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Markets are not pricing for it, partly because the irrationality seems to reduce the probability of this outcome. However, there are multiple interpretations of what ‘rational’ means for all actors involved. One can make the argument that the US and China are both acting rationally, while assumptions that our global system is rational may themselves be irrational. On that basis, the risks of trade wars may be higher than markets currently suggest
Marketing communication / Non-Independent Research. This publication is issued by Coöperatieve Rabobank U.A., registered in Amsterdam, and/or any one or more of its affiliates and related bodies corporate (jointly and individually: “Rabobank”). Coöperatieve Rabobank U.A. is authorised and regulated by De Nederlandsche Bank and the Netherlands Authority for the Financial Markets. Read more
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