KINGSTON, NY, 9 MAY 2019—It never ends. For over three years, the nearly constant refrain from the business media for equity market pull backs have been "Trade Wars." Rarely, however, have they attributed the record breaking S&P and Nasdaq to trade initiatives because, in fact, it’s earnings, stock buy backs and low interest rate/cheap money that keeps the markets rising.
Yes, markets across the globe are falling this week following President Donald Trump’s threat to impose 25 percent tariffs on some $200 billion worth of Chinese goods and an additional $325 billion worth of Chinese goods would also be hit with 25 percent tariffs if a deal was not struck.
However, we maintain our August 2018 trend forecast: "A full blown trade war will not occur. We concluded that Trump's imposed tariffs, and threats of escalating them, are characteristic of his 'Art of the Deal' negotiation strategy."