The U.S. reached a preliminary trade agreement with Mexico that addresses several American grievances. A similar deal with Canada appears to be on track. These breakthroughs, combined with an easing of tensions with the European Union, could allow a more coordinated approach to the toughest trade problem of them all: reaching an agreement with China.
This is good news for investors who worry about a global trade war that would derail growth and undermine corporate earnings. But important questions remain. How they are resolved will ultimately determine the extent to which trade policy durably influences growth and asset markets.
President Donald Trump has upended long-standing approaches to trade negotiations by sidestepping conventional processes, protocols and procedures. As I suggested
, the best analytical approach for understanding the new state of global trade is game theory. In particular, by thinking of different strategies and outcomes in a world where a traditionally cooperative game is being played uncooperatively.
Read more here