 |
The Chinese just made a preemptive trade war strike…
The Wall Street Journal reports China is hiking its “parcel tax” on April 8 on foreign goods shipped into the country.
The tax affects all overseas shipments mailed through e-commerce websites (like Amazon and Alibaba).
The taxes will range from 9-17% depending on the item. They’ll make “Made in China” items more competitive against foreign goods… since Chinese consumers pay no such tax on domestic goods.
The government hopes this will protect domestic industry and aid local employment.
Regular Daily readers know trade wars are “stage two” of deteriorating relations between nations…
The first stage—currency wars—began during the Great Recession in 2008-2009. Both countries’ central banks have manipulated the value of each’s currency as a way to spur exports. Weaker domestic currencies mean goods cost less to foreign buyers.
The second stage—trade wars—begins once countries start hitting limits of their currency interventions. They use tariffs (taxes on imports) to further hurt their foreign competitors.
The final stage—real wars—follows trade wars. Trade wars break down the cooperative agreements in place between countries. Once you see the other nation as an existential threat to your domestic industries… there’s little reason left to avoid shooting at each other.
Bottom line: Trade wars benefit no one in the long run… but they do benefit politicians looking for votes in the short run. Expect calls for retaliatory tariffs to grow throughout the election cycle.
That will help keep market volatility high. Stay long gold and U.S. dollars.
|
Recommended Links An Important Warning Before You Buy Gold
Due to recent market volatility, many readers have written in about the best ways to buy gold right now. But before you consider buying gold (or if you own some already), we strongly encourage you to check out what one of the world’s leading experts is saying right now. Click here to view.
Jim Rickards’ Breaking Video Goes Too Far
Inside, he exposes the next major attack against the U.S. dollar. But here’s the scariest part… According to Jim, this new surprise attack will come from one of America’s sworn allies. If you can stomach it, I strongly urge you to watch immediately. Click here to watch Jim Rickards’ controversial presentation. |
