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| Posted by: Paul Donovan | Tags: Paul Donovan

An attack by the US president on an individual company does not directly change the economic outlook. Falling equity markets may produce a negative wealth effect, with economic implications, but barely half of Americans own equity (and most do not own very much equity).

The longer-term concern is not about the accusations, but the fact that they were made over the Trump Twitter feed. Rule of law and the certainty of established process encourage innovation and investment. Random tweets by a head of state against individual companies may undermine innovation and investment.

China's decision to tax Chinese consumers of US pork products was in retaliation for the US taxing US consumers of steel and aluminum products. Sausages are rarely reason for a trade war. However, there are expected to be more US taxes on US consumers of products that have been partially made in China, so there is a risk of escalation.

There are some opinion polls on Eurozone manufacturing sentiment, but these should be ignored in favor of information that tells us something about the real world. Brainard and Kashkari of the Fed are both scheduled to speak.