China’s flagship tech company Huawei is the first Chinese company to establish global dominance in a game-changing technology, namely 5G mobile broadband. Washington’s efforts to thwart Huawei’s rise simply are an after-the-fact charade by the US national security establishment to deflect blame for a catastrophic policy failure. With a wink and a nudge, the rest of the world will humor the United States, and continue to do business with the Chinese giant.
We’ve hated this market of late and advised investors to sell. Emerging markets in general and China, in particular, did better than US stocks, but that’s small consolation. Today’s ill wind blew nobody good but owners of government bonds. There are lots of political reasons for the market to plunge, but there is also an important vulnerability: Most of the profitability among US corporations is concentrated in a very small number of names.