Source: Tyler Durden
Friday’s euphoric reversal, which saw the Dow Jones first tumble some 400 points before staging a miraculous 500 points comeback on no news but a rebound in optimism that just because new US import tariffs were put in place that would make a trade deal/compromise between the US and China more likely, appears to have been… premature.
Following some soothing words from both the US and Chinese sides on Friday that while talks to avert a tariff hikes had failed, they were “constructive” and there was grounds for “cautious optimism” for the future, the standoff between the U.S. and China abruptly escalated over the weekend when China’s vice premier Liu He said that China is planning how to retaliate and listed three core concerns that must be addressed, and on which it wouldn’t make concessions, ahead of any deal including:
- i) the complete removal of all trade-war related tariffs,
- ii) set targets for Chinese purchases of goods in line with real demand and
- iii) ensure that the text of the deal is “balanced” to ensure the “dignity” of both nations.
Commenting on this list, the Editor in Chief of the Global Times, Hu Xijin, who has become a real-time translator for Chinese unspoken intentions on twitter, explained that “from perspective of China’s politics, there is little room for compromises. They will insist.This political logic won’t be changed no matter how much additional tariffs the US will impose.”