Cease Fire at the G20: Trump and Xi Declare Truce on Trade

It’s said that nothing ever really gets done at the G20, which is currently meeting in Osaka, Japan.  Nineteen member countries and the European Union agreed to a new deal to tackle climate change.  Guess who was the lone holdout.  President Trump was harshly criticized, at home and abroad, for praising Saudi Crown Prince Mohammed Bin Salman, who ordered the killing of Washington Post columnist (who had legal residency in the U.S.) Jamal Khashoggi.  There was one cautiously positive development to emerge from the summit, however.  Trump and Chinese counterpart, Xi Jinping, agreed to restart talks and temporarily de-escalate the trade war.

Has Oil Bottomed? If Demand is So Low Due to China, Why isn’t Copper Showing Any of the Same Patterns?

If oil demand is down so much due to the China trade war and tariffs, how come the more economically sensitive materials, such as copper, have not felt the same economic downward price effects?

Today China has asked it’s refineries to hold off on placing new orders for crude oil imports in anticipation of lower prices once and if demand stalls further. The Chinese buyers have cut off purchases of U.S. crude oil as the trade dispute between Beijing and Washington continues.

Trump’s Trade Wars, Tariffs, Sanctions, Bans; What’s Next?

President Donald Trump (R) lifted his tariffs against Mexico and Canada, but is he scaling up on China. So what about cars, steel, aluminium, washing machines, Iran, North Korea, Venezuela, Cuba and Huawei?

Trade Wars

Cars: Trump asked for and received a government study on car imports. He was particularly angered last November when General Motors announced that it was closing car assembly plants in Ohio, Michigan and Maryland. Trump has threatened to impose a 25% tariff on imported cars in retaliation for GM’s moves.

Mexico Wants to Appease Trump and Send National Guard to Southern Border

Negotiations take days in Washington- but still breakthrough is missing. If nothing happens, US tariffs will apply to all imports from Mexico on Monday. The Mexican government is now making concessions.

To appease US President Donald Trump in the migration dispute, Mexico wants to deploy 6,000 National Guardsmen on its Southern border. Mexican Foreign Minister, Marcelo Ebrard said this on Thursday in talks with US officials in Washington. This is to prevent the entry of Central American migrants on their way to the USA. The Mexican government wants to prevent with a set of concessions that Trump raises from Monday to punitive tariffs on Mexican imports.

Trump’s Tariffs: Mexican Concessions, Republican Rebellion

President Trump is set to unilaterally levy an escalating 5% tariff on all Mexican goods next week, and just about everybody is working diligently to stop them. The two countries continued talks Thursday, aimed at satisfying Trump’s demands that Mexico do more to stop the flow of migrants from Central America. To that end, Mexico has begun to deploy the National Guard on its southern border with Guatemala. Back in the States, members of the president’s own party have begun to show their own frustrations with Trump’s tariffs. This time, they might be serious.

Is the Economy Slowing? A Few Indicators Are Saying Yes.

  1. Interest Rates: The 10-year Treasury is hitting around 2.08%, down from 3.25% just three months ago.
  2. Oil is down around $53 per barrel. Down from about $65 in April.
  3. Industrial Production has hit multi-year lows.
  4. Gold and the dollar are moving up.

These four indicators have many forecasting both a tougher time ahead and a rotation into safe havens.  The central focus of concern is the trade wars with China and the new tariffs with Mexico.

Nike Claims the “Consumer Gets Hurt” in a Trade War with China. True or False?

With the China tariff up 25%, we’re constantly being told this will hurt the consumer and that it’s why inflation is rising (up 1.5% in April from 1.4% in March accounting to the Commerce Department). The Consumer Price Index increased 0.3% last month after moving up 0.2% in March. If the trade war with China trade is so bad where is the inflation, where are the price hikes?

Nike and other companies are saying the “consumer will get hurt” with the China and Mexican tariffs, but is this really true? Bear in mind that Nike is not neutral in this fight as it has large investments in China and as a global manufacturer has strong ties to both countries.

Return of Tariff Man Imperils USMCA, Shocks Markets

If President Trump wants his free trade deal passed, he has a funny way of showing it. On the same day that Vice President Mike Pence met Canadian Prime Minister Justin Trudeau in Ottawa, to push the United States-Mexico-Canada Agreement through Parliament, the President tweeted out an entirely new trade policy. The United States would impose a 5% tax on all imports from Mexico, “until such time as illegal migrants coming through Mexico, and into our Country, STOP.” The unexpected return of Tariff Man sent shockwaves through the continent and financial markets Friday.

US and China Trade: The Stakes Are Rising

On Sunday, President Trump tweeted an escalation to his trade war with China, warning tariffs would more than double, from 10% to 25%. By Tuesday, stocks were sent tumbling, and companies scrambling. The Dow Jones Industrial Average dropped 472 points Tuesday, it’s worst day in four months. Grain futures hit their lowest mark in more than 40 years. Companies weren’t given much in the way of warning, with tariffs due to increase Friday. They’ll have to decide whether to eat the tariffs themselves or pass the costs on to consumers.

Trump’s escalation comes amid a five-month truce between the world’s two biggest economies, and as the U.S. and China appeared close to a deal. However, Administration officials say China has been backtracking from earlier commitments. In a Washington Post op-ed, former chief strategist Steve Bannon urged the president to “follow his instincts and not soften his stance against the greatest existential threat ever faced by the United States.” Trade advisor Peter Navarro, and others, see no deal as preferable to any deal, and some fear the president will cave, again.

Trump’s Harsh Economics for EU, China, Mexico, Canada, El Salvador, Guatemala and Honduras

USA China Truce Starts With Bomb Shells