Stephen McDonnell

And, of course, the other thing is that, I mean, it's funny, Donald Trump has said that he's going to whack tariffs on anyone who responds to his tariffs with their own tariffs. Well, then it just keeps escalating because what does he think other countries are going to do, just sit back and cop it? Of course they're not.

And, of course, the other thing is that, I mean, it's funny, Donald Trump has said that he's going to whack tariffs on anyone who responds to his tariffs with their own tariffs. Well, then it just keeps escalating because what does he think other countries are going to do, just sit back and cop it? Of course they're not.

And so especially a country like this, the might of China, well, really, they've been relatively modest at the moment in what they've opposed on U.S. goods and they're keeping their powder dry. So there's plenty more China could do in terms of hurting U.S. exports if Beijing decided that it wanted to go down that road.

And so especially a country like this, the might of China, well, really, they've been relatively modest at the moment in what they've opposed on U.S. goods and they're keeping their powder dry. So there's plenty more China could do in terms of hurting U.S. exports if Beijing decided that it wanted to go down that road.

A lot of people would be scratching their heads looking at where the world's going at the moment with the way the Trump administration is throwing trade relations everywhere into chaos and wonder how can the Chinese government be this confident.

A lot of people would be scratching their heads looking at where the world's going at the moment with the way the Trump administration is throwing trade relations everywhere into chaos and wonder how can the Chinese government be this confident.

I've just come from the great hall of the people and it'd be crazy to be ignoring the elephant in the room. I think every Chinese person who heard that speech would know what he's referring to there. I mean, why is this especially a problem for China? I mean, just have a look at the Chinese economy. Huge areas where they've got to deal with these problems.

I've just come from the great hall of the people and it'd be crazy to be ignoring the elephant in the room. I think every Chinese person who heard that speech would know what he's referring to there. I mean, why is this especially a problem for China? I mean, just have a look at the Chinese economy. Huge areas where they've got to deal with these problems.

The ongoing property crisis, youth unemployment, local government debt, sluggish consumer confidence. Chinese people don't have enough confidence in the economy, saving too much, not spending enough. Now, the areas where the economy is doing pretty well, electric vehicles, solar panels, new tech. People all know about DeepSeek and TikTok. This is all export-driven stuff.

The ongoing property crisis, youth unemployment, local government debt, sluggish consumer confidence. Chinese people don't have enough confidence in the economy, saving too much, not spending enough. Now, the areas where the economy is doing pretty well, electric vehicles, solar panels, new tech. People all know about DeepSeek and TikTok. This is all export-driven stuff.

And so what the Chinese government doesn't need now is a renewed trade war with the US, or anyone else for that matter, when these bright light areas of the economy are reliant on exports. And yet they're still saying they're going to achieve around 5% growth this year.

And so what the Chinese government doesn't need now is a renewed trade war with the US, or anyone else for that matter, when these bright light areas of the economy are reliant on exports. And yet they're still saying they're going to achieve around 5% growth this year.

A lot of people would be scratching their heads looking at where the world's going at the moment with the way the Trump administration is throwing trade relations everywhere into chaos and wonder how can the Chinese government be this confident. I mean, for example... One thing it really needs to do is to get domestic consumption going.

A lot of people would be scratching their heads looking at where the world's going at the moment with the way the Trump administration is throwing trade relations everywhere into chaos and wonder how can the Chinese government be this confident. I mean, for example... One thing it really needs to do is to get domestic consumption going.

Interestingly, and we look at the tea leaves here in China, the word consumption was mentioned 31 times in the speech today as opposed to 21 times last year. Now, you might think, well, why does that matter? Well, it shows that this problem of building up greater consumer confidence is at the forefront of the minds of the Communist Party.

Interestingly, and we look at the tea leaves here in China, the word consumption was mentioned 31 times in the speech today as opposed to 21 times last year. Now, you might think, well, why does that matter? Well, it shows that this problem of building up greater consumer confidence is at the forefront of the minds of the Communist Party.

And, you know, a decade ago, they said there was going to be this shift towards consumerism. an economy reliant much more on domestic consumer confidence, domestic consumer spending. But it hasn't panned out that way.

And, you know, a decade ago, they said there was going to be this shift towards consumerism. an economy reliant much more on domestic consumer confidence, domestic consumer spending. But it hasn't panned out that way.

To attempt to encourage this, they've had financial incentives to switch out your old clapped-out car, to swap your old appliances for new ones, cash for clunkers, as it's being referred to. They're going to allow a greater proportion of the GDP to be caught up in debt, so the deficit-to-GDP ratio has gone up. and yet not really much change to China's social safety net provisions.

To attempt to encourage this, they've had financial incentives to switch out your old clapped-out car, to swap your old appliances for new ones, cash for clunkers, as it's being referred to. They're going to allow a greater proportion of the GDP to be caught up in debt, so the deficit-to-GDP ratio has gone up. and yet not really much change to China's social safety net provisions.