Unable to bear it anymore! At the关口 of the US debt crisis and amid the China-US tariff negotiations, the US has conceded defeat quite thoroughly.

No one expected that the US would kneel down so completely, directly canceling all tariffs planned for April 4th.

Without any conditions or any haggling, the US has simply given in, as if the tariffs had never been imposed.

Trump is so decisive this time because he can no longer endure it; 6.5 trillion US dollars of US debt will mature in June, and this is a major threat. If there is any fluctuation in the US debt, the collapse of the entire USD financial hegemony and order would be imminent, which is unacceptable for any US administration.

Originally, Trump wanted to trigger high inflation through global tariffs and force the Federal Reserve to intervene and save the market. Who knew that the Fed remained stubborn and refused to cut interest rates.

The result was that inflation did not occur, but stagflation did. Without a doubt, stagflation has arrived. Stagflation means a simultaneous decline in purchasing power and rising prices. These dual blows should not happen together. Few countries can push themselves into stagflation, which means that if stagflation occurs in normal countries, it is really a big trouble.

The US experienced it once in the 1970s, lasting for a full 10 years, which is a nightmare for Americans. If it weren't for Reagan's arrival in the 1980s, the US might have collapsed on its own. However, one consequence of Reaganomics was the hollowing out of manufacturing industries, laying the groundwork for today's problems.

This time, due to being caught in stagflation, an economic phenomenon that defies common sense, the Federal Reserve is at a loss. Since stagflation has arrived, the Federal Reserve has no way of guiding the current direction of the US economy. Even though Trump has pressured multiple times, the Federal Reserve chairman remains firm on not cutting interest rates. After all, in such critical times, the Federal Reserve cannot afford to take responsibility if something goes wrong.

Therefore, with the叠加 of the US debt crisis and stagflation, Trump really can't handle it anymore. Moreover, externally, China's strong countermeasures have dealt a severe blow to the US economy. As the world's largest industrial country, China's countermeasures are directly aimed at American farmers, Wall Street finance, and the military-industrial complex, striking right at the heart of the US.

For Trump, if he fails to address the US situation, the combined results would lead to a complete collapse. Therefore, Trump urgently needs to resolve issues with China by making substantial concessions in areas like tariffs, technology control, and geopolitical politics to gain temporary support from China for the US bond market. Then he can address his internal crisis. So Trump lowered his proud head this time.

Of course, we must also understand that any escalation of confrontation between China and the US is strategic; any easing of confrontation is tactical. In other words, overall, both sides need to pause first, take a break, and then continue the fight. The US has conceded first.

Next, we will see how Trump handles this big bomb of US debt.

Original Source: https://www.toutiao.com/article/1831930391626883/

Disclaimer: This article represents the author's personal views.