The US-China trade war is still on-going, four-weeks in a row now.
Given President Donald Trump’s decision to raise tariffs by $325 billion just this week, not only businesses from two nations will suffer, but also the investors which drive profit from the stock market. China is also on the verge of increasing tariffs, reportedly about $60 billion in US exports.
Given this serious socio-economic war going on, the stock market is also affected because sales of different companies were declining too.
In fact, just last week, according to Reuters, US investors have pulled out a net of $9.6 billion assets from the U.S. stock market. If the trade war continues, stocks will be slammed, causing the global economy to drift.
China’s Unfair Advantage
Despite US trade threats, China is one step ahead. The nation is cutting out exports and investments from the Chinese market, steals intellectual property and forces Chinese businesses to transfer technology and subsidize companies.
These tactics aren’t covered by the World Trade Organization, hence, there are no specific organizations to penalize China’s actions.
Meanwhile, the United States isn’t prepared for the cost of the trade war with China. The United States has ruined allies with Japan, EU and Canada, with personal insults and lifted tariffs on their goods.
US Consumers Will Suffer
Given that tariffs on goods offered by China increased, US consumers will suffer from additional costs. What experts are saying is, by summer, there will be a huge price mark up with Chinese goods, including school supplies, smartphones and appliances. Hence, this is the perfect time for consumers to buy all the necessary products they need, while the prices are still quite normal.
Meanwhile, in stocks, US investors have been pulling out assets ever since January, amounting to $40 billion.