(Oct 7): It appears that there is nothing so extreme that you can contemplate that cannot become a White House tweet. In recent weeks, in briefing notes and forums, we have canvassed the extreme perimeters of US President Donald Trump’s trade war with China. This included the idea that Trump would freeze Chinese assets in the US. We noted that his freezing of Venezuelan assets was a precursor to this possibility.
It was followed by calls from some Republicans, and endorsed by Trump, for US pension funds to withdraw investments from Chinese companies, and from index and managed funds that had exposure to Chinese companies. As with many of Trump’s tweets, many people chose to ignore this threat.
Chinese enterprises took these threats more seriously, with some major Chinese companies proposing to develop co-listings in Hong Kong, although momentum has been halted as a result of the current Hong Kong unrest. Alibaba Group Holding, Tencent Holdings and others may come to regret that delay.
