The market is down 4 percent and people are crying . Unbelievable.
Drew
We face a Sophie’s choice
I guess we can look on the bright side. Anyone who has high interest rate mortgages can refinance soon at a much lower rate. It looks like the 10-year Treasury has breached the 4.0% level. Let’s see.
The sad part is that we’ve had globalist presidents going back to Nixon and Carter who allowed all of the domestic industries to be offshored. This should never have happened, but then again all of the president’s back to Nixon and before were all globalists. The drop dead time to implement a tariff regime was back 30 years ago.
The time of widening trade and fiscal deficits is coming to an end
The United States cannot continue running these massive deficits anymore, whether it be trade or fiscal. And the reasons for this are straightforward;
•The shelf life of quantitative easing QE has reached its expiration date, since the Federal Reserve can no longer continue purchasing Treasuries nor mortgages, lest it further ignites inflation.
•Moreover, the United States government can no longer afford to use its military to enforce the dollar hegemony. It’s all become much too expensive.
This current trade deficit with CCP China is running at about $300 billion per year in the red, and growing. So what’s the answer?
CCP China has a lot more to lose
A pyrrhic victory
If this continues, I envision a scenario where Chinese nationals will be stripped of real estate ownership here in the states. All the farmland that the CCP Chinese have been quietly accumulating will be stripped from them and sold at auction. I envision a scenario where all Chinese visas will be revoked. I see a scenario where the military ships will sail into the Panama Canal and take possession.
We have to understand that CCP China and Chinese nationals own so much more real estate and farmland domestically than Americans do in China. There are millions more Chinese nationals in the states stealing technology and ideas than there are Americans in China.
Unless the Panamanian president intervenes and forces some sort of transaction, I envision a scenario in which Trump will engage the military to take over the Panama Canal. But we have to understand one thing, Chinese CCP should never have been able to exert control over the canal in the first place. We must thank our globalist presidents going back to Carter and Clinton for this unfortunate set of geopolitical circumstances.
QE has reached its expiration date
QE is now inflationary
If the fiscal and monetary trajectories established during Obama and QE, and carried out with Trump and accelerated with Biden, continue on their present course, the United States will definitely be submerged into the New World Order.
From its inception in late 2008 until late 2019, the mechanisms of quantitative easing were not inflationary. We could make a case that under the circumstances at the time, QE was actually deflationary as a greater percentage of the economic output was devoted to servicing debt.
I have been stating since my early blogging days 12 to 13 years ago, that as long as the federal government feigned fiscal prudence, QE could be carried on indefinitely. I mean, it could have been essentially carried on forever. Unfortunately, the covid crisis came along and upended all of this. United States government can no longer control itself nor its spending habits.
Thus, we are now confronted with a “Sophie’s choice” scenario. There is no decision that is preferable to any other and each one comes with terrible consequences.
Any solution is better than dealing with CCP China
Although it may seem like a pyrrhic victory if the United States prevails in some sort of trade standoff with CCP China, the US would be much better off in the long run if it rids itself of having to deal with the lying and propagandizing CCP China. Unfortunately, in the short and intermediate term, the results could be devastating.
Without the United States and its willingness to offshore its economy to Asia, the CCP would be ruling over a third world backwater. CCP China is still vitally dependent on running its trade surpluses, and without these trade surpluses, the Chinese economy would be an utter shambles.
CCP China is also the primary existential enemy of the United States and that’s why Kissinger back in 1971 and ’72 was under orders to open up China’s economy. This was all in prelude to establishing the tableau for World War III.
Unfortunately, I don’t see any quick fix. CCP China’s massive trade advantage will continue and prevail. United States built its own future global conflict enemy. It’s taken over 50 years to do so, so any solution to undo the damage won’t come overnight. But it starts with the first step.
Personally, my optimal world would include a domestic economy that does not have much to do with China anymore. If the market’s crater, I won’t stand in the way. Let the inflation take foot. Let the chickens come home to roost.
But China will never be friends with the United States. The fact that CCP China will continue to match president Trump’s proposed tariff rates indicates a recalcitrant trading partner. It clearly demonstrates the greediness and willful ignorance of the CCP. There is never any bargaining in good faith with CCP China. CCP China is as truthful and honest as the propaganda videos they put out on YouTube so that the vloggers can get paid to promote China.
In the long run, the United States is much better off without dealing with Russia and CCP China.
That’s my normative judgment. That’s where I stand. I’m not saying what Trump is doing is correct. I am saying that the United States needs to figure out how to extract itself from the clutches of CCP China.
If anyone here reading this has a solution, please comment.
NG. The 10-year treasury yield closes at 3.99%, which is much higher from today’s low yield. I was hoping for more sustained drop.
The synagogue is driving the market down, so we never implement tariffs. The exporting nations can run the surpluses forever.
Dow Chemical is trading at $28 now… Dizzying. Its like covid XOM all over again.
My guess is Trump may make minor adjustments with certain countries that capitulate, but over all the tariffs are going to stay till the system breaks. This is it!
Except from Market Watch: We will see.
The selloff that followed President Donald Trump’s “Liberation Day” tariff announcement was large by any measure, a Black Thursday and a Black Friday. If they are followed by a Black Monday and Tuesday, then everyone is in trouble.
Back in October 1929, after suffering their own Black Thursday, traders also had a weekend to ponder what the new week would bring. It brought disaster.
The market went into free-fall from Monday’s opening bell. The selling only stopped, briefly, late Tuesday, from exhaustion as much as anything. Black Monday and Black Tuesday erased around a quarter of the market’s value in two days.
No doubt the Synagogue is crashing the stock market. It is their way of making Trump look bad.
No tariffs have been implemented yet, it’s still all talk at this point. Shorts are having a good couple of weeks, I saw that coming but it’s too much of a hassle for me to short stocks. Many are oversold so there should be upticks next week as some did that today.
Also pay attention to your local towns. Many Asian companies like Singapore are opening businesses in my area, they are doing the same in your towns. The speed the city council approved all of it is shocking, within a couple of months. They are using those fiat dollars they were given to buy all things American and turn it into China from within.
I’ve said before just from my observations that there won’t be a military invasion, they are moving here, and they are already here and they are breeding out and replacing natural born citizens.
REPLACEMENT is the keyword for the force majure. REPLACEMENT
You cannot defend your Country if the enemy uses legal means to take it over. Buying all the elected officials, who give law enforcement employees and national guard members orders and the means to prevent defence from civilians.
Everytime I hear China worldwide continuously lie through its teeth about how they want a multipolar world and criticize the USA on wars, invasions, etc. I realized what a snake that country is.
Furthermore, I read comments from stupid imbecile praising China as the agent of reason and even saying better to be under a Chinese structure. How stupid can you be to support the full core manifestation of communism?
I recently visited Taiwan and it is everything opposite to China. America is praised everywhere in Taiwan.
It is what China was supposed to be before the communists kick Chiang Kai Shek out of China funded by Jewish bankers to Mao Zedong.
You got that right. I see the Taiwanese corporations and government working with the United States about bringing factories here to our shores. I see TSM and other Taiwanese corporations, who were made rich off the backs of the American consumers, willing to spend up to a trillion dollars and invest in the United States.
Something has to change. The only thing CCP China is doing here in the states is buying up farmland in shell corporations.
And that’s just one of the compelling reasons the CCP will attack the land of unwalled villages!
The planets are aligning. It seems that Americans will still have their second amendment and will completely annihilate any of the troops that make it to shore. That’s what it says in Ezekiel 38 and 39. Americans will be working full-time for 7 months to bury the Chicomm dead.
It is my understanding they will be piled up in the grand canyon.
Sounds good to me. When the Grand canyon is filled up, we can light ’em all on fire. The orientals are non-Adamic man anyway, and I don’t really care what happens to them. Why? Not only do they not care about me, but they hate and exploit my people.
I have been studying Chinese history some extent and there were never any historical timeline discontinuations because of any flood that supposedly washed across the entire planet. The orientals were here a lot longer before Adamic man came along in Genesis 2.
I just prefer we turn our backs on these Oriental nations and bring jobs back home. I’m tired of seeing my people struggle.
As Moses once famously said, let my people go! Perhaps we’ll see a second Exodus soon.
Yes, there will definitely be a Second Exodus. More spectacular than the first one!
Maybe Trump should start filling the SPR back up….
Given the current set of circumstances, I was hoping Treasury bond yields would fall even further. Currently the 10-year yield sits right below 4%. Let’s see if it can fall any more. Energy commodities are really getting hit hard this morning and continue the trend of the past few days.
Although the situation may look dire, I am encouraged to see deflationary forces prevailing here, rather than seeing inflationary forces rise.
I am encouraged to see Treasury bond yields fall rather than rise. I just hope to see them fall further.
On paper, what Trump is saying seems compelling enough. He’s promising to slash trillions in personal and corporate income taxes as a trade-off for tariffs.
I suspect the ultimate goal will be a North American Union mechanism with nearshoring deals with Mexico and Latin America. There may be an expanded Oceania-type of setup as well. I suspect the ultimate goal will be getting rid of China as a supply chain source.
I know this much, China has much more to lose here than the United States. The United States will be fine through all this, regardless of what the alt-media say. Foreigners hold a lot less of US Treasuries than before.