The trade war between US and China

As of 1/2019, I predict the trade war would be ended in April or before. Trump-made problem would be fixed and Trump would declare victory. Trump cares about his election in less than 2 years and Xi’s 10-year term has plenty of years left. A full-fledged trade war could not be good for both countries and the rest of the global economies.

I expect the forced transfer of technologies will be eliminated. It is an unfair bait for gaining the Chinese market. We have to blame the U.S. CEOs signing these agreements for their bonus consideration. So far, both sides have lost a combined total of 6 billion. Many long-term harms have been done to the U.S. Here is a summary of the actions and counter-actions from China.

	U.S.	China
Tariff	Will not gain a lot of jobs as other countries and robots would fill the gap.	Will pass tariffs to the consumers. Will have less profits. Will lose the market to some countries.
Barriers	Would open the market to more US products.	Patriotism would discourage citizens to buy US products.
Unfair rules	This is a bright spot for US.	Could have more impact 5 years ago.  China depends less on foreign technologies than before.
Internal market	Will be reduced.	Will be expanded.
Treasury	Interest rate will be higher.	Reduce owning US Treasury.
Depreciation of the Yuan	Harmful for export goods to China.	Make Chinese products more competitive.
Core technologies	Will lose these sectors to China eventually. Intel, Micron… have suffered already.	China will concentrate research on CPU and memory. China may limit rare earth export to US.
US allies	Eventually they will be sided with China due to economic reasons.	Eventually will gain more.
US Corporation	Many will suffer such as Apple.	Less FDI.
Soy	A direct blow.	Will switch to other countries at higher prices. Soy will be reduced in the mix for feed.
Education & tourism	Will be decreased from China.	More universities and more tourists to Europe.

 

Lazy man's market timing

From my book "Profit form the coming market crash":

Sound Advice Risk Indicator

We only invest in stocks or real estates in a crude sense. This indicator comparing the allocations between these two investments has been quite successful. When we invest too much in the stock market instead of real estates, we will expect a market crash. When this index hit 2 as in 1906, 1928, 1937 and 1965, we had market crashes at all these times. Today (12/2018), we have similar warning. Use Google to search for articles mentioning this indicator. Here is one of many.

Buffett’s Equity to GDP

It measures the value of the market. It has been quite successful. Google for the current value. Advisor Perspectives may have this value and many insights on the current market. It will not detect the peaks and bottoms as no one can consistently. About a third of S&P earnings come from abroad. Hence it boosts market cap but doesn’t include those countries’ GDP. It is a major fault.

Lazy man’s market timing

Sound Advice Risk Indicator, Equality to GDP, Inverted Interest Curve and Death Cross make up the lazy man’s market timing. Google for the current values of the four. If you cannot get the last one, calculate it from finviz.com.

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For more of my reasoning, check out the book described next. It has 950 pages (6*9) for $9.99. It could be the best $10 you ever spend.

The above is an abstract from my book "Complete the Art of Investing" which is available from Amazon.


I challenged to have the best-performed article in Seeking Alpha history, an investing site, for recommending 5 or more stocks in one year after the publish date. The concepts for that article are discussed in this book.

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