The trade deal that isn’t

The trade negotiations in Washington are unlikely to shift the needle of global confidence or impending recession significantly. The Washington pact is about having negotiations (over 3-5 weeks) to fix a deal. We doubt that, even in the event of a narrow agreement, China will comply with the broader range of US demands to change the way it manages its economy. We are leaving our key investment positions unchanged: long US Treasuries; long US dollar; long gold; short euro; short Australian dollar and holding downside option protection for equities. We continue to stay out of emerging markets.

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