The US-China Trade War Has Reached the Point of No Return

The point of no return has been crossed – the US government, in just a couple of months, has created all the conditions to return the US to the era of the Great Depression. The pieces are in place, the cards are laid out – the US trade war with China is already bearing fruit. There is not even a slight chance that America’s economy can be revived.

 

Imminent Collapse of Intel Corporation

 
The US government has imposed a ban on the supply of products from Inspur, a company specializing in the production of high-tech servers. Naturally, this concerns the supply of equipment to the Chinese market. On average, this accounts for about 50% of Intel’s revenue.

 

 

It could have been possible to maintain positions by supporting the American market, but even here, failure. The industry giant Apple has officially announced the development of its own ARM processors for personal computers and laptops. This means that about 10% of total revenue can be forgotten.

 

Intel also suffered a blow from its direct competitor in the market – AMD. The manufacturer of inexpensive components released quite powerful processors and motherboards. Considering the low price and excellent performance indicators, Intel has no chance to stand firm. Only a price policy – reducing the cost of all types of products – could save it. But even this is impossible, as Intel’s entire business operates on bank loans.

 

The US-China trade war will affect Taiwan

 

Chipset manufacturers TSMC and MediaTek are also sounding the alarm. Americans threaten sanctions against Taiwan if they decide to extend the chip supply contract to China. It is still unclear how this will end. But if Taiwan succumbs to US pressure, it will lose up to 90% of all its income. This is an inevitable bankruptcy. It is enough to recall the fate of ZTE, which, under sanctions, lost $12 billion in revenue in just three months and disappeared from the market.

 

 

Perhaps the Taiwanese government understands the risks and will find some solution to satisfy everyone. So far, over 30 years of Chinese oppression by Americans, Taiwan has managed to stay afloat. The East is a delicate matter. People know the value of resources and money. And this is encouraging.

 

The Dragon’s Tail Strike – China is Ready to Solve Its Problems Independently

 

China’s manufacturing capacity is not as far behind the US as it seems at first glance. Although the Chinese lack modern innovative developments, they know how to make copies. Currently, all the money is being invested by the Chinese government into the economy and technology. Equipment is being hurriedly purchased, and headhunters are recruiting top specialists from all over the world.

 

 

All these actions suggest that within the next 6-12 months, China will be able to launch its own chip production to supply its domestic market. And where there are high-tech chips, there are processors for computer equipment. Add affordability, and the global IT market will inevitably shake. China accounts for a quarter of the world’s population. Its best friends are Russia, Mongolia, and North Korea. There is a market to sell to – the US economy will collapse and will not recover.

 

The Long-Suffering Huawei

 

Few outside China have heard of Huawei. The factory quietly produced modems for the global market and smartphones for Chinese consumers. The breakthrough in 5G technology allowed Huawei to provide the world with quality wireless communication. Then the US intervened, accusing the manufacturer of information theft. Sanctions followed immediately. But this policy has played into the hands of the Chinese.

 

 

As a result, all potential opponents of US policy have chosen the Huawei brand. The share of smartphones on the global market increased from 5% to 30% in just one year. Remember the high-tech brand Lenovo? Where is it now? With a market share of 20% in 2018, it disappeared into obscurity. In stores, instead of Lenovo, new Huawei, Honor, and Xiaomi products are displayed.

 

Even the refusal to support Google services (by order from the government) led to the Chinese launching their own app store. It will develop rapidly, as Huawei officially announced the complete absence of tariffs for software developers. For those unaware – Apple and Google have introduced a 30% digital tax, which we recently wrote about.

 

US Trade Wars Are a Very Foolish Venture

 

The lives of Americans teach nothing. Remember the disastrous US sanctions against Russia in 2014. They decided to plunge Russians into chaos, but it backfired. In three years, Russia raised its industry to the level of the 1970s, providing jobs and goods of all necessary categories. The losers are Europe, which, due to its short-sighted government, loses billions of euros annually. And will continue to lose until it frees itself from American dominance. The US-China trade war will affect all major world powers. The Chinese will quickly adapt to the market and then start choosing – whom to befriend and whose economy to plunge into chaos.

 

 

It is unfortunate that only a handful of people decide the fate of the entire world. Intel produces excellent high-performance processors. Google has great services and a solid technical base. Huawei manufactures cool smartphones and modems. Italy and Greece produce delicious olive oil, and the Netherlands has the best cheeses. Engaging in honest trade between different countries can easily satisfy demand and develop the economy. It is a pity that our leaders do not understand this.