China and US officials meet today
Lower level Chinese officials will be Washington tomorrow for the start of two days of meetings on trade with Treasury Undersecretary David Malpass.
Maybe some of the information coming out today is designed to be a warning to China, in order to gain some leverage in talks, but here are three signs that we're headed towards an ugly outcome.
1) Trump's Reuters interview
The headlines from the interview were about Trump talking about the Fed, but he doesn't control the Fed. What he does impact is trade. He was asked about this week's meeting and said:
"I don't anticipate anything coming out of it."
2) Today's WSJ story
The Wall Street Journal today reported that Trump is moving closer to putting up to 25% tariffs on $200 billion of China exports. They also reported on what he's been telling donors.
"At a fundraiser on Friday in the tony Hamptons section of New York's Long Island, he focused on China, said two participants. The message was: 'They better pay attention because we're not done with those guys yet,' said one of the participants."
3) Today's Axios report
Axios is just out with a report saying that Trump is geared up for a battle and believes he can win. They spoke at length with an unnamed member of Congress who said
- "He thinks he's right and he thinks he's winning."
- "He's resolved to be the guy that changes the world trading system. ... He's willing to take some pain to do it."
- "Trade is the one policy issue he feels comfortable with: He owns it, and he's 100 percent convinced he's right."
They also cited a separate official who said Trump is 'all-in' on China.
Separately, we're getting reports today that auto tariff timetables may slip. The Axios report says Trump is being urged to focus on China and settle or put off battles over autos with Europe, or on NAFTA for alter.
