| Mistrust is growing between Washington and Beijing, Hong Kong stocks are looking good to Chinese investors, and the U.K. may be heading for a snap election. Here are some of the things people in markets are talking about today. Suspicious Minds Chinese and U.S. officials are struggling to agree — again — on the date for a planned meeting this month to continue trade talks after Washington went ahead with tariffs on Sunday, even after Beijing's request to delay them, according to people familiar with the discussions. The world's two biggest economic powers have yet to see eye to eye on basic terms of re-engagement, with mistrust on both sides. Chinese state media called out the U.S. administration's behavior as "China-bashing," and the Ministry of Commerce in Beijing has plans to bring the spat before the World Trade Organization. Meanwhile, Trump is asserting that talks will go ahead for September, but that isn't doing much to soothe markets – the S&P 500 Index dropped 1.8% last month and U.S. Treasury yields have plunged amid the swirling uncertainty hurting companies, at home and abroad. Looking Good Hong Kong authorities have warned that radical protesters showed "signs of terror," more than 1,000 people have been arrested, Reuters reports that Carrie Lam would "quit" if she could, and some of the most violent confrontations have occurred since unrest first broke out three months ago… But Chinese investors are still pouring money into Hong Kong stocks. Mainland investors bought shares in the city for a 32nd session Monday, pouring a net HK$72 billion ($9.2 billion) across the border in that period, the longest buying streak since December 2017. What gives? Chinese traders have been lured by the cheap valuations, and have largely ignored the worst deterioration in corporate net income in three years — the Hang Seng Index slipped 0.4% Monday, taking its drop from an April high to 15%. The gauge has given up all its gains for the year and is the worst-performing major index globally in the past month. Markets to Slip Asian stocks are set to follow U.S. futures lower as Chinese and American officials struggle to schedule a planned meeting this month to continue trade talks — futures slipped in Tokyo, Sydney and Hong Kong. Cash markets for both U.S. stocks and bonds were closed for the Labor Day holiday, but 10-year Treasury futures erased a decline while the dollar strengthened for the sixth consecutive day to its highest in more than two years. The pound slumped to a two-year low with the U.K. facing a showdown in Parliament over delaying Brexit (again). Elsewhere, crude oil slipped below $55 a barrel amid concerns a hurricane battering the U.S. east coast and an economic slowdown from the trade war may dent demand. Record Cash Pile In banks across Japan sits a pile of money that's bigger than most countries' gross domestic product — the cash reserves of the nation's companies. Firms listed in Japan held 506.4 trillion yen ($4.8 trillion) in cash as of their latest filings, the highest level on record. Many are divided on whether it's testament to their strength, or simply a wasted opportunity — companies see the money as a buffer against hard times, but it has long riled investors, who say executives should invest it for growth or return it to shareholders. Despite his best efforts, Prime Minister Shinzo Abe is struggling to contain the problem, levels have more than tripled since March 2013, months after he returned to power vowing to stamp out cash-hoarding. Election Threat Boris Johnson is planning for a snap general election on Oct. 14 if he loses a crucial vote over a no-deal Brexit in Parliament this week, a senior U.K. official said. Under new legislation introduced by a cross-party alliance of MPs (including Tory rebels), the PM would have to either get new deal through the House of Commons by Oct. 19, or persuade lawmakers to back a no-deal exit. If Johnson can't achieve either outcome — Brexit would be delayed again to Jan. 31. under the new game rules designed to significantly impede the chances of a no-deal divorce. Despite the signs of trouble, the prime minister said he will not delay leaving the European Union under any circumstances, and that he wants to avoid an election. The pound fell by as much as 0.98%. What We've Been Reading This is what's caught our eye over the weekend. And finally, here's what Tracy's interested in this morning The opening of Costco's first store in China last month was marked by scenes of eager shoppers pushing to get inside. Part of the wholesale retailer's allure was said to be the prospect of bulk-buying pork: Prices have surged in China following an outbreak of swine fever that's destroyed a huge chunk of domestic pig farming. How was the virus able to spread so rapidly in the country? This investigative piece from Caixin describes how a patchwork of different supervisory authorities and opposing incentives failed to stem the epidemic. For instance, local officials were reportedly reluctant to report outbreaks because it meant having to spend part of their budget compensating farmers for culling infected animals.  Now, Bloomberg reports that one Chinese city is rationing pork and capping prices on the meat in an effort to ease the burden on residents. The price cap — 10% less than a moving average of the market price — is supposed to help people weather the price increase, while the quota should limit demand and stop the cut-price pork from flying off the shelves. It could be the first instance of China's authorities mounting a concerted effort to stem the surge in pork prices. The question is whether efforts to ramp up pork production and damp down prices are starting before policies to staunch swine fever's spread have been fully completed. You can follow Bloomberg's Tracy Alloway at @tracyalloway. The best in-depth reporting from Asia Pacific and beyond, delivered to your inbox every Friday. Sign up here for The Reading List, a new weekly email coming soon. Before it's here, it's on the Bloomberg Terminal. Find out more about how the Terminal delivers information and analysis that financial professionals can't find anywhere else. Learn more. | 
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