Mr. Trump is in no rush to back down. “When the time is right, we will make a deal with China,” Mr. Trump tweeted yesterday. He later told reporters, “Our economy is fantastic; theirs is not so good. We’ve gone up trillions and trillions of dollars since the election; they’ve gone way down since my election.” (His close allies reportedly say backing down is not an option, as he sees the clash as helping his 2020 election prospects.)

But reaching a deal may be hard even if Mr. Trump wanted to. The U.S. and China “seem to be digging into their positions in ways that will be hard to resolve with the mutual face-saving that typically turns high-stakes negotiations into deals,” Neil Irwin of the NYT writes. “It is not clear what the offramps might be that would allow a de-escalation.”

“For now, the American economy remains strong, with rising wages and the lowest unemployment rate in 50 years,” Ms. Swanson writes. “But with less trade, American jobs up and down the value chain that are seemingly unrelated to importing and exporting goods could suffer, including research and development, retail and marketing products.”

U.S. stocks recovered from their trade shock yesterday, with their largest gain in a month. “Investors are trying to adjust to the ratcheting up of trade tension,” Matt Phillips of the NYT writes.

More: Mr. Trump argued that interest rate cuts by the Fed would make it “game over” for China in the trade war. And some in China say that the two nations benefit from their relationship more than they admit.