Most coverage of the mounting US-China strategic tensions has focused on tariff threats. Equally significant are moves by the US to choke off Chinese investments in the US technology sector. These moves are part of a strategy to ensure that China can’t catch up to the US in critical technology fields by buying, or buying into, cutting-edge American firms.
It’s no secret that here at Evergreen we’re boisterous free-market advocates. Data and history show that economies operating freely in a system with moderate and rational government control perform better in the long-run. When economies are burdened by excessive government policy or overwhelmed with authoritarian control, nations become unstable, which often spurs abuse and extremism.
In March, Evergreen outlined our near- and long-term concern for an escalating trade war in The Trump Trade Tirade. Well, ladies and gentlemen, it seems as if the worst
has come is coming to fruition.
Given the spectacle that played out in Singapore at the beginning of this week, it’s easy to forget the state of uncertainty that markets and individuals lived in at times last summer when Kim Jong-un and President Trump traded nuclear war intimidations.
Generally speaking, the purpose of EVA is to communicate Evergreen’s overall outlook on the markets and economy. We tend to stick to this script by writing on topics such as central bank policy, inflation, the stock market, the bond market, and energy. One theme we try to avoid – or at least stay neutral on – is politics.