If there's one overarching theme that pervades almost all of the commentary I've read this week, it's that market participants have finally woken up to why recent escalations in the dispute between Washington and Beijing matter more than previous escalations.
Note that I didn't include the word "trade" before "dispute". That's because it's now clear that at least one party to this worsening quarrel has designs on curtailing the other side's economic development. In other words, this isn't just about righting historical trade injustices or leveling the proverbial playing field.
If you don't believe me, just ask Ray Dalio, who on Wednesday said the following:
As I have explained for a while, the US-China conflict is much more extensive than a 'trade war.' It is an ideological conflict of comparable powers in a small world. It’s about 1) China emerging to challenge the power of the US in many areas and 2) these two countries having two different approaches to life - one that’s top down and one that’s bottom up. [Read More]
Published @ May 29, 2019