The fallacy of the trade agreement with China

The exchanges continue to mark historical highs as rumors are heard about the trade agreement with China, but the reality is that the global economy has slowed.

Rumors about the signing of an impossible trade agreement with China suggest that economic problems come from there. The economic problems that come are the end of an upward cycle of 11 years.

Only the benefit of a few companies increases, while most companies have stagnated and others are already starting to publish “profits warning.” This is the reality of the economy.

The NASDAQ 100 index trades with a P / E ratio of 25.75. That is a value that indicates that companies are overvalued. The year 2018 closed with a P / E ratio of 21.78.

On the other hand, the trade agreement with China is impossible today, since the real point of disagreement is intellectual property. A matter where China has been stealing from the West forever and what it doesn’t want is to pay for technology. And we must ask ourselves if we are interested in negotiating with someone who has robbed us and does not want to compensate us, perhaps we should simply put aside China.

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