Many fans and friends have asked me how I view the outcome of the tariff war. Today, I will analyze the consequences of the tariff war and several possibilities.

First possibility: The United States has raised the tariff rate on China to 104%, which means China can increase its stakes. If China continues to raise tariffs, the U.S. economy could collapse by 80%. If we enter a Great Depression, global prices will soar, and currencies will collectively depreciate. This is the outcome that the Americans do not want to see, hurting the enemy a thousand while harming themselves eight hundred. It is hoped that negotiations will lead to concessions from China, but it can be predicted that the negotiations will definitely involve concessions from the Americans, though not too many. China must incur some losses.

Second possibility: China implements zero tariffs to revive manufacturing. In the short term, the benefits for China outweigh the drawbacks, but in the long term, the drawbacks outweigh the benefits. The Americans do not want zero tariffs from China, as it would make it unlikely for them to lower interest rates. However, in the long run, if China has zero tariffs, it will forever be constrained by the Americans, with no capacity for resistance. This is why retaliatory tariffs against the Americans are necessary.

Predicted outcome: At the national level, tariffs will be increased to negotiate, the Americans will make concessions, and China will incur some losses. This is the best result for both countries.

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