The American market is currently in denial about Trump's budding trade war with China and even the most vague, unverified claim from White House appears to be enough to momentarily ease their fears, but what are the Chinese saying?
The White House has claimed they're engaging in "back-channel" talks (this claim led to a rally on Wall Street), but one former Chinese official says there's "no plan whatsoever for the two sides to talk" and Chinese state media is mocking the Trump regime.
In China, state researchers and media talked down the likely impact of U.S. trade measures on the world’s second largest economy and described the Trump administration’s posturing on trade as the product of an “anxiety disorder”.
“Under the current circumstances, both sides even more cannot have talks on these issues,” Foreign Ministry spokesman Geng Shuang told reporters at a regular news briefing.
The trade frictions were “entirely at the provocation of the United States”, Geng added.
Beijing did not want to fight a trade war, but was not afraid of one, Vice Commerce Minister Qian Keming told the Boao Forum for Asia in the southern province of Hainan.
I just don't think this going to turn out the way the White House or Wall Street expects it will.
China is going to call Trump's bluff and we'll either have a trade war or Trump will back down and cancel most of his tariffs. Backing down and quietly conceding he has no idea what's doing is the best option for all parties involved, but will he do that twice in a single year?
Trump quietly canceled most of his tariffs on steel and aluminum, but not on Chinese steel and aluminum. China is a more visible target that he can't quite so easily back down from.
Furthermore, with the walls of special prosecutor Robert Mueller's probe closing in around his inner circle, Trump will be more prone than ever to making rash decisions.
We've already seen evidence of that. Just yesterday, Trump announced that he would take military action in Syria in the same meeting that he openly fumed about the investigation.
Chinese President Xi Jinping announced this morning that China will open up its market to foreign banks, a move which has been under consideration for years, but he did not make any suggestion that the country will concede to any of Trump's demands.