E Jim Cramer Slides To Dark Side On China Tariffs

Jim Cramer, a staunch free trader, has abruptly gone over to the dark side on the issue of China tariffs. Originally, he posted the argument that China tariffs were bad, and that Apple would suffer. Originally, I spoke about Cramer's early position:

Even Jim Cramer has finally spoken of the the companies and deals that could be sacrificed as he finally acknowledges that Trump wants a cold war and Wall Street does not. Cramer listed Micron Technology and Rockwell Collins as being particularly vulnerable. Apple and others may have enough pull with the Chinese government to avoid being sacrificed, but it certainly is a dicey situation for retail investors. 
Unfortunately, Wall Street has not enamored itself to the public or it would and could make a stronger argument for free trade. 

But now, the CNBC stock analyst has come out of the tariff closet to support as yet unknown tech companies in California who want the trade war to continue. From CNBC we see the following:

 

Creative Commons 2.0:  Flickr
Technology executives are telling CNBC’s Jim Cramer that they’re willing to endure short-term pain from the U.S.-China trade war in favor of the long-term payoff.
“When I went out to San Francisco last week, I heard the same thing from a surprising number of people in the tech industry who do not like President [Donald] Trump one bit, ” the “Mad Money” host said Monday.
“What they said was ‘If we’re going to take on China, now’s the time to do it,’” he said. “They may not be fans of the president, but they’re on board with the trade war.”

Cramer goes on to say that they see China's weakness, economically, as a time to go try the tariff war on China, as its imports and exports are taking large declines. Cramer goes on to say this is the time to stop the joint ventures and give US tech complete access to Chinese markets without sharing technology. And astonishingly, Jim concludes with support for this position:

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Disclosure: I have no financial interest in any companies or industries mentioned. I am not an investment counselor nor am I an attorney so my views are not to be considered investment ...

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Gary Anderson 1 month ago Author's comment

Update 3: Stocks are down as it is announced that Xi and Trump will not meet prior to March 1 deadline. Trump needs to blink and stop any additional tariffs. He should blink but he is driven by his own irrational goals, so we can't be sure.

Gary Anderson 1 month ago Author's comment

Update 2: Larry Kudlow says no official meeting was cancelled, but that was not the issue. The issue is that the US rejected a Chinese outreach. Add this to continuing threats to Huawei's Meng, and we will have little chance for a trade deal. China will throw Canada into a recessionary position to add to this world turmoil.

Gary Anderson 2 months ago Author's comment

Update: The US has halted trade negotiations over IP issues. It is clear that the US is not interested in negotiating with China on trade. The US is taking a hardball approach and wants to humiliate China. Jim Cramer sided with Tech leaders in Silicon Valley who he says want the US to hammer out IP concessions. I wrote this is a very dangerous policy on the part of the USA and that it goes against Cramer's understanding that trade wars are bad and that Wall Street doesn't want them. Interesting to see how Cramer interprets this latest US roadblock to free trade. I think Wall Street should wake up but it likely is looking for soothing words from Jim and also from the liar in chief who said a trade war was likely, knowing it isn't.

Dick Kaplan 2 months ago Member's comment

Regardless of whether you think #Trump is right or wrong about the #tradewar, I think we can all agree that he won't back down. So if that's the case, it's better to be on the winning end. So the real question is, how do we win it?

Gary Anderson 2 months ago Author's comment

That is the question. If he won't back down, you are saying he will humiliate China. And if he humiliates China, I don't see long term success, but a lot more volatility. JMO.

Dean Gilmore 2 months ago Member's comment

I was as surprised as you with this about face. But Isn't it possible that #Cramer is correct? Sounds like he discussed it with a number of leaders in tech and they convinced him to change his tune. But perhaps they are right.

Gary Anderson 2 months ago Author's comment

Yes, Dean, it was a surprise. If I thought he was right I would not have written the article. How would you describe the historic debacle of tariff wars with what Cramer and tech is proposing now? How is this supposed to work when free trade has clearly been the driving force for economic progress in the world? As I have always maintained, it is politics that has given globalization a bad name, not the concept of free trade. If China cannot get tech from California it has to get tech from somewhere else. And the nations mentioned have seen our politicians as jokesters.

Dean Gilmore 2 months ago Member's comment

"If I thought he was right I would not have written the article." Haha, that's very true.

Gary Anderson 2 months ago Author's comment

I just want to know from you why you think he is right. This is a learning process for all of us. Historically, we know where this is headed. If there is a compromise, then that seems to be out of character for Trump, although hopefully that would happen. I just don't think the IP compromise, with monitoring and continual threats to reimpose tariffs will work.

Dean Gilmore 2 months ago Member's comment

It's not that I think #Cramer is right, I just wondered if maybe, in speaking to some top tech titans, that perhaps he (or they) were privy to some info we were not.

Gary Anderson 2 months ago Author's comment

Well, Cramer did reveal part of their thinking. He said they believe China is weak, with imports and exports diving. So, it is obvious that they believe China will accept a deal. China could accept a deal to kick the can, but it will cause massive resentment in the future. Would the deal result in our interest rates exploding? What would China sell to gain cash for more purchases of US goods? And how long would that last? I wonder if anyone has even thought much about the points that Michael Ashton made, let alone the complexity of intellectual property negotiations.

Howie Sandberg 2 months ago Member's comment

I dunno, it sounds like Gary Anderson and Michael Ashton are correct to me. That even if we "win" the trade war, it will hurt us in other ways.

Gary Anderson 2 months ago Author's comment

Yes, exactly. The framework of world trade will continue, with or without us. We will get some cooperation with Europe and Canada who fear us. But Israel does not fear the USA, nor does Japan. They have to act in their best interests, which is in alignment with free trade.