The Great Trade War Begins… And It’s About Time Since China Is Competitively Rotten To The Core

Posted: July 7, 2018 in Business, China, Farros, Politics, Royal, Royal Blog, Stocks, Trump
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Yesterday was proverbial d-day for the start of the great Trade War between China and America.

It’s about time… China is aggressively and overtly protectionist… and has been for decades.

I learned this first hand in the CAD business.  It was absolutely impossible for us to sell our product in China… even though we were successfully selling our product in other areas of Asia.

Why?  Because China mandated that Chinese businesses and consumers could only buy Chinese CAD…

… even though Chinese companies were happily selling their CAD — and we were competing against their CAD — unencumbered in the U.S.

But we were a small player, so maybe you can chalk up our failure to penetrate China on our size.

But what about Autodesk, makers of AutoCAD, the #1 CAD product in the world?

Nope, they’ve been shut out for years, too.

To make matters worse, Autodesk found out a Chinese CAD company had stolen their intellectual property.  The Chinese Company vehemently denied the allegations.  Autodesk had no choice but to sue the Chinese Company in the World Court where the Chinese Company continued to vehemently deny the charges… until, facing irrefutable evidence, they finally had to admit their wrong-doing.

But it gets even worse. 

While Autodesk could have collected major damages, they realized if they did, the Chinese government would have been EXTRA punitive… so Autodesk had to voluntarily give up any settlement value in the hopes of helping the Chinese “save face” so they could have any shot at selling in the country.

That is unfair governmental manipulation at its worse.

But that is the China I know about first hand:  Competitively rotten to the core.

So I don’t care about any short-term tariff pain.  When it comes to true capitalism, China is like a big but immature bully and I am so looking forward to a much more experienced fighter punching these guys in the face.  It is well deserved and long overdue.

 

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