US Says No Trade Talks At G-20 Unless China Makes Early Concessions: FT

In accordance with what has become a time-honored Trump Administration tradition, officials from within the administration - and presumably speaking on behalf of President Trump - told reporters at the Financial Times that the US won't talk trade with China at the G-20 summit unless Beijing produces a detailed list of possible concessions as gesture that his side is serious about finding a resolution that CEOs, the IMF and, increasingly, investors worry could dampen economic growth and finally trigger a correction in US stocks. The report comes four days after Larry Kudlow, Trump's top economic advisor, said talks at the G-20 were being discussed. "We have been negotiating on and off and it has been unsatisfactory thus far...maybe, I want to underscore maybe Jonathan, there might be a meeting between Trump and Xi down in Buenos Aires".

Kudlow said he doubted there would be any talks before the meeting (China canceled what would have been the fifth round of talks last month). But since he spoke, the US-China relationship has only further unraveled as Vice President Mike Pence accused China of "meddling in American democracy" and blasted China's supposed "debt diplomacy", "currency manipulation" and "IP theft."

China

And one day after a press conference with China's foreign minister morphed into an "unprecedented confrontation" when President Xi decided to snub Secretary of State Mike Pompeo during his latest visit to Beijing, Chinese officials reportedly said that, while they have a list similar to the one that the US has requested, they don't want to share it with the Trump administration until "a stable political climate" returns to Washington. This could be a reference to the Trump administration's chaotic approach to the trade dispute or possibly the upcoming midterm elections (or both). And in a sign that the Chinese have grown tired of Trump undercutting efforts by both Kudlow and Treasury Secretary Steven Mnuchin to revive talks, Beijing is also asking that Washington appoint a "point person" who has the authority to negotiate on behalf of the president.

As a reminder, here's where the US and China left off before communications broke down and Trump decided to go ahead and slap tariffs on roughly half of Chinese goods entering the US (provoking China to retaliate):

US negotiators presented Vice Premier Liu He with a detailed list of more than 140 specific demands, ranging from the elimination of market access barriers to large, long-term purchases of US energy and agricultural commodities that would reduce Beijing’s large goods trade surplus with the US.

In August, Chinese negotiators indicated that they could reach agreement on about a third of the demands relatively quickly and were willing to engage in discussions on another third.

The remainder, they added, were off-limits because of national security or other concerns. These included US demands that China’s domestic cloud computing market be opened to foreign companies.

China never delivered its latest response to the US's demands (which it had planned to do during the fifth round of negotiations before they were canceled). But before it would be willing to move forward, the US has said it wants to hear whatever the Chinese had planned to say, otherwise trade talks on the sidelines of the G-20 would be firmly off the table.

Privately, some officials have said that they worry the two Chinese officials responsible for managing the trade talks "aren't a good fit" to deal with Trump.

China has designated Mr Liu and vice-president Wang Qishan to deal with the US. But some visiting Americans worry that Mr Wang’s discursive style will quickly exhaust Mr Trump’s attention span.

The upshot: Unless China makes at least agrees to a framework for the talks ahead of the meeting, the US is refusing to meet. And given the military, economic and rhetorical provocations undertaken by the Trump administration in recent weeks, it's unlikely that Xi would bow to these demands, even as China pumps liquidity into its financial system to try and support a floundering market and flagging economic growth brought about, in part, by these trade tensions.