16.05.2021

JP Morgan: “trade war” may drag on for a long time

This was stated in an interview with CNBC by the chief strategist for global markets at JP Morgan Asset Management, David Kelly. He noted that leaders of other countries will not make concessions to the American authorities and the deterioration of trade relations may last in 2019 and 2020.

The “trade war” is a serious problem. Many people think that at some point the other side will blink and offer some concessions. But what if this does not happen? Import duties will have a negative effect both for the USA and for other countries. The aggravation of trade relations and sharp rhetoric are already a negative factor for the markets.

In the short term, the US economy will continue to grow, but I am concerned about this long-term duty situation. I think the markets are just beginning to prepare for a protracted trade confrontation and take into account the potentially unpleasant consequences. Because this is how wars develop. Generals always say that troops will return home very soon, but in reality conflicts always drag on.

This confrontation may last next year, and in subsequent years. The problem is that this situation has already acquired a political coloring. The new president of Mexico, Canadian Prime Minister Justin Trudeau or Xi Jinping does not want to show that they are ready to make concessions to the United States. Politically, they cannot afford to look weak. This is not just some kind of financial transaction. In response to US duties, these countries will take mirror measures, and ultimately this will slow down the global economy. ”

JPMorgan named the best currencies in a crisis

In the event of an economic downturn in the United States or a global recession, Swiss francs, Singapore dollars, US dollars and Japanese yen should be purchased, getting rid of the currencies of developing countries. This is stated in the review of JPMorgan Chase, reports Bloomberg.

The first three relate to the currencies of countries with extremely stable external positions, and investors should have them in their portfolio during the recession, analyst Paul Meggesi notes.

JPMorgan points out that the yen is the cheapest currency for hedging risks, the Singapore dollar in this sense is a less attractive tool. The US dollar remains in a winning position as the main world currency: it is bought by banks and companies in all countries, if necessary, to reduce the debt burden during the recession.

The currencies of developing countries, on the contrary, are particularly sensitive to recession and, on average, depreciate by 17% in the first two years since the crisis began, analysts said.

JPMorgan emphasized that talk of a global economic downturn is “premature.” At the same time, analysts conclude that amid the unfolding “trade war” it is wise for investors to consider financial management strategies in case of unforeseen circumstances.

J&J will pay injured women $ 4.7 billion

Johnson & Johnson Corporation will pay $ 4.69 billion to 22 women who claim to have developed cancer due to the use of the company’s products. The decision was made by a jury in Missouri.

The jury’s decision was unanimous, according to Bloomberg. This compensation will be the sixth in the list of the largest in the history of the United States, out of those appointed following the results of proceedings relating to the production of low-quality products.

J&J does not agree with the court decision and calls it unfair. The company intends to appeal, claiming that its products do no harm, much less lead to the development of cancer.

However, several thousand lawsuits have already been filed against Johnson & Johnson in the United States. The company is accused of fraud and hiding information that some of its products can cause irreparable harm to health. Moreover, some of the plaintiffs claim that the company’s hygiene products contained asbestos dust, which is a strong carcinogen and which caused ovarian cancer.

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