Tariff strategy falling into 3 buckets/JGB yields continue higher/Earnings comments of note

It seems that the tariff strategy is falling into three buckets. One, what we've seen over the past few days where they are used as a cudgel in order to achieve a non-economic end, such as stopping fentanyl and migrants and which was successful in its aims with Mexico and Canada. China on the other hand is a different animal and at least for now we're back in a tariff battle with them as they retaliated, though seemingly measured, with a variety of measures including blacklisting PVH products from the country, Illumina too, 17% of the world's population PVH might not longer sell to. Also, limits were placed on the export of key raw materials that we need. Secondly, use tariffs to protect some domestic industries, like steel and aluminum that we saw in 2018 and also encourage manufacturers to bring production back to the US. Thirdly, use tariffs to raise money as part of the Trump income tax extension deal needed this year.

As for US Main Street businesses that are caught in the middle of all of this, I have to believe many are on edge, visibility is limited and we'll see what that means for hiring and capital investments. On the other hand, we anticipate major relief on the regulatory side and that will be the balancing act they are going to have to dance around.

The Hang Seng by the way rallied by 2.8% overnight as the 10% tariff on them is manageable in their eyes and in response to the more mild response back against us. The Hang Seng does house some cheap stocks that we own and whose businesses will benefit from growth throughout Asia, not just in China. The offshore yuan is up for a 2^nd day on the same hopes that maybe the tariff back and forth between us and them can be smaller than last time.