German Industrial Orders Plunge – The Surface Reason is China – The Underneath Reason is Trump…

Boy howdy if ever there was an article that showed the layers and ramifications of President Trump’s global trade reset, this is a good one.   The multinational media do not want American voters to understand the dynamic, because if we did people would catch-on to how the global economy was structured upon removal of U.S. wealth…

(Tweet Link)

Reuters is reporting on a significant drop in German industrial orders, and they specifically point to diminished orders from the U.K (small part) and China (big part) as the cause.  However, the analysis stops at the part where China’s lack of industrial orders is the leading contribution to retraction in the German export sector.

What the financial analysis does not approach (ie. the third rail of multinational corporate admission that must never be outlined), is the reason why Chinese orders for German industrial goods have dropped.

The problem for China, and ultimately for Germany, is that Trump’s trade reset has stopped a big amount of U.S. wealth from arriving in Beijing. Simultaneously, Beijing is countering Trump’s tariffs by devaluing their currency.  The rebound economic impact is doubled. China has: (1) less income; and (2) less value within their own currency.

Where does this dynamic show up?…. Anytime China is going to buy something.

China’s currency devaluation makes their exports cheaper; however, at the same time it makes any of their imports more expensive.  As a consequence China buys less… and that now exhibits in lower purchases of German stuff.  See how that happens?

So yeah, the ramifications for Merkel’s German economy -twice as bad as originally forecast- are based on China fighting Trump.  The fact that China is bleeding cash, and has simultaneously dropped the value of their currency, means China can’t buy stuff.

All of those nations who were counting on Chinese purchases are now going bananas.  This is why the multinationals blame Donald Trump… and to make matters even worse – the U.S. economy is thriving, while they watch from the sidelines.  It’s a delicious dynamic.

For more than three decades global economies have grown by removing wealth from the United States.  The U.S. multinationals have countered the economic arguments by claiming those global economies have purchased U.S. treasuries; but that means we trade our current wealth for future debt.

President Trump has reversed this dynamic.  We are repatriating our national wealth through new trade policies, and will pay for any incurred foreign debt by expanding our own economy and controlling our own destiny.

Here’s Reuters article (emphasis mine):

BERLIN (Reuters) – Weaker demand from abroad drove a bigger-than-expected drop in German industrial orders in July, suggesting that struggling manufacturers could tip Europe’s biggest economy into a recession in the third quarter.

Germany’s export-reliant economy is suffering from slower global growth and business uncertainty caused by U.S. President Donald Trump’s ‘America First’ trade policies and Britain’s planned, but delayed, exit from the European Union.

Contracts for ‘Made in Germany’ goods fell 2.7% from the previous month in July, data showed on Thursday, driven by a big drop in bookings from non-euro zone countries, the economy ministry said. That undershot a Reuters consensus forecast for a 1.5% drop.

“The misery in manufacturing continues. The decline in new orders significantly increases the risk of a recession for the German economy,” VP Bank analyst Thomas Gitzel said.

Germany’s gross domestic product contracted by 0.1% quarter-on-quarter in the second quarter on weaker exports, with the decrease in foreign sales mainly driven by Britain and below average demand from China.

“The danger is great that negative growth will also be recorded in the third quarter,” Gitzel added. (read more)

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This entry was posted in Big Government, China, Communist, Donald Trump, Economy, European Union, G7, Hong Kong, media bias, President Trump, Professional Idiots, propaganda, Trade Deal, Uncategorized, US dept of agriculture, US Treasury, USA. Bookmark the permalink.

240 Responses to German Industrial Orders Plunge – The Surface Reason is China – The Underneath Reason is Trump…

  1. AB says:

    How about fewer purchases from china because they’ve reverse engineered your stuff and are making their won copies?

    Liked by 8 people

  2. Sundance, I so appreciate your analysis and reporting. You help me be informed by presenting issues in an easy to understand way.

    I’m curious as to your thoughts about the US debt that China holds… is this something that could be used as leverage against these new policies?

    Liked by 7 people

    • Serena says:

      I wish we could get our President and his financial advisers to put this info that Sundance has on these pages out there in the public. They need to say these things every time they are on camera in plain language so that all Americans can understand what’s at stake and what we are fighting for. Our children and their children’s very survival.

      Liked by 9 people

    • flyboy46 says:

      There is an old saying about debt. If I owe the bank a million bucks, the band Owns me. If I owe the bank a Billion dollars, I OWN the Bank. Think about that for a few minutes. HOW is China going to collect on our debt they OWN?

      Liked by 1 person

  3. bob says:

    The US is lucky we aren’t so much export dependent and a large part of our exports are ag. It’s easy enough to give farm support money to farmers and pay them with tariff money. Germany not so lucky and with their reliance on high labor and super high energy they are effed. Meanwhile we have all the food, are energy rich and have both high and low priced labor and a dynamic market with easy entry and exit. Germans can’t lay off workers without a huge issue. It used to be they could send Turkish workers back to Turkey but they can’t do that any longer. I don’t wish bad upon them but I do wish all the good returns to the USA.

    Liked by 4 people

  4. noswamp says:

    Blackstone CEO and Goldman Sachs are multinational corps on Wall Street benefiting CHINA not the USA. Those companies could care less about the American people. Trump knows this.

    Liked by 6 people

  5. willthesuevi says:

    A 2nd or 3rd order effect of this will be a great win for the USA. The leftist educators, economists, and media are screaming holy hellfire and damnation will occur as President Trump rights this economic wrong.

    When the youth of America sees and lives through this economic resurgence and strengthening of America they will realize they have been misled and at that point will really start thinking and observing for themselves.

    Most important for our long term survival. No education is so valuable and memorable as when you discover knowledge yourself.

    Liked by 4 people

  6. drlou007 says:

    So Merkel and the EU want to trade with China. Good luck with that. China will steal your IP or force German companies to give it up for the ‘privelige’ of doing business in China. All the while, Germany’s trade deficit with China is about $200B! Go at it, Mrs. Merkel. Show the Chinese what a fool you are. We already know.

    Like

  7. Cogsys says:

    I wonder if Greenland will be part of the EU deal with China.

    Like

  8. Juba Doobai says:

    “Donnie Two Scoops, you can’t do that to us,” beseeched Angela Merkel.

    “Watch me,” flatly stated Donnie Two Scoops.

    Like

  9. Wendi Lau says:

    I like how you explained this. It’s a viewpoint that should be included in balanced articles.

    Like

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