Powerlessness is a feeling nobody likes.

Investors probably don’t want to hear it, but when it comes to the ongoing U.S./China trade dispute there simply isn’t any way to gain a fundamental edge on expected outcomes or developments from these negotiations. You just won’t know until there is an announcement. Indeed, with the president tweeting regularly about the ups and downs of these talks, it’s possibly even hard for administration officials themselves to know for certain. Those tweets sometimes render media scoops useless or old news in seconds.

Unfortunately, investors must navigate the waters as they are, and not as they would have them be. And, like it or not, the developments around the US/China trade war are the most important macro drivers of financial markets at the moment.

As the acrimonious rhetoric between the Middle Kingdom and the U.S. has ratcheted up in recent weeks, equity markets have transitioned from “feels like 1996” to “chop (not top).” There is zero visibility on progress on trade over the next few months, but I’m think there will be some détente by YE 2019, particularly as 2020 U.S. political considerations and economic duress in China become practical issues and come to the fore.

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