The Washington Post | Tue, May 14, 2019
by Lawrence H. Summers
On Monday, China announced new tariffs on $60 billion of U.S. exports, and the United States threatened new tariffs on up to $300 billion of Chinese goods. These actions were cited as the principal reason for a decline of more than 600 points in the Dow Jones industrial average, or about 2.4 percent in broader measures of the stock market. With the total value of U.S. stocks around $30 trillion, this decline represents more than $700 billion in lost wealth.
This was not an isolated event. Again and again in the past year, markets have gyrated in response to the state of trade negotiations between the United States and China.