Acting chief-of-staff Mick Mulvaney appears on Fox News to answer Chris Wallace question about whether President Trump is serious about punishing Mexico with tariffs for their lack of action on illegal central American migrants.
Mulvaney skewers Wallace and predicts the tariffs will hit. Additionally Mulvaney sets the record straight on the impact of tariffs on consumers.
Generally, watching a Chris Wallace segment is worthless; however, Mulvaney’s linguistic Ginsu delivery is so good, this one is worth watching:

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All your interests are belong to us…. There was previous discussion of how Beijing would respond if/when their economic interests were challenged. In essence, the prediction was that China would drop the panda mask and revert back to their oppressive totalitarian tendencies.

It is an interesting dynamic because the more the communist state moves to punish and control western business interests, the less likely any western investment flows into China. It’s a simple question: Why would anyone want to engage a business relationship inside a totalitarian system that could move at any moment to control your business?

(South China Post) China will publish a list of “unreliable” foreign entities deemed to have damaged the interests of Chinese firms – a move set to ratchet up tensions in its escalating conflict with Washington, after the US government blacklisted Chinese telecoms giant Huawei.
The Ministry of Commerce said on Friday that it would blacklist foreign businesses or individuals that violated market rules and contractual obligations, or took “discriminatory measures” to hurt Chinese business rights and interests, as well as national security and interests.

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Well, this doesn’t come as a surprise.  Hoping to keep the borders open and fend off the Trump tariff’s on Mexican imports, Mexico’s President Lopez-Obrador (AMLO) enlists the help from Tom Donohue and the U.S. Chamber of Commerce.

MEXICO CITY (Reuters) – Mexico’s president and the top U.S. business lobbying group called on President Donald Trump to back down from a threat to impose punitive tariffs on Mexican imports, in a dispute over migration that could shock Mexico’s economy.
[…] The ultimatum from Trump is the biggest foreign policy test to date for Mexican President Andres Manuel Lopez Obrador and a tall order for Mexican security forces struggling not only to combat migrant flows but also to fight a record level of gang violence and homicide.

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AMLO knows there is no way for Mexico to begin retaliating against the U.S. after President Trump demanded they step-up migration travel enforcement or face U.S. tariffs on Mexican imports.  There’s no way for Mexico to take on Trump economically; and they would be foolish to try…  All business interests in Mexico will take a financial hit as soon as the stock market opens tomorrow: [Tweet Link]
No doubt Mexican Foreign Minister Jesus Seade will reach out to Jared Kushner for relief/assistance; but don’t look for President Trump to change on this issue until he sees substantive actions taking place.  Trump knows AMLO has a tendency to play political games with immigration; he’s made hollow promises before; and now Jesus Seade is in a very tenuous position.

(Reuters) […] The announcement rattled investors who feared that worsening trade frictions could hurt the global economy. The Mexican peso, U.S. stock index futures and Asian stock markets tumbled on the news, including the shares of Japanese automakers who ship cars from Mexico to the United States.

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Jumpin’ ju-ju bones, President Trump has just announced an emergency tariff program on all Mexican goods that begins on June 10th at 5% and continues to increase monthly until Mexico takes action to halt illegal Central American migration.
Tariff Schedule: ♦5% effective June 10th ♦10% effective July 1st ♦15% effective August 1st ♦20% effective September 1st ♦25% effective October 1st, and continuing therein until Mexico takes action to stop the flow of Central American migrants.

Details from the White House: As everyone knows, the United States of America has been invaded by hundreds of thousands of people coming through Mexico and entering our country illegally.
This sustained influx of illegal aliens has profound consequences on every aspect of our national life—overwhelming our schools, overcrowding our hospitals, draining our welfare system, and causing untold amounts of crime. Gang members, smugglers, human traffickers, and illegal drugs and narcotics of all kinds are pouring across the Southern Border and directly into our communities. Thousands of innocent lives are taken every year as a result of this lawless chaos. It must end NOW!
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Vice-President Mike Pence traveled to Canada today as an emissary of the Trump administration to support Canadian passage of the USMCA trade agreement.
According to Reuters media reports the vice-president was focused on the importance of a strong North American economic alliance, and how a united tri-lateral agreement can form a geopolitical hedge against influence from communist China and socialist ideologies in Cuba and Venezuela. Justin from Canada expressed his perspectives over diminished women’s rights, U.S. abortion laws, the important contributions of a transgender workforce, climate change and the NBA championship playoffs…. Yes, really:

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Meanwhile in Mexico: “The Senate, controlled by Lopez Obrador’s National Regeneration Movement (MORENA) and its allies, should approve the United States-Mexico-Canada Agreement (USMCA) once it has passed through congressional committee, the president said.” (link)
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Today is a very good day.  Despite the professional punditry and their doomsayer predictions of Trump tariffs driving up costs for consumers, exactly the opposite is happening.
Despite large growth in the Main Street USA economy; and despite large wage gains by U.S. blue-collar workers; inflation remains low and mysteriously detached from the Fed monetary policy.

WASHINGTON (Reuters) – U.S. inflation was much weaker than initially thought in the first quarter amid a sharp slowdown in domestic demand, which could cast doubts on the Federal Reserve’s view that the benign price pressures were largely because of temporary factors.
The personal consumption expenditures (PCE) price index excluding the volatile food and energy components increased at a 1.0% rate last quarter, the government said. The so-called core PCE price index, which is the Fed’s preferred inflation measure, was previously reported to have risen at a 1.3% pace.
The increase last quarter was the smallest in four years and pushed inflation further below the Fed’s 2% target. (read more)

They just don’t get it.  For over three years CTH has been explaining how President Trump’s maganomic policy will reverse three decades of stagnant Main Street economic growth.  Today the Bureau of Economic Analysis (BEA) once again confirms our earlier predictions, and releases the data showing inflation is essentially nonexistent.
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Chrystia Freeland has presented the initial procedural process for  the Canadian Parliament to take up a bill to pass the USMCA.  However, the Canadian window is short, if they don’t ratify the trade pact by the end of June, the Canadian parliament will go into legislative recess until after the general elections October 21st, 2019.

OTTAWA (Reuters) – Canada took a first step toward ratifying the new North American trade agreement on Monday just three days ahead of U.S. Vice President Mike Pence’s trip to Ottawa to discuss the passage of the treaty.
Foreign Minister Chrystia Freeland presented what is known as a “ways and means motion” to the House of Commons, which opens the way for the formal presentation of a bill.

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A fascinating press conference from the standpoint of President Trump and Prime Minister Shinzo Abe’s united position toward the dynamic of North Korea.
It is obvious that Trump and Abe have a strategy for the next step in engagement with Chairman Kim Jong-un.  Notice how PM Abe gives prepared remarks specifically about direct talks, face-to-face talks, with Chairman Kim, facilitated by President Trump opening the door:

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Obviously President Trump trusts Prime Minister Abe as a strategic ally; and a big component of this state visit is the two leaders coordinating regional security issues. China confronted/contained, and simultaneously both partners working on the hostage rescue of Chairman Kim is incredibly consequential.
The strategic value of this state visit is much more than surface appearances.
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Based on time zones (Japan is 13 hours ahead), and considering Lighthizer left on Thursday; it would appear Japanese Economy Minister Toshimitsu Motegi and U.S. Trade Representative Robert Lighthizer are meeting right about now.

(Reuters) – Japanese Economy Minister Toshimitsu Motegi said on Friday that he will meet with U.S. Trade Representative Robert Lighthizer in Tokyo on Saturday for trade talks ahead of a summit meeting between leaders from the two nations on Monday.
Japanese Prime Minister Shinzo Abe and U.S. President Donald Trump are expected to discuss topics including North Korea’s nuclear programs, trade issues and the coming Group of 20 leaders’ summit. (link)

Following the State Dinner to celebrate the beginning of the Reiwa Era, introduced with the coronation of Japanese Emperor Naruhito, President Donald Trump and Prime Minister Shinzo Abe are scheduled to hold a summit and joint press conference on Monday.
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