The corporate tax reform is at the top of Mr. Trump's agenda, and that is perhaps one of the most effective trade signals he can send to China. Indeed, reducing the incentive for the exodus of American manufacturing, and bringing some of it back, would also stop large technology transfers that are part of mandatory Sino-American joint ventures for American firms doing business in China.

Investors, therefore, should pay no attention to trade war noises. Mr. Trump has powerful cards to play in a trade negotiation with China,and in the discussion of political and security issues that need to be clarified.

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