Welcome the thoughts on the market. I'm Michael Zezes, head of Public Policy Research and Municipal Strategy for Morgan Stanley.

Along with my colleagues bringing you a variety of perspectives, I'll be talking about the intersection between U.S. public policy and financial markets.

It's Wednesday, December 2nd at 9 a.m. in New York.

It's the time of year when we and Morgan Stanley research looked to the year ahead and tried to answer clients most

pressing questions about markets.

One of the most common questions we're getting is if the presence of a new administration

in Washington, D.C. will lead to a reduction in the trade barriers that have gone up between the US and China,

something markets might cheer and could help both economies in the near term.

However, we think this outcome is unlikely.

Now it's fair to say the tone and the approach might change.

Whereas the current administration chose to confront traditional allies and rivals alike,

the incoming administration has expressed a preference for coordinating with

traditional allies in Europe and Asia to deal with the perceived issues around preference for

coordinating with traditional allies in Europe and Asia to deal with the perceived issues

around trade with China. But the outcome is unlikely to be different at least in

2021. For example, in order for the goods tariffs that were raised in 2018 and 2019 to be reduced,

we'd expect the US and China would need to reach an agreement to make fresh mutual

concessions.

Yet we think all the easy and medium difficulty concessions were effectively made in the phase one trade agreement.

As for non-tariff barriers, like the kinds of export restrictions and controls that have been placed on semiconductors,

those have largely sprung from laws that enjoyed bipartisan support.

And those laws outline the power of the executive branch to study and implement potential

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