As part of the contentious trade war strategy unrolled over the last few months, the U.S. president tried to effectively ban U.S. companies from trading with Chinese telecom firm Huawei.
The ostensible reason for the band was that Huawei, being suspiciously close to the Chinese government, could use its market connections to spy on American agencies.
However, the subsequent reactions in the market and in corporate board rooms showed how interrelated the global economy is, and how hard it is to embark on new protectionist programs with a stock market that’s really consolidated internationally.
Despite attempts to juice the market with a federal interest rate cut, investors have been seeing large indices trending downward lately and are looking to put their money elsewhere.
Meanwhile, U.S. firms are hoping that the Commerce Department allows them a particular waiver of the trade ban with Huawei.
This week, Reuters reports that nearly 130 firms have asked the U.S. Commerce Department for a license to sell goods to the Chinese firm.
That’s nearly triple the 50 applications the agency said it received last month.
It shows how strong international market connections are – the New York Times reported after the ban that attorneys for U.S. firms were looking for loopholes that would allow trade to continue.
However, Huawei has already reported $10 billion in losses due to the blacklisting and reportedly 600 U.S. workers were laid off from the company.
Keep watching what happens in a sudden jarring trade escalation between two of the world’s largest economies; most recently, in answer to a reporter’s question, Trump said he might have second thoughts about impacting the market with more tariffs, as, as he put it, “I have second thoughts about everything.”