-the-vital-mekong-river-to-power-its-expansion/

[18]. Vietnamese Worry About China’s “Slow, Creeping Invasion” from Tibet to Australia and Pakistan, https://johnib.wordpress.com/2018/10/07/320212/

[19]. https://johnib.wordpress.com/2018/09/26/south-china-sea-do-china-and-the-u-s-know-each-others-intentions/

[20]. http://www.abc.net.au/news/2016-07-13/rothwell-south-china-sea-verdict-explained/7624120

[21]. http://www.abc.net.au/news/2017-11-29/south-china-sea-why-is-australia-worried-about-chinas-stance/9206998

[22]. China’s Dream of a China-Dominated World May Be Fading (At Least For Now) Because of Donald Trump, https://johnib.wordpress.com/2018/10/07/chinas-dream-of-a-china-dominated-world-may-be-fading-at-least-for-now-because-of-donald-trump/

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