REPORT: China’s economy showing signs of collapse

From the outset of Trump’s tariff war, I had stressed that China was the key and that we needed patience.

I will be the first to admit I was rattled when China appeared to dig in for the long haul, but reports are now surfacing that suggest if we hold out a little longer, China will have no choice but to cave.

Raising Trump

When Trump raised his tariffs against China, President Xi struck right back and raised the tariffs against the United States.

The country was adamant that it would not give in.

During this little spat, I offered both concern and patience, stating that in the end, China knows it needs the American consumer dollar, so it was a matter of who could hold out longer.

When stocks started to crash here and economic signs showed a possible recession, I had warned that Trump was on the clock and he would need to get this settled sooner rather than later, but now it appears that China’s hand could be forced.

Trump Crashing in Polls

The most recent polling for Trump on the economy was not good, with six in 10 saying Trump is making the economy worse.

Trump was underwater in several key areas, and he was even starting to lose support regarding his immigration policies, but there was one number the media was not really touting.

As I stated in a previous report, more than 90% of Trump voters, according to recent polling, said they would not change their vote for Trump even though the administration is struggling right now.

That is a good sign for Trump: Even if people are not happy, they are willing to stick this out for a bit and trust his call on the tariffs.

China Ready to Collapse

According to the most recent data, China’s Purchasing Managers’ Index (PMI) fell below 50 last month, the first time that has happened since COVID, when the country was literally shut down.

Robin Xing, chief China economist at Morgan Stanley, stated, “It’s definitely worse than expected. It shows tariffs started to bite.”

Trump recently responded about the tariff war on Truth Social, stating, “At some point, hopefully in the near future, China will realize that the days of ripping off the U.S.A., and other Countries, is no longer sustainable or acceptable.”

So, both countries are reeling right now, and common sense says they sit down and work this out with a deal where everyone gets to save face and come out better for the deal on the other side. Now, both sides are clearly on the clock, but Trump seems to have the support of his voters, so I am sure he will dig in and try to ride this out until the very last second.