Since the moment he was shocked to find himself actually working in The White House, fringe quasi-economist Pete Navarro has spent every waking moment trying to set off a trade war with China.
Well, that's not entirely fair. Navarro has also been put in numerous time-outs for being himself [ie, a crazy person] and has also been known to roam the halls in sweatpants carrying copies of his books and giving advice on podiatric health. But when he's not doing those things, Navarro can be found on cable news praising Donald Trump's economic genius and unsubtly blaming everything from wage stagnation to the NBA draft lottery on Beijing. Navarro is another one of Trump's singleminded soothsaying aides who seem to have just enough access to the Oval that their batshit ideas become batshit realities.
China is not rolling over on the tariff gambit, and the cautious optimism of a deal being struck soon looks a lot more like naive stupidity. The markets also seem to have decided that they're close to done pretending that Trump's tweets, Mnuchin's mumblings or Larry Kudlow's whiny come-ons are anything other than venal pablum from a panicky White House that has just realized Xi Jinping ain't nothing to fuck with.
The trade war we've all been waiting for is here, and we're seeing the first battle take its toll:
China has not been an ideal trade partner and there are a plethora of ways in which our relationship with the world's largest consumer economy can improve but an arbitrary barrage of tariffs meant to provoke an axiomatic dictatorship into a game of economic pain chicken is not a great way to get this done. What might be more efficacious, and we're just spitballing here, is a coherent diplomatic plan to create a mutually beneficial deal with a country that we need in a global economy that will remain a global economy. And for that to work, we need real adult economists in the room.
Peter Navarro is a crank, and he's in the room. This is his economy now.