[Source/Observer Network, Ruan Jiaqi]

According to a report by Bloomberg on May 29, David Einhorn, founder of Greenlight Capital, expressed cautiousness about America's ability to withstand the impact of the trade war between China and the United States and held a neutral view on the overall U.S. stock market at the Sohn Montreal Investment Conference held in Canada on Wednesday.

At the Sohn Montreal Investment Conference held in Canada, this "big short" figure frankly stated that China's advanced technology, lower labor costs, and comprehensive preparations for the economic conflict between the U.S. and China all indicate that the U.S. should prepare itself for a "punch in the face" in the trade war.

Einhorn also admitted that he doubted whether the U.S. could win without suffering economic pain, as it seemed that no one was willing to face an empty shelf situation.

Hedgeweek, a hedge fund news website, mentioned that Einhorn warned at the conference that the U.S. might underestimate China's preparation and determination for the economic conflict.

On May 21 local time, David Einhorn spoke at the annual Sohn Investment Conference for hedge funds in New York. Sohn Conference Foundation video screenshot.

According to earlier reports by Bloomberg, multiple Wall Street heavyweights publicly warned of the risks of Trump's tariff policies after President Trump announced so-called "reciprocal tariffs" on April 2 and triggered a global tariff chaos. Einhorn was one of them.

Einhorn pointed out that tariffs would "disproportionately" impact low-income groups and drag down economic growth through inflationary effects. He believed that the impact of tariff policies on the economy would force the Federal Reserve to take action, with expected interest rate cuts exceeding market expectations and further depreciation of the dollar against gold exchange rates.

He also emphasized that before the tariff turmoil, the U.S. economic growth had already shown signs of slowing down, "whether this slowdown will eventually turn into a recession remains to be determined in hindsight, but the downward trajectory of the economy is clearly visible."

Bloomberg reported that in the first quarter this year, Greenlight Capital achieved an 8.2% return due to its bet on gold. In a letter to investors in April, Einhorn clearly stated that this move was a response to "the market turmoil caused by tariff policies and increased economic uncertainty."

The letter also warned that White House policies were likely to further stimulate inflation, "all current government policies will lead to higher long-term inflation."

Business Insider also reported that on May 15 local time, during the Sohn Investment Conference, an annual event for hedge funds held at Lincoln Center in Manhattan, New York, Einhorn started his speech with a joke criticizing Trump's tariff policy, implying that "America is shooting itself in the foot."

"We thought we caught a butterfly, but the market sees it as a moth," he said.

Before this Wednesday, Einhorn had not publicly commented on the current round of Sino-U.S. trade disputes. On the same day, the U.S. Court of International Trade in New York prevented the implementation of the tariff policy announced by Trump on April 2, which he called "Liberation Day," and ruled that the tariff policy was "ultra vires."

But less than 24 hours later, on May 29 local time, the U.S. Court of Appeals for the Federal Circuit approved the request from the Trump administration to temporarily restore the implementation of the so-called "reciprocal tariff" policy.

Bloomberg reported that this legal dispute may inject more uncertainty into the global economy. Previously, Trump's constantly changing tariff policies had already made the global economy uneasy.

American political news website Politico also pointed out that this might weaken Trump's negotiating leverage against trading partners. Some countries see these rulings as a "pressure relief valve" for tense, sometimes even stalled, trade negotiations with the U.S.

From May 10 to 11, high-level economic and trade talks between China and the U.S. were held in Geneva, Switzerland. Both sides agreed to reduce tariffs within 90 days, lowering the tax rate by 115%.

At the regular press conference on May 29, Chinese Foreign Ministry spokesperson Mao Ning reiterated when answering related questions that China has repeatedly stated its position on the issue of tariffs. There are no winners in tariff wars or trade wars; protectionism damages the interests of all parties and ultimately lacks public support.

This article is an exclusive article of Observer Network and cannot be reprinted without permission.

Original source: https://www.toutiao.com/article/7510067040242106915/

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