The second largest investment bank in the world, Goldman Sachs, has informed their clients that they no longer believe Trump's trade war with China will end this year or even next year.
In a research note published by their top economist, the bank more or less admitted that their previous view of Trump's judgment was incorrect.
Analysts at Goldman Sachs, led by Chief Economist Jan Hatzius, said in a research note published late Monday that they had anticipated this move.
"News since President Trump's tariff announcement last Thursday indicates that U.S. and Chinese policymakers are taking a harder line, and we no longer expect a trade deal before the 2020 election." [...]
"While we had previously assumed that President Trump would see making a deal as more advantageous to his 2020 re-election prospects, we are now less conﬁdent that this is his view," analysts at Goldman Sachs said.
Goldman also believes Chinese lawmakers are increasingly inclined to dig in and wait for Trump's departure from the White House, adding to their skepticism that a deal will be reached before Trump is out of office.
That may be the case, but not for the reason espoused by Trump's White House.
According to widespread reports, Trump's inner circle believes China would rather wait until Trump is gone so they can make a deal with a more receptive administration that will go easy on them, but I don't believe that's the case.
If China is waiting to make a deal with a future president, it's because making a deal with Trump is virtually impossible. Because Trump doesn't make "deals." Trump's idea of a deal is he gets everything and you get nothing. And that may work when you're stiffing contractors, but it doesn't work when you're dealing with a sovereign nation. Trump also couldn't keep his tariffs in his pants for even 24 hours after the latest round face-to-face trade talks concluded.
There is no end in sight because of Trump. It's all him. It's not about economics or even policy in general. Trump doesn't even know the economics or the policy. The trade war is being driven by Trump's cult of personality and emotional whims, not any particular economic indicator.