While US President Donald Trump, in his frustration still calls the coronavirus the China virus because it originated there, China is pressing ahead not only with regaining its pre-coronavirus status as the workshop of the world and has ramped up its exports, but it is also leading the race for developing a vaccine for Covid-19. It turns out that vaccines developed by China, of which at least four are in the final stage of clinical trial, might be ready for public use as early as November. Now we are likely to experience yet another phenomenon that will drive the White House to frustration.
So far international financial markets have defied all the gloom and doom that has descended upon the real global economy, which has already slipped into recession, because of two things. One, the willingness of central banks, particularly in bigger and richer countries, to keep coming up with relief and stimulus packages as long as needed. And two, the prospect of developing a vaccine, which is why whenever even fake news about a possible cure for the virus hits the news waves financial markets make for the sky as if just powered by extremely positive financial results, which is of course not the case.
Of late, because of the deadlock between the Republicans and Democrats in Congress, it seemed that the world’s biggest economy would not be able to come out with a new package in time to keep financial markets from running out of steam. And indeed some markets had been turning since at least the last half of last week. But now that China has given hope of another vaccine, it could well be that investors of the world, whose only loyalty lies with successful investments, might pour yet more money into markets and keep them rising. How that would frustrate the Trump White House is not difficult to guess at all. It seems all Beijing has to do to win this emerging cold war with Washington is keep doing the right thing and letting the other party make all the mistakes.