U.S. stocks fall after U.S. sanctions China

[bemildred]

Source: Marketwatch

NEW YORK (MarketWatch) -- U.S. stocks turned sharply lower on Friday, briefly sending the Dow Jones Industrial Average down by over 100 points, after news that the U.S. has imposed trade sanctions on China and amid concerns about oil prices, which continued to trade around $66 a barrel.

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"We haven't seen the exact percentages yet, but this represents a 20-year break in U.S. trade policy and potentially a watershed in US/Chinese trade relations," said Brian Dolan, director of research at Forex.com. "The obvious impact is going to be felt in dollar/yen which is already collapsing."

The sharp drop in the dollar reflects concerns that China may sell - or simply stop buying U.S. assets, mostly U.S. Treasury bonds, which could lead to a spike in interest rates and further weaken a slowing U.S. economy.

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"Anti-China protectionist legislation will backfire -- resulting in the functional equivalent of a tax hike on the U.S. consumer, as well as reduced Chinese demand for U.S. Treasurys," said Morgan Stanley chief economist Stephen Roach said in research note earlier Friday.

Read more: http://www.marketwatch.com/news/story/us-stocks-fall-after-us/story.aspx?guid=%7B2C9FCB95%2D1B92%2D4789%2D8815%2D0E45614526E4%7D

[hippiechick]

1. Trade sanctions on China? When they OWN us? Smart, George.

Where's the D'oh! smiley when I need it??


:hurts:

[bemildred]

2. Ah, here it is:

Commerce Department Applies New Duties Against China (Update2)

March 30 (Bloomberg) -- The U.S. Commerce Department, reversing more than two decades of practice, decided today to levy new duties on imports from China to compensate for Chinese subsidies to exporters.

The change of policy by the Bush administration, which debated the action for months, applies initially to imports of coated paper from China. It also opens the way for steel companies, textile producers and other manufacturers facing competition from China to apply for the same protection.

``This decision is the most significant step toward a stronger trade policy with China than we have experienced in this decade,'' Republican Representative Phil English of Pennsylvania said in a statement today.

Under decade-old practices, antidumping duties are the only ones that have been applied on products from countries such as China with managed economies because it is difficult to identify subsidies in those nations.

http://www.bloomberg.com/apps/news?pid=20601080&sid=aF.7.yncEb7g&refer=asia

[madrchsod]

13. about fucking time

the bastards killed northwestern steel and wire in sterling illinois. every time we matched or even went under the chinese the bastards lowered the price per ton. the koreans are not much better on their pipe pricing but they are not as bad as the chinese. there are only one or two sock manufactures left in the usa. once they are gone we will never be able to make seamless socks in the usa again.

[Warpy]

10. China owes a small percentage

The bulk of the debt is owed to people who have worked for a living since 1983, the first of six increases in the OASDI premiums that went right into the General Fund.

There's a great pie chart at

http://www.optimist123.com/optimist/2005/11/pie_chart_of_wh.html

[Psephos]

14. Thank you for some sanity

The link is a useful picture of what most economists already know.

US annual economy is $13.5 trillion; China owns about $500 billion in Treasury notes.

Yes, it would be disruptive to US finances if China no longer purchased US debt, but hardly catastrophic. Over and over I see posts here that "China is gonna call in our debt" as though China can simply present its T-Bills and demand payment on them ahead of their 10- or 20-year maturities.

Umm. Ooooo-kkaaaaaayyy.

[tularetom]

3. Hey let's shit on the guys who are keeping us afloat

makes a lot of sense to me cough cough. Somebody should have thought about this when they got in bed with China a few years back. They don't give a crap about us except as consumers and once they develop other markets for the stuff they produce they won't need us at all.

[soothsayer]

4. we're going to threaten to blow up their Iran oil pipeline if they don't

comply. behind the scenes of course. so either watch china capitulate, or watch a smart bomb go off target (oops! no oil for two months, china. sorry)

[fshrink]

5. Walmart stock?

Anybody knnows.

[Tempest]

8. Down a fraction

No real movement from the announcement.

[AndyA]

6. Not only does the Bush Administration believe in slitting open another's throat,

they also shit in the open wound.

Nice, George. You've financed your Republican-Iraq war by borrowing from China. Now you do this to them?

Even wild animals don't shit where they sleep.

Idiot! Get him out of the White House NOW!!

[indepat]

7. The chickens are coming home to roost and fuc*ed, that's fuc*ed, is what we are

[A HERETIC I AM]

9. At 2:20 the Dow has regained almost all of it. Currently down 8.26 for the day.

An almost 100 point return since 11:50 AM

[A HERETIC I AM]

12. Now at 3:00 Dow positive for the day by 11.65

n/t

[HockeyMom]

11. No more poison pet food

good