USTR Robert Lighthizer Outlines U.S. Trade Priorities – Trump Administration Willing to Confront WTO Multinationals…


In about a week Round #3 of NAFTA renegotiations begin in Canada.  Dispute settlement and country of origin rules are widely anticipated to be key points of disagreement.

For those who follow trade and economics closely, the latest Trump trade policy outline from U.S. Trade Representative Robert Lighthizer is buckets of good news. President Trump, Commerce Secretary Ross and USTR Lighthizer willing to confront the World Trade Organization (WTO), the epicenter of multinational economics and globalism.

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WASHINGTON (Reuters) – The WTO dispute settlement system is “deficient” and has often ruled in favor of free trade that overlooks details of a trade agreement, U.S. trade envoy Robert Lighthizer said on Monday.

Speaking at the Center for Strategic and International Studies, Lighthizer, a trade lawyer, made clear that the administration was poised to push for major changes to the global trade system during upcoming meetings of the Geneva-based trade body. WTO member countries will meet in Buenos Aires on Dec 10.

U.S. President Donald Trump called the World Trade Organization a “disaster” during his presidential campaign and his administration has sought to unilaterally go after countries like China that it thinks is breaking trade rules.

“There are a number of issues on which there is pretty broad agreement that the WTO dispute settlement understanding is deficient,” said Lighthizer, highlighting problems with WTO staffing and transparency.

“The United States sees numerous examples where the dispute settlement process over the years has really diminished what we’ve bargained for or imposed obligations that we do not believe we agree to,” he said.

He added: “There have been a lot of cases in the trade remedies laws where in my opinion the decisions are really indefensible.”

Since its launch in 1995 the WTO has become the main venue for resolving trade disputes between countries. The Trump administration has begun to launch trade investigations under statutes seldom used in the WTO era, including a “Section 301” probe of China’s intellectual property practices.

Lighthizer did not threaten a U.S. withdrawal from the WTO, but emphasized his own dissatisfaction with some of its rulings.

In a letter in March, the Trump administration made clear that U.S. law supersedes WTO rules — a view that could be invoked should Congress adopt policies that are later challenged by other member countries as violating WTO rules.

“We’ve had tax laws struck down, we’ve had other provisions where the WTO has taken…the decision they were going to strike down something they thought shouldn’t happen, rather than looking at the agreement as a contract,” he said.

Lighthizer emphasized that the Trump administration was reviewing all trade agreements and would seek to renegotiate those that did not benefit U.S. workers and businesses.

“I believe, and I think the president believes, that we must be proactive,” he said, “We must demand reciprocity in home and international markets. So expect change, expect new approaches and expect action.” (link)

Judge Suspended for 30 days for Wearing a Trump Hat


 

A judge in Ontario, Canada was suspended for 30-day without pay for wearing a Trump hat – Make America Great Again. This certain raises the question would he have suffered the same penalty had he worn a Hillary hat?

New Zealand & the Hunt for Taxes


QUESTION:  Hi Martin,

Firstly I appreciate your insight into world events. I don’t see anyone else coming even close to what you do.

In New Zealand we are facing an election and taxation is a big topic. Labour on the left has appointed a new, young, female leader who has wide appeal. She is hedging on Labour’s taxation policy but it’s known they favour capital gains taxes – business, property, inheritance, you name it. I saw an article that Illinois is experiencing massive flight of wealth due to taxes. Will people run out of options for places to go or is the world in general headed towards mass taxation?

Thanks for your time.

PJ

ANSWER: Yes,  Jacinda Ardern is a desperate attempt to raise Marxism to its former glory. The Labour Party fell to below 30% in the polls so they put a young girl up front to gain votes. It is also true that Illinois is a complete disaster. I wrote about how they should just dissolve the state because they cannot even go bankrupt on their government pensions. It is true that every five minutes someone leaves Illinois. The most recent poll revealed that 47% of people in Illinois wanted to leave the state. Property values will collapse in Illinois because there is a mass exodus and no buyers unless they are oblivious to what is taking place. This is how Rome fell from a population of 1 million to 15,000. People just walked away from their property.

Marxism has destroyed the world economy and caused the deaths of countless millions of people all for a theory that has never worked. We are facing the darkest hours in this collapse of socialism. Make no mistake, there are plenty of people who have been brainwashed to believe it is the rich causing this rather than the greed of politicians. It is the government pensions in Illinois that has destroyed the State. They prefer to say the rich do not pay their fair share but government always needs more and more. So that “share” never ends until it reaches 100%.

This will come to a head most likely in violence and it is highly likely it will erupt in civil unrest and even war over the course of the next few years. Unfortunately, this is the Crash & Burn. It is just not sustainable. Economic growth declines and the standard of living for everyone collapses. It is just how we give birth to the next era.

Can Our Model Forecast Private Companies & Industries?


 

QUESTION: Hello. I am a business consultant working for a global consulting company and have a client that is in the transportation sector that would benefit from your research. I have been advising the client with regard to their business and IT strategy, however would also like to introduce them to Armstrong and possibly subscribe to your services.

A few questions first:
1) Are your models customizable to facilitate forecasting of domestic fuels consumption?
2) If yes, what is required to initiate a discussion around this type of service?
3) Would it be possible to speak to a person regarding your standard services and any custom modeling?
Kind Regards,
KR

ANSWER: Yes. We are re-instituting on the Institutional Level the ability to input even the sales of any company and the model will then provide the full forecast with timing and price projections. Therefore, it can be tailored to any company and industry.

Where has the Outflows from the US$ Gone for the Past Year?


QUESTION: Re: Am i certain about the Strong Dollar?

Hi Marty, great blog posts and response. I think after reading this blog posts, the question on everyone’s mind is, what is causing the outflow of capital from the USD? And where is capital concentrating in right now? Is it the Euro? The Bunds? Gold?
And when do you see the outflow will stop and reverse?
Thank you
Regards
Rm
ANSWER: There has been outflows to Emerging Market debt by pension funds in the States for the past year. They have been trying to compensate for the lower interest rate returns by going more risky. We have been call on this issue more than once.
Then there has been the expectation that the ECB will end QE and Europe will boom. We can see that the DAX for the past year has risen in dollar terms. We have seen a tremendous outflow into the European share markets, but not so much into the debt issues.
Gold has been minimal because that is the retail side, not a target for institutional money. They need income, not storage fees. They will participate in gold stocks, but not stockpile bullion.

The 5 Factors Behind Capital Flows


QUESTION: Hi Martin,

Well from myself and your family we thank you for sticking with us in this time as you have mentioned you could be doing other thing for yourself but like a brother you are sticking with us even when you know we will rise and repeat most likely, but in the same but different we hold hope for humanity. My question is can we get a large movement in confidence in currency without any major move in the physical instrument. Can the US dollar not have a hard drop before going back up on the basis that the confidence was effected more than the instrument it does not look like a linear relationship but more ying and yang where the ratio can be anywhere at any time but together are complete.Thanks Brother
Peace Out
LP

ANSWER: The driving forces behind capital flows center upon CONFIDENCE that manifests within five critical areas. Each area provides one major component which in turn has subdivisions. The 1987 Crash in the stock market took place because the G5 kept saying they wanted the dollar down by 40% to help trade. The morons failed to realize that if you lower the dollar by 40% to make you exports cheap to sell more, you simultaneously cheapen all assets. The Japanese had bought 33% of the US National Debt to try to easy trade friction, but then faced with a 40% loss on currency, they sold. This inexperience of those in government is just beyound contemplation. What the Plaza Accord was doing was trying to lower the value of the dollar to reduce the cost of American labour in international terms. This was the lethal combination of FOREX and LABOUR manipulation.
  1. FOREX
  2. LABOUR
  3. INFLATION
  4. SECURITY
  5. TAXATION

INFLATION is actually the major component of interest rates. The future value of money must incorporate a profit over the inflation rate in order to make a loan feasible. TAXATION is critical for capital will move like water to the place that is most advantageous for a real rate of return. You cannot tax investment at 90% and expect people to take a risk.

SECURITY is both economic (rule of law) as well as war. For example, capital fled to the USA from around the world during World War I and II. Therefore, economic justification does not always come into play when SECURITY issues rise to the top. The dollar is also the reserve currency because capital is not yet comfortable parking in Russian or Chinese debt and they are in US debt.

Canadian Perspective


QUESTION: Hello Marty. I so appreciate your blog and Socrates, which is helping me steer through these crazy markets. I’m a Canadian taking care of all my family’s investment accounts, and knowing what’s coming down the road, I’m very concerned I’m going to take a misstep, especially with my children’s accounts. I haven’t been doing this long enough to have experienced a monetary crisis anywhere. What I can’t get my head wrapped around is what to do longer term from the Canadian perspective. We all have both USD and CAD funds in our accounts. I plan to increase the USD portion while the CAD is down. I’m also buying US investments in CAD (unhedged) to catch the rise in currency. But when the USD peaks and the crash and burn begins, my assumption is Canada has a boom in metals commodities while oil crashes due to lack of demand and we also go into recession due to lack of exports to the US and so lower employment. So what is a Canadian’s smart move when the USD peaks……cash out our USD investments and turn back to CAD and invest in commodities, etc. or would I be better off staying in the USD and buying inverse etfs and commodity stocks/etf’s that aren’t available on the TSX? Just trying to get a handle on what ultimately happens to Canada in all this. Thanks so much for any insight you may have on this topic.

ANSWER: We are in the staging process right now and that means we must push everything to the limit. In the case of the C$, that major point remains well above the market at 8840 level. It will require a monthly closing above that level to reverse the trend creating a bull market for the C$.
In order to create these big moves, we absolutely must push everything in a counter-trend move to its extreme in order to trap everyone and that provides the fuel for the next great wave. Everyone gets so convinced about any trend with just a brief rally like euro, pound, C$, gold or oil.  This is how markets suck people in to lose money. Trends are defined not by a single market, but by a group of markets that all are interlaced and confirm one another. This is the entire purpose of allowing access to our Global Market Watch so you can visually see the global trend unfolding together.
We are approaching the point-of-no-return when people wake up and begin to lose confidence in government. Until that happens, we remains treading water. The Dow has not broken out until the Phase transition begins. This is also why the metals rally but fail to really make impressive new gains

Horsepucky News Courtesy of Murdoch’s Wall Street Journal…


This stuff is beyond ridiculous at this point.  Remember, there are trillions of dollars at stake and all of the vested financial interests, writ large, have positioned themselves to do anything possible to draw down the support for President Trump’s ‘America-First’ agenda.

Don’t kid yourselves or sell your intelligence short; it ain’t about Donald Trump per se’, the opposition is against the policies of President Donald Trump.  Trump’s ‘America-First’ policies are adverse to the interests of multinational corporations and the multinational financial institutions who underwrite those corporations. Yes, this includes Rupert Murdoch, aka “Mr. Wall Street”, the proprietor of the Wall Street Journal and all around self-indulgent billionaire.

The latest approach is for the Wall Street Journal to write an article about Trump reconsidering pulling out of the Paris Climate Agreement based on, wait for it…. the conversations with an “EU official”. Un huh.   “International Climate Officials” they say. Ohhh… Journalistic standards now dispatched and not even an inquiry to the White House prior to publication.  Go figure. {{{eyeroll}}}

Seriously folks, if we want to help President Trump and the agenda we voted for, then inoculate yourself -and your family- from this ridiculous corporate media ‘gaslighting’.

It’s lower than fake news, it’s horse-pucky news.

If President Trump was flinching, if president Trump was even positioned toward the place where flinching begins, I swear to you CTH would be all over it like bluebottle flies on a flattened possum.  He ain’t, and we’re not.

COMMENT – “I’m not an educated person. I never graduated high school. I got my GED because the Army wouldn’t let me join without either a diploma or a GED. Went to basic training at Ft. Benning when I was 17. Did a tour in Iraq when I was 18 and 19. It was not a pleasant experience. After my tour, I got discharged for what I will euphemistically call “medical reasons”, if you catch my drift.

Hard times followed. I was basically homeless for a while. Lived in a friend’s van for about a year. I felt like that guy in that “I’m as mad as hell and I’m not going to take it anymore” movie when he said, “Things just seem to get worse and worse and nobody knows what to do about it”. I felt like the Forgotten Man. I was hopeless. My spirit was crushed. I had pretty much given up.

That all changed for me in June of 2015. I saw a man and his beautiful wife come down the escalator. I saw a man who, like me, was as mad as hell. And he really really wasn’t going to take it anymore. I saw a man who stood up fearlessly against everything that was wrong in the world. I saw a man who gave up a life of luxury to be slandered and threatened every day. I saw a man who was a cheerleader, not for the lobbyists and donors, but for people like me. I thank God for sending this man. Things were getting worse and worse alright. But here was a man who knew what to do about it.

Day one I was hooked. I said, “This is it. This is what I’ve been waiting for. This is my guy. He’s fighting for me, so I’m fighting for him. I’m all in.” And since that day I have never seen that man waver. He has never let me down. And I hope I never let him down.

This movement has been an incredible journey. Everyday is a wild ride and I’ve loved every minute of it. And there’s so much more to come. I look forward to every day now. I wake up with a smile on my face every day because Donald J. Trump is my President.

Sorry to get so personal, but for me this is personal. I’ve never met the man, but Donald J. Trump is more than just my President. He’s my friend.

Call me a fanboy, call me a cheerleader, call me whatever you want. You bet I’m a cheerleader for my President, my friend. He lifted my spirit in a way I didn’t think possible. He gave me hope. He inspires me everyday. I intend to be his biggest cheerleader. It’s the least I can do. Frankly, I don’t know where I’d be without him.

I don’t feel like the Forgotten Man anymore. I have a friend. And he lives at 1600 Pennsylvania Avenue. I’m proud of my President. I’m proud of my friend. I stand with him 100%. (link)

More Strange Gold Reasoning


QUESTION #1: Marty,

___ ________ makes the argument that if “the government” raised the price of gold to $5000/oz it would start and inflation that would wipe away the debt.

 

Don’t they have to ensure convertibility as well? He kind of skips over that. And isn’t that pegging the dollar to gold, and no peg holds? At that price the dollar would become incredibly cheap, and world demand for it would soar to arbitrage trade into goods, I would think.

 

Anyway, how does his proposal compare to the 1934 and 1971 devaluations.

 

Cheers,

EM

ANSWER:  This proposal is insane and it would not work anyhow. In 1934, it was the link of gold to the dollar that CAUSE deflation. When Roosevelt devalued the dollar, then inflation took place. If you suddenly fixed gold at $5,000, so what? He would be doing the opposite by creating deflation and then the national debt would become payable in gold.

The 1971 closing of the gold window by Nixon cut the link to gold ending Bretton Woods and then inflation unfolded. This is why Europe is in trouble for they keep trying to create a strong Euro which means assets decline and that produces deflation.

I just do not get the reasoning of these people. They clearly have no real world experience. They want to forecast markets without ever leaving their bedroom.

QUESTION #2: I have been bullish on gold until recently. It seems that to cheer gold we have to cheer the end of the world. If that is our fate for us all, then gold won’t matter. As you said, a $1,000 in gold in 1980 is worth $1350 today less storage fees. A $1,000 in the Dow back then is $22,000 plus all the dividends. Do you really think gold will ever go up? With North Korea fading out, what reason do we even have for gold? Deflation dominates the world and taxes keep going higher and higher so there is less disposable income. It does seem gold is on its deathbed. Any comment?

ANSWER: All of that is true. We have to wait for the next cycle. Tax reform is absolutely critical to the future. The next cycle things will chang

The Confusion in Gold


QUESTION #1: [_____] says that the dollar will collapse because with the debt ceiling gone – no more buyers of Treasuries in the markets and only the Fed Reserve buying – inflation goes to the wazoo. All over USA. care to comment?

ANSWER: Total nonsense. The USA debt of $20 trillion is a tiny fraction of global debt at $160 trillion. This entire theory does not hold up. Just where is all the money going to run? Gold? Institutions do not buy gold and cannot function with gold, which is not legal tender for even paying your taxes. The only thing that matters is the general public confidence. When the average person on the street no longer trusts government, that is the tipping point.

There is a whole series of people given a choice between a bar of chocolate and a bar of silver. They take the chocolate. Kids line up in Starbucks and pay with their phone – not even cash. Not until you shake the confidence of these people will you see the explosion in markets. That is what took place in the late 1970s. I was there. OPEC created the image of wholesale inflation. People were hoarding toilet paper.

QUESTION #2: What will Fed Balance Sheet Shrinkage do to Gold?

ANSWER: The opposite of what people think. Shrinking the Balance Sheet will be anti-inflationary to the standard reasoning and thus gold should collapse with deflation. However, the Fed has turned away from QE because pension funds are at serious risk. They have run off to emerging markets and bought very long-term paper desperately trying to get their yields up. As the stock market rises because there is no alternative, the Fed politically will be forced to raise rates. They will end up creating inflation with rising rates that will blow interest expenditure through the roof.

QUESTION #3: Since we bounced off the reversal again, obviously this still does not negate a break of $1k and then the slingshot up. But it just seems as if gold is on its deathbed. If nuclear war could not get it to exceed last year’s high, is there anything left in this bag of fundamentals we have been hearing about forever?

ANSWER: I understand. This is what the Reversal System is good at. We stopped within a dime of that number. What will be will be. We are running out of fundamentals to keep buying gold. It’s like the fake news about the storm in Florida that a 15 foot wall of water would destroy the coast. It never came and many people are really angry at the media. How many times can they do this before people no longer listen. Gold is a confidence game – plain and simple. This number is just incredibly important far more than most people dare to consider. I will be doing the gold report soon. It is very critical at this point.

GCNYNF-GMW 9-16-2017

COMMENT: Marty, thank you so much for the past several years of WEC. You have taught me to keep my head in times like this. I bought the gold on the GMW and then sold it against the reversal with a stop just above as you did with the yen in 1998. I had two friends who were buying at the high expecting gold to breakout when I was selling. It was two against one. The majority must be wrong.

Thanks!

See you in Orlando.

ANSWER: The number of long positions verse net shorts in gold reached about 5:1 and you saw what happened – it simply bounced off of the reversal and did not exceed last year’s high. I am always amazed at how people get so bullish and say I am wrong and then within 2 days they lose their shirt. As they say, you can lead a horse to water, but you cannot make him drink. Some people judge the next 10 years by a few days of price movement. That is how the market separates traders from fools