Category World Economic Form

Dec 31 2018

Twitchy Panda – Chairman Xi Jinping Year in Review Speech Stays Away From Mentioning U.S. Trade War…


Re-Posted from The Conservative Tree House on December 30, 2018 by 

China’s Communist Chairman Xi Jinping delivered a prepared speech to the Chinese People’s Political Consultative Conference on Saturday and stayed far away from mentioning the challenge of a U.S. -vs- China trade reset.

Those who follow China’s historic patterns will note careful and intentional inferences within Chairman Xi’s remarks as shared by SCMP media:

[…] While the Belt and Road Initiative has faced an increasing international pushback amid fears it is saddling poorer countries with unsustainable debts, Xi’s speech steered clear of this and other sensitive topics.

Instead he praised the initiative for helping to improve international ties, adding: “Our circle of friends is expanding.”

“Circle of friends” defined as those political suckers (selfish and corrupt political parasites willing to sell out their countries’ best interest) who accept the smiling panda face and completely ignore the cunning dragon behind the mask maneuvering to enslave the locals.

[…]  Xi only made terse references to the country’s economy development, which is facing its biggest challenges in a decade as growth slows and concerns grow that the country will not be able to achieve its growth target of 6.5 per cent for this year.

Xi did not highlight any particular economic achievements over the past year and said only that next year the party would continue to promote stable economic development.

[…] Looking ahead to the coming year, Xi reminded delegates of his three key policy priorities – fighting pollution, corruption and poverty – and said the year offered challenges and opportunities to build a “well-off society in an all-round way”.

2019 will mark the 70th anniversary of the People’s Republic of China and Xi told his audience they should make the strengthening of ideological and political guidance a priority. “Winning people’s hearts is the biggest political battle,” he said. “Consensus is the power for forging ahead.”  (more)

Yes, it’s always a precarious balancing act when Xi must find a way to keep the pesky pitchforks at bay, and simultaneously build the largest domestic surveillance program in the history of totalitarianism.

The confrontation with China is the priority for President Trump.  POTUS knows China is far more dependent on the U.S. than vice-versa.

I have no doubt the Trump administration has strategic plans to leverage trade access to the U.S. market as part of a way they can destabilize Chairman Xi if needed.

Also, Xi knows this subtle and Trumpian angle is a much larger risk than readily appears at the surface.

Xi knows Trump knows; and Trump knows, Xi knows that Trump knows.

And so we dance…

President Trump is the first U.S. President to understand how the red dragon hides behind the panda mask. The entire planet is focused on the dynamic of Chairman Xi and President Trump.  Billions waged on tweets, coded messages, hints of smiles.  Epic stuff.

In the multinational finance world this financial face-off is bigger than the all military world wars combined.  This is legendary stuff here.  Bigger than any legacy initiative ever fathomed by all Presidents in decades.  Every nuance and inference is carefully reviewed by Wall Street’s ‘Big Club’ looking for any leverage to influence the outcome.

The funniest thing is Donald Trump doesn’t care about all that.  He has the desired ‘America First’ outcome gamed out for decades:  We finally win, China acquiesces.

The Wall Street global financial crowd is on pins-and-needles hoping desperately the confrontation between China and the U.S. doesn’t escalate.

Meanwhile, blue-collar Main Street USA is hoping ‘bull-in-a-china-shop-Trump‘ punches Xi in the nose; as retaliation for decades of designed exploitation and globalist erosion of our manufacturing and industrial base.  Diplomatically of course.

In 2019 the bamboo forest is in real risk of shrinking…

It may not be popular to keep pointing out, but this is the stuff President Trump really cares about.  The Deep State, DC Swamp, Mueller, Comey, Michael Cohen, congressional hearings…. confrontations, resistance efforts…. and all that ‘spygate’ and surveillance stuff is way over there…. Something that is necessarily attended to, but in the larger scheme of things, far less important.

President Trump has fifty years of business skills in various predatory and adversarial financial deals.  Leverage, or the ability to force an opponent to take an action that benefits your position, is the most valuable weapon in deals; business or politics the same is true.

Leverage and influence is extremely valuable and it’s not just against Democrats and the Never Trump alliance (ie. Sea Island group). President Trump is in a fight against multiple enemies from all sides, across all aisles and political alignments.

The declassification leverage is a weapon; an atomic hammer that strikes everyone in a 360° blast radius.  President Trump is not going to waste it to remove a few political gnats.

And it is not limited to domestic adversaries.  This leverage has a geopolitical value.

Think about geopolitical trade deals with Five-Eyes allies.  Think about how President Trump may need an ally to take a position adverse to their preferred interests. The potential for declassification of intelligence documents showing complicit corruption within the U.K. and Australia could destroy politicians external to the U.S.

Think about an ally being asked to take a position on China (trade), Iran (sanctions), Russia (energy), etc.  Movement on any of these geopolitical issues, and many more, can be tilted -in part- based on the threat of sunlight or declassification. Leverage is a tool.

Getting particular democrats to support the USMCA; what’s that worth?

Getting a southern border wall and sensible immigration law; what’s that worth?

What does President Trump value?  What is important to him?

What part of the transactional relationship can be enhanced by leverage?   Pro-tip: it’s not personal; it is not leverage to benefit Trump personally; he doesn’t care about that shallow stuff… his view of the horizon is much longer, much further; much more consequential.

It annoys the heck out of many people, me included, that Donald Trump is willing to absorb so much inbound fire, unnecessarily; which, by extension, means that his supporters are forced to absorb so much inbound and unnecessary fire; but he is.

What is President Trump’s primary objective?   Save the U.S.A. through economics.

Economic security is national security.

I think much of our angst is because we look too short-term; and the media does a great job of convincing us President Trump is selfish.  Perhaps they are correct. Perhaps I’m wrong; but I see this leverage issue as something Trump views as important – obviously; or he wouldn’t approach it that way.

Would President Trump trade a $500 billion per year positive benefit to the U.S. economy in exchange for never outlining the fraud against him?

Would President Trump accept new jobs for a million Americans in exchange for never outlining the 2016 fraud against him?

Yeah.

He would.

Without question.

And he wouldn’t care if it meant he could never win in 2020.

He ain’t a politician.

Optimal outcomes.

Piss you off?

Probably.

That’s Trump.

This massively consequential economic reset on a global scale is the primary reason Donald Trump finally decided to run for office.  Everything else is less than:

 

Dec 31 2018

The Merkel & Macron Tag-Team – Surrender Sovereignty to Brussels


Armstrong Economics Blog/Politics

Re-Posted Dec 31, 2018 by Martin Armstrong

QUESTION: Mr. Armstrong; Merkel has come out and said that “Nation states must today be prepared to give up their sovereignty.” This is what you have been saying that the agenda is to federalize Europe. Would you care to elaborate on her latest statement?

Thank you from Berlin

PH

ANSWER: Merkel has stepped down as leader of the CDU. She knows that she is on the way out. She hopes to cling to her position of power until she is dragged out by the hair. This statement is indeed the behind the curtain view. But she qualified that statement insofar as yielding sovereignty to Brussels over especially migration. This is a shot across the bow at the rising nationalism. You must look at the entire statement she made in order to expose the thinking process.

Merkel condemned any notion that Germany should join a fast-growing number of nations pulling out of the migration agreement. Even Australia pulled out of the UN migration agreement. She said that “there were [politicians] who believed that they could decide when these agreements are no longer valid because they are representing The People”. What is interesting is how she is splitting a democratic form of government which represents the people and one of an anti-democratic position because politicians know better than the people. She continued to remark that “the people are individuals who are living in a country, they are not a group who define themselves as the [German] people.” She holds the position that migration is inevitable, necessary and desirable. She refuses to admit that allowing in the refugees was a mistake.

Her reasoning states that nationalism “is not patriotism, because patriotism is when you include others in German interests and accept win-win situations.” The fact that is an anti-democratic position behind the curtain is evidenced by the fact that the FrenchPresident Emmanuel Macron, also recently stated that “patriotism is the exact opposite of nationalism [because] nationalism is treason”.

Macron travelled to Berlin and addressed the Bundestag that France and Germany have “obligation not to let the world slip into chaos and to guide it on the road to peace.” He added that “Europe must be stronger… and win more sovereignty” in order to suppress in truth the riots seeking to remove him in France. Both Macron and Markel are pitching that all EU member states should now surrender national sovereignty to Brussels over “foreign affairs, migration, and development” in addition to “an increasing part of our budgets and even fiscal resources.” Macron has sought and obtained an exemption to run a higher deficit than the EU rules allow because of the tax protests in France.

What is going on here is a tag-team. Merkel and Macron are advocating the surrender of sovereignty because they then can blame Brussels and not shoulder the responsibility for the economic disaster Europe is heading into for 2020/2021. We have two politicians whose days are numbered advocating the federalization of Europe that they previous swore would never happen.

Dec 30 2018

Der Spiegel Suspends Two Senior Editors for Not Catching Fake News


Armstrong Economics Blog/Press

Re-Posted Dec 30, 2018 by Martin Armstrong

The major influential German news weekly, Der Spiegel, has suspended two of its senior editors following the scandal involving a reporter Claas Relotius admitted faking stories for years. Relotius, who is 33, resigned after admitting that he had made up stories and invented protagonists in more than a dozen articles in the magazine’s print and online editions. Relotius was also named journalist of the year by CNN back in 2014. This has provided another whole dimension to the Fake News issue. Here, instead of institutional bias such as CNN, Fox, New York Times, and the Washington Post, we have an individual just creating news. He managed to get away with it for so long because the readers wanted to believe what he wrote.

Dec 15 2018

Does French Yellow Vest Revolution Echo U.S. Tea Party?


Published on Dec 14, 2018

Yellow vest protests in France may have a connection with the recent U.S. Tea Party movement. Stephen Green leads Scott Ott and Bill Whittle to consider the parallels and differences. Right Angle is one of the shows produced by members at http://BillWhittle.com/subscribe
Dec 14 2018

The Real Game of Thrones


Armstrong Economics Blog/Central Banks

Re-Posted Dec 14, 2018 by Martin Armstrong

The real Game of Thrones is already underway. The contest to succeed Mario Draghi is now officially open. The head of the European Central Bank (ECB) will leave office on October 21st, 2019. The question is who has the guts to step up to the plate to clean up the mess he is leaving behind? The appointment of his successor is already underway.

All the various governments are planning to submit their entries for what people are calling the ECB derby of 2019. Nobody really knows what will happen between now and the summer of 2019 is already a political lifetime. The favorite behind the curtain seems to be Jens Weidmann, who is the current head of Germany’s Bundesbank. If he would take that position is debatable. There are huge economic problems Draghi is leaving behind with the Quantitative Easing and then stir in conflicting political interests, and it becomes highly questionable whether this is going to be an easy compromise of the clash of titans.

The backroom shenanigans are not going to be so easy since Draghi has kept member states on life support. The monetary policy crisis in Europe may now come to a head and expect this to also become a major influence behind the Euro in 2019 as speculation grows. However, there is a prelude to the Draghi successor. Come May 2019, the term of Vítor Manuel Ribeiro Constâncio, who has served as Vice President of the ECB from June 2010 until May 2018 must be decided. Constâncio served as Governor of the Bank of Portugal from 2000 to 2010. With his term expiring in May, the new Eurogroup president, Mário Centeno, formally asked his finance minister colleagues to submit their nominations for the job by February 8th, so that the heads of government have time to agree before the spring. The choice of vice president will certainly influence political balance which could alter also the type of policy to expect from 2020 onward.

One thing is very clear, the Vice President and President will not be from the same countries regardless of their qualifications. The tradition has been that the four largest eurozone economies — Germany, France, Italy, and Spain — must have one representative on the board, with the other two seats being left to remaining 15 powers. There is little question that Jens Weidmann would reverse the policies of Draghi and shrink the ECB balance sheet as quickly as possible. The French will object to Weidmann being the man to sit in that chair when many states are starting to complain about the austerity philosophy of Germany

Dec 14 2018

The Brewing European Debt Crisis


Armstrong Economics Blog/Sovereign Debt Crisis

Re-Posted Dec 14, 2018 by Martin Armstrong

Macron is pushing for the European Finance Minister to raise money by selling EU bonds and then distribute the money to the 19-member Eurozone. France is very heavily indebted and here once again we have simply the goal to raise more money rather than reform. Because of the riots in France, Macron is trying to get the EU to fund France. They want to call this the European Monetary Fund and it would be pitched as stabilizing the Eurozone, but in reality, it is circumventing the austerity principles and budget constraints.

Juncker was the European Finance Minister to chair a body of European Finance Ministers from each member state. He would also become the Vice President of the European Union.
Juncker is seeking to use the European debt crisis that is brewing as the means to the ends resulting in the final federalization of Europe. If the EU raises the money and hands it out like welfare to the states, then they become addicted and totally dependent upon Brussels and thus eventually all sovereignty is surrendered.

This new European Monetary Fund would incorporate the European Stability Mechanism (ESM) which is a Luxembourg-based fund that lends money to states in crisis. They lent money to Cypris, Greece, Ireland, Spain, and Portugal. They were issuing their own debt but were not an EU entity. The ESM capitalization was guaranteed by the euro countries. Therefore, the proposal is really a takeover and it would be a way to funnel money to states such as France

Dec 11 2018

French President Macron Declares “Social and Economic” State of Emergency….


Re-Posted from The Conservative Tree House on December 10, 2018 by

With massive civil unrest overwhelming many parts of French society, President Emmanuel Macron made a televised speech to the nation attempting to calm the anger. Macron declared a social and economic state of emergency and attempted to stop the ongoing Yellow Vest protests by announcing a special year-end bonus.

In addition to the year-end bonus, during the national address from the Elysee Palace Macron announced an increase in the minimum wage of €100 per month; a tax exemption on overtime pay; and a plan to not raise taxes on pensioners with an income less than €2,000/month.  Here’s the english version of the EU broadcast.

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When the same issues happened in Venezuela, Maduro followed a similar plan… things didn’t end well.   Macron has already committed the full weight of his police and military to crush any uprising.  Tenuous times in France.

Dec 9 2018

1,400 Arrests in France as Yellow Vest Protests Spread Across Europe…


Re-Posted from The Conservative Tree House on December 8, 2018 by

French President Emmanuel Macron may have maneuvered to block the growing uprising, but it’s quite possible he’ll lose his presidency in the process. French police took a much more aggressive posture this weekend.  The violence is disturbing.

In an effort to stop a replay of last week’s violence, French police moved in pre-dawn raids to round up those they identified as leaders of the Yellow Vest protest movement. In the city of Paris over 800 arrests were made by Macron’s forces and the French military were deployed. Overall, throughout France more than 1,400 arrests were made so far.

As the sun set, less organized protests continued as frustrated French set fire to cars, burned barricades and smashed windows in isolated geographic pockets within the city. Police forces were boosted to around 8,000 across Paris, with EU armored vehicles deployed in the city of lights for the first time in modern history. The pictures are stunning.

The Daily Mail has a pictorial of the events – SEE HERE

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Dec 8 2018

Annegret Kramp-Karrenbauer Replaces Merkel


Armstrong Economics Blog/Germany

Re-Posted Dec 7, 2018 by Martin Armstrong

Annegret Kramp-Karrenbauer was elected by the CDU party congress in the second ballot by a narrow majority to the new CDU chairmen. Kramp-Karrenbauer received 51.75% of the delegate votes, Friedrich Merz 48.25% of the vote. Jens Spahn was eliminated after the first ballot. Therefore, the CDU has sealed its fate. Kramp-Karrenbauer will maintain the policies of Merkel and will not push Merkel out of office. This is setting things up for a stronger rise of the AfD and puts the CDU at risk of dividing yet over the Refugee Issue.

Hillary should have just learned to speak German.