Reaction from American chief executive officers to the escalating U.S. trade war and stalled trade talks with China ranges from thinking President Donald Trump is “stupid” for taking such a hard line to thinking they can actually stop him, CNBC’s Jim Cramer said Friday.
“There are some CEOs who think Trump is stupid and that this is all bad and it will go away in the election,” Cramer said on “Squawk on the Street. ” “There are CEOs who say, ‘You know what, we’re not going to let this happen.’” Cramer continued, “Then there are CEOs who have been trying to get into China for years — and never been allowed — and they’re the companies, the companies going higher.”
Cramer also speculated Friday that Trump does not want “sincere talks” with China over trade because the president feels like he has “got them on the run” and “feels this is how you get re-elected.”
Last week, Cramer reported people were saying that U.S. companies that did not reduce their China exposure after months and months of watching Washington and Beijing clash over trade and economic issues have only themselves to blame.
The Trump administration, at 12:01 a.m. ET last Friday, increased duties on $200 billion worth of Chinese products from 10% to 25%. On Monday, in retaliation, China announced plans to raise tariffs rates on $60 billion in U.S. goods. The president has also been threatening all along to put tariffs on the rest of China’s imports.
Wall Street has been concerned higher tariffs could eventually harm U.S. businesses, especially those with lots of exposure to China. The moves from the Trump administration led to a massive sell-off to start the week. But stocks clawed back most of their losses through Thursday’s close.
Cramer on Friday said, “Why is everyone so confused by these [China moves from Trump]? I don’t think he could be more clear. He’s saying, ‘Listen, I’m not going to do what the previous presidents have done.’”
“Trump doesn’t want American companies to do business with China,” the “Mad Money” host added. “Trump doesn’t want any sort of effort that makes China militarily better, that makes them ahead of us in terms of 5G,” the next generation wireless technology.
