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Merkel: Because of Trump, everyone is a kaput. In addition to Putin

Merkel: Because of Trump, everyone is a kaput. In addition to Putin

July 12 2018
Tags: Germany, Merkel, USA, Trump, Economy, Europe, China, Analytics

The German Chancellor considers the US President to be the destroyer of the world order, against which the Crimean issue is losing its relevance.

In Germany, continue to discuss the sensational statement Merkel, who in her address to the deputies of the lower house of the German parliament said that the specter of the global crisis is materializing. This is how she commented on the threat of the US president Trumpavesti duties on the import of cars from Europe. According to the Chancellor, if this happens, the Germans will receive the most severe blow for the entire post-war history.

The analytical publication Trib Live together with CNBC and Associated Press experts prepared a special bulletin on the economic relations between the EU and the US in the light of Merkel's speech. After reading this document, there is a feeling that very soon everyone will have a kaput.

Perhaps that is why, in her speech, Merkel for the first time said that, as the leader of Europe's largest economy, she undertook to fight for the survival of global institutions that arose after the Second World War and underwent a severe attack by the Trump administration. "The international financial crisis (2008-2009 years - author), would never have been resolved so quickly, despite the sufferings of nations, if we had not cooperated in the spirit of partnership (within the G20)," Merkel recalled.

The leader of the FRG avoided the term "trade war", calling the tariff confrontation an economic conflict. She explained that Trump is trying to maneuver between the EU and the PRC, offering some European companies to take the liberated niche of Chinese goods. However, Berlin strongly supported Beijing, warned its companies against such practices. This shows that Germany today is secretly coordinating international efforts for international opposition to America.

It is possible that China's retaliatory measures in the amount of $ 34 billion against tariffs imposed by Tramp on Chinese goods were also agreed in Germany, since such American products as crude oil, soybeans and seafood fell under trade restrictions. The main beneficiaries of the Chinese "rebuff", oddly enough, are Russia and Iran, as well as indirectly Germany, interested in cheap Russian gas.

Merkel among other things said that from now on, international tariff conflicts with the United States are based on the principle of an "eye for an eye". The European Union, although belatedly, responded to overseas steel and aluminum taxes with counter taxes on US imports of $ 3,25 billion. In other words, the actions of the participants in the tariff conflicts will be spiral, leading to a dangerous reduction in the total volume of world trade.

How can we not remember here our ridiculous response measures against US sanctions.

If the White House does not stop in its trade wars, then the good times for Europe will end quickly, despite today's growth. To this conclusion the Chancellor of the Federal Republic of Germany came, frightening his deputies this time with an American, not Russian threat. So far, the Germans have managed to reorient some of the car exports to China, squeezing out American competitors from there. But what will happen tomorrow - none of the serious analysts can predict, because the purchasing power of the Chinese can be undermined by a sharp decline in exports to the States. The second such market in the world simply does not exist.

In addition, Washington almost openly calls on Beijing to abandon European goods, replacing them with American ones. Like, then the monstrous trade imbalance between the US and the PRC will disappear and, consequently, the ground for a tariff conflict. Thus, Trump shows that he "nachihat" on the Allies of the Old World.

Against this backdrop, Paris flared up, which, in spite of Berlin's "globalism," dreams of finally quarreling Trump and Xi Jinping in order to occupy the vacated trading positions in two global markets at once. Economists Alicia Herrero and Jianwei Xu of the French bank Natixis believe that European (read - French) manufacturers of cars, aircraft, chemicals, computer chips and factory equipment can take their shares immediately in two markets if a full-scale trade war breaks out. However, for this 5-th Republic, most likely, will have to leave the EU.

Anyway, everything depends on Trump's position: how much is the US president willing to go far in implementing national economic protection plans?

Judging by information from America, the current administration of the White House is confident of the correctness of its steps, therefore, is not going to stop. So, the American recruiting company Glassdoor reported that for the first time in many years the labor shortage in the US led to a sharp rise in wages. For example, in June 2018, the pay for truck drivers increased by 7,3% - to $ 54,659 per year, e-commerce and logistics experts at 6,8% - to $ 43,961 per year, workers at factories at 5,1% - to $ 36,179 per year. More began to receive and low-paid categories: cashiers in banks - up to $ 31,108 per year, retail sellers - up to $ 29,746 per year.

The beneficiaries of the Trump reforms were, for example, African American bakers in Chicago, Latin American chefs in Monterey restaurants, spa workers in Hilton Head, seamstresses, small business workers

Today, according to the latest poll of the American public opinion institute Gallup (beginning of July 2018 year - author), 55% of all Americans believe that their best days are yet to come.

It is difficult to imagine what could have made Trump to abandon his further plans for protectionism if the American economy each time receives an impulse of development from new tariff restrictions of Chinese or European goods.

However, we can not discount the overseas liberal establishment, which promises to arrange a total crisis in the election year 2020. In addition, the experts of the Democratic Party see in the high salaries of workers a deadly threat to the competitiveness of America, because quickly enough 25% tariffs will exhaust their protective properties. Well, and further, in order to grow, the US will have to close trade borders altogether. And this is a road to a dead end, as it undermines the international financial market.

Nevertheless, now Trump's electoral support is growing by leaps and bounds, and, consequently, his chances of re-election in 2020.

In this regard, the prophecy of Chancellor Merkel on the materialization of the long-term global economic crisis has a real basis. In addition, the scenario is extremely unlikely that the G20 will again meet to fight the economic storm, as under Obama.

What's interesting: very many European politicians are already less aggressive towards Moscow, at least, because after communicating with the "arrogant" Americans, there is not enough strength for anti-Russian rhetoric. Moreover, if Trump introduces tariffs for cars of the Old World, the EU will support Russia, although it is not open. It is logical to expect that the Germans and the French will begin to crush the Ukrainians, as transatlantic protégés. After all, in the generally accepted economic policy the following principle after "an eye for an eye" is "a friend of my enemy is my enemy".

In this connection, in backstage conversations both in Berlin and Paris, it is believed that today cards are incredibly well suited for the Putin Putin. If in 2020 Trump still seated in his chair, then after 2024 the Crimean question is logically transformed into a format of banal territorial disputes, which in the whole world there are several hundred.

Alexander Sitnikov
Free Press
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