Investors on Wall Street seem to have a rosy view of the U.S.-China trade talks. After President Trump announced that he would be holding off on implementing new tariffs against China as was previously planned, the stock market went up.
The announcement was made as administration officials said that the trade talks were going well. Based upon the positive direction, the administration no longer felt they’d take a step back by creating new tariffs.
The process of negotiations has been on-going for months now, with positive outlooks being expressed by both sides… but without a comprehensive agreement up to this time. Both sides seem to be invested in maintaining stability in the world market while they work through their differences. Neither the U.S. or China would really benefit from an escalation of the trade war. It’s a basic tenet of modern economics that tariffs hurt everyone involved: the target of the tariffs, the country implementing the tariffs, as well as average consumers within each of those countries.
Optimism is great, but a final deal will be much better.
