The Register Citizen (Torrington, CT)
White House stokes confusion, fear on China deal
The Trump administration raised doubts Tuesday about the substance of a U.S.-China trade cease-fire, contributing to a stock market plunge and intensifying fears of a global economic slowdown.
Investors had initially welcomed the truce that the administration said was reached over the weekend in Buenos Aires between Presidents Donald Trump and Xi Jingping — and sent stocks soaring Monday. But on Tuesday, after a series of confusing and conflicting words from Trump and some senior officials, stocks tumbled, with the Dow Jones sinking as much as 800 points.
White House aides have struggled to explain the details of what the two countries actually agreed on. And China has not confirmed that it made most of the concessions that the Trump administration has claimed.
Other concerns contributed to the stock sell-off, including falling long-term bonds. That suggested that investors expect the U.S. economy to slow, along with global growth, and possibly fall into recession in the coming year or two.
Trump and White House aides promoted the weekend deal as an historic breakthrough that would ease trade tensions and potentially reduce tariffs. They said that China had agreed to buy many more American products and to negotiate over the administration’s assertions that Beijing steals American technology. But by Tuesday morning, Trump was renewing his tariff threats in a series of tweets.
“President Xi and I want this deal to happen, and it probably will,” Trump tweeted. “But if not remember, I am a Tariff Man. When people or countries come in to raid the great wealth of our Nation, I want them to pay for the privilege of doing so.”
Trump added that a 90day timetable for negotiators to reach a deeper agreement had begun and that his aides would see “whether or not a REAL deal with China is actually possible.”
Among the conflicting assertions that White House officials made was over whether China had actually agreed to drop its 40 percent tariffs on U.S. autos.
Most economists noted that the two countries remain far apart on the biggest areas of disagreement, which include Beijing’s subsidies for strategic Chinese industries, in addition to forced technology transfers and intellectual property theft.