Trump looks one way, row another to seek trade Nirvana

There's a Chinese saying that one looks one way and rows in the other direction. Trump keeps hitting China with tariffs, but he doesn't want a trade war, what he wants is for Xi Jinping's government to open up its IT and financial sectors and let the yuan strengthen.

Consider Trump's April 4 tweet: ``We are not in a trade war with China, that war was lost many years ago.'' His calls for more tariffs after that look more like bargaining chips than an attempt to rerun unsuccessful battles.

Trump looks to be seeking to protect America's technology-drive economy as Xi's ``Made in China 2025'' program threatens to force out global players. The U.S. has every reason to be fearful of China's emergence as a IT power -- that certainly wouldn't make America look very great.

And while Trump boosting the tariffs threat has roiled markets, it may actually be a positive because it makes it much harder for either side to allow negotiations to fail. Look at the Korea-U.S. trade deal as a good precedent. Korea was exempted from steel levies after agreeing to limit efforts to hold down the won and to measures that will help U.S. automakers.

Source: Bloomberg Pro Terminal

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