Trade and tariffs were in the news again this week, and investors are caught in a tug of war. The President is focused on his reelection (as all politicians are) and he ran on an America First platform in which protectionism and using tariffs and trade barriers were cornerstones. He also needs a strong economy and stock market for voters to feel good about reelecting him. These can be relatively antagonistic goals. So, one week the President is focused on increasing pressure on the Chinese with more tariffs, and the next week he's trying to mollify the stock market. Add to the fact that a Tweet can come out at any moment with a policy change or reversal and you have markets whipsawed as we have seen this week. Whether you agree with the President's policies or not, that is the world that we live in.
So we start with the obligatory articles on trade, plus why the lobster harvest has been so strong recently, how other countries are restricting trade, a late summer reading recommendation, Roth IRAs, and why social connections are so important.
Enjoy this week's The Friday Buzz. Have a great weekend!
- President Trump Must Have Something in His Eye: Because he blinked. On Monday, with all the negative trade news, the bond market inverted further, and the stock market dropped sharply. On Tuesday, the administration announced the new tariffs would be delayed until mid-December to avoid hurting retailers and consumers for the holiday shopping season. What's surprising is how quickly the President reacted to the market pullback as well as admitting for the first time that tariffs are hurting U.S. consumers and businesses. I'm sure China will do all they can to leverage the President's sensitivity to market swings. CNBC WSJ