Between You and Me…
Investing is about predicting the future and predicting it better than anybody else. So, when an undercover blog started foreshadowing trade war trends with freakish accuracy, everyone began taking notes.
The US and China came back online last week, rejoining the geopolitical group chat to schedule some more negotiations. Investors have heard it all before. What they may not have heard are the prophetic writings of an underground Chinese social media blog called ‘Taoran Notes.’ Whoever or whatever is tapping away behind the account has tipped new “developments” as “very likely,” with a pristine trade war track record for support. Everyone’s sent messages to the stealthy actor, but so far, they’ve all been left on ‘seen.’
Economic punditry gets very noisy in the West, which contrasts with the deafening silence in government-controlled China. While these WeChat market musings are rare and exciting to hear, some investors are still skeptical about trading the dollar-yuan currency pair based on them. Most of these ‘Taoran Notes’ are written in broad strokes, and a broken clock is right twice a day. The account is critical of the US, citing President Trump as a fanatic damaging his own interests, which probably isn’t a view too far away from that of President Xi’s… It’s your call!
Ultimately, how and why this trade war will end is anyone’s guess. It’s gotten personal between the two biggest economies in the world. It could end through compromise, frustration, public protest, a market crash, surrender, or indeed, fire and fury! Shall we just call it a draw?