Good morning from unfrozen Washington DC. To follow on yesterday’s comment, I think the forced termination of the Huawei-AT&T deal significantly raises the likelihood that a major US consumer electronics firm with meaningful operations in China will be smacked down at the first sign of a real US-China trade war.

Beijing assumes the US government is so paranoid about Huawei because it uses US firms to do what it says Beijing does with Huawei, and the Snowden revelations confirmed many of those suspicions. If anything Beijing has been remarkably tolerant of some US consumer electronics firms given the treatment of Huawei and what we learned from the documents Snowden stole.

One theme I have heard fairly consistently is that US firms and financial markets have not fully grasped the increasing risk of a material US-China trade dispute. The companies’ denial may be understandable as there is little they can do but markets may be in for quite a shock if President Trump follows on through on …