We were on a roller-coaster of a ride this week with tweets and statements from The White House as well as comments from the Chinese. All of this taken together has whipsawed markets to the upside and to the downside. Given recent remarks, it appears that the US/China trade negotiations are at a standstill and may remain so until and unless President Trump and President Xi meet during the G20 meeting next month in Japan. Therefore, we may very likely see a continuation in volatility until there is further clarity surrounding the trade war. Nevertheless, be on the lookout for more tweets!
Ep. 70B - War Profiteering + A Market Divided Cannot Stand
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We discuss the power and influence of the military-industrial complex and how recent meddling and sabre rattling regarding Venezuela and Iran is recent proof of their influence. We must also look at how these companies within this industry benefit and profit from bloodshed and war. This is more than just profits, this is an issue that is in need of a true national discussion.
It’s been on the back burner, but not out of mind, and yes, we’re talking about Brexit. The PM’s deal is set to be voted on for a 4th time and so we’ll see in a few of weeks if the 4th time is the charm for Theresa May. Given the US/China trade war, there is a large and powerful political lobby that is caught in the crossfire – farmers. The President has stated repeatedly that the US will continue to subsidize farmers. Given the politics of the situation, is the President attempting to “buy” votes from those key swing states that he needs to maintain his office? Lastly, we discuss the sabre rattling regarding Iran and more broadly the effects of war and how we need a new level of consciousness here in the 21st century to end all wars.
These are the words coming from the President – this whole trade war thing is actually just a “little squabble.” Of course the markets liked this news and other “positive” comments from the President and thus markets were able to regain some of yesterday’s losses. It is too much power in the hands of an individual to move the markets to any degree, let alone to the magnitudes we have been witnessing. Furthermore, the President is once again calling out the Federal Reserve and instructing them to lower interest rates – this time, so we can win the trade war. Have we stated that we’re living in the financial world of Oz? Just open your eyes.
How much longer will this “trade war” continue? Everything was supposed to be “great,” historic,” “fantastic,” “remarkable,” etc etc etc… Now we know that the talks were taking too long and that additional tariffs needed to be increased on Chinese goods – this is per the President’s tweets. The Chinese have retaliated and global equity markets are selling-off. A tweet kick- started this market selling – will new tweets counter this and will we be “risk-on” again later this week? It’s anybody’s guess, we’re in the financial world of Oz, and anything can happen, but these tactics on the US side and their “success” are coming into question. Who blinks first?
The trade war is on! What remains, is how far will both sides go in their escalation. So far, we know that the USA has increased tariff rates and is looking to perhaps do so regarding additional Chinese goods. In retaliation, the Chinese have increased tariffs on additional US goods, which are slated to be effective on June 1st. All of this can change on a dime. We never know what will be said or tweeted out minute-to-minute, but what we do know is that global equity markets have been selling-off rapidly over the last week and today. Will this continue or will the markets cling to hope of a trade deal? Also, the politics of this become interesting as the US is in the early stages of the 2020 Presidential campaign. Will the Chinese sit back and wait or will a deal be struck?
Is the United States in the midst of a Constitutional crisis? If you ask the Dems and the MSM, you would be led to believe that the answer to that question, is yes! However, they are ultimately making the claim that the President did not commit collusion or conspiracy with the Russians and therefore there’s a crisis. So, their logic is the following: there’s no crime, yet we’re in crisis – makes absolutely NO sense. However, are we in the midst of a different sort of crisis regarding the President’s use of Twitter? In this instance we’re discussing the volatility that has existed in the global markets this week, driven primarily by tweets about US/China trade talks. Was it the Founders’ intentions to have a President move global markets to this degree, if at all? This is a serious question because this is NOT how it’s supposed to function.
