Earlier today President Trump spoke candidly with the White House assembly of U.S. Governors about the critical need to re-evaluate their position(s) on trade.  President Trump’s remarks were direct, but also remarkably nuanced toward the audience.  However, if you follow Trump’s process, you’ll note the familiar indications.

Next, far less subtle and yet following along the same predictable process, the Wall Street Journal is reporting President Trump now promoting his economic guru Peter Navarro to be Assistant to The President.   Navarro is a brilliant and strategic trade hawk who has a long track record of supporting the same trade principles as Donald Trump.

A NAFTA decision/announcement looms. ♦ As expected and predicted, a recent phone call by Mexican President Pena Nieto to POTUS Trump didn’t end well. ♦ USTR Lighthizer blasted Canada at the end of round six NAFTA renegotiation. ♦  Placing Pete Navarro inside the circle puts him directly in the right place to speak on behalf of President Trump for an upcoming announcement.   All of these NAFTA exit indicators are great news.

Our wolverine team is growing.  Now we have Commerce Secretary Wilbur Ross, U.S. Trade Representative Robert Lighthizer, U.S. Treasury Secretary Steven Mnuchin and Asst. To POTUS Peter Navarro, all assembled.

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Vice-President Mike Pence introduces President Donald Trump during a White House conference with the nation’s governors.  After opening remarks by both the Vice-President and President, President Trump asked governors for their input and questions.

This is an important discussion between the President and Governors because of the looming battle with the institutional republican political apparatus (GOPe) over a necessary NAFTA exit.

On the key topic of the economy the President remarked about the growing GDP and future of trade deals, trade negotiations and how important it is to break the cycle of trade agreements that do not advance the best interests of the entire nation.  Another big topic of the larger discussion was school security and proactive measures to protect.

[Transcript] State Dining Room – 10:53 A.M. EST

THE PRESIDENT: Thank you, everybody. Thank you very much. And I want to thank our Vice President for that really lovely introduction. That was very nice, Mike, and I appreciate it.

This is a time of great opportunity for our country. We’ve created nearly 3 million jobs since the election — a number that nobody would have thought possible. You go back and take a look at what they were saying just prior to the election. Nobody thought it was even possible.

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One of the more interesting CPAC discussion segments between one of the top experts within the cabinet, Office of Management and Budgets (OMB) Director Mick Mulvaney.

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Currently Director Mulvaney is wearing two hats; he spends 3 days a week as OMB Director, and 3 days a week as interim director of the Consumer Financial Protection Bureau (CFPB).

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Consider this a kick-off to my official NAFTA watch.  Readers will note my earlier spidey-sense prediction of NAFTA withdrawal announcement in/around the end of February through March.   I cannot see a delay in an announcement extending beyond March 2018.  Ergo, CTH is fine-tuning the radar to watch closely.

The fatal flaw within NAFTA has not been addressed.  Neither Canada nor Mexico has even slightly indicated a willingness to engage talks over the fatal flaw.

Exactly the opposite happened earlier this month when Canada signed up to the TPP deal.

The agreement has yet to be ratified by Canadian Parliament, and many are nervous, but it will likely get done.

The NAFTA decision will be the biggest political and economic decision in the Trump administration so far, and the corporate GOPe response is anticipated to be beyond ugly.  Additionally, it would be intellectually dishonest not to accept there are very specific interests watching these pages as part of their proactive strategy. (Hi, Tom)

That said, if you were Mexican President Enrique Peña Nieto and you noted the specificity of the current trade-policy planetary positions; and you were overlaying the preparatory action taken by Justin from Canada; and you understand there are factually hundreds of billions in play; you would be a fool not to go past past Economy Minister Ildefonso Guarjardo and directly engage the ultimate decision-maker, U.S. President Donald Trump, out of an urgent need to evaluate the survivability of your economic surroundings.  It would be imprudent not to prepare yourself:

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NAFTA is as precarious as a slow-spinning plate on a stick. Mexico and Canada are both  taking half-hearted turns recharging the momentum – while simultaneously looking for trade options due to, well,.. the inevitable.

The basic issue is a simple one; for the U.S. NAFTA has a fatal flaw. Canada and Mexico are used by China and Asian nations as a way to work-around direct trade with the U.S. and use NAFTA as a backdoor into the U.S. market.  It works out great for Canada and Mexico, but terrible for the U.S.  It’s a structural issue and no amount of negotiation is going to remove the fatal flaw unless Canada and Mexico agree to terms that are directly against their current financial interests.

Ergo POTUS Trump is positioned to withdraw.

Trying to keep the U.S. in NAFTA, but understanding the likelihood of exit, Justin from Canada originally approached China for a big trade deal.  Justin didn’t find Happy Panda in his discussions; instead he found The Red Dragon behind the Panda mask.  China was willing to talk trade, but China tiered their approach because Canada is only valuable to China as long as the NAFTA door is open.  Without NAFTA China has no use for Canada.

Justin left China with dragon burns and immediately realized his trade cards were getting weaker by the day…. so he had to sign-up for the Trans-Pacific-Partnership.  Unfortunately for Justin, though some think he didn’t realize the consequence, signing TPP guaranteed POTUS Trump would exit NAFTA.

Why?  Because if the U.S. stayed in NAFTA the TPP nations would now have a collective backdoor into the valuable U.S. market through Canada.  The NAFTA fundamental flaw just became more flawed.

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Last year President Donald Trump requested a national security Section 232 trade-investigation, to conducted by the U.S. Department of Commerce and Secretary Wilbur Ross, specifically focusing on U.S. steel and aluminum manufacturing.

The discussion continued last week as President Trump met with a group of republican and democrat members of congress to talk about trade policy and focus attention on the lack of American steel and aluminum production.   [The responses from the republican participants was very enlightening and disappointing.]

On Friday Commerce Secretary completed the industrial review and provided President Trump with trade recommendations to consider given the nature of the national security compromise.   See Outline Here.

Recommendations of the Steel Report:  Secretary Ross has recommended to the President that he consider the following alternative remedies to address the problem of steel imports:

1. A global tariff of at least 24% on all steel imports from all countries, or
2. A tariff of at least 53% on all steel imports from 12 countries (Brazil, China, Costa Rica, Egypt, India, Malaysia, Republic of Korea, Russia, South Africa, Thailand, Turkey and Vietnam) with a quota by product on steel imports from all other countries equal to 100% of their 2017 exports to the United States, or
3. A quota on all steel products from all countries equal to 63% of each country’s 2017 exports to the United States.

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Yesterday President Trump invited the media to keep their cameras on during a round-table discussion on trade.  He did this for a reason.  President Trump wanted the American voters to watch Republican politicians demand that he stop trying to bring manufacturing jobs to the United States.

In essence, Trump doing what Trump does best, played the role of Toto and pulled back the curtain on the Republican anti-American corporate business agenda.  The republicans in attendance never paused to reflect upon the sunlight or the reason for their specific invitations. They are comfortable back-room deals and POTUS Toto relaxed them perfectly.

One by one the Republicans took-the-bait and fully exposed themselves.  Lamar Alexander, Mike Lee, Pat Toomey and Roy Blout all took turns telling POTUS to quit trying to save American high-wage jobs, drop the national economic view and just accept multinational corporate globalism.

The subsequent full-throated establishment display stands as one of the greatest plays of the Trump administration to date. However, it was Republican Senator Ron Johnson from Wisconsin who really went the full distance:

[Transcript] […] In Wisconsin, a big manufacturing state, in seven years I have not visited one manufacturer that could hire enough people. That was certainly my experience in the last 20, 25 years. For a host of reasons, we tell our kids you have to get a four-year degree. We pay people not to work. So we do need to be concerned about, in such a tight labor market, do we have enough workers in manufacturing.

So my final point is, it makes no sense for me to try and bring back high labor-content manufacturing to America. We need to do the value added things. And so I would just say, proceed with real caution there.  (more)

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Earlier today one of the more consequential meetings took place between President Trump and his economic team -vs- the professional UniParty apparatus consisting of multinational corporate-purchased Democrats and Republicans.

The policy discussion isn’t sexy or headline making from the perspective of the U.S. media; however, the resulting outcomes will have more of a bearing on you and your family than any other economic policy conflict in this administration.

On one side we have President Trump and a very focused policy and trade group containing Commerce Secretary Wilbur Ross, Treasury Secretary Steven Mnuchin and U.S. Trade Representative Ambassador Robert Lighthizer. On the other side the corporate UniParty apparatus consisting of U.S. Chamber of Commerce Republicans and Democrats.

An encapsulated view would be Main Street (Trump) -vs- Wall Street (UniParty).

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This is THE battle. This is the “trillions at stake“. Everything else is chaff and countermeasures; a war is being waged around this financial issue. Everything within the current conflict is downstream from the economic argument around these issues.

This is the epicenter of the entire institutional conflict against President Trump. This is why THE SWAMP, through all its various affiliated and indulgent enterprises – including the intelligence apparatus, are waging a battle against the disruption that is President Trump.

It is the money.

Period.

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Earlier today President Trump hosted a White House discussion meeting to outline an infrastructure initiative with state and local leaders.  The initiative is part of a $1.5 trillion proposal to join with federal, state, local and private investment toward rebuilding American critical infrastructure, roads and bridges.

[Via White House] BUILDING AMERICA’S INFRASTRUCTURE: Today, President Donald J. Trump released his legislative goals to rebuild our Nation’s crumbling infrastructure. The six principles include:

• $200 billion in Federal funds to spur at least $1.5 trillion in infrastructure investments with partners at the State, local, Tribal, and private level.
• New investments will be made in rural America, which has been left behind for too long.
• Decision making authority will be returned to State and local governments.
• Regulatory barriers that needlessly get in the way of infrastructure projects will be removed.
• Permitting for infrastructure projects will be streamlined and shortened.
• America’s workforce will be supported and strengthened.

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Economic optimism reaches a 13-year high according to the latest polling release from Investors Business Daily.

…[…] The IBD/TIPP Economic Optimism Index climbed 2.9% in February to reach 56.7. This is the highest reading for this index since October 2004, and marks the 17th straight month that it has been over 50 — which signals overall optimism about the economy. It is also well above its long-term average of 49.3. (more)

Additionally, a recent UBS survey of business confidence shows the Tax reform bill passing has created a stunning jump in already strong optimism for the future.
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