• Same story, different day...........year ie more of the same fiat floods the world
  • There are no markets
  • "Spreading the ideas of freedom loving people on matters regarding high finance, politics, constructionist Constitution, and mental masturbation of all types"

Trump's Economic, Tax & Spending Plans

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'It's welfare!' Republicans pile on Trump's $12 billion subsidy plan giving 'golden crutches' to farmers wounded by trade war he started

  • Trump administration plans $12 billion bailout for farmers affected by trade war
  • Lawmakers in his own party are panning the idea as 'welfare'
  • They say farmers want open markets, not handouts
  • Trump's wide-ranging use of trade tariffs to protect U.S. industries has put American farmers at a disadvantage when other countries retaliate
http://www.dailymail.co.uk/news/art...fer-U-S-farmers-billions-ease-trade-pain.html
 

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American's love to throw subsidies to the so called "poor farmers." In my neck of the woods large corporate farms are the norm these days with the exception of financially well heeled individuals looking for tax gimmicks. Gone are the days of the Joad's dust bowl situation but to hear the politicians the farmers are practically starving. Tax laws, subsidies and other assorted welfare types of payments flow to the farmers...and yet they are always complaining that they need more government help...and they usually get it too.
 

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The Trump Family Profits Off Of Products Not Made In The U.S. | Velshi & Ruhle | MSNBC
MSNBC


Published on Jul 24, 2018
It’s “Made in America” week at the White House, but the first family is making money selling their products that were not made in the USA. Ali Velshi and Stephanie Ruhle show you the Trump goods made in places like China, India and Mexico. Products from Ivanka’s brand, the First Lady, and the president himself.
» Subscribe to MSNBC: http://on.msnbc.com/SubscribeTomsnbc
 

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Trump calls Republicans 'weak' for not marching in lockstep on trade and says 'vicious' China is targeting U.S. farmers because he loves them

  • A number of Republicans unloaded on Trump's new plan to provide $12 billion from taxpayers funds to prop up farmers hurt in the trade war
  • China slapped tariffs on U.S. agricultural products after Trump imposed tariffs on steel and aluminum
  • Trump tweeted about 'weak' politicians Wednesday and said farmers are getting 'ripped off'
  • He vented at people 'snipping at your heels during a negotiation'
http://www.dailymail.co.uk/news/art...blicans-weak-not-marching-lockstep-trade.html
 

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How the Trump tax cut is helping to push the federal deficit to $1 trillion

NYT
JIM TANKERSLEY
11 mins ago


In the trough of the Great Recession in 2009, as companies laid off hundreds of thousands of workers each month, the amount of corporate income taxes collected by the federal government plunged by almost a third. It was the largest quarterly drop since the Commerce Department began compiling the data in the 1940s. No other period came close.

Until this year.

In the first half of 2018, corporate tax collections dropped to historically low levels as a share of the economy, according to data from the Bureau of Economic Analysis. That is pushing up the federal budget deficit much faster than economists had predicted.

The reason is President Trump’s tax cuts. The new law introduced a standard corporate rate of 21 percent, down from a high of 35 percent, and allowed companies to immediately deduct many new investments. As companies operate with a lower tax burden and a greater ability to offset what they owe, the federal government is receiving far less revenue than it would have under the previous tax system.

The growing deficit has forced the Trump administration to adjust its claim that the tax cuts would pay for themselves by generating increased revenue from faster economic growth. The White House’s Office of Management and Budget said this month that it had revised its forecasts from earlier this year to account for nearly $1 trillion of additional debt over the next decade — almost $100 billion a year in additional deficits, on average.

That is hindering the government’s ability to stabilize its balance sheet before the next recession hits or maintain spending programs that could help blunt the pain of future downturns. Economists equate that process to refilling the city water tower during periods of heavy rain, in order to prepare for the next drought. It’s not happening this time around.

So what’s going on?

The deficit is rising as billions in new spending compound the effects of tax cuts
The United States’ annual budget deficit is expected to top $1 trillion as early as the 2019 fiscal year, with the Congressional Budget Office’s baseline forecasts showing the annual deficit rising to $1.5 trillion over the next 10 years.

Adding to the deficit are hundreds of billions of dollars of federal spending increases, which Congress passed and Mr. Trump signed this year.

Corporate tax collections are down by a third from last year
From January to June, corporate tax receipts were nearly $50 billion behind — or down by close to a third — where they were a year ago.
“If we hadn’t changed our tax system,” said Kimberly A. Clausing, an economics professor at Reed College in Portland, Ore., who studies business taxation, “you would be expecting rising revenues.”

Corporate collections are running 20 percent below initial forecasts from the Congressional Budget Office and 10 percent below predictions from the Penn Wharton Budget Model, a nonpartisan research initiative that forecast large deficits as a result of the tax law.

Administration officials dismissed those outside estimates when the bill was being debated, but their own estimates now show something similar: an annual deficit that tops $1 trillion from 2019 through 2021, and falls from there only because of large proposed spending cuts that the administration has spent little effort on and that Congress has taken no steps to pass.

Companies are bringing back money held abroad, but are spreading out the tax bill over time
Corporate profits after taxes are higher than they have ever been in the United States (though still below their peak as a share of the economy, which was reached under President Barack Obama).

White House officials say the new law, which changed how the United States taxes multinational companies that operate here, is spurring a wave of so-called repatriation — companies returning money to the United States that they had booked on their balance sheets abroad in order to defer American taxes.

In the first quarter of this year, according to Commerce Department data, multinationals repatriated $306 billion, in the form of dividends. That was $270 billion above the average quarterly amount over the last five years. White House officials say that’s a sign that the tax law is working.
Over time, that repatriation should generate tax revenue.

But, as Ms. Clausing noted, companies can spread the bill over the next eight years, which is why we’re not seeing that money lifting corporate tax payments in the near term. The law forces multinational companies to pay a one-time tax on cash and assets held abroad, but the Internal Revenue Service allows firms to pay that bill in annual installments, even if they choose to pay out the money in dividends right away.

Companies may take advantage of a provision to write off new investments
Some analysts believe the so-called expensing provisions of the new tax law, which allow companies to write off new investments immediately, could prove more popular than some forecasters anticipated. To take advantage of the provision, companies may write off investments in software or machinery or new buildings.

If that’s true, “it means the government will lose more revenue than we all originally thought, especially in the short run,” said Kyle Pomerleau, an economist with the Tax Foundation in Washington, which forecast a large boost to economic growth from tax cuts and the expensing provision.

Multinationals could also be shifting money — on paper, basically — into the United States solely to take advantage of the expensing provision and reduce their American tax bills. It’s also possible, but far too soon to tell, that changes to multinational taxation, including what is considered a de facto minimum tax on certain income earned overseas, will not raise as much revenue as expected.

In those cases, the outcome could be a boon for multinationals, and a larger-than-expected blow to the Treasury.

http://www.msn.com/en-us/money/mark...cit-to-dollar1-trillion/ar-BBL2AIM?ocid=ientp
 

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Trump under fire as it emerges key components of the NASA space capsule touted at 'Made in America' event are actually made in Europe

  • Orion crew module was on display on the South Lawn of the White House
  • European Service Module supplies propulsion, power and the essentials of life support for the capsule
  • NASA says the European module is a ';critical' part of the system
http://www.dailymail.co.uk/sciencet...rump-overlooks-Europes-role-NASA-capsule.html
 

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We Have A Deal: Watch As Trump And Juncker Reveal Agreement To Avert A Trade War


by Tyler Durden
Wed, 07/25/2018 - 15:45


There was much pessimism going into today's meeting between US President Trump and EU Commission president Jean-Claude Juncker that any deal could be announced.

In fact, according to an analysis released earlier today by SGH Macro Advisors, hopes of anything tangible being announced are slim to none, as EU officials were dampening expectations right ahead of the widely anticipated summit over auto and trade tariffs between Trump and Juncker.

From what we understand, the EU is not coming with any “substantial offer” to Washington, but rather with some broad proposals intended to keep a dialogue alive and to avoid further escalation. EU officials are concerned about the raising of expectations last week by National Economic Council Director Larry Kudlow, and they see his comments to some extent as “bullying tactics” to pressure them into concessions in the negotiations.​

And yet, according to Dow Jones and Reuters, Trump has managed to secure concessions to avoid a trade war, including agreeing to import more soybeans and lowering industrial tariffs as well as working more on LNG exports.

President Trump has secured concessions from Europe to avoid a trade war, with Europe agreeing to the following (per Dow jones):

  • Europeans agreed to work on more U.S. LNG exports
  • Europeans agree on lowering industrial tariffs
  • EU agrees to align regulator standards on medical products
  • EU agrees to import more U.S. soybeans

It was not immediately clear if auto tariffs are also included in the agreements, but stocks are surging on the news, and the January all time highs are now in sight:



As Bloomberg notes, while it's reasonable to wonder what the actual impact of European concessions might be, the knee-jerk reaction of markets is probably understandable.

Watch the press conference live below:


Started streaming 52 minutes ago
President Trump holds news conference alongside European Commission president Jean-Claude Juncker at the White House Rose Garden. Subscribe to The Washington Post on YouTube: http://bit.ly/2qiJ4dy

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Trump, Juncker Announce Deal Pulling Back From U.S.-EU Trade War

Bloomberg
Toluse Olorunnipa and Margaret Talev
1 hr ago


(Bloomberg) -- President Donald Trump reached an agreement Wednesday with European Commission President Jean-Claude Juncker aimed at averting a transatlantic trade war, easing tensions stoked by Trump’s threat to impose tariffs on car imports.

The two sides agreed to expand European imports of U.S. liquified natural gas and soybeans and lower industrial tariffs on both sides, Trump said. The U.S. and European Union will “hold off on other tariffs” while negotiations proceed, Juncker said.

“We had a big day, very big,” Trump said at a joint statement with Juncker at the White House Wednesday. He hailed “a new phase” of trade relations.

The two leaders also said they would work toward “zero” tariffs on industrial goods, according to Trump. He added that they would try to “resolve” steel and aluminum tariffs he imposed earlier this year and retaliatory duties the EU levied in response.

Trump and Juncker took no questions after their brief remarks in the Rose Garden, an impromptu appearance scheduled after less than two hours of talks.

Juncker came to Washington for a last-ditch bid to avoid U.S. tariffs on cars. He told reporters he entered Wednesday’s meeting with the intention of reaching an agreement with Trump.

Trump warned at a cabinet meeting last week that he would move forward with 25 percent auto tariffs if the meeting with Juncker didn’t go well.

Trump could impose car tariffs on national security grounds once Commerce Secretary Wilbur Ross completes a required investigation.

Auto tariffs at the level Trump has threatened would add about 10,000 euros ($11,700) to the sticker price of a European-built car sold in the U.S., according a European Commission assessment obtained by Bloomberg News last month. That would cut U.S. imports of European cars and car parts in half, the commission forecast.

To contact the reporters on this story: Toluse Olorunnipa in Washington at tolorunnipa@bloomberg.net;Margaret Talev in Washington at mtalev@bloomberg.net

To contact the editors responsible for this story: Alex Wayne at awayne3@bloomberg.net, Mike Dorning

©2018 Bloomberg L.P.

http://www.msn.com/en-us/news/world...ck-from-us-eu-trade-war/ar-BBL3ylh?ocid=ientp
 

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Trump declares a victory in his trade war. Skepticism is warranted.

Washington Post
Aaron Blake
6 hrs ago

For the second time in two weeks Wednesday, President Trump emerged from a high-profile meeting with European allies and claimed victory. This time, it was hailing alleged concessions from the European Union to avert the escalating trade war Trump launched.

“This was a very big day for free and fair trade — a very big day indeed," Trump intoned alongside European Commission President Jean-Claude Juncker.

But claiming victory is one thing; demonstrating it is another. And Trump has shown more of a knack for the former than the latter.

Despite Trump's “very big day for free trade" declaration, the details thus far are thin and vague. The E.U. will buy more soybeans and liquefied natural gas, and existing tariffs on steel and aluminum will be reevaluated. The rest, it seems, is to be determined — part of “a dialogue" Trump proudly announced and predicted would be a great success. “We’re starting the negotiation right now, but we know where it’s going," Trump said, making clear this is hardly set in stone.

It's obvious why Trump would want to shift the narrative; just Tuesday, he was forced to give farmers hurt by the retaliatory tariffs in the trade war a $12 billion bailout. But it all sounds a little like Trump's dubious victory declaration after a NATO summit in Brussels two weeks ago. Before exiting the summit, Trump called a news conference and claimed that NATO allies had given in to his demand that they increase their spending on the common defense. “They have substantially upped their commitment, and now we’re very happy and have a very, very powerful, very, very strong NATO,” he said.

To this day, there's no concrete reason to believe anything has changed. A communique at the end of NATO described the goal as it had been — 2 percent of each country's GDP by 2024 — and French President Emmanuel Macron openly disputed that any new agreement had been reached. “The communique is clear," Macron said. “It reaffirms a commitment to 2 percent in 2024. That is all."

Even in announcing the supposed breakthrough, Trump didn't lay out which countries agreed to what — “Some are at 2 percent, others have agreed definitely to go to 2 percent, and some are going back to get the approval, and which they will get to go to 2 percent," Trump said — and the White House hasn't substantiated his claim.

From a political standpoint, the strategy makes sense. Diplomacy is complicated and extremely difficult for your average American to understand, as is trade. Trump has also shown he's not particularly worried about the media and experts parsing his comments and casting doubt on his victories, as long as he can sell them to a base that has stood by Trump through thick and thin and almost always seen his exploits in the best possible light.

If your only goal is to appeal to voters who already mistrust what the media and experts are telling them and you have little regard for specifics, it becomes easier to manufacture crises and then claim you have used them to obtain concessions. As long as the E.U. imports more soybeans, Trump has something specific he can point to as a deliverable from his trade war strategy. And people who want to believe Trump will believe he just stuck it to the E.U. and bent it to his will.

It's also worth noting that often the belligerent actors on the world stage get what they want — because other countries are wary of poking the bear. Trump has certainly made himself into a bear, feuding with allies and cozying up to strongmen. But even if you can win a series of small victories that way, you only need to fall short once for the “madman strategy" to seriously backfire.

That hasn't happened yet, which means Trump can keep plausibly claiming victories — no matter how thinly constructed or tentative they are. And that appears to be what he'll keep doing.

http://www.msn.com/en-us/news/polit...skepticism-is-warranted/ar-BBL3BgV?ocid=ientp
 

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‘Juncker is a surrender monkey’ – Max Keiser on EU commissioner meeting with Trump
RT


Published on Jul 26, 2018
Max Keiser, host of RT's 'The Keiser Report,' says Europe has bowed to US pressure.

READ MORE: https://on.rt.com/9b31
 

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China could bring more pain to US soybean farmers if Trump escalates the trade war
in Commodity News 26/07/2018





With President Donald Trump threatening that he’s “ready to go” with tariffs on more than $500 billion in goods from China, there’s a possibility Beijing could inflict more pain on U.S. agriculture as part of retaliation, including another round of duties on soybeans.

If China were to add another round of duties on soybeans, it could add pressure on the Trump administration due to the economic importance of soy exports to China. However, the White House may have helped prepare for more pain in the American agriculture sector by rolling out a $12 billion emergency plan for U.S. farmers on Tuesday.

“Nobody is going to win in this trade war,” said Bret Davis, an Ohio soybean farmer and a member of the American Soybean Association’s governing committee. “We just hope instead of a tariff that we come to an agreement and make it better for our side and their side.”

Still, there is precedent for China slapping “double whammy” tariffs months apart on the same U.S. agricultural products. For example, China imposed two rounds of tariffs on pork, nuts and fresh fruit. In the case of pork, after the additional tariff went into effect July 6, “the other white meat” is now subject to an import tax that exceeds 70 percent.

“You’ve already seen China express ways that they will probably get around soy,” said Sam Funk, senior grain and oilseed analyst at Rabobank in St. Louis. The Chinese tariffs have already hit most lucrative sectors of agriculture, from grains and oilseeds to livestock and fresh produce. There have also been duties slapped on items such as dairy, nuts and wine.

If Beijing added a second wave of tariffs on U.S. soybeans, Funk said it could be done without Chinese buyers suffering the imported tax directly, such as by going through state-owned strategic reserves and then releasing some supplies internally. The Chinese government would presumably absorb the tariff, but if there were a double tariff the costs could increase sharply for Beijing.

A report earlier this month from Bloomberg suggested the Chinese government would reimburse buyers for costs of the new import duties, assuming the soybean cargoes are for state stockpiles. It cited unnamed sources for the information.

Pig feed and fish farms
China buys about two-thirds of the world’s soybean exports, using most of it for soy protein to feed roughly 700 million pigs in the country or to make cooking oil. The soy also is used for feeding poultry and to support the country’s fish farming sector.

The Chinese media, meantime, has been full of stories in recent weeks about how the country is no longer as dependent on the U.S. for its soybean needs, including how pork producers are using more alternative feeds, including cotton seeds and bone powder, and not seeing impacts in quality nor breeding.

Even so, an agricultural ministry official acknowledges prices of pork may go up due to price of soy imports rising.

Some US farmers can’t cover the bills

There also is pain being felt in the U.S. farm sector due to Beijing’s soybean tariffs. Chinese buyers have scrapped U.S. soybean orders in the past few months since the trade fight escalated and they have continued since the tariffs went into effect earlier this month.

Soybean prices have plunged nearly 20 percent since April when China first announced the 25 percent tariff on U.S. soybeans. That means farmers are getting lower prices for the commodity, and at these levels some are not making enough to cover bills. Beijing started collecting the tariff on U.S. soybeans on July 6.

“Cash prices are the lowest they’ve been in more than a decade,” said Brennan Turner, president and CEO of the grain marketing business FarmLead. “If Washington and Beijing can’t come to terms on major issues, this might be the new normal.”

Also, the price China was paying for soybeans from Brazil — its top international supplier — rose sharply after the tariff was announced, so Beijing is paying a premium over the U.S. price. At the same time, the recent “bargain” prices for the U.S. beans appear to have sparked interest from other buyers, including Brazil and Mexico.

“Another tariff would mean another step down in price for soybeans, which will definitely put harvest prices below production costs for many producers across the country,” said Chad Hart, an agricultural economist at Iowa State University in Ames.

According to Hart, some farmers are “doing well and can weather this financial storm quite easily. A bunch in the middle can handle this, but it will definitely erode their bottom line. And then we have some that were struggling before this tariff dispute really started, and this will push a few of them out of the door.”

U.S. farm income has fallen about 50 percent since 2013 and is forecast to decline 6.7 percent this year, or the lowest level in nominal terms since 2006, according to the latest U.S. Department of Agriculture estimates.

China targets Trump states
Experts believe political factors drove Beijing to use soybeans as a weapon in the U.S.-China trade war. China buys roughly half of the U.S. soybean exports, and roughly one in three rows of soybeans grown on the nation’s farms goes to the world’s second-largest economy.

Top soybean-producing states include Illinois, Iowa, Minnesota, Nebraska, North Dakota, South Dakota, Indiana, Missouri, and Ohio. Trump won all but Illinois and Minnesota in the 2016 presidential election.

Last year, the U.S. exported about $20 billion of agricultural products to China and soybeans accounted for more than $12.2 billion of that amount.

Brazil remains the largest seller of soybeans to China, but its exports to China tend to be exhausted in the fall months or December. Analysts suggest China will need to buy some U.S. soy when South American supplies slow to a trickle, so they could use Beijing’s strategic reserves to reimburse domestic users for the cost of the tariff or resort to other creative means.

“China is going to have to get soybeans from somewhere,” said Funk, the Rabobank analyst. “It could be U.S. soybeans land somewhere [on a ship] and then turnaround and get a new designation as being from a new location.”

Source: CNBC

https://www.hellenicshippingnews.co...ean-farmers-if-trump-escalates-the-trade-war/
 

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EU sees major success in Trump trade talks
in World Economy News 26/07/2018




European Commission President Jean-Claude Juncker’s deal on Wednesday to end U.S. President Donald Trump’s threat of new tariffs was hailed as a major success by EU officials and other European governments.

“Breakthrough achieved that can avoid trade war and save millions of jobs! Great for global economy!” tweeted German Chancellor Angela Merkel’s Economy Minister Peter Altmaier as news of the Washington deal broke late in the evening in Europe.

“This is a big day for the Commission, it’s a big day for Juncker,” a senior EU official said. “The imminent sanctions and everything that could have happened unilaterally … is off now.

“We have a system engaging them in dialogue, not confrontationally,” the official added. “For as long as the dialogue continues we can make this win-win.”

Brussels had been playing down expectations before the meeting that the EU chief executive could dissuade Trump from imposing new tariffs on European – notably German – cars.

The plan had been to lay out a threat of EU retaliation on U.S. goods that the EU said could wipe $50 billion off U.S. national income in the coming years while also renewing offers of resuming talks on lowering barriers to transatlantic trade.

In the end, Trump agreed to resolve arguments over the steel and aluminium tariffs he introduced to European dismay earlier this year, to scrap any other planned penalties and to join in a dialogue with Brussels on enhancing trade. The EU will work to ease U.S. imports, including soybeans and natural gas.

The EU official said Trump’s agreement came as something of a surprise to the European delegation, but the U.S. president appeared to have appreciated the risk of a further trade war.

“We were surprised but I think that they also saw that the potential of a deal would be much more than the cost of retaliation,” the official said. “I think they weighed what it would mean to open up a 50-billion-euro trade nightmare.”

“Any potential threat … is off the table. And we have a process now and they are hooked into the process.”

Another Merkel ally, the centre-right leader in the European Parliament Manfred Weber, tweeted: “Once again it is clear this evening — Europe is strong when it acts with determination.”

Earlier this month, while Trump stirred new consternation in Europe with criticism of Germany and others during a NATO summit in Brussels, Juncker faced questions, notably in Germany, over his fitness to negotiate for the EU as he appeared unwell.

He dismissed suggestions he was drunk, blaming sciatica. The apparent success of his talks in Washington is certain to be portrayed by the Commission as proof that the EU executive is capable of defending the interests of the 28 member states.

Source: Reuters (Reporting by Alastair Macdonald, editing by Philip Blenkinsop and James Dalgleish)

https://www.hellenicshippingnews.com/eu-sees-major-success-in-trump-trade-talks/
 

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Financial Times: Chinese Officials “Awed” by Trump’s “Skill as a Strategist and Tactician”

Posted on July 26, 2018 by Yves Smith

A Financial Times article, The Chinese are wary of Donald Trump’s creative destruction, by Mark Leonard, director of the European Council on Foreign Relations, is so provocative, in terms of the contrast with Western perceptions of Trump, that I am quoting from it at some length.

According to Leonard, quite a few key players in China see Trump as having a coherent geopolitical agenda, with reducing China’s influence as a key objective, and that he is doing an effective job of implementation. From his Financial Times piece:

I have just spent a week in Beijing talking to officials and intellectuals, many of whom are awed by his [Trump’s] skill as a strategist and tactician…..​
Few Chinese think that Mr Trump’s primary concern is to rebalance the bilateral trade deficit….They think the US president’s goal is nothing less than remaking the global order.​
They think Mr Trump feels he is presiding over the relative decline of his great nation. It is not that the current order does not benefit the US. The problem is that it benefits others more in relative terms. To make things worse the US is investing billions of dollars and a fair amount of blood in supporting the very alliances and international institutions that are constraining America and facilitating China’s rise.​

In Chinese eyes, Mr Trump’s response is a form of “creative destruction”. He is systematically destroying the existing institutions….as a first step towards renegotiating the world order on terms more favourable to Washington.​

Once the order is destroyed, the Chinese elite believes, Mr Trump will move to stage two: renegotiating America’s relationship with other powers. Because the US is still the most powerful country in the world, it will be able to negotiate with other countries from a position of strength if it deals with them one at a time rather than through multilateral institutions that empower the weak at the expense of the strong.​
My interlocutors….describe him as a master tactician, focusing on one issue at a time, and extracting as many concessions as he can. They speak of the skilful way Mr Trump has treated President Xi Jinping. “Look at how he handled North Korea,” one says. “He got Xi Jinping to agree to UN sanctions [half a dozen] times, creating an economic stranglehold on the country. China almost turned North Korea into a sworn enemy of the country.” But they also see him as a strategist, willing to declare a truce in each area when there are no more concessions to be had, and then start again with a new front.​
For the Chinese, even Mr Trump’s sycophantic press conference with Vladimir Putin, the Russian president, in Helsinki had a strategic purpose.​
They see it as Henry Kissinger in reverse. In 1972, the US nudged China off the Soviet axis in order to put pressure on its real rival, the Soviet Union. Today Mr Trump is reaching out to Russia in order to isolate China.​
In fact, Trump made clear on the campaign trail that he wanted to normalize relations with Russia because he saw China as the much bigger threat to US interests, and that the US could not afford to be taking them both on at the same time. He also regarded Russia as having more in common culturally with the US than China, and thus a more natural ally. Given the emphasis that Trump has placed on US trade deficits as a symbol of the US making deals that are to America’s disadvantage, by exporting US jobs.

However, even if the Chinese are right, and there is more method to Trump’s madness than his apparent erraticness would have you believe, there are still fatal flaws in his throwing bombs at international institutions.

As anyone who has done a renovation knows, the teardown in the easy part. Building is hard. And while the young Trump that pulled off the Grand Hyatt deal had a great deal of creativity and acumen, early successes appear to have gone to Trump’s head. He did manage to get out of the early 1990s real estate downturn in far better shape than most New York City developers by persuading lenders that his name was so critical to the value of his holdings that creditors needed to cut him some slack. But the older Trump has left a lot of money on the table, such as with The Apprentice, by not even knowing what norma were to press for greatly improved terms.

The fact that the half-life of membership on Trump’s senior team seems to be under a year does not bode well for establishing new frameworks, since they require consistency of thought and action. And the fact that Trump has foreign policy thugs operatives like John Bolton and Nikki Haley in important roles works against setting new foundations.

So even if the Chinese are right and Trump has been executing well on his master geopolitical plan, Trump is at best capable of delivering only on the easy, destructive part, and will leave his successors to clean up his mess.


This entry was posted in China, Free markets and their discontents, Globalization, Politics on July 26, 2018 by Yves Smith.

https://www.nakedcapitalism.com/201...s-awed-trumps-skill-strategist-tactician.html
 

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The real Art of the Deal
Posted July 26, 2018 by Joshua M Brown


Trump needed a trade win. Any win, quite frankly. Having to cut a check to his own farmer voting bloc was bad enough without his former attorney releasing tapes on him and all the lingering Putin stuff from last week. The automakers squealing about tariffs hurting their businesses was probably a last straw.

Then the EU shows up at his doorstep…

Bloomberg:

European Commission President Jean-Claude Juncker proved on Wednesday that the EU isn’t the useless bunch of bureaucrats populists and nationalists make it out to be. He came to Washington with a bridge to sell, and in three hours of talks he sold it to Trump.​
I have been saying for weeks that this would end when the President finally declares victory in the trade war. He knows the base doesn’t need actual data or numbers proving it, just him saying he won would be enough. We’re talking about incurious people, impervious to facts and guided purely by emotion. All they need to know is what team they’re on in the culture wars, the rest takes care of itself and they’ll buy into anything if it comes from “their side.”

The genius of President Trump is understanding that dynamic intuitively. He probably can’t put it into words, other than “I could shoot someone on 5th Avenue” but he is highly adept at playing the game regardless of the inarticulate way in which he goes about it. Words are overrated.

This is the environment he is operating in, so it’s no stretch at all for him to simply say “Look, I won!”

Trump appears to believe he got two important promises from Juncker. “European Union representatives told me,” he tweeted, “that they would start buying soybeans from our great farmers immediately. Also, they will be buying vast amounts of LNG!”​
In fact, the EU, which barely produces any soybeans, is already buying them from the U.S. and will increase imports of the oilseed this year because of a low domestic rapeseed crop and smaller supplies of sunflower seed meal from Ukraine and Russia.​
The Europeans probably walk away having quashed the tariff on their auto exports into the United States for nothing of substance in exchange.

The real art of the deal is not necessarily winning a negotiation. It’s choosing the right time to negotiate, when your counterparty is on the mat and needs to save face. The flattery and false bonhomie is just a tactic, a nice touch that goes a long way when dealing with someone whose only real concern is their own feelings and the optics.

The Saudis knew how to play this guy from day one. The Chinese too. European leaders are learning.

The stock market is smart. It never fully bought into the worst-case trade war scenario. Nor should it have. The threat was always going to be worse than the outcome. Expect more capitulation with more countries as the march toward the midterm election continues.

Source:

How the EU Bureaucrat Won Bigger Than Trump (Bloomberg)

http://thereformedbroker.com/2018/07/26/the-real-art-of-the-deal/
 

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Mercedes May Move Some US Production To China


by Tyler Durden
Thu, 07/26/2018 - 11:40


Two weeks ago we reproted that BMW - the largest US auto exporter - is considering moving production for some of its SUVs out of the U.S. - the company employs 10,000 people at a plant in Spartanburg, S.C. - and to China as a result of new tariffs placed on the vehicles. Now it's Mercedes' turn.



On Thursday, Daimler said it was looking at ways to mitigate the impact of a trade war between China and the United States, a step which includes a review of whether to shift some U.S. production to Asia, according to Reuters.

Daimler's profits have been hit since the start of the month as a result of tariffs on exports to China of the Mercedes-Benz GLE SUV which is built in Tuscaloosa, Alabama. Asked whether Daimler would consider manufacturing the Mercedes GLE at its factory in Beijing, Chief Executive Dieter Zetsche said, "Of course we look at when parameters change, and how one could react to this, and whether we can set ourselves up in a better way."



For now the company has not made a decision: "we are thinking about such matters, but so far we have not come to a decision."

Zetsche added that recalibrating the production footprint was costly and time consuming since it also required reconfiguring the supplier network, but the longer the trade war persists and the more money Daimler loses on export tariffs, the more likely such a move will be.

https://www.zerohedge.com/news/2018-07-26/mercedes-may-move-some-us-production-china
 

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How the Trump tax cut is helping to push the federal deficit to $1 trillion

NYT
JIM TANKERSLEY
11 mins ago


In the trough of the Great Recession in 2009, as companies laid off hundreds of thousands of workers each month, the amount of corporate income taxes collected by the federal government plunged by almost a third. It was the largest quarterly drop since the Commerce Department began compiling the data in the 1940s. No other period came close.

Until this year.

In the first half of 2018, corporate tax collections dropped to historically low levels as a share of the economy, according to data from the Bureau of Economic Analysis. That is pushing up the federal budget deficit much faster than economists had predicted.

The reason is President Trump’s tax cuts. The new law introduced a standard corporate rate of 21 percent, down from a high of 35 percent, and allowed companies to immediately deduct many new investments. As companies operate with a lower tax burden and a greater ability to offset what they owe, the federal government is receiving far less revenue than it would have under the previous tax system.

The growing deficit has forced the Trump administration to adjust its claim that the tax cuts would pay for themselves by generating increased revenue from faster economic growth. The White House’s Office of Management and Budget said this month that it had revised its forecasts from earlier this year to account for nearly $1 trillion of additional debt over the next decade — almost $100 billion a year in additional deficits, on average.

That is hindering the government’s ability to stabilize its balance sheet before the next recession hits or maintain spending programs that could help blunt the pain of future downturns. Economists equate that process to refilling the city water tower during periods of heavy rain, in order to prepare for the next drought. It’s not happening this time around.

So what’s going on?

The deficit is rising as billions in new spending compound the effects of tax cuts
The United States’ annual budget deficit is expected to top $1 trillion as early as the 2019 fiscal year, with the Congressional Budget Office’s baseline forecasts showing the annual deficit rising to $1.5 trillion over the next 10 years.

Adding to the deficit are hundreds of billions of dollars of federal spending increases, which Congress passed and Mr. Trump signed this year.

Corporate tax collections are down by a third from last year
From January to June, corporate tax receipts were nearly $50 billion behind — or down by close to a third — where they were a year ago.
“If we hadn’t changed our tax system,” said Kimberly A. Clausing, an economics professor at Reed College in Portland, Ore., who studies business taxation, “you would be expecting rising revenues.”

Corporate collections are running 20 percent below initial forecasts from the Congressional Budget Office and 10 percent below predictions from the Penn Wharton Budget Model, a nonpartisan research initiative that forecast large deficits as a result of the tax law.

Administration officials dismissed those outside estimates when the bill was being debated, but their own estimates now show something similar: an annual deficit that tops $1 trillion from 2019 through 2021, and falls from there only because of large proposed spending cuts that the administration has spent little effort on and that Congress has taken no steps to pass.

Companies are bringing back money held abroad, but are spreading out the tax bill over time
Corporate profits after taxes are higher than they have ever been in the United States (though still below their peak as a share of the economy, which was reached under President Barack Obama).

White House officials say the new law, which changed how the United States taxes multinational companies that operate here, is spurring a wave of so-called repatriation — companies returning money to the United States that they had booked on their balance sheets abroad in order to defer American taxes.

In the first quarter of this year, according to Commerce Department data, multinationals repatriated $306 billion, in the form of dividends. That was $270 billion above the average quarterly amount over the last five years. White House officials say that’s a sign that the tax law is working.
Over time, that repatriation should generate tax revenue.

But, as Ms. Clausing noted, companies can spread the bill over the next eight years, which is why we’re not seeing that money lifting corporate tax payments in the near term. The law forces multinational companies to pay a one-time tax on cash and assets held abroad, but the Internal Revenue Service allows firms to pay that bill in annual installments, even if they choose to pay out the money in dividends right away.

Companies may take advantage of a provision to write off new investments
Some analysts believe the so-called expensing provisions of the new tax law, which allow companies to write off new investments immediately, could prove more popular than some forecasters anticipated. To take advantage of the provision, companies may write off investments in software or machinery or new buildings.

If that’s true, “it means the government will lose more revenue than we all originally thought, especially in the short run,” said Kyle Pomerleau, an economist with the Tax Foundation in Washington, which forecast a large boost to economic growth from tax cuts and the expensing provision.

Multinationals could also be shifting money — on paper, basically — into the United States solely to take advantage of the expensing provision and reduce their American tax bills. It’s also possible, but far too soon to tell, that changes to multinational taxation, including what is considered a de facto minimum tax on certain income earned overseas, will not raise as much revenue as expected.

In those cases, the outcome could be a boon for multinationals, and a larger-than-expected blow to the Treasury.

http://www.msn.com/en-us/money/mark...cit-to-dollar1-trillion/ar-BBL2AIM?ocid=ientp
Pretty sure the deficit was at a trillion plus the entire time Obama was in office. How else did we go from 10-20 trillion in debt in 8 years?
 

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Trump’s Plan for U.S. LNG in Europe to Face Reality Check
July 26, 2018 by Reuters



VladSV / Shutterstock.com




By Vera Eckert, Oleg Vukmanovic and Sabina Zawadzki FRANKFURT/LONDON, July 26 (Reuters) – President Donald Trump’s plan for “vast amounts” of U.S. liquefied natural gas (LNG) to be sold to the European Union after trade talks with its top representative faces a reality test.

After a meeting at the White House with European Commission President Jean-Claude Juncker on Wednesday, Trump said the EU would also buy more U.S. soybeans and work with Washington to cut other trade barriers to zero.

“European Union representatives told me that they would start buying soybeans from our great farmers immediately. Also, they will be buying vast amounts of LNG!,” Trump wrote in a Tweet.

Juncker said the EU would build more terminals to handle America’s LNG.

It appeared that a major LNG deal between the trading partners had been struck.

In reality, three-quarters of Europe’s existing import facilities lie empty while demand for U.S. LNG on the continent remains limited.

The most lucrative markets for U.S. LNG are in South and Central America, India and the Far East, with Europe near the bottom of the pile given its relatively low prices and ample supplies of gas via pipelines from Russia and Norway.

Global gas price signals determine LNG trade flows, Royal Dutch Shell Chief Executive Ben van Beurden said on Thursday.

“Will U.S. LNG reach Europe? Yes, but only if there is an arbitrage opportunity that makes sense,” he said.

Politicians have little sway over this. The EU applies zero tariffs on U.S. LNG imports, so cutting them is not an option to boost trade in any future U.S.-EU talks.

Europe’s declining domestic production of gas from the North Sea, Netherlands, Germany and Norway leaves a growing gap for Russia and potential LNG suppliers in the United States to exploit.

EU gas production will halve by 2040, the International Energy Agency says.

By then, 84 percent of gas will be imported against 71 percent 2016, it says, although it could be less if green energy expands faster and energy efficiency gains reduce the need for gas.

Trump told reporters on Wednesday that Europe would be a massive buyer of LNG to diversify its energy supply – “And we have plenty of it.”

A number of European companies have already announced plans to buy LNG from a new wave of planned U.S. projects.

Portugal’s Galp, Italy’s Edison, Britain’s BP and Royal Dutch Shell are all lining up to lift LNG from Venture Global’s planned Calcasieu Pass project in Louisiana.

But supply from these and other projects will not be ready for years and even then there is no guarantee it will come to Europe in meaningful quantities if more lucrative markets, such as China, emerge.

The benefit of lifting supplies from the U.S. is that a buyer can divert shipments to the highest bidder anywhere in the world without needing the approval of the seller.

Thomas Kusterer, chief financial officer for German utility EnBW, said on Thursday that he would consider purchasing U.S. LNG if it became cheaper than other sources.

Having more LNG options will help Europe avoid being overcharged by Russia, analysts say.

“LNG is a valuable option for Europe, it can create negotiating power,” said Hanns Koenig of Berlin-based Aurora Energy Research.

(Reporting by Vera Eckert, Oleg Vukmanovic Additional reporting by Tom Kaeckenhoff Editing by Giles Elgood)

(c) Copyright Thomson Reuters 2018.

http://gcaptain.com/trumps-plan-for-u-s-lng-in-europe-to-face-reality-check/
 

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Pumped-up Trump teases 'unthinkable' GDP numbers in freewheeling trade speech to steelworkers where he claims he won the women's vote and there's 'a dictator or two' in NATO

  • The president said Friday's GDP numbers will be 'terrific' as economists agree the numbers could be as high as 4.2
  • But, they caution, it's likely a one-time thing caused by countries massively importing U.S. goods to beat Trump's tariff hikes
  • Trump also claimed he won the women's vote in 2016 (he won white women)
  • He touted his deal-making power at NATO: 'These are kings, queens, presidents, prime ministers, and a dictator or two'
  • And he falsely bragged the media cover him much more than they covered President Barack Obama or President George W. Bush
http://www.dailymail.co.uk/news/art...s-freewheeling-trade-speech-steelworkers.html
 

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"I Can Be Stupid As Well" - Juncker Threatens Trump Behind Closed Doors


by Tyler Durden
Fri, 07/27/2018 - 05:00


Authored by Mike Shedlock via MishTalk,

Some amusing details have emerged from this week's alleged trade cease-fire "deal" between Juncker and Trump.



Please consider Juncker’s Trade Pitch to Trump: ‘I Can Be Stupid, as Well’.

Once Mr. Juncker entered the Oval Office, it was clear Mr. Trump was in a mood to negotiate, said a senior European Union official who was present.​
Mr. Juncker grabbed the opportunity to argue that both sides need to refrain from further punitive tariffs or they would foolishly harm themselves.​
“If you want to be stupid,” he told Mr. Trump, “I can be stupid, as well.”
Backing up his points, Mr. Juncker flipped through more than a dozen colorful cue cards with simplified explainers, the senior EU official said. Each card had at most three figures about a specific topic, such as trade in cars or standards for medical devices.​
“We knew this wasn’t an academic seminar,” the EU official said. “It had to be very simple.”


What Happened?
In a nutshell, Trump backed down.

Why?

My assessment yesterday was accurate: Trump was feeling the heat from Republican senators and all automakers.

For details, please see Trump and Juncker Supposedly Agree to Trade Deal: Lies All Around.

  • My lead-in: "Color me skeptical as to how long this lasts and what happens next."
  • Middle quote 1: "It will take the EU and the US a decade to work out a real agreement. Juncker by himself cannot promise anything. All 27 nations in the EU have to ratify trade deals."
  • Middle quote 2: "So, is Juncker lying today or was he lying two days ago? The US is not going to supply the EU with LNG. That is a direct and blatant lie by Trump. The EU will get natural gas from Russia via Nordstream2. US LNG would be far more costly. So there are lies all around."
  • My conclusion: "With 35 companies and organizations bitching about Trump's inane tariffs, this is best viewed as either a reversal by Trump or a political stunt that accomplishes nothing. Obvious lies aside, it is a good thing to deescalate trade war talk."


Eurointelligence Comments
Eurointelligence commented early this morning echoing what I stated yesterday.

We are not sure that the EU can deliver what Juncker promised, and a different interpretation of what was agreed emerged almost immediately.​
One of the reasons for Trump’s apparent U-turn may have been yesterday’s profit warnings from US car makers due to tariffs on steel and aluminium.​
The big question is whether this is for real or whether, as the FT put it, this only constitutes a ceasefire in a trade war. It is not clear whether he was simply looking for an opportunity to declare victory and move on, or whether he will return to this issue.​

While the EU thought it agreed to include talks to open up the EU market to US agricultural goods, Trump interpreted the result in a way that could set the EU up for failure. “Soybeans is a big deal. And the European Union is going to start, almost immediately, to buy a lot of soybeans — they’re a tremendous market — buy a lot of soybeans from our farmers in the Midwest, primarily. So I thank you for that, Jean-Claude.” [Mish Comment: Juncker cannot agree to that. It's a lie, as is LNG]
Die Welt asks why cars are excluded from this agreement, especially given Trump’s obsession with them. The answer is that it is politically easier for both sides to agree to drop tariffs on general industrial goods than on cars. It is quite possible that the US and the EU might end up with a broad package of measures to liberalise trade, as well as higher US tariffs on imported cars. Before the meeting, the Washington Post quoted sources close to Trump as saying that the president was ready to impose a 25% tariff on all car imports - about $200bn worth. This issue is clearly not off the table.​
We agree with the conclusion of the article - that it is too early to be relaxed about US/EU trade relations, but the agreement yesterday should nevertheless be regarded as an encouraging sign.
We need to watch out for reactions from France in particular. The Germans naturally welcomed it. We are not sure the French will be happy.​
And finally, we are in full agreement with Adam Tooze, who makes the point in an article in the New York Times that the EU is not right about trade just because Trump is wrong. They are both wrong. He sees the real issue as Europe’s obsession with competitiveness.​

Answer Already?

TRUMP RETAINS LEVERAGE TO IMPOSE TARIFFS IF U.S. AND EU CANNOT COME TO A DEAL; EU NEEDS TO OPEN TO MORE U.S. AUTO EXPORTS: RTRS

Trade Negotiation Strategy Explained
Sadly, this is what's become of trade negotiation policy: Anything you can do, I can do stupider. I can do anything stupider than you.

https://www.zerohedge.com/news/2018...l-juncker-threatens-trump-behind-closed-doors
 

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Trump Vs. The Fed: America Sacrificed At The NWO Altar


by Tyler Durden
Fri, 07/27/2018 - 00:15


Authored by Brandon Smith via Alt-Market.com,

There is a disconnect within the liberty movement over the notion of where to find the root source of globalism.

A segment of people within the movement seem to think that the fount of globalism resides within America itself; that American imperialism is the foundation of the globalist scheme and the dollar is the single most important mechanism supporting their power. This is an naive oversimplification of the problem.



Numerous misconceptions stem from the idea that globalists actually have loyalty to the U.S. system. For example, over the past several years you might have often heard the argument that the Federal Reserve would “never end QE,” that they would “never let stock markets fall,” that they would “never raise interest rates,” that they would “inevitably go to negative interest rates,” that they would “never cut the balance sheet,” etc. etc. All of these assumptions were based on the idea that central bankers and globalists need the U.S. economy and the dollar system in order to maintain financial control of the world in general.

All of these assumptions also turned out to be completely false as the past couple years of fundamentals show the direct effects of the Fed pulling the plug on its artificial support of the U.S. economy. Particularly, we have seen a spike in corporate and consumer debt not seen since before the crash of 2008. Business interests are scrambling to take up the slack left by waning Fed stimulus, and they are digging themselves into a grave-like hole in the process.

Not only this, but we have numerous examples of Fed officials admitting that a crash in markets and the economy would occur if the Fed cut off support. This includes current Fed chairman Jerome Powell, who outlined the result of balance sheet cuts and interest rate hikes back in 2012. Meaning, skeptics cannot argue that the Fed is somehow “unaware” of its own actions and the consequences. The central bankers KNOW exactly what they are doing and what will happen as a result. They are bringing down the U.S. economy deliberately as multiple sectors hang by the thin thread of low but steadily rising interest rates and Trump's tax cuts.

This has caused considerable confusion for many alternative analysts. They have spent so long operating under the notion that the Fed will protect U.S. markets, protect the dollar and thus protect itself. What they refused to accept was the possibility that the Fed is actually a suicide bomber whose goal is to eventually destroy itself and everything around it, thus bringing down America from within.

But why would the globalists do this? For those that assume the U.S. economy represents the “goose that lays the golden eggs,” what I describe above is inconceivable. In order to understand what is happening and why, we must cast off the lie that America is a golden goose that perpetually supports the globalist agenda. Rather, America is more like a host to the globalist parasites, and once the host is drained of all vitality, the parasites will leave and move on to bigger and better targets.

In other words, just as numerous empires before it, the U.S. system served a purpose for a particular window of time. It was exploited as a means to an end, and now the banking elites are moving on to a “new world order” in which America plays a far diminished role. This is why the Fed continues to act in a manner that appears bewildering to so many people. This is why the Fed is taking actions that they have openly admitted will cause a crash. They WANT a crash.

The Fed itself is merely an empty shell. It is an institution on paper, representing a set of illusions that are treated as concrete. If we are looking for the top of the globalist pyramid, we would certainly not start with the Fed. The Fed is a tool for manipulating the U.S. political framework and economic engine, and like all other central banks in the world its policies are dictated by much more important entities like the Bank For International Settlements (BIS).

It is organizations like the BIS and the IMF that are set to become the new centers of the financial world as the U.S. economy and the dollar sink into obscurity. I outlined this plan in detail in my article “The Economic End Game Explained,” but it has taken quite some time for the facts I presented to be accepted by a greater portion of the movement. The claim that the Fed “would never” sacrifice itself is a powerful distraction from the truth.

Globalists do not care about maintaining the U.S. system as it is. They are even willing to undermine it in order to create the chaos needed to generate social and political capital; the kind of capital that will buy them a worldwide economic reset and their so-called “new world order.”

Within this construct, the masses would be made to accept open centralization of financial and political control into the hands of a minority of banking elites. That is to say, the globalists no longer want to be covert; they prefer to be overt, and venerated as saviors of humanity rather than despised as an organized cancer.

In order to achieve such a fantastic farce, certain steps need to be taken. In particular, someone else needs to take the blame for the disastrous consequences of the global reset when it accelerates.

Donald Trump fits the bill perfectly for a number of reasons, but the ultimate scapegoat for a crash of the U.S. system is not Trump alone, but the conservative ideal overall. I have argued for some time that Trump is likely controlled opposition — a pied piper for conservatives. His rhetoric is almost everything liberty advocates and Republicans like to hear, but his actions do not always match his words.

In particular, the induction of multiple banking elites and Council on Foreign Relations members into Trump’s cabinet makes it impossible for true change to ever take place within the White House, let alone the rest of Washington. Which is probably why we have seen Trump flip-flop on so many issues recently. Trump is supposed to present the face of a “populist” conservative stalwart while at the same time doing the bidding of the globalist handlers standing over his shoulder in the Oval Office.

More specifically, Trump has reversed course on his relationship to the Fed many times.

In September of 2016, Trump attacked the Fed on the campaign trail, stating that they were keeping interest rates low and the dollar weak in order to artificially boost stock markets for the Obama administration. This was mostly true, though the Fed could not care less about protecting the image of any particular president. Instead, they were preparing for the global reset while getting ready to lay blame at the feet of their populist scapegoat.

After Trump entered office, he suddenly changed his attitude, offering full support to Janet Yellen and then Jerome Powell while taking credit for the spike in stocks fueled by Fed’s balance sheet purchases and low rates. Trump at that time also stated that a strong dollar was better for America.

Today, the situation has changed yet again. Trump now suddenly has conflict with the Federal Reserve and the rising dollar index, voicing his concerns that the Fed is creating conditions that will lead to difficulty in the trade war as well as an economic crisis. Fears are rising within mainstream economic circles that this is leading to a war between Trump and the Fed. Some are even theorizing that Trump might try to take control of the Fed completely.

To the casual observer, all this makes Trump appear rather schizophrenic — but maybe this is the point.

The Fed’s usefulness for the globalists is waning. Their only job now is to continue raising interest rates and cutting their balance sheet in a controlled demolition of financial markets and equities. Once they are done, the only thing left is for the dollar to lose its world reserve status and then the sabotage of the U.S. will be complete.

A battle between Trump and the Fed serves a couple of purposes.

Firstly, it provides cover for the dismantling of U.S. stocks and the U.S. dollar, just as the trade war (also blamed on Trump) provides cover for the same. A conflict between the president of the United States and the Fed would lead to substantial doubt in markets over the safety of investment in U.S. equities, debt and currency.

Secondly, if Trump is seen as “getting tough” on the Fed, liberty activists that are skeptical of the Trump administration and his globalist appointed cabinet might be lured into the fold and support policies which will ultimately be the unmaking of liberty.

Dismantling the Fed several years ago would have done irreversible damage to the banking elites and their plans for a perfectly timed economic reset. Today, it’s too little too late. In fact, the globalists may PREFER that the Fed be taken down by conservatives now so that we become the bumbling villains that triggered a historic fiscal panic.

This is not to say that I support the continued existence of the Fed, but I do want to point out that Trump is not talking about combating the IMF or the BIS, nor is anyone else in the mainstream discussing it. Removing one sacrificial appendage of the vampire squid is useless; we must go to core organizations and shut them all down to make any difference in the outcome. The fact that they are going to sacrifice the Fed and the dollar anyway does not help matters.

I believe Trump’s “schizophrenia” on the Fed is due to him simply following the script that has been given to him. I do not think the globalists were always certain they wanted to use the tactic of a president vs. Fed crisis. But, I did predict back in early 2017 that this is exactly what they would end up doing in my article “In A Battle Between Trump And The Federal Reserve, Who Really Wins?

It only makes sense at this stage in the game. The Fed is going to continue to raise interest rates and cut its balance sheet no matter what happens. They are going to use “inflationary pressures” supposedly caused by Trump’s infrastructure spending and the trade war as an excuse for their actions. Trump, in turn, is going to blame the Fed for the inevitable stock market crash and the rising dollar causing difficulty with “winning” the trade war.

I do not know if the globalist script calls for Trump to go as far as shutting down the Fed completely, but rest assured if he does there will be hundreds of alternative analysts decreeing that it is irrefutable proof that Trump is not controlled opposition and he “must have a plan.” The actual plan will be the end of the dollar as the world reserve currency to make way for the global economic reset and a NWO currency framework, all in the name of stopping a catastrophe initiated by “evil conservative populists.”

Make no mistake, what we are witnessing is 4th generation warfare on the public - All other wars including the trade war are kabuki theater designed to distract from this reality. Even a war between Trump and the Fed would be ultimately farcical as the globalists are already positioned to exploit the outcome of a failing dollar system.

The goal?

To convince the masses that sovereign nationalism leads to planetary disaster, and that the "only solution" is to hand over economic and political power to a centralized authority of financial high priests with a direct line to the god of fiscal stability.

* * *

If you would like to support the publishing of articles like the one you have just read, visit our donations page here. We greatly appreciate your patronage.

https://www.zerohedge.com/news/2018-07-26/trump-vs-fed-america-sacrificed-nwo-altar
 

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'It is indeed a big one': Trump hails new report as U.S. economy surges to 4.1 percent growth in second quarter –and promises it will go 'a lot higher' after trade deals come in

  • The economy hit the 4.1 per cent rate from April through June
  • Trump hailed the latest figures at the White House
  • Called it an 'American economic miracle'
  • 'It is indeed a big one'
  • Said he was 'honored' by the numbers and called it a 'great day'
  • He also slammed Obamacare and called for more tax cuts
  • President Trump said at a rally Thursday that if the rate had a 4 in front of it, 'We're happy'
  • The fast clip comes despite a multi-front trade war
  • Analysts said countries boosted purchases of some agriculture products in advance of tariffs
  • Driven by consumers who began spending their tax cuts and exporters who sought to get their products delivered ahead of the tariffs
http://www.dailymail.co.uk/news/article-5999315/US-economy-surges-4-1-percent-growth-rate-Q2.html
 

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Soybean farmer calls Trump's $12 billion bailout a "pacifier"
CBS This Morning


Published on Jul 25, 2018
Republican backlash is growing against President Trump's $12 billion plan to help American farmers feeling the pain of the escalating trade war. The president's proposal was announced Tuesday in response to retaliatory tariffs imposed by China and other countries. Adriana Diaz speaks with one Illinois farmer who voted for President Trump and says he's now on the front lines of the president's trade war.
 

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Trump's New $12 Billion Farm Subsidies and My Thoughts
MN Millennial Farmer


Published on Jul 26, 2018
Trump's New $12 Billion Farm Subsidies and My Thoughts
 

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Yeah, that's the image of him they chose to post!

jew_basic.jpg
 

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Fight brewing as Trump favors big oil in Alaska
CNN


Published on Jul 29, 2018
Alaskans are divided over President Donald Trump's plan to bring oil drilling to Alaska's Arctic National Wildlife Refuge. CNN's Bill Weir reports.
 

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JP Morgan Chase chief Jamie Dimon says Trump's tax and red-tape cutting has 'accelerated growth' but warns trade wars could cut into America's economic recovery

  • Dimon praises Trump for tax and regulation cuts that helped businesses grow
  • But he cautions that retaliatory trade tariffs from other country as a headwind
  • 'It takes 12 years to get permits to build a bridge that's already there and failing. And it took 8 years to put a man on the moon,' he said
  • Dimon believes 'bad infrastructure, bad taxation [and] excess regulation' have stifled innovation and business formation
http://www.dailymail.co.uk/news/art...ting-accelerated-growth-warns-trade-wars.html
 

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Trump Considering Unilateral $100 Billion Tax Cut On The Wealthy


by Tyler Durden
Tue, 07/31/2018 - 04:44


We may have an idea what was the (leaked) reason for today's selloff in Treasurys, which pushed the 10Y yield just shy of 3.00%.

According to the NYT, the Trump administration is considering a $100 billion unilateral tax cut meant to mainly help the wealthy, and is hopes to bypass Congress in implementing it "a legally tenuous maneuver that would cut capital gains taxation and fulfill a long-held ambition of many investors and conservatives."

However, despite the NYT's alarmist take, Trump's proposal actually does make some sense: what it calls for is to inflation-adjust one's long-term cost basis when calculating capital gains tax. Considering that various welfare programs like Social Security are already indexed for Cost of Living Adjustments, the idea is probably not that outlandish, especially if inflation were to suddenly explode higher.
Here's how it would work.

Currently, capital gains taxes are determined by subtracting the original price of an asset from the price at which it was sold and taxing the difference, usually at 20 percent. If a high earner spent $100,000 on stock in 1980, then sold it for $1 million today, she would owe taxes on $900,000. But if her original purchase price was adjusted for inflation, it would be about $300,000, reducing her taxable “gain” to $700,000. That would save the investor $40,000.

Treasury Secretary Steven Mnuchin hinted at the idea during last weekend's G-20 meeting in Buenos Aires, when he told reporters that his department was studying whether it could use its regulatory powers to allow Americans to account for inflation in determining capital gains tax liabilities. The Treasury Department could change the definition of “cost” for calculating capital gains, allowing taxpayers to adjust the initial value of an asset, such as a home or a share of stock, for inflation when it sells.

“If it can’t get done through a legislation process, we will look at what tools at Treasury we have to do it on our own and we’ll consider that,” Mnuchin said, emphasizing that he had not concluded whether the Treasury Department had the authority to act alone. “We are studying that internally, and we are also studying the economic costs and the impact on growth.”

To be sure, any such move would face near-certain court challenges, not to mention cause further turmoil inside the bond market, which is already rather displeased with Trump's recent busting of the US deficit. It would certainly reinforce a liberal critique of Republican tax policy at a time when Republicans are struggling to sell middle-class voters on the benefits of the tax cuts that President Trump signed into law late last year.

Chuck Schumer was, as usual, ready to hand out criticism:

“At a time when the deficit is out of control, wages are flat and the wealthiest are doing better than ever, to give the top 1 percent another advantage is an outrage and shows the Republicans’ true colors,” said Senator Chuck Schumer of New York, the Democratic leader. “Furthermore, Mr. Mnuchin thinks he can do it on his own, but everyone knows this must be done by legislation.”​

Still, no matter whether an inflation adjustment is justified or not, it is indeed the case that high earners would be the biggest beneficiaries of a reduction in capital gains taxes, which however were untouched in the $1.5 trillion tax law that Trump signed last year.

According an independent analyses cited by the NYT, more than 97% of the benefits of indexing capital gains for inflation would go to the top 10 percent of income earners in America, while nearly two-thirds of the benefits would go to the super wealthy — the top 0.1 percent of American income earners.

In other words, the rich are about to get even richer.



Liberal tax economists see little benefit in it beyond another boon to the already rich.

“It would just be a very generous addition to the tax cuts they’ve already handed to the very wealthy,” said Alexandra Thornton, senior director of tax policy at the liberal Center for American Progress, “and it would play into the hands of their tax advisers, who would be well positioned to take advantage of the loopholes that were opened by it.”

And while the proposal is sure to have a contested fate in Congress - and the courts - two questions remains: how would Trump pass such a law, and who would pay for it.

Making the change by fiat would be a bold use of executive power — one that President George Bush’s administration considered and rejected in 1992, after concluding that the Treasury Department did not have the power to make the change on its own. Larry Kudlow, the chairman of the National Economic Council, has long advocated it.

Conservative advocates for the plan say that even if it is challenged in court, it could still goose the economy by unleashing a wave of asset sales. “No matter what the courts do, you’ll get the main economic benefit the day, the month after Treasury does this,” said Ryan Ellis, a tax lobbyist in Washington and former tax policy director at Americans for Tax Reform. So... would this wave of asset sales also lead to the market crash that Trump so desperately dreads?

The decades-long push to change the taxation of investment income has spurred a legal debate over the original meaning of the word “cost” in the Revenue Act of 1918, and over the authority of the Treasury Department to interpret the word in regulations.

“I think we ought to look at not penalizing Americans for inflation,” said Representative Kevin Brady of Texas, the Republican chairman of the Ways and Means Committee, who said he would like to see the Treasury Department make the change through regulation.

* * *

As for who pays, the answer is simple: yield starved investors across the globe who remain inert to any suggestion that the ballooning US debt load could lead to a crisis.

According to the Wharton budget model, indexing capital gains to inflation would reduce government revenues by $102 billion over a decade, with 86 percent of the benefits going to the top 1 percent. A July report from the Congressional Research Service said that the additional debt incurred by indexing capital gains to inflation would most likely offset any stimulus that the smaller tax burden provided to the economy.

Trump's proposal is surprising as taxation of capital gains was not featured in the framework for the second round of tax cuts, released by the Ways and Means Committee last week. It is highly unlikely that Congress will pass another tax bill this year because of the slim Republican majority in the Senate.

https://www.zerohedge.com/news/2018-07-30/trump-considering-unilateral-100-billion-tax-cut-wealthy
 

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NATO Is A Goldmine For US Weapons' Industries


by Tyler Durden
Tue, 07/31/2018 - 02:00


Authored by Brian Cloughley via The Strategic Culture Foundation,

Countries of the NATO military alliance have been ordered by President Trump to increase their spending on weapons, and the reasons for his insistence they do so are becoming clearer.



It’s got nothing to do with any defence rationale, because, after all, the Secretary General of the US-NATO military alliance, Jens Stoltenberg, has admitted that “we don’t see any imminent threat against any NATO ally” and the Stockholm International Peace Research Institute recorded in its 2018 World Report that “at $66.3 billion, Russia’s military spending in 2017 was 20 per cent lower than in 2016.”

Even Radio Free Europe, the US government's anti-Russia broadcaster, records that Russia has reduced its defence spending.



There is demonstrably no threat whatever to any NATO country by Russia, but this is considered irrelevant in the context of US arms’ sales, which are flourishing and being encouraged to increase and multiply.

On July 12, the second and final day of the recent US-NATO meeting, Reuters reported Trump as saying that “the United States makes by far the best military equipment in the world: the best jets, the best missiles, the best guns, the best everything.” He went on “to list the top US arms makers, Lockheed Martin Corp, Boeing Co and Northrop Grumman Corp by name.”

On July 11 the Nasdaq Stock Exchange listed the stock price of Lockheed Martin at $305.68. The day after Trump’s speech, it increased to $318.37.

On July 11 the Nasdaq Stock Exchange listed the stock price of Boeing at $340.50. The day after Trump’s speech, it increased to $350.79.

On July 11 the New York Stock Exchange listed the stock price of Northrop Grumman (it doesn’t appear on Nasdaq) at $311.71. The day after Trump’s speech, it increased to $321.73.

General Dynamics, another major US weapons producer, might not be too pleased, however, because its stock price rose only slightly, from $191.51 to $192.74. Nor might Raytheon, the maker of the Patriot missile system which Washington is selling all over the world, because its stock went up by a modest five dollars, from $194.03 to $199.75. Perhaps they will be named by Trump the next time he makes a speech telling his country’s bemused allies to buy US weapons.

Trump also declared that “We have many wealthy countries with us today [July 12 at the NATO Conference] but we have some that aren’t so wealthy and they did ask me if they could buy the military equipment, and could I help them out, and we will help them out a little bit,” which made it clear that poorer countries that want to buy American weapons will probably not have to put cash down for their purchases. So it wasn’t altogether surprising that the stock prices of the three arms manufacturers named by Trump all rose by over ten dollars.

To further boost this bonanza, the State Department did its best to make US arms sales even easier by enabling weapons manufacturers to avoid the well-constructed checks and balances that had been in place to ensure that at least a few legal, moral and economic constraints would be observed when various disreputable regimes queued up to buy American weapons.

But these regulations no longer apply, because on July 13 the State Department announced new measures to “fast-track government approval of proposals from defense and aerospace companies” which action was warmly welcomed by the President of the US Chamber of Commerce Defence and Aerospace Export Council, Keith Webster, who is “looking forward to continued collaboration with the White House on initiatives that further expand international opportunities for the defense and aerospace industries.”

There was yet more boosting by Lt-General Charles Hooper, Director of the Defense Security Cooperation Agency, who declared at the Farnborough International Air Show on July 18 that “Defense exports are good for our national security, they’re good for our foreign policy. And they’re good for our economic security.” He then proposed that his agency cut the transportation fee charged to foreign military sales clients, which would be a major stimulant for sales of “the best jets, the best missiles, the best guns” so valued by Mr Trump. Obviously a devoted follower of his President, the General followed the Trump line with dedication by reminding the media that “as the administration and our leadership has said, economic security is national security.” This man just might go places in Trump World.

But he won’t go as far as the arms manufacturers, whose future growth and profits are assured under Trump and the Washington Deep State, which is defined as “military, intelligence and government officials who try to secretly manipulate government policy.” US weapons producers have realised, as said so presciently two thousand years ago by the Roman statesman, Cicero, that “the sinews of war are infinite money,” and their contentment will continue to grow in synchrony with their financial dividends.

Voice of America joined the chorus of reportage on July 12 and observed that “with Thursday's renewed pledge by NATO countries to meet defense spending goals, some of the biggest beneficiaries could be US weapons manufacturers, which annually already export billions of dollars worth of arms across the globe.”

Within European NATO, the biggest spenders on US arms, thus far, are Poland, Romania, Britain and Greece, and the amounts involved are colossal. Poland, whose economy is booming, has signed an agreement to buy Patriot missile systems for $4.75 billion, adding to the purchase of Joint Air-to-Surface Standoff Missiles for $200 million, Advanced Medium Range Air-to-Air Missiles, costing $250 million, and High Mobility Artillery Rocket Systems for the same amount. Delivery of its 48 F-16 multi-role strike aircraft ($4.7 billion) began in 2006, and Warsaw has proved a loyal customer ever since. Who knows what exotic new piece of US hardware will be ordered as a result of Mr Trump’s encouragement?

Romania, a country with only 750 kilometres of motorway (tiny Belgium has 1,700 km), has been seeking World Bank assistance for its road projects but is unlikely to benefit because it is so gravely corrupt. This has not stopped it purchasing US artillery rocket systems for $1.25 billion and Patriot missiles for a colossal $3.9 billion, following-on from construction in May 2016 of a US Aegis missile station, at Washington’s expense. It forms part of the US-NATO encirclement of Russia, and its missiles are to be operational this year.

The message for European NATO is that the US is pulling out all stops to sell weapons, and that although, for example, “about 84% of the UK's total arms imports come from the United States”, there is room for improvement. Slovakia is buying $150 millions’ worth of helicopters and paying a satisfying $2.91 billion for F-16 fighters, but other NATO countries appear to have been less disposed to purchase more of “the best jets, the best missiles, the best guns” that Mr Trump has on offer.

The mine of NATO gold is there for exploitation, and following Trump’s enthusiastic encouragement of his arms’ manufacturers it seems that extraction will be effective.



The US Military-Industrial Complex stands to gain handsomely from its President’s campaign to boost the quantities of weapons in the world.

https://www.zerohedge.com/news/2018-07-30/nato-goldmine-us-weapons-industries
 

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U.S., China Seek to Restart Talks to Defuse Trade War, Sources Say
July 31, 2018 by Bloomberg



Lightspring / Shutterstock

By Jenny Leonard, Peter Martin and Saleha Mohsin (Bloomberg) — The U.S. and China are trying to restart talks aimed at averting a full-blown trade war between the world’s two largest economies, two people familiar with the effort said.

Representatives of U.S. Treasury Secretary Steven Mnuchin and Chinese Vice Premier Liu He are having private conversations as they look for ways to re-engage in negotiations, according to the people who spoke about the deliberations on condition of anonymity.

They cautioned that a specific timetable, the issues to be discussed and the format for talks aren’t finalized, but added there was agreement among the principals that more talks need to take place.

Negotiations to resolve the dispute have been stalled for weeks, with both sides refusing to budge. High-level U.S. talks on the Trump administration’s trade posture toward China are taking place this week, according to a third person who also spoke on the condition of anonymity.

U.S. stocks rose, Treasury yields edged higher, offshore yuan erased an earlier drop and the dollar pared gains.

The next wave of U.S. tariffs is set to kick in as early as Wednesday, with the possible imposition of duties on another $16 billion of Chinese imports. Officials in Beijing have vowed to respond with the same amount of tariffs on U.S. products.

Complicating Mnuchin’s efforts is a harder line taken by U.S. Trade Representative Robert Lighthizer, who has jurisdiction over the U.S.’s 301 investigation that sparked the tariffs. That case concluded China was stealing American technology and tariffs were needed to offset the damage.

A U.S. Treasury official didn’t immediately respond to a request for comment.

‘Chronic Problem’
U.S. and Chinese officials have given little recent indication in public that a restart to negotiations might be in the offing. Lighthizer said last week that trade tensions with China are a “chronic problem,” while China’s representative at the World Trade Organization accused the U.S. of “extortion.”

The two sides held three rounds of formal talks, beginning with a delegation to Beijing led by Mnuchin in May. After Liu visited Washington later that month, the nations released a joint statement pledging to reduce the U.S. trade deficit with China, among other things. But within days, President Donald Trump himself backed away from the deal, saying talks would “probably have to use a different structure.”

Talks broke off after the Trump administration imposed tariffs on $34 billion in Chinese imports this month, a move the Chinese said would void any promises they’d made in negotiations. Beijing responded in kind with its own tariffs.

Trump’s mission to reduce the U.S. trade deficit via the threat of tariffs has brought him into conflict with China as well as U.S. allies, roiling financial markets and raising fears of a global trade war the International Monetary Fund has warned may undermine the strongest economic upswing in years.

© 2018 Bloomberg L.P

http://gcaptain.com/u-s-china-seek-to-restart-talks-to-defuse-trade-war-sources-say/
 

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U.S., China Seek to Restart Talks to Defuse Trade War, Sources Say
July 31, 2018 by Bloomberg



Lightspring / Shutterstock

By Jenny Leonard, Peter Martin and Saleha Mohsin (Bloomberg) — The U.S. and China are trying to restart talks aimed at averting a full-blown trade war between the world’s two largest economies, two people familiar with the effort said.

Representatives of U.S. Treasury Secretary Steven Mnuchin and Chinese Vice Premier Liu He are having private conversations as they look for ways to re-engage in negotiations, according to the people who spoke about the deliberations on condition of anonymity.

They cautioned that a specific timetable, the issues to be discussed and the format for talks aren’t finalized, but added there was agreement among the principals that more talks need to take place.

Negotiations to resolve the dispute have been stalled for weeks, with both sides refusing to budge. High-level U.S. talks on the Trump administration’s trade posture toward China are taking place this week, according to a third person who also spoke on the condition of anonymity.

U.S. stocks rose, Treasury yields edged higher, offshore yuan erased an earlier drop and the dollar pared gains.

The next wave of U.S. tariffs is set to kick in as early as Wednesday, with the possible imposition of duties on another $16 billion of Chinese imports. Officials in Beijing have vowed to respond with the same amount of tariffs on U.S. products.

Complicating Mnuchin’s efforts is a harder line taken by U.S. Trade Representative Robert Lighthizer, who has jurisdiction over the U.S.’s 301 investigation that sparked the tariffs. That case concluded China was stealing American technology and tariffs were needed to offset the damage.

A U.S. Treasury official didn’t immediately respond to a request for comment.

‘Chronic Problem’
U.S. and Chinese officials have given little recent indication in public that a restart to negotiations might be in the offing. Lighthizer said last week that trade tensions with China are a “chronic problem,” while China’s representative at the World Trade Organization accused the U.S. of “extortion.”

The two sides held three rounds of formal talks, beginning with a delegation to Beijing led by Mnuchin in May. After Liu visited Washington later that month, the nations released a joint statement pledging to reduce the U.S. trade deficit with China, among other things. But within days, President Donald Trump himself backed away from the deal, saying talks would “probably have to use a different structure.”

Talks broke off after the Trump administration imposed tariffs on $34 billion in Chinese imports this month, a move the Chinese said would void any promises they’d made in negotiations. Beijing responded in kind with its own tariffs.

Trump’s mission to reduce the U.S. trade deficit via the threat of tariffs has brought him into conflict with China as well as U.S. allies, roiling financial markets and raising fears of a global trade war the International Monetary Fund has warned may undermine the strongest economic upswing in years.

© 2018 Bloomberg L.P

http://gcaptain.com/u-s-china-seek-to-restart-talks-to-defuse-trade-war-sources-say/
I predict China trade talks will be a success a win for Trump, China and America.
 

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President Donald Trump's Summits Leave Us Worse Off Than Before: Haass | Morning Joe | MSNBC
MSNBC


Published on Jul 31, 2018
President Trump said on Monday he is willing to meet with Iran without preconditions 'whenever they want.' This comes a week after Trump's Twitter threats against Iran. The panel discusses.
 

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President Donald Trump Considers Another Tax Cut For The Rich | Hardball | MSNBC
MSNBC



Published on Jul 31, 2018
Nothing says you're fighting for the little guy like another tax cut for the mega rich, and that's exactly what President Trump is considering. The Trump administration wants to bypass Congress and cut capital gains taxes. It would amount to a $100 billion tax cut, according to some estimates.
 

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If you help the rich it trickles down to the small guy farther along just need to be patient.
 

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Trade War Returns: China Vows Retaliation To US "Blackmail" If Trump Hikes Tariffs


by Tyler Durden
Wed, 08/01/2018 - 07:33


It took less than a day for the latest trade war ceasefire with China to crash and burn.

Just hours after reports spread that Trump is considering more than doubling planned tariffs on $200 billion in Chinese imports, raising the rate from 10% to 25%, China vowed it would retaliate, and warned the U.S. against "blackmailing and pressuring" it over trade.

As reported last night, the latest US proposal - which Trump could unveil as soon as today - would increase the potential tariff rate from 10% the administration had initially put forward on July 10 for that wave of duties in a bid to pressure Beijing into making trade concessions, to 25%.

At the same time, representatives of Steven Mnuchin and Chinese Vice Premier Liu He are reportedly having private conversations as they look for ways to reengage in negotiations, however as the WSJ also reported on Tuesday, these negotiations haven't had much, if any, success. As Bloomberg notes, "while American and Chinese officials have hinted at the possibility of restarting talks in recent weeks, it’s been almost two months since they last held high-level negotiations."

The two sides held three rounds of formal talks, beginning with a delegation to Beijing led by Mnuchin in May. After Liu visited Washington later that month, the nations released a joint statement pledging to reduce the U.S. trade deficit with China, among other things. But within days, Trump himself backed away from the deal, saying talks would “probably have to use a different structure.”​

In response to the latest escalation out of the White House, China again accused the United States of bullying, and vowed to retaliate if Trump proceeds with the measures, warning that pressure tactics would fail.

U.S. pressure and blackmail won’t have an effect. If the United States takes further escalatory steps, China will inevitably take countermeasures and we will resolutely protect our legitimate rights,” Chinese Foreign Ministry spokesman Geng Shuang told a regular news briefing.


Chinese Foreign Ministry spokesman Geng Shuang

Repeating the same futile line that has been used before on numerous occasions, when asked about communication between the two countries on the dispute, Geng said China had “always upheld using dialogue and consultations to handle trade frictions”, but that dialogue must be based on mutual respect and equality.

“Unilateral threats and pressure will only produce the opposite of the desired result,” Geng said.

Trump had said he would implement the $200 billion round as punishment for China’s retaliation against the initial tariffs aimed at forcing change in China’s joint venture, technology transfer and other trade-related policies. The president has also threatened a further round of tariffs on $300 billion of Chinese goods; we expect him to renew these threats on twitter in the coming hours.

The public comment period on the U.S. tariffs aimed at $200 billion ends Aug. 30 after public hearings Aug. 20-23, according to the U.S. Trade Representative’s office. It typically has taken several weeks after the close of public comments for the tariffs to be activated and will send a signal that the Trump administration is upping the pressure on China to make serious concessions.

Quoted by Reuters, Erin Ennis, senior vice president of the U.S.-China Business Council, said a 10 percent tariff on these products is already problematic, but more than doubling that to 25 percent would be much worse.

“Given the scope of the products covered, about half of all imports from China are facing tariffs, including consumer goods,” Ennis said. “The cost increases will be passed on to customers, so it will affect most Americans’ pocketbooks.”​

Meanwhile, Bloomberg notes that in a sign the trade standoff is escalating withint Chinese politics, the Politburo signaled on Tuesday that policy makers will focus more on supporting economic growth, after the latest Chinese manufacturing surveys showed trade tensions have led to a modest slowdown in China's growth rate.

The communique, which followed a meeting of the country’s most senior leaders led by President Xi Jinping, said the campaign to reduce leverage will continue at a measured pace while improving economic policies to make them more forward-looking, flexible and effective in the second half.​
Chinese equities and the yuan extended losses Wednesday afternoon, with the Shanghai Composite closing down -1.8% at the lows of the session, as concern over possible higher U.S. tariffs overwhelmed optimism about Beijing’s pledge to support economic growth.



The yuan fell against a trade-weighted basket of currencies to a level that’s near the lowest on record, confirming that Beijing is indeed allowing further weakness. Meanwhile, the offshore Yuan tumbled to the lowest level in the past year before local banks intervened to sell dollars - the PBOC's preferred method of direct market intervention - and prevent a resurgence in capital outflows.



In advance of the Aug. 30 public comment period deadline, the next wave of U.S. tariffs is set to kick in as soon as today with the possible imposition of duties on another $16 billion of Chinese imports. The implementation could be delayed for weeks as the administration works out the details of which products it will target. Officials in Beijing have vowed to respond with the same amount of tariffs on U.S. products.

https://www.zerohedge.com/news/2018-08-01/china-vows-retaliation-us-blackmail-if-trump-hikes-tariffs
 

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Published on Jul 31, 2018
Nothing says you're fighting for the little guy like another tax cut for the mega rich, and that's exactly what President Trump is considering. The Trump administration wants to bypass Congress and cut capital gains taxes. It would amount to a $100 billion tax cut, according to some estimates.
I'd say it's a step in the right direction.
...and why should there even be a capital gains tax? Just because someone was smart enough to buy something that actually appreciated in value, how does it give the gov a Right to any of it, let alone such a large portion of it? Even 20% is akin to highway robbery.
 

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"More Pain Ahead": Wilbur Ross Says Trump Will Put More Pressure On China "To Modify Their Behavior"


by Tyler Durden
Fri, 08/03/2018 - 07:26


Chinese stocks slumped overnight as trade war tensions escalated after Wilbur Ross said there’s more pain ahead unless China changes its economic system, as Beijing repeated it will never surrender to U.S. trade threats.

“We have to create a situation where it’s more painful for them to continue their bad practices than it is to reform,” Commerce Secretary Wilbur Ross said in an interview on Fox Business Network late on Thursday. As a result, Trump will keep turning up the pressure on China for as long as the country refuses to level the economic playing field, Ross said.


Pointing out the obvious, Ross said that "the reason for the tariffs to begin with was to try and convince the Chinese to modify their behavior. Instead they have been retaliating. So the president now feels that it’s potentially time to put more pressure on, in order to modify their behavior."

As for the impacts on the US economy, Ross noted that a 25% levy on $200bn is $50bn per year on a $18 trillion economy, so even if the levy was passed, “it’s not something that’s going to be cataclysmic”.

Elsewhere Bloomberg cited unnamed US officials who noted that the US is open to new formal talks with China, but Beijing must agree to open its market to more competition and stop retaliatory measures.

Ross' comments follow a statement by China’s Ministry of Commerce which noted that "China is fully prepared and will have to retaliate to defend the nation’s dignity and the interests of the people, defend free trade and the multilateral system, and defend the common interests of all countries,” China’s Ministry of Commerce said in a statement Thursday on its website. The “carrot-and-stick” tactic won’t work, it said.

Elsewhere, a member of its State Council Wang Yi said “we hope that those directly involved in the US trade policies can calm down…"

Indeed, along with its pledge to fight back, China also left the door open for a resumption of negotiations. “China has consistently advocated resolving differences through dialogue, but only on the condition that we treat each other equally and honor our words,” the ministry said.

Trump said last month that he’s willing to impose tariffs on every good imported from China, which totaled more than $500 billion last year. American companies, industry and consumer groups have pleaded with the administration to avoid tariffs, saying they could raise their costs and eventually lead to price hikes for consumers.​

So, as DB's Jim Reid notes, "lots bubbling along till the end of the public comments period in the US on 5th September."

https://www.zerohedge.com/news/2018...ump-will-put-more-pressure-china-modify-their
 

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Billions at Risk as China Proposes 25% Tariffs on U.S. LNG Exports
August 3, 2018 by Bloomberg



Photo: By Igor Grochev / Shutterstock

By Naureen S. Malik (Bloomberg) — China is proposing a 25 percent tariff on imports of U.S. liquefied natural gas as retaliation for the Trump Administration’s latest push to increase tariffs on the Asian giant. The shares of America’s largest gas exporter, Cheniere Energy Inc., fell on the report.

Such a move would be a major blow for America’s emerging business to export the chilled fuel abroad, a key outlet needed for shale supplies growing at a record clip this year. It’s the first time the fuel has been ensnared by the expanding trade war, and comes as Russia plans to begin pumping gas to China through its newly-built 2,500-mile (4,000 kilometer) Power of Siberia pipeline by the end of 2019.

Billions of U.S. dollars may hang in the balance as Cheniere, Tellurian Inc. and other developers have been courting utilities and state-backed companies in the Asian country to justify construction of more terminals to ship the super-chilled form of natural gas.

“At least in the short term any Chinese buyer looking for long term supply would have to drag their feet on signing a U.S. contract,” Jason Feer, head of business intelligence at Poten & Partners Inc. in Houston, said by telephone.

The Not-So-Surprising Commodity Excluded from China’s Tariff List

China accounted for 13 percent of the exports from Cheniere’s Sabine Pass terminal in Louisiana as of mid-June, based on ship-tracking data compiled by Bloomberg. The Houston-based company dropped as much as 7.7 percent after the report, the biggest one-day percentage decline since 2016.

Cheniere didn’t immediately respond to a request seeking comment. The company recently gave the green light to expand its Texas export terminal thanks in part to a contract it signed earlier this year with China National Petroleum Corp., according to a company statement.

Earlier this year, China emerged as the world’s biggest importer of natural gas, topping Japan, as it aggressively moves to reduce its reliance on smog-inducing coal.

With China’s traditional suppliers in Central Asia unable to keep up with demand during the recent winter, Cheniere moved to help fill the gap. Since 2016, when its Sabine Pass export terminal opened in Louisiana, Cheniere had shipped about 50 supertankers filled with the super-chilled fuel to China as of the end of June, with the majority of it moving after the cold weather kicked in.

U.S. Shale Producers Warn Chinese Tariffs Would Hit Energy Exports

Warren Patterson, commodity strategist for ING Bank NV, said he was “quite surprised” to see LNG show up on China’s list.

“Given the transition we are seeing in China, with a move away from coal towards natural gas, I would have thought that the government would have wanted to ensure adequate supply,” Patterson said in an email.

Gas exports overall to China jumped 17 percent last year to 92 billion cubic meters, and they’re poised to hit 200 billion by 2025, according to Massimo Di Odoardo, vice president of global gas and LNG at Wood Mackenzie Ltd. in London.

© 2018 Bloomberg L.P

http://gcaptain.com/billions-at-risk-as-china-proposes-25-tariffs-on-u-s-lng-exports/
 

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Here Is The Full List Of US Products That Will Be Hit With New Chinese Tariffs


by Tyler Durden
Fri, 08/03/2018 - 13:10


Stoking the flames of the relentless trade war between the US and China, earlier today Beijing unveiled a list of $60 billion of some 5,207 goods imported from the United States that will be taxed with extra tariffs ranging from 5 to 25%, should the U.S. follow through on a plan to impose duties on $200 billion of Chinese goods as early as next month.

Here are some facts and figures about the products (via BBG):

  • Taxation breakdown:
    • 2,493 products fall under the 25% category;
    • 1,078 products will be taxed at 20%,
    • 974 at 10%
    • 662 at 5%
  • Liquefied natural gas to be taxed at 25%
  • Agricultural products may face levies between 10% and 25%
  • Machinery is mainly taxed in 20%, 10% and 5% categories
  • Mining, mineral and metal products face tariffs of 10%-25%; natural and synthetic chemicals are taxed under all four brackets
  • Sports equipment is mainly taxed under 10% and 20% categories
  • Motor vehicles, together with their parts and accessories, fall mostly within the 5% bracket


Will this be the final trade war salvo? Certainly not: in response to China's sanctions announcement, earlier today Larry Kudlow told Bloomberg that Trump will keep pressing China for trade concessions as the administration views China's $60BN response as "weak" although together with the last tariff rounds, it pretty much exhausts the amount of imports that China takes from the US in any given year, and so China can't impose further sanctions even if it wants to.



"We’ve said many times: no tariffs, no tariff barriers, no subsidies. We want to see trade reforms. China is not delivering, OK?," Trump's top economic advisor Larry Kudlow said. "Their economy’s weak, their currency is weak, people are leaving the country. Don’t underestimate President Trump’s determination to follow through."

That said there is some hope for a ceasefire: U.S. and Chinese officials have held “hardly any conversations” in the past month, but there’s “some hint” the Chinese may be warming to the idea of negotiations, Kudlow said. There’s recently been some communication at the highest levels, he also told reporters outside the White House, although with neither leader willing to appear weak, it is virtually certain that unless both parties agree on a ceasefire at the same time, the trade war will continue.

Meanwhile, Chinese authorities - bracing for economic fallout - have taken a range of measures in recent weeks to bolster the economy. On Friday officials stepped in to cushion the yuan, which has been battered by trade tensions and was approaching the key level of seven to the dollar, and the PBOC announced it would impose a reserve requirement of 20% on trading of foreign-exchange forward contracts, making it far more difficult to short the yuan.

Commenting on the Yuan devaluation, which many saw as greenlighted by Beijing, Kudlow said the weaker yuan indicates that investors have questions about the strength of China’s economy, adding a lack of intervention to prop up the yuan is helping cushion the impact of the trade war for China, although that clearly changed in the course of the day.

“Some of the currency fall though, I think, is just money leaving China cause it’s a lousy investment and if that continues that will really damage the Chinese economy,” Kudlow said.

Of course, China's intervention, apart from being seen as a from of soft capital controls to prevent any further capital flight from the nation by keeping the yuan stable, will also have the result of putting further pressure on the Chinese economy which will no longer be able to offset US tariffs via a weaker currency, effectively providing an easing of monetary conditions for the US.

The full list of US products subject to 25% tariffs is shown below. Unfortunately, China's Ministry of Finance saw it fit to only provide a non-English version.

https://www.scribd.com/document/385387258/China-25-Tariffs#from_embed

https://www.zerohedge.com/news/2018-08-03/here-full-list-us-products-will-be-hit-new-chinese-tariffs