The trade war continues to escalate or detonate the "super financial crisis"? IMF Director General director general gives warning
In addition to internal factors, many American media and scholars are also concerned about the impact of external factors on the US economy. CNN said that there is also a trade war between the two largest economies in the United States and China. The double-pronged tariff increase measures impair business and investment confidence. Due to the trade war, the IMF lowered its forecast for the world's 2019 economic growth, including the United States, on Monday, which also aggravated investor nervousness.
Lubini, a professor at New York University's Stern School of Business and a former White House economic adviser who has accurately predicted the 2008 financial crisis, warned that "the economic recession and financial crisis are taking shape in 2020." He believes that the US stock market is full of bubbles. The US stock market's earnings ratio is 50% higher than the historical average. And because of the overheated economy, inflation has risen and government bond prices have reached record highs. In addition, the continued escalation of the US trade war with China and other countries will further lead to a slowdown in growth and increased inflation. In the event of a flash crash, the "super financial crisis" will be detonated.
Trump denied the stock market crash in an interview with Fox News on the 10th because he launched a trade war against China. The Russian satellite news network said that Trump also threatened, "The Chinese have lived too well for too long and Adding tariffs has already damaged the Chinese economy and will take more measures."
The US media is well aware that Trump’s launch of a trade war will pose a significant risk to the US economy. The Wall Street Journal recently said that "Trump's chances of winning the Chinese offensive are fleeting." The report said that the United States currently seems to have a strong ability to put pressure on China in trade, but this advantage may not last long. A good day when the US economy grows at 4% and the inflation rate stays at 2% may be difficult to sustain. The Trump administration’s threat to impose tariffs will hit China, but it also means that it will become more difficult to find alternative suppliers to ease upward pressure on US consumer prices. In industries affected by tariffs, more than 50% of imported goods come from China.
"Trump will increase trade wars, or compromise?" German news TV said on the 11th, now Trump must make a decision as soon as possible, is to continue a comprehensive trade war with China, or to get close as soon as possible, sign Compromise agreement. The former will likely bring the US and the world economy into a new crisis. The latter may still cause internal contradictions in the United States, but it can pull the world economy back from the edge of the abyss, and the United States can still be a beneficiary of world trade.