Markets Overreacting

The movement in markets to the tariffs are completely over blown. The charts below put this into perspective. Total USA exports to China only amounts to 9%.

The “trade war” with China has amounted to a small slice of the economy and a fraction of each countries GDP’s. The share of Chinese soybean imports from the USA this growing season peaked under 40%. It usually climbs to 80%. The trade war with China is hurting Trumps constitutes more than anyone else. As the 2020 election gets closer, I think Trump will tone down his rhetoric on this subject. This will give the market less of a reason to have big down days like Friday.