White House Office of Trade and Manufacturing Policy Director Peter Navarro appeared on Fox Business last night to outline the U.S. position in the ongoing trade reset against communist China. Almost all of the financial media and economic punditry are intentionally obfuscating the underlying nature of China’s economic model.
China is a communist central government controlled economic system. Free-market principles do not apply when dealing with China; therefore trade strategies based on ‘free markets’ cannot succeed against the centralized planning of a communist regime.
Secretary of State Mike Pompeo visited North Korea amid the backdrop of the U.S. -vs- China trade confrontation. The geopolitical economic issues form the structural disconnect between the ongoing U.S. negotiations and the responses from China through their proxy province in North Korea.
Secretary Pompeo debriefs the media shortly before departing the DPRK; and expresses a generally positive disposition about the ongoing talks:
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However, unnamed officials, likely elements within the central North Korean government who are control agents for Beijing, send a more confrontational message at the conclusion of the meetings:
(AP) North Korea says high-level talks with a U.S. delegation led by Secretary of State Mike Pompeo were “regrettable” and has accused Washington of trying to unilaterally pressure the country into abandoning its nukes.
The Bureau of Labor Statistics presents the latest snapshot of jobs and employment. According to the BLS data, behind the 213,000 jobs added, the most significant gains all center around growth in durable goods, manufacturing, transportation/distribution and the ancillary business services directly connected to the blue collar sector.
In addition, April was revised up from +159,000 to +175,000, and the change for May was revised up from +223,000 to +244,000. With these revisions, employment gains in April and May combined were 37,000 more than previously reported.
In the macro-review things are looking great; however, when you go into the micro-review you discover things are even better, they are MAGAnificent.
To understand what is happening we must all remember the Trump MAGAnomic policies are geared toward enhancing the creation of “goods”; the production of physical “stuff”; the manufacturing and durable good sector; or put another way: Main Street/Blue Collar work. MAGAnomic policy is geared toward expanding the production base of the U.S. economy. Therefore all majority benefit will be necessarily attached to those workers and industries that are part of the expanding production base. (more…)
For more than three decades all U.S. economic policy has been elevating Wall Street and diminishing Main Street. As a result blue-collar workers have not had wage gains keeping up with inflation for over 30 years…. Then came the era of Trump.
More than two years ago CTH began discussing the ramifications to a new emphasis on the economy outlined as a possibility of candidate Donald Trump’s economic policy outlook. Within the overall discussion we walked through the anticipated changes possible if A.) Trump won the election, and B.) Trump began instituting Main Street economic policy ahead of Wall Street policy (the past 30+ years).
We discussed the new dimension that would occur between two economic engines (Main Street -vs- Wall Street) as three decades of policy shifted. CTH outlined statistical and measurable KPI’s that would become visible in the space between the policy shifts.
Part of those discussions focused on energy costs, product costs (we explained how inflation would be weird), and importantly, wage rates. It takes several months of policy emphasis (actual outcomes), before the labor market wage rates would grow. We anticipated seeing that impact in Q2 of 2018, which is April-June 2018. Well:
(Via CNBC) […] The Bureau of Labor Statistics reported that April closed with 6.7 million job openings. May ended with just over 6 million people the BLS classifies as unemployed, continuing a trend this year that has seen openings eclipse the labor pool for the first time. At some point that gap will have to close. Economists expect that employers are going to have to start doing more to entice workers, likely through pay raises, training and other incentives.
Last month the White House presented a 36-page outline of the U.S. position toward trade with China (full pdf below). White House National Trade Council and Office of Trade and Manufacturing Policy Director Peter Navarro delivers a presentation to discuss that report. Very well worth watching:
Pontificating economic globalists are stuck between empirical good news and their preferred anti-Trump tariff narrative. Economic media like the Wall Street Journal are filled with angst, as Trump’s manufacturing MAGAnomics continues to destroy their decades-long talking points and globalist preferences.
The analysis of June factory and manufacturing indicators from the Institute for Supply Management (ISM) highlight an expanding reality: increased production, increased new orders, increased employment, and demand outpacing supplies and transportation capacity. Yes, all of this means the Main Street U.S. economic engine is firing on all cylinders. We can only imagine what the Q2 numbers will reflect when it’s all rolled up.
ISM DATA – “Comments from the panel reflect continued expanding business strength. Demand remains strong, with the New Orders Index at 60 percent or above for the 14th straight month, and the Customers’ Inventories Index remaining low. The Backlog of Orders Index continued to expand, reading at 60 percent of higher for the third consecutive month. Consumption, described as production and employment, continues to expand in spite of labor, skill and material shortages.
What does this mean in blue collar language? Short term: OVERTIME pay folks…. maximum earnings possibilities as demand for factory and manufacturing has all employment working maximum production shifts. Long term: upward wage pressure, jobs, jobs, jobs.
For the Truck Drivers? Work, work, work. You got a rig, they need it hauled. Everywhere. (more…)
Today U.S. Chamber of Commerce President Tom Donohue announced another campaign to protect and defend his Wall Street contributors against initiatives that benefit Main Street U.S.A. This is not the first time, and unfortunately it will likely not be the last time.
For a great historic reference consider THIS ARTICLE from 2014; when the U.S. Chamber of Commerce announced their direct attack against the Tea Party backed candidates that threatened to remove the massive lobbying power of Tom Donohue’s corrupt officials. That 2014 reference point has two parts. I strongly urge anyone who would defend the U.S. CoC approach to read both.
The overwhelming majority of economic punditry and opinion come from salespeople on the purchased payroll, direct and indirect, of the chamber. It is one of the most, check that, it is the mostcorrupt and abusive enterprise in the history of our nation. They are pulling out a very familiar playbook.
(Reuters) – The U.S. Chamber of Commerce on Monday denounced President Donald Trump’s handling of a global trade dispute, issuing a report that argued the tariffs imposed by Washington and retaliation by its partners would boomerang badly on the American economy.
President Donald Trump meets with Prime Minister of the Netherlands Mark Rutte in the Oval Office at the White House.
During remarks President Trump notes a phone call with Mexico’s winning presidential candidate Andres Manuel Lopez Obrador; and ongoing interviews/discussions with possible Supreme Court nominees. [Four SCOTUS nominees were interviewed today and three or four more will come in the next few days.]
On the trade front President Trump notes the ongoing issues with the WTO (World Trading Organization), and a possible confrontation looming over structural changes needed to reset global trade disparities and establish open markets.
The official announcement is coming momentarily. All other candidates have conceded. Looks like Andrés Manuel López Obrador, an avowed soft-Marxist, will EASILY end up with 53 to 59% of the vote and is the next President of Mexico: Primary platform points: ♦Amnesty to all drug cartels. ♦No longer will work with U.S. immigration enforcement. ♦Nationalize oil industry. ♦Farm subsidies. ♦Elimination of multinational corporate influence on farming. ♦Support and assistance for economic growth plan: using •mass migration of Mexican nationals into Southern U.S., •create AmeriMex border region, and •remittance of earnings back to Mexico as initiative for rapid domestic economic growth. (more…)
Maria Bartiromo continues to distance herself from all Sunday talk-show competition with some of the best and most insightful interviews and topics available. Today Mrs. Bartiromo interviews President Donald Trump. The substantive content is excellent.
From a position of understanding Trump policy, and expanding/predicting how each policy will carry forward, this really is one of the best interviews to date. Bartiromo hits on most topics of interest and expands on the topics of greatest consequence. Anyone who seeks to understand where the administration is going with economics and trade only needs to keep revisiting this one interview – it’s all there.
Domestic discussion includes the Supreme Court, trade and tariffs, immigration, border security, ICE, mid-term election, taxes, jobs and the ongoing battle between congress and the DOJ/FBI. Foreign discussion includes trade and geopolitics with Canada, China, the EU, North Korea, Iran and the upcoming summit with Russia. The intersection of economics and geopolitics via the Trump Doctrine is clear as day.
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[There was a time, not too long ago, when Bartiromo didn’t *get* the Trump doctrine and how economic leverage is used to achieve strategic geopolitical benefits; ultimately ending with massive wins for America. You can tell she understands the strategy now.] (more…)
