Citing sources familiar with the current state of talks, Reuters is reporting that "phase one" of Trump's "greatest and biggest deal ever" is probably not going to be signed before the end of the year. You know, if it's ever signed at all.
I speculated that it may be delayed just based on the fact that there's only two weeks of time remaining before Trump's last opportunity to meet with Chinese President Xi Jinping before the end of year, but matters are more complicated than that according to Reuters' sources.
According to their report, the current impasse is the same impasse that has existed since the very beginning. China wants Trump to roll back his tariffs but Trump won't do so unless China concedes to making structural reforms to their economy.
WASHINGTON (Reuters) - Completion of a “phase one” U.S.-China trade deal could slide into next year, trade experts and people close to the White House said, as Beijing presses for more extensive tariff rollbacks, and the Trump administration counters with heightened demands of its own. [...]
Trump and U.S. Trade Representative Robert Lighthizer recognize that rolling back tariffs for a deal that fails to address core intellectual property and technology transfer issues will not be seen as a good deal for the United States, a person briefed on the matter said.
A hypothetical deal had a much greater chance of being signed sooner rather than later when it was just a simple truce that would freeze Trump's trade war in place as the status quo.
Where things stand now, the chances that Trump will impose his next round of tariffs on December 15th have increased.
Trump could justify delaying his next around of tariffs by saying talks with China are going well, but it's just as likely that he'll impose them because he thinks it will pressure the Chinese to finally cave in to his demands.
There's far more at stake here for China than the ability to sell shoes and Christmas tree ornaments to Americans duty free. Trump has insulted and threatened their sovereignty and his war of words has made it less likely that China's ruling party will tell Xi Jinping that he can give Trump want he wants even if it would benefit their economy.
Financial markets dropped following Reuters' report, but the markets never should have shot up in first place just because Larry Kudlow said some happy words once.