Speaking from Bedminster New Jersey, President Trump answers questions from media surrounding the ongoing issue with North Korea, and the intransigent republican Senate Majority Leader Mitch McConnell and his inability to move legislation.

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It’s always about the economic folks.  President Trump is the first U.S. president to fully appreciate, and utilize, economic leverage to achieve U.S. national security objectives.

…”If China helps us with North Korea I will feel a little differently about trade”…

~President Donald Trump

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When candidate Donald Trump first proposed renegotiating NAFTA back in 2015 everyone was stunned. Fixing bad trade deals had never been proposed by any candidate. Candidate Trump also proposed a border wall.  Those two policy initiatives are entirely connected. Almost immediately the government of Mexico realized the potential impact and threatened to use illegal migration if NAFTA was reopened.
Well, Trump won the presidency.  The crony capitalists/lobbyists in DC (U.S. Chamber of Commerce – Tom Donohue) are freaking out. Congress was notified of the intent to renegotiate NAFTA.  Mexico and Canada were notified. Commerce Secretary Ross, U.S.T.R Robert Lighthizer and Treasury Secretary Mnuchin are ready to begin next week (Wed).
President Trump and Secretary Ross have already announced they will try to renegotiate NAFTA on a trilateral basis (U.S., Canada and Mexico). However, if it doesn’t work, they’ll scrap the 3-way NAFTA and go one-on-one with individual bilateral agreements.

Today Mexico’s Economic Minister Ildefonso Guajardo threatens to flood the U.S. with South American illegal aliens, criminals and gang members as leverage to keep exploiting NAFTA.

MEXICO CITY (Reuters) – Mexico could pull back on cooperation in migration and security matters if the United States walks away from talks to renegotiate the North American Free Trade Agreement, the Mexican economy minister said in a newspaper report published on Thursday.

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The PPI is the Producer Price Index.  The CPI is the Consumer Price Index.  The PPI reflects the price product producers are getting for their goods and services.  The CPI reflects the price consumers are paying for their goods and services.  They generally run together as lower production prices usually mean lower consumer prices.
Here again today, the fed is perplexed.  With a growing economy, and with labor market tightening, the people who control the monetary policy have continued to anticipate inflation, rises in the PPI and CPI.  However, as we have outlined, it’s not happening.
It’s a little wonky, but basically prices are NOT going up.  The Fed is perplexed.  We predicted this:

[…] The Labor Department said its producer price index for final demand slipped 0.1 percent last month, weighed by decreasing costs for services. That was the largest decline since August 2016 and reversed June’s 0.1 percent gain.
In the 12 months through July, the PPI increased 1.9 percent after rising 2.0 percent in the year through June. Economists had forecast the PPI to tick up 0.1 percent last month and 2.2 percent from a year ago. (read more)

Neither the PPI nor the CPI measure changes in food or energy costs.  Those high consumption sectors have always been removed from Fed measures.
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When we initially read this article yesterday our review began with an earnest and sincere effort to understand the concerns amid the career bureaucrats in the U.S. State Department; and also to understand the overall cultural climate that would need Secretary Tillerson’s Deputy Secretary of State John Sullivan to spend an inordinate amount of time trying to calm these officials….

WASHINGTON (Reuters) – The No. 2 U.S. diplomat on Tuesday sought to allay concerns among the State Department’s rank-and-file employees over possible layoffs and perceptions of a lack of firm direction under the administration of President Donald Trump. (more)

…After all, this has to be about the eleventyth time either Secretary Tillerson or Deputy Sullivan has addressed these ‘climate assessment’ issues. It was less than a week prior to this latest effort by Sullivan when Tillerson himself was talking to the department.
I mean seriously, how much “talking to‘ could one organization need? These are obviously some seriously needy people. Then again, we’ve long discussed the overall liberal perspectives within the department; so the most entrenched liberalism inside government is definitively inside the Department of State.
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Apparently CTH and Asian expert Gordon Chang are on the same intellectual page in analysis of the ongoing North Korea issues.  In this interview Mr. Chang outlines the dynamic between U.S. President Trump, North Korean President Kim Jong-un and Chinese President Xi Jinping.
Gordon Chang also agrees that mounting economic pressure on China will be the pathway to getting the DPRK into line.

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The North Korean commentariat today has all been centered around a “response” to a precipitous strike by the United States. As previously outlined by Secretary Tillerson, via the “four no’s”, and backed up by the entire U.S. policy team, there is no intent on the U.S. to initiate a North Korean regime change. That leverage approach is China’s to utilize; while we hold China accountable.
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Robert Mercer is a billionaire hedge fund manager who originally constructed the multi-million Cambridge Analytica data tool to aid Ted Cruz in winning the 2016 GOP Primary.
Mr. Mercer bought controlling interest in Breitbart Media for $10+ million. It was through Breitbart media that Mercer, together with Steve Bannon, deployed the Cambridge Analytica tool with a two year presidential poll (2014/2015) to vacuum up user data for later use in the 2016 republican primary.  Kellyanne Conway is part of their long-term relationship dynamic.
However, after Ted Cruz refused to specifically and enthusiastically endorse the winner, Donald trump, at the GOP convention in Cleveland, Robert Mercer kicked him out of his suite.  Robert Mercer generally stays in the background and his daughter Rebekah Mercer leads the political advocacy.  That said, they have the resources and disposition to destroy just about any political foe they choose to engage.

(Via Politico)  One of Donald Trump’s most generous political benefactors is providing a six-figure donation to a super PAC devoted to unseating Sen. Jeff Flake, an Arizona Republican who has been fiercely critical of the president.
Robert Mercer, a reclusive hedge fund billionaire who was intimately involved in Trump’s rise and helped to bankroll his 2016 campaign, is contributing $300,000 to a super PAC supporting former state Sen. Kelli Ward, who is challenging Flake in a Republican primary next year.

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Well, many of us were waiting for this – and we have discovered exactly what most CTH readers anticipated, China is a paper tiger.
Last night China finally delivered the official communist government position outlining their perceived leverage over the U.S. and President Trump’s economic diplomacy and economic security platform.
China has always used The Global Times to communicate their official communist state positions.  Last night China delivered their warning; oh, you’re gonna love this:

“US needs correct logic in dealing with North Korea”.

[…] The US asks China for help when it cannot solve its problems with North Korea. Some US elites even want to urge China to claim full responsibility for the issue or they will threaten to retaliate. Under this logic, isn’t it reasonable for North Korea to attack its southern neighbor when it is under military threat from the US?
Moreover, those US elites may not have considered the leverage China has over the US. What if China restricts the usage of iPhones and the number of Chinese students to the US, or imports fewer US agricultural products? (link for more)

Now, it is critical to emphasize this is the official outlook of the Chinese Communist regime and what they perceive as their leverage over the United States.  This is the official outlook of the party apparatus behind Xi Jinping.
So let’s look at their position in sequence.
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State Department Spokesperson Heather Nauert delivers the press briefing for August 9th, 2017.  The insufferable media gnats remain fixated on President Trump’s remarks about North Korea – remarks, combined with months of created leverage, that are actually delivering results.
After ignoring all of the action President Trump, Secretary Tillerson, Secretary Mnuchin, and Secretary Ross have taken to shape the geography; and without even seeing the leverage Trump has positioned on China, Russia and North Korea; the pool reporters are floating questions from a parallel universe called ‘bizarro world’.
Seriously, questions about possibly needing a new “diplomatic direction” are ridiculous against the backdrop of the greatest international diplomatic win in years happening only a few days ago with the 15-0 UNSC unanimous vote on North Korea sanctions.
U.S. journalists are embarrassing.

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[Transcript will be added later]
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Speaking today in Garmisch-Partenkirchen Germany, Defense Secretary James Mattis gave a statement to the media before the commemoration of the 70th anniversary of the Marshall Plan at the George C. Marshall Center:

“The United States and our allies have the demonstrated capabilities and unquestionable commitment to defend ourselves from attack.

Kim Jong Un should take heed of the United Nations Security Council’s unified voice, and statements from governments the world over, who agree the DPRK poses a threat to global security and stability. The DPRK must choose to stop isolating itself and stand down its pursuit of nuclear weapons.

The DPRK should cease any consideration of actions that would lead to the end of its regime and the destruction of its people.”

“President Trump was informed of the growing threat last December and on taking office his first orders to me emphasized the readiness of our ballistic missile defense and nuclear deterrent forces.

While our State Department is making every effort to resolve this global threat through diplomatic means, it must be noted that the combined allied militaries now posses the most precise, rehearsed, and robust defensive and offensive capabilities on earth. The DPRK regime’s actions will continue to be grossly over matched by ours and would lose any arms race or conflict it initiates.”

~ U.S. Secretary of Defense, General James Mattis

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President Trump responded moments ago to the statement from Senate Majority Leader Mitch McConnell about President Trump holding “excessive expectations” of congress. McConnell’s remarks were made Monday and highlighted yesterday.
President Trump responds via twitter: “I don’t think so”…
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