Boris Johnson gave Huawei a boost on the world stage when he decided to use the giant tech company’s 5G technology. Mr. Trump and Mike Pompeo tried to stop Johnson by threatening to take him off the intelligence briefing list, but Boris told Pompeo to butt out.
U.S. tech companies continue to complain about the Huawei debacle. Trump’s Huawei ban hurt the U.S. tech industry in 2019, and some companies believe the situation will get worse in 2020. There’s a tech war in progress and Trump wants to win it. But the president’s tariffs, sanctions, and his business decisions make it hard for American tech companies to compete with China.
China is ahead of the U.S. in terms of controlling the global 5G network. More than 30 countries are Huawei customers, and 40 more might sign a contract in 2020. Huawei’s 2019 revenue was $118 billion despite the blackballing, so CEO Ren Zhengfei told employees the 18% increase over 2018 shows Trump’s mission to bring the company down is in trouble.
The Feds won’t cut interest rates in 2020, according to Fed Chair Jerome Powell. But the Feds have to do something about the central bank’s expanding balance sheet. Some economists think the Feds might stop injecting money into the repo market in 2020 to reduce its balance sheet. But if that happens, economic growth may head for the toilet.
Mr. Trump wants Powell to cut rates to zero, but that strategy didn’t work in Japan. EU interest rates are so low another cut won’t stimulate its battered Brexit and Tariff-bruised economy.
The U.S. economy continues to show signs of a meltdown even though government economists continue to tell the president low unemployment and inflation are signs of a healthy economy.
GDP growth dropped 1% in 2019. And the budget deficit passed $1 trillion in December 2019. Business investment dried up, and the job market created 500,000 fewer jobs in 2019 than in 2018.
Despite the economic fever, the Congressional Budget Office (CBO) claims Gross Domestic Product growth will grow in 2020. The budget deficit will exceed $1 trillion in 2020, and the national debt will top $23 trillion. Plus, consumer debt will hit 98.3% of the GDP growth in ten years, according to the CBO.
Source: https://www.cnbc.com/2020/01/28/us-budget-deficit-to-break-1-trillion-in-fiscal-2020-cbo-says.html
Dil Bole Oberoi
