US To Impose Tariffs

[Mr Gently Benevolent]

U.S. to Impose Tariffs on Chinese Pipe After Ruling (Update3)


By Daniel Whitten

Dec. 30 (Bloomberg) -- The U.S. will impose duties on $2.8 billion in steel-pipe imports from China after saying subsidies on the products may harm American steelmakers, a move that threatens to escalate trade tensions between the two countries.

The U.S. International Trade Commission voted 6-0 today in Washington. The Commerce Department set duties in November ranging from 10.4 percent to 15.8 percent, subject to the ITC’s ruling, on Chinese pipes used in oil wells. A preliminary ruling by the ITC in May led Chinese producers to halt exports to the U.S., state-owned Tianjin Pipe Group Corp. has said.

The case is the largest so-called countervailing duty complaint filed against Chinese products, and was brought by groups and companies including U.S. Steel Corp. Tariffs have been a point of tension between the two nations since President Barack Obama imposed duties in September on Chinese tire imports. Obama, during a visit to Beijing Nov. 17, pledged along with President Hu Jintao to work on easing trade frictions. I was wondering when the tariffs were going to be imposed on certain steel products coming into the US from China.

http://www.bloomberg.com/apps/news?pid=20601087&sid=ayFouCuAEXbM&pos=4

[Ordie]

There is a trend within China to re-nationalize private industries. They, in turn get automatic loans from state-owned banks with little vetting and oversight.

Thus there is an argument for tariffs.

Then again, the US Government owns GM, which produces China's most desireed luxury car, The Buick. The PRC could in turn impose tariffs on the Buick.

[Flagg]

I'm not as worried about tariffs on goods escalating into full blown trade wars.

Even with the institutional memories of fruit flies surely folks will think "trade/tariff wars = Depression + War" or some such......

We are so economically inter-related if real trade wars errupted, it would be catastrophic....the west can't make sh!t anymore....so when our toaster breaks, the world would end.

And if China doesn't get enough toaster orders from Florida, those tens of millions of unemployed toaster makers are going to riot.

It's like economic MAD....ain't gonna happen in a big way...probably just token examples to keep the unions in the US from having a stroke.

What DOES worry is barriers to CREDIT.

Here's an example......the Bank of Scotland loaned a truckload of money to a development up the beach from us.....the Bank of Scotland has since been nationalized.....at what point do UK citizens start screaming for that money to be repaid and invested in creating local jobs in the UK, instead of loaned to folks way down in NZ?

The more banks are nationalized(and the banking mess is FAR form over), the more political influence and control over them exists...the more folks become unemployed...the more pressure on politicians to do stupid things....which could include enforced barriers to credit as one possible bad news scenario.

[wotsnext]

The RBS pay me 0.5% then lend my money to the kiwi's? yet my son cant get a mortgage..........where's my pen p-)

[Flagg]

The RBS pay me 0.5% then lend my money to the kiwi's? yet my son cant get a mortgage..........where's my pen p-)

That's exactly my point....your situation is very relevant......you have every right to kick your MP in the @ss and demand that the capital of the banks your country(and you) owns be allocated more for deployment domestically...and that's where a potentially very large problem occurs...we have a very deeply intertwined globalization of commerce....which I doubt will become undone to avoid the mistakes of the past........but we also have an equally intertwined globalization of finance......it's easier and faster to get into a global credit war we have never faced on this scale than a global trade war of which we have SOME institutional memory of the downsides of it.

In a nutshell...if you wrote a letter to your MP and others did as well, and RBS recalled the funding facility, they would fall over, and your asset would be only worth pennies on the dollar, requiring RBS to take a capital writedown, which would require them to call in many other loans to get their lending ratios back in order, which would knock over more companies, which would require more writedowns, which would require calling in more loans, etc, etc, etc......

Right now there are a lot of banks, companies, property developments where clearly toxic loans are still being serviced...but SHOULD be called in....it's the fear of what happens after a couple big ones get called in is the problem..and where the word cascade takes over.

So it's a bit like a Mexican Standoff in some respects.

Capital controls could soon be on the horizon.....Brazil's recent 2% tax on money "imported" into the country could be a harbinger of far more onerous choices such as those made by Argentina since 2001.

Most folks who've traveled to most places in the last 10-20 years would have probably experienced a fairly transparent ability to use their own capital around the world with relative speed and ease.........it wasn't all that long ago that it was considerably more difficult.....it's possible, and even likely for some countries, that we could see a bit of a return to that......where freedom of international commerce/travel is effectively hindered by far greater difficulty/inability to transact it.

And it's not that hard for a cascade to occur....Iceland was not a "one off"....Greece and Eastern Europe is an area to keep an eye on.....and the international money lent to Dubai that assumed they are good for it is a shocker....the overcapacity in EVERYTHING in Dubai is simply insane from seeing it up close and personal a few months ago....which is a similiar problem facing the Chinese led Asian manufacturing overcapacity...and ALL of the excess capacity built and half abandoned used leveraged credit.

I do not know how it's going to end.......nor does anyone in my opinion....as this is arguably the most complex set of problems humanity has yet faced.

Just my 0.02c