We are a bit confused about last night’s POTUS tweet asking China to remove tariffs immediately on agricultural products. We know the president is under tremendous pressure from farmers who are losing their arse and their farms in his trade war.
“Farm loan delinquencies just hit the highest level that we have seen in 9 years.” – WashPost, Feb 28th
Stumped
If negotiations are going so well and China is ready to agree to buy billions, and billions and billions of additional American goods, mostly ag, over the next several years to reduce the trade deficit, by extension doesn’t that mean the tariffs come off?
Or is Trump just looking for a good faith gesture by the Chinese for not slapping on additional tariffs yesterday? The Chinese might find the tweet offensive as the tariffs Trump is asking them to reduce are mainly retaliatory from the first round of the trade war. China could respond “we have already made a concession by not slapping on additional tariffs to retaliate against the tariffs the U.S. threatened to implement on March 1.”
Or is POTUS trying to score political points in the farm belt ensuring that he gets credit when a final deal is struck? It will take some time for farmers to recover from the China trade shock and will still have to worry about an additional round of retaliatory tariffs if POTUS goes to war with Europe over autos.
Or is the president trying to put more pressure on Xi for additional concessions?
Or is not everything as awesome as Lary Kudlow projects in the China talks?
Or is Trump trying to look tough after the North Korean summit debacle? By the way, the president did the right thing by walking but should have never been in Vietnam with KJU, in the first place.
Or is the fact we are talking about it exactly what motivates POTUS to tweet?
Or is the tweet just random impulse and nothing there?
Or…? You decide, folks.
Global Macro Monitor 