This is no Huawei to win a trade war

[Bloomberg]( Today’s Agenda - The U.S. arrested Huawei’s CFO [because REASONS](, that’s why. - The market is foretelling [a recession](, or [not](. - The EU should [help the U.K.]( help itself not Brexit. - Eddie Lampert still [doesn’t get what Sears]( needs. - OPEC’s [dithering on oil production]( is a bad look. Huawei to Go, Guys Let’s say you’re trying to make trade peace with China. Do you: - a) Have dinner with Xi Jinping, declare it a huge success and make specific promises about what’s next; - b) Spend a week walking back those promises; - c) Arrest a top executive at China’s biggest tech company; or - d) All of the above. If you chose “all of the above,” then you are in the Trump administration, apparently. Back on Dec. 1, on the very same day President Donald Trump dined with Xi at the G-20 Summit in Argentina, you had Canada – at the request of the U.S. -- [arrest Wanzhou Meng](, the CFO of Huawei Technologies (and daughter of the company’s founder). It’s unclear what the charges are, but it may have to do with Iran sanctions violations. Huawei is China's flagship tech company, and this is not exactly the kind of thing you do if you're trying to calm tensions with China. It is possible Xi and Trump had a laugh about it over drinks. But China seemed pretty angry about it today. And it’s hard to understand what the point is here. There are other ways to do something about alleged Huawei misdeeds than throwing the founder's daughter in the hoosegow. Was this carefully considered, or is it, as Tim Culpan asks, just [a clumsy shakedown](? If Trump does nothing more than squeeze cash out of Huawei, as ended up happening with ZTE Co., then it may not accomplish much. Better to use this leverage to make some real headway on curbing China’s intellectual-property theft, Tim suggests. As Eli Lake writes, Huawei has been a huge technology security risk for years, but arresting executives over sanctions violations doesn’t solve that particular problem. So far it has been hard to see much tangible benefit from Trump’s [create-crisis/pretend-to-resolve-crisis]( trade-war strategy, but maybe that’s because we’re measuring success the wrong way. Ramesh Ponnuru suggests even a losing trade war could [benefit Trump in the way]( that matters to him the most: winning re-election. Further Trade-War Reading: - China lowering tariffs on car imports [won’t help automakers much](. The real pain is U.S. metals tariffs, and those are here to stay. – Anjani Trivedi - A U.S.-China trade war leaves Brazil [pinned down in the DMZ](. – Mac Margolis Markets Have Trouble With the Curves Trade-war uncertainty and other anxieties hit stocks again today. Jared Dillian suggests markets – in bonds, homebuilder and tech stocks, and oil, to name a few – are telling us [a recession is unavoidable](. And we shouldn’t fear it, Jared writes; it will help clear out the inefficiencies and bubbles. One thing freaking stocks out is the yield curve’s inversion – short-term interest rates turning higher than long-term ones, which is sort of like dogs lying down with cats. But only a small part of the rate universe has sunk into The Upside Down. And Brian Chappatta points out one key interest rate, that of the 2-year Treasury note, fell a lot today. To Brian, [this matters more than the curve inversion]( and suggests traders are starting to think the Fed might be done cutting rates for this cycle. That would be good news for the stock market. Anyway, Stephen Gandel writes, another key interest-rate gap – the spread between corporate borrowing costs and safe Treasury rates – is still near its historic average, [no sign of financial pressure](. Nir Kaissar suggests another rate spread to watch, the one between the market’s earnings yield and the return on cash. Almost every time this turns negative, a bear market follows. It’s not underwater yet, but it’s [been moving in the wrong direction](. Seeking a Brexit Off-Ramp U.K. parliament is due to vote next week on Theresa May’s Brexit plan, and it looks like she’s going to lose – the vote, maybe her job, maybe the very idea of Brexiting. It could be a chaotic mess (more than usual), and [the European Union should help with the cleanup](, Bloomberg’s editorial board writes. First, it would be useful if an EU court lets the U.K. unilaterally revoke Article 50, thereby giving up on Brexit, if a second referendum calls for that. And if the U.K. does come to its senses, then the EU should forgive and forget this whole mess, letting Britain stay in the EU on its old terms. Otherwise it risks the worst possible outcome – a no-deal Brexit that hurts everybody. Further EU Reading: - Brexit is a test of humanity’s decision-making ability. It’s [not doing great so far](. – Tyler Cowen - Emmanuel Macron is a [poor poster boy for liberalism](, opening the door to an illiberal takeover of France. – Pankaj Mishra Eddie Lampert Sure This Lipstick Will Make Pig Kissable By all rights, Sears Holding Corp. should be pushing up daisies in the retail graveyard by now, but Eddie Lampert keeps throwing good money after it. Now he has made a [$4.6 billion bid]( to buy it out of bankruptcy and keep a husk of it running. This is admirable, sort of, but Sarah Halzack notes Lampert keeps stubbornly [not doing the one thing needed]( to actually turn Sears and Kmart around: make them into retailers that don’t feel like prison commissaries. Seriously, have you [been in one]( lately? OPEC Kicks Can, Self Crude-oil prices fell hard again today, and OPEC was widely expected to leave a meeting in Vienna with a pledge to pump more oil to support the market. That didn’t happen. Liam Denning writes this [puts even more pressure on OPEC]( to come up with such a pledge after tomorrow’s meeting of the organization and some non-OPEC exporters such as Russia. Otherwise OPEC might soon be exposed as the dysfunctional, barely held-together herd of cats it really is. At the G-20 meeting last weekend, it briefly looked as if Russia and Saudi Arabia had agreed to pump more oil, in defiance of their mutual admirer Trump. They may yet do so tomorrow; but that’s no sure thing. And an agreement might not be worth the paper it’s written on, writes Leonid Bershidsky. Both countries have [every reason to pump as much oil as they can](. Telltale Charts Government subsidies accelerated the evolution of solar-panel technology, making it more economical, notes Noah Smith. Trump’s plan to kill electric-vehicle subsidies would [prevent a similar evolution of battery technology]( that could help the world avoid climate catastrophe.  Further Reading Here’s what to look for in [tomorrow’s jobs report](. – Mohamed El-Erian Responsible investing can [turn climate change from a risk]( into an opportunity. – Mary Schapiro Internal emails show Facebook Inc.’s Mark Zuckerberg is [not the aw-shucks babe in the woods]( he pretends to be. – Shira Ovide Japan’s arrest and harsh treatment of Carlos Ghosn [just keeps looking worse and worse](. Payback could be hell. – Joe Nocera  Democrats are getting their House stewardship [off on the wrong foot](, by shooting themselves in it. – Jonathan Bernstein Former Obama White House counsel Rober Bauer says Trump is giving us a chance to [rethink our unhealthy relationship]( with the presidency. – Francis Wilkinson Update British retailer Ted Baker PLC just removed the “hug zone” near the desk of founder and CEO Ray Kelvin. Now where will people go for super-weird hugs? Andrea Felsted wrote yesterday about how [the board let this ridiculous]( situation happen. ICYMI Trump may want former U.S. Attorney General [William Barr to take the job]( again. The U.S. is now a [net oil exporter](. Kickers Tired: Ugly Christmas sweaters. Wired: [Ugly Christmas-sweater sneakers](. (h/t Scott Duke Kominers) The [gut-brain axis]( could cause salt to hurt the brain without even raising blood pressure first. The [40 best Christmas movies](. Mental Floss’s [best books of 2018](. AV Club’s best [country](, [metal]( and [punk]( albums of 2018. [2018 in photos](. Note: Please send sneakers, suggestions and kicker ideas to Mark Gongloff at mgongloff1@bloomberg.net. New to Bloomberg Opinion Today? [Sign up here]( and follow us on [Twitter]( and [Facebook](. [FOLLOW US [Facebook Share]]( [Twitter Share]( SEND TO A FRIEND [Share with a friend] You received this message because you are subscribed to Bloomberg's Bloomberg Opinion Today newsletter. [Unsubscribe]( | [Bloomberg.com]( | [Contact Us]( Bloomberg L.P. 731 Lexington, New York, NY, 10022