Charles high level trade walks are underway in china as we speak. Already a ton of headlines are trickling out. Edward lawrence is live at the u. S. Trade Representatives Office with the very latest. Edward . Reporter charles, i can tell you these talks started about 30 minutes before they were scheduled to talk and they have been working through lunch. They passed through a break in the schedule on this i cant tell you if that is good news t could be good news. It could be they reached a sticking point. In any case they are still talking which is good news here. Chinese trade sources said the chinese would like to work out a deal on parts they already agreed upon, that both sides agreed upon and lay a timeline out what comes next year for those difficult points. Following the guidelines theyre looking at sort of the japaneseu. S. Deal where they have a deal on agricultural and digital trade. Move forward with the rest of the stave later on. The u. S. Wants to know what concessions chinese are putting back into the trade deal that u. S. Trade representative Robert Lighthizer says was removed from the trade deal. The mood of the talk had soured this week. In fact the chinese a little upset 28 new companies and entities were added to the entities list, that is the blacklist from selling to the United States here. Visa restrictions from the state department, they are concerned about the restrictions in place for human right violations from some Chinese Government officials as well as communist party officials. May be too soon to talk about a partial deal or not. What has subsided from the conversation is talk of the chinese leaving later on today, cutting this trip short. That has sort of subsided here. President donald trump tweeting out this morning saying he will actually meet the chinese vice premier tomorrow in the white house, signaling that they would be probably, most likely be here through tomorrow. Charles . Charles edward, thank you very much with all the twists and turns in the trade saga, the market is exhibiting optimism with so much in line over the next 24 hours. Well know a lot. I would like to bring in Hudson Institute senior fellow, michael pillsbury. Things we heard today, the olive branches on both sides. America apparently willing to do something with a currency pact. Something brought up at the beginning of these trade talks, remembering lighthizer was part of the currency pact that ended our dispute with japan years ago, maybe doing something with respect to huawei, limited access for huawei, china apparently for the u. S. Also to let oil tankers resume business because they were sanctioned from, because they transported iranian oil. All this got the market off to a good start. We got a big bump that we heard President Trump was getting involved. Where does that put us now . Still optimistic i think, charles. President trump traditionally met with liu he on the second day of the talks in the oval office, inviting the press to come in and ask questions. That is nothing positive or negative that has become traditional. Its a good sign. This is an upbeat meeting. The number of issues is enormous. If china takes back what it reneged on may 2nd. Were talking about a lot of progress being announced tomorrow in the agreement. I tend to believe the white house is quite correct yesterday to tell people on background the 28 entities being put on the entity list, the visas issue, these are not part of the trade talks. These were in the works already. So it is not necessarily extra pressure being added at that. Neil you talked about the enormity of it, a lot of people pointed to it at very beginning it is overreaching, a deal to level off the trade imbalances, back off made in china 2025, that china wants to be preeminent country in the world, theft of intellectual property, more recently human rights coming into question. So how likely does that make then or how practicable does it make the idea of a piecemeal deal . Something tomorrow and then working on the rest later . Well, tomorrow they could obviously announce a lot of progress and imply some things have been agreed to. That was the case as you recall back late april, early may. The 150 page secret trade agreement was in some sense agreed to. It wasnt agreed to by xi xinping apparently but, that is a lot. 150 pages which Steve Mnuchin says contained seven chapters, one for each of the key issue areas. That was a lot already. If we get that, sort of back tomorrow where we were in may, i will count that as enormous success compared to all the worst Case Scenarios, charles, that you and i both know that the chinese would walk out in a huff or President Trump would escalate sharply. Those worst Case Scenarios will be no longer under discussion. Were looking at a more positive approach if this happens tomorrow. Neil charles speaking of escalation, from wall streets perspective, the way they measure progress if President Trump announces tomorrow, okay the october 15th, additional rates or tariffs go from 25 to 30 will be delayed and pushed off and new tariffs scheduled for december 15th will be delayed, perhaps until early next year that is the low bar wall street is looking for. Any possibility about that . I dont know but the president has already shown, from buenos aires that he was willing to postpone in that case for three months, shown postponing tariffs going into effect is a gesture he is willing to make. So that would be a positive outcome tomorrow. Certainly the chinese feel the pain of the tariffs. They have made no secret about that. So theyre in some sense hoping he will lift the tariffs today, even all of them. I dont think that is very likely at all. Charles i think youre right though and we saw a lot of bad economic data, gn in china, down 17 at the open. A whole bunch of nasty stuff there. I want to switch gears a little bit because the Financial Times reporting that you gained information from hunter biden from the chinese. I want to read to the audience the Financial Times, Washington Bureau guy wrote to you, mike, is it accurate you tried to raise the hunter biden issue with china, you replied i got quite a bit about hunter biden from the chinese. This 1. 5 billion payment. Can you set the record straight for us . Sure there is a little bit of hype going on here. Ive been over to china six times since President Trump was elected. Each time i talk about what is going to happen for the reelection. They are fascinated by american politics. I written three books covers their perceptions of american politics. Charles did they give you information on hunter biden. Whatever they said was basically from our newspapers. There was no intelligence or nothing new about hunter biden. They acknowledged they read about the scandal here in the u. S. , what the president has said but they didnt give me anything special or unusual. They talked about how biden will be the frontrunner. They think that is a positive thing. Charles all right. Michael pillsbury, straightshooter, always appreciate it. Thanks, charles. Charles lets get a read on the markets and how they will play out with these trade talks. I bring in to discuss, david dietze, point view wealth management, Bahnsen Group cio, David Bahnsen. The scenario i laid out for michael pillsbury, a partial currency kind of deal that takes the yuan out of the equation, so xi can say, hey, they wont push us around with respect how we manage our own currency, maybe huawei sales. Maybe saying okay, well take the sanctions off these chinese oil tankers, some soybeans obviously would be in the mix and maybe a jv, no longer forcing American Partners to be the junior partner. That kind of a package what would wall street response be . I think that kind of package wall street would respond favorably to, we are at a point now, the market moved up so much in the last five weeks a lot is more asymmetrical. How much more can the market can drop if they dont get certain things. That level is 80 priced in, not completely. If you take away tariffs put on before, which is different than deescalating, deescalation is priced in. No were escalating tariffs, were going full bore, i think you see a significant market drop. If we get enough progress where they take away tariffs that with were put on last year, wall street would respond favorably. Charles that would not be as much on the table as china would want, david dietze. The other scenario, both sides get something. We delay tariffs that were going into effect this year and move the talks along . So im a little bit more optimistic than David Bahnsen here. I think since there are signs of progress, wall street is directionally oriented than what the whole package looks like. As long as wall street feels were not on the precipice after huge blowup of the trade better than a truce, i it kind of think were off to the races too strong of a word. Corporate chieftans are conservative. But they will get optimistic if they see progress. Market can move higher. Weve done well yeartodate. Were not up on a 12 month basis. I think there is room for more progress here. The problem is wall street has an incredible memory, this will not be the first time or the second or the third that weve had progress. Wall street wants certainty more than anything. Well not get full certainty tomorrow, i understand that, but i think it has to be more than the same level of progress weve already had. He was talking about the meeting back in may. The 150 page document, here is the thing no one seems to remember. 90 of it was agreed. 10 had never agreed. It was intellectual property enforcement. That is still the issue. We want to take away tariffs youre not suggesting though that has to be resolved before the market goes higher . No, im not. That is the very last piece. I think market will move meaningfully higher when it sees there is really a path to certainty. Cant be the same level of optimism so, minor little bump up, hey, were holding back. Well reconvene in three months, i dont think the market moves a lot on that level. That it needs more than. I couldnt agree more with you to the extent they talk about progress on things that will take month, if not years to resolve f there is concrete commitment to delay or freeze current tariffs, maybe even reduce them, i think wall street will take that charles risk reward scenario that you described does change, right . It changes, let me ask you, you brought up Interest Rates. Cpi came in less than anticipated. Big drop in used cars and trucks. Apparel, again, considering the cpi number, ppi, number, what we hear from jay powell, you know, the fed, they still meet this month that will be consequential. Possibility of them going even 50 basis point . I dont think there is a crisis. I dont think they will go 50 basis point. Charles certainly they cutrate this month . Yes, absolutely i think you see 50 by the end of year, inflation rates still not hitting target. There is no real impediment. They need to get our Interest Rates more in sync with the rest of the world and uninvert that yield curve which is only up there because of the fed. Charles bahnsen . The whole issue of Interest Rates is difficult. All of us as investors want to believe we have things working in our favor. We like the idea of easy money pushing down a riskfree rate and gives us opportunity for better pricing. We know what happens when rates come higher. If they go too aggressive reducing, the fact of the meatier you may get a little boost, you might not. The market is already expected it. If you end up going too far at some point they have to get off of it. They have no tools. More thinking what it does to investors in a year or two than i am in a month. Charles david and david. Thank you both very much. Apple facing backlash here at home after pulling a hong kong protest app and really. Ed china. Apple of course not the only american tech giant that holds these apps to appease china. 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Charles as high level trade talks are taking place today, u. S. Companies, well they continue to blink to the communist company. Apple pulling a police tracking app from the app store set to be used by hong kong protesters. Google removing a mobile game that allows them to role play as hong kong protesters. Nba preseason game in china was not televised after the rockets gm tweeted support with hong kong. She is back from third trip to china, wall street journal opinion writer jillian melchior. You watched struggles of these folks. Youre a business reporter. How do you feel about the initial reaction of in the ba, apple, google, American Companies genuflecting to china . Im incredibly frustrated about it. I spent the last couple weeks really talking to young people. We have to keep in mind the young etf protester arrested was 12 years old. They are showing extraordinary courage, taking to the streets, fighting for basic freedom. In america, Corporate Leaders dont have the same courage as a 12yearold girl. It is disgusting. It turns my stomach. Charles what do you think is going to happen . Protests seem like theyre getting more violent and confrontational. Were bracing for something ugly going to happen. Yes. It is already ugly. Charles every time i hear carrie lam the chief there speak, sounds she is letting us know at some point there could be even extreme violence . I think it is really frustrating seeing how the Chinese Government is trying to spin this story. People in hong kong cant elect their chief executive, even if all of them go vote and vote for prodemocracy candidates, prodemocracy will have the minority in the legislature. Theyre only venue to express the political will has been in the streets. The police are responding to Peaceful Protesters by arresting them. Lobbing tear gas at them. Hitting them with rubber bullets. Arresting their children. You have a sense in hong kong, peaceful protest is not enough. If they want to fight to defend their freedom that is not enough. That is unfortunate, they get a propaganda victory. They say look these protesters are out of control. This started by china to ignore the obligations, leave hong kong alone, preserve basic rights, one country two systems. Charles President Trump said hong kong may come up as part the trade talks. Administration took strong actions against china this week. Blacklisting of 28 companies. Removal of visas for certain individuals associated with the treatment of uyghurs. You were not happy initially that the administration was not doing a lot. What does it mean to the hong kong protesters when they see President Trump stepping up like this. It means absolutely everything. You go to protests seeing people wave american flags. I was talking to one protester who first thought trump was crazy. He appreciates him for standing up to human rights. It is no just chinas promise to hong kong. When the british handed over hong kong as a colony it was a bilateral treaty, a joint declaration china agreed to it is now saying that treaty is no longer legally binding. We want to violate it. If you cant trust china to live up to obligations in hong kong. You know chinas word in International Agreements an obligations is no good. Charl