Peter Schiff: Chinese Trade Deal Isn’t Going to Make America Great Again (Video)
The US and China are reportedly getting closer to working out a trade deal. The Chinese have indicated they will import more US natural gas, semiconductors and soybeans. Peter Schiff recently appeared on RT to talk about it. He said that no matter what ultimately comes out of these trade negotiations, it’s not going to make America great again.
Stock markets have rallied in recent weeks, primarily driven upward by news that the trade war could be close to an end. But Peter said he doesn’t think that the actual agreement will end up being that big of a deal in substance.
I think that China had probably had intention to buy American soybeans and other agricultural products. We have no idea of knowing whether the Chinese end up buying any more products, and they might have bought even if there wasn’t a deal. I mean, we do make some things that Chinese want. Unfortunately, they’re things that we grow or harvest. You know, we’re almost like a colony of China where we send them raw materials and food, and they send us manufactured goods.”
Peter was asked what it would take to make this a “great deal.”
There is not going to be a great deal, although that is not going to stop Donald Trump from touting it as the greatest deal in the history of deals. I have no doubt that whatever is agreed to, Trump is going to say it’s a huge win; it’s a great deal. But it’s really going to be nothing, and it’s not going to be any more significant than NAFTA 2, which he called USMCA. You know, we’re not going to make any significant dent in our trade deficit, with China or anybody else, until the dollar really collapses and prices America out of the import market. It’s actually imports — cheap imports and foreign credit — foreigners loaning us money so we can keep buying stuff that’s artificially helping prop up our economy and our standard of living. And ultimately I think the world is going to cut us off.”
Peter said that won’t happen until the dollar collapses, but we are heading in that direction because the Federal Reserve has done what he’s been saying it was going to do since the beginning.
And that is aborted their attempts to normalize interest rates and shrink their balance sheet. But the next step is going to be a return to zero percent interest rates and more QE, and that is going to knock the bottom out of the dollar. And that’s what’s going to ultimately bring down our trade deficits when we’re too broke to afford to buy anything.”
Peter said the next round of rate cuts isn’t going to stimulate the economy or reinflate the bubbles like the three previous rounds of QE did.
It’s going to be a sedative for the dollar. The dollar is going to tank. Commodity prices are going to rise. I think the cost of living is going up. We’re headed for stagflation in the United States. And yes, that’s going to bring down our trade deficit, but it’s going to be a painful reduction in our standard to living.”
Peter said the ultimate problem with America’s trade relationship with China is that we just don’t make things the Chinese want to buy.
We have too much government, we have too many regulations, we have too high taxes and that hasn’t changed under Trump. That’s why he hasn’t made America Great Again. He’s just made deficits greater again.”
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