“…verge of a very dangerous situation.”  Take your pick as to the litany of issues here at home and around the world that this statement could be referring to this morning, but in this case it was a quote from the Chief Executive of Hong Kong, Carrie Lam, describing the current state of tensions in that city following what has now become nine straight weeks of protests.

The big issue this morning, however, is the further escalation of the trade war as China responded to President Trump’s tweets from Thursday by reportedly instructing state-owned corporations to halt imports of US agricultural products, and more importantly, allowing the yuan to float above 7.

After a weak session of trading on Friday, global equities are in further liquidation as major Asian and European equity benchmarks are down close to 2% and US futures are trading down over 1%.  Keep in mind too, that US stocks were down every day last week with the S&P 500 falling over 3%.  Treasury yields are down sharply again this morning with the 10-year down to 1.77%, and the yield curve (10y/3m) is at new extremes in terms of inversion.

Continue reading in today’s Morning Lineup.

Bespoke Morning Lineup – 8/5/19