President Trump — bolstered by the 750-point snap back in the Dow Wednesday — tripled down on his China tariffs Thursday stating the US was looking at an additional $100 million in imports.
Market futures on Friday morning seem to confirm that the new ploy has a much smaller effect on the markets. Futures this morning are down 200 points as oppose to -500+ Wednesday morning.
The White House narrative is that this is a negotiation — a jumping off point for discussions — and probably not how it will play out in the coming months.
While the news focuses on Trump’s point to correct years of trade imbalances, it appears the underlying initiative is defending Intellectual Property for Silicon Valley.
This contradicts the theme of Trump battling Amazon’s Jeff Bezos and therefore is ignored because mainstream news can’t handle an issue with multiple facets. Black and white issues are easy, topics with shades of grey don’t allow partisan brow beating.
Intellectual Property will have to be the best mechanism for America to regain its trade superiority. Making widgets will never be our forte anymore for the simple fact that we have little desire to manufacture products anymore.
Looking at our education system and culture, we do not value people who make things. It’s unfortunate that this is reality, but code writing is rewarded monetarily. See Apple’s market cap of $860 billion when compared to Ford Motors’ $44 billion.
So let’s see how this plays out. However I for one do not really care what the price of soybeans is doing this morning.