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What Investments Will Prosper When the Trade War is Resolved?
As the G-20 summit approaches, many are hopeful that a scheduled meeting between the leaders of the USA and China will result in at least a temporary truce in the evolving trade war. Our take on this is that there are long-term, core issues that the USA needs to have addressed and which China does not want to talk about. So, the question for investors is, what investments will prosper when the trade war is resolved for good or for ill? But, first here is a bit of background on the trade war.
Possible Truce in Trade War?
The New York Times writes about the possibility of a China trade truce.
President Trump is projecting a steely facade as he prepares for a critical meeting on trade this weekend with President Xi Jinping of China. But behind his tough talk and threats of higher tariffs is a creeping anxiety about the costs of a prolonged trade war on the financial markets and the broader economy.
That could set the stage for a truce between the United States and China, several American officials said, in the form of an agreement that would delay new tariffs for several months while the world’s two largest economies try to work out the issues dividing them.
While a short-term truce might happen in order for talks to go on between the two nations, there are core issues that need to be resolved before the USA makes a new set of agreements.
Such an outcome is not certain. Administration officials have expressed deep disappointment with China’s response to Mr. Trump’s pressure so far, characterizing it as a list of proposals, transmitted in Chinese, which they say would do little to curb China’s theft of American technology or address its other predatory trade practices.
Can China Make the Changes Necessary to End the Trade War?
Our sister site, Forex Conspiracy Report, asks, Can China Make the Changes Necessary to End the Trade War?