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Why China won't yield to Trump

Holding $1 trillion of US Treasuries, Beijing has the whip hand

| China
  © Reuters

BEIJING -- Last month, U.S. President Donald Trump enacted steel and aluminum tariffs aimed squarely at China. On April 2, China retaliated with tariffs on 128 American products. Trump then announced 25% tariffs on another 1,300 Chinese products, representing some $50 billion of exports. In response, China threatened 25% tariffs on 106 U.S. exports (including soybeans, cars, and airplanes), to go into effect whenever the U.S. tariffs do.

Yes, if these measures go into effect, it will amount to a trade war -- one that the United States is not likely to win.

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