CTH shared last week the visibility of a cross-party political and economic horse-trade {Go Deep}.  It would appear some evidence toward that likelihood is gathering:

(Schumer link)

Speaker Nancy Pelosi and Minority Leader Chuck Schumer want their infrastructure proposal.  President Trump wants a fundamentally realigned geopolitical trade reset.  No doubt Pelosi/Schumer will attempt to get their political win and simultaneously eliminate any Trump win.  However, until the weeds are reached they are each playing their role.

One of the aspects to President Trump that bears a continual reminder is the importance of actual economic victory over optical political victory.   President Trump is primarily focused on the former, and only concerned about the latter as it relates to his goal:

….to fundamentally restructure the way the American economy interacts with the global community. Economic security is national security.

That’s what President Trump cares about. President Trump’s outlook on economic security is only superseded by one measure: his willingness to use the U.S. military to protect U.S. persons from physical threats of harm.

Withdrawing the tentacles of global exfiltration of American wealth; vis-a-vis the structural reset of the U.S. economy and how it engages with the global trade systems; is the pinnacle focus of President Trump. All other issues are ‘less than’; and the internal politics within Washington DC is far, far, less than in this set of priorities.

It may be uncomfortable for many to see and/or admit, but all other priorities held by supporters of President Trump fall below his primary economic objective.  American economic priority is the stuff Donald Trump has discussed, shared, considered and sought counsel on for over 30 years.

Any ancillary policy or issue that intersects with Trump’s focus on the U.S. economy gets priority [See: Trans-Pacific Partnership (TPP); Transatlantic Trade and Investment Partnership (TTIP); and Paris Climate Treaty as examples].  However, all issues which fall farther away from the economy are downstream priorities.

Within the small dot, disproportionately emphasized by pundits, lays the internal politics of DC.  President Trump has spooky good political instincts, yet his valuation of politics is proportional to the necessity of politics in achieving the economic transformation.

Everything else is less-than.

Everything.

Trump may cede ground on specific issues that make his supporters angry; but he will never cede ground on an issue that intersects with his global economic realignment.

It’s worth keeping that in mind.

Earlier today President Trump presented the commander-in-chief trophy to the U.S. Army team during a Rose Garden event.

More than 600 Iranian-funded Hamas terror missiles have been fired into Israel from Gaza. Four Israeli civilians have been killed.  In retaliation, Israel has carried out military strikes against Hamas leaders in Gaza.  President Trump tweets support for Israel.

GAZA/JERUSALEM (Reuters) – Rockets and missiles from Gaza killed four civilians in Israel while Israeli strikes killed 14 Palestinians, most of them militants, in surging cross-border fighting on Sunday, according to Gazan officials and the Israeli military.

Israeli Prime Minister Benjamin Netanyahu said he ordered the military to continue “massive strikes” against Gaza’s ruling Hamas group and Islamic Jihad in the most serious border clashes since a spate of fighting in November.

Israel’s military said that more than 600 rockets and other projectiles – over 150 of them intercepted by its Iron Dome anti-missile system – have been fired at southern Israeli cities and villages since Friday.

It said it attacked more than 260 targets belonging to Gaza militant groups. Gaza officials said Israeli air strikes and artillery fire killed 22 people, including 10 civilians, since Friday.

A rocket that hit a house in Ashkelon on Sunday killed a 58-year-old man, police said. He was the first such Israeli civilian fatality since the seven-week Gaza war in 2014.

Another rocket strike killed a factory worker, a hospital official said. The military said a civilian was killed near the border by an anti-tank missile fired at his car from Gaza and a fourth died when a rocket struck the city of Ashdod.

In Gaza, Islamic Jihad identified seven fighters killed in Israeli strikes, while medical officials said that six civilians also died.

In what it said was a separate, targeted attack, Israel’s military killed Hamed Ahmed Al-Khodary, a Hamas commander. The military said he was responsible for transferring funds from Iran to armed factions in Gaza. Hamas confirmed Khodary had been killed.

The attack on his car was the first such killing by Israel of a top militant since the war five years ago. Israel had suspended what Palestinians call an assassination policy in an attempt to lower tensions. (read more)

In response to the escalating attacks, National Security Adviser John Bolton announces the U.S. is moving military into the region.

“In response to a number of troubling and escalatory indications and warnings, the United States is deploying the USS Abraham Lincoln Carrier Strike Group and a bomber task force to the U.S. Central Command region to send a clear and unmistakable message to the Iranian regime that any attack on United States interests or on those of our allies will be met with unrelenting force. The United States is not seeking war with the Iranian regime, but we are fully prepared to respond to any attack, whether by proxy, the Islamic Revolutionary Guard Corps, or regular Iranian forces.” (WH Link)

Well, it looks like all suspicions are now confirmed. The dragon dance of 2017 and 2018 has extended into 2019. DPRK Chairman Kim fires rockets, Trump smacks Chinese Chairman Xi. Yes, we can officially put the remaining bits of skepticism to rest…

The meeting last week between Treasury Secretary Steven Mnuchin, U.S. Trade Representative Robert Lighthizer and their Chinese counterparts including Vice-Chairman Liu, was especially important.  Mnuchin and Lighthizer said they would debrief President Trump on the likelihood of whether a successful trade deal with a communist regime was structurally possible; or whether Beijing was playing a game of delay.

The ongoing dance with the dragon has been a series of cunning manuevers between the Panda mask and the Dragon face. At the conclusion of the Beijing visit by Mnuchin and Lighthizer, Chinese Chairman Xi sent a proactive response using his familiar proxy North Korean Chairman Kim. The DPRK test-fired three missiles.

Today President Trump responds:

The increase of the Round-1 tariffs from 10% to 25%, previously delayed after discussions between Xi and Trump in Argentina, will now be triggered. Additionally, the Round-2 tariffs (25% on $325 billion of different goods), originally scheduled for March 1, also postponed after the Argentina dinner, will now be implemented.

WASHINGTON (Reuters) – President Donald Trump dramatically increased pressure on China to reach a trade deal by announcing on Sunday he would hike U.S. tariffs on $200 billion worth of Chinese goods this week and target hundreds of billions more soon.

The move marked a major escalation in trade tensions between the world’s two largest economies and a shift in tone from Trump, who cited progress in talks as recently as Friday.

But a less than rosy update from United States Trade Representative Robert Lighthizer, including details that China was pulling back from some commitments it made previously, prompted Trump’s decision and jab on Twitter at Beijing.

“The Trade Deal with China continues, but too slowly, as they attempt to renegotiate. No!” Trump said in a tweet.

Financial markets reacted negatively. S&P 500 e-minis fell 1.6%, while Dow futures were down 420 points or 1.6%.  The move could be a negotiating tactic ahead of a new round of talks this week.  [It’s not, /SD]

Chinese officials are scheduled to meet their U.S. counterparts in Washington on Wednesday after meeting in Beijing last week for a round that Treasury Secretary Steven Mnuchin described as “productive.”

New fines will now hang over those talks, assuming they take place as planned. Trump said tariffs on $200 billion of goods would increase to 25 percent on Friday from 10 percent, reversing a decision he made in February to keep them at the 10 percent rate after progress between the two sides.

The president also said he would target a further $325 billion of Chinese goods with 25 percent tariffs “shortly,” essentially targeting all products imported to the United States from China. (read more)

Inflation in the U.S. remains low at 1.4%…. now is the perfect time to hit Beijing with expanded tariffs. I’m surprised China didn’t evaluate that aspect, perhaps they did; but they are also running out of time due to negotiation pressure from Trump.

Beijing referring back to the DPRK blackmail reflects a certain desperation on the part of the communist regime.  A dual display of bad form, and a visible *tell* for President Trump.

Knowing China has just indicated a weak hand, now Trump calls their bluff.

Chairman Xi played a cunning Panda-face game between the Argentina dinner (G20), the manipulation of the Hanoi summit with Chairman Kim, and the extended trade negotiation talks.  Xi stopped the immediate tariff threat, and simultaneously retained the DPRK leverage over Trump.

However, given the scale of China’s dependence on access to the U.S. market, it was only a matter of Trump allowing the appearance of diplomatic time to pass before he could counter with a more forceful response of his own.  I have no doubt Lighthizer dropped a strategic ultimatum on Beijing last week, triggering them to drop the panda mask.

Team U.S.A. came out of these negotiations exactly where President Trump always seemed to be heading; he wants full frontal tariffs on Chinese imports because he knows China will never genuinely negotiate terms until they are defeated.

Chairman Xi and Vice-Chairman Liu now have only a few days to rethink their approach. Now they have exhausted the delay strategy; and simultaneously any immediate increase in DPRK hostilities will be transparent and of no further trade benefit.

Fully acquiesce to Trump trade terms, or purchase some extended trade benefit with full retreat from North Korea manipulation.

…..Keep watching; this is the part where Wilbur Ross reemerges to close the deal.

There’s something really odd about the latest reports from South Korea about a test of three missiles the South has corrected to describe as “projectiles”.  The odd part is there’s zero mention in North Korea state media about it.  Fox News picked up on that aspect in a brief sentence inside their report:

[…]  South Korean officials were monitoring the situation and were sharing information with their American counterparts. North Korea did not report on Saturday’s firings. Seoul’s intelligence agency said it thinks the projectiles were not missiles given their short travel distances and low altitude.

Amid a tremendous amount of recent geopolitical background moves; and given the history of China using the DPRK as a geopolitical proxy province; there’s a possibility Beijing ordered the action.

Out of caution, please note our CTH perspective is entirely outside the mainstream view on the dynamic within the DPRK and the network around Kim Jong-un.  Quite simply all of the moves, counter-moves, and specifically the timing of them, align with the U.S. and China confrontation far more than most mainstream observers seem to notice.

Through the years of our research, and specifically as it relates to overlaying timing of events as they unfold, it still seems as though China controls the influence agents in/around North Korean Chairman Kim Jong-un.   I have gone so far as to say there appears to be more of a captive scenario surrounding Chinese Chairman Xi Jinping and his authoritarian alignment with Chairman Kim.

In the past two-and-a-half years every time North Korea presents a hostile action it has been simultaneous to a background event where the U.S. and China are confronting each-other.  The coincidences; and there have been dozens of unique examples; are far too common not to be connected.

My hunch is that Chairman Kim has little to no control over the activity within the top-tier of his military.  I highly suspect China directly controls the upper-tier of DPRK military leadership.  If that very strong suspicion is correct; the launch of these ‘projectiles’ would be aligned with a series of three background events:

♦One: A very serious stage in the U.S-China trade negotiations where Secretary Mnuchin and USTR Robert Lighthizer just left Beijing.  Remember, this recent meeting was going to be the key meeting for Mnuchin and Lighthizer’s recommendations to President Trump as to whether an actual trade agreement with communist China was possible.

♦Event Two:  Chairman Kim Jong-un just returned from meeting with Russian President Vladimir Putin for the first time.  Kim doesn’t travel much at all.  Chairman Xi (China) and Vladimir Putin (Russia) are strategically very close partners. [Emphasize “very”]

♦Event Three:  President Trump has an hour long phone call with President Putin; literally in the same 24-hr period where Pyongyang decides to test their missilesprojectiles again.

As with events in 2017 and 2018, these events seem more connected; especially against the completely opposite nature of words to deeds in the Trump/Kim Hanoi summit.  Again, something happened in the hour inside that summit after Kim stunningly said he was at the summit to discuss denuclearization – and an hour later reversed course.

Again, the sequencing is key.  President Trump and Chairman Kim set up Hanoi summitdate. President Trump and Chairman Xi meet in Argentina (G20); and the outcome was an agreement to delay round-2 tariffs on China.  Trump and Kim then meet in Hanoi and Chairman Kim has a 180° reversal in position.  Trump walks away.

Individually Xi and Putin have been losing to Trump’s strategy.  Their mutual interests in Iran, Pakistan and Central America (Venezuela) have been blunted by Trump.  Economically Trump has used energy as a policy to weaken Russia; and Trump has constructed an alliance of trade interests to weaken China.

At the 30k ft level it looks like Chairman Xi and President Putin are working in concert now to leverage a fall-back defensive position around Chairman Kim.  With Xi controlling the majority elements of the DPRK as a proxy province, renewed missile tests are once again focused on weakening President Trump.

So far China and Russia have been defeated by Trump’s use of economics as a geopolitical weapon.  To retain their interests China and Russia are bleeding out cash to their strategic allies; but Trump keeps moving quickly and cutting them off (see Iran).  Their economies  can only bleed out cash for so long…. So it would stand to reason they would shift tactics and try to get more confrontational militarily… yet, they don’t want the visibility of military confrontation.  That’s where North Korea comes in.

Last point, if you look at President Trump’s tweets from the perspective that Chairman Kim is somewhat a of a captive to his circumstances, they seem to make more sense: