‘The Art of the Deal’ . . . .

[errolanderson]

Trump appears to have stoked a global trade war. But according to the U.S. president, trade wars are easy to win. China announced yesterday 128 U.S. products added to their tariff hit list.

U.S. equities and dollar in for a battering (IMO). Talk of additional Fed rate hikes may be replaced by incoming QE4 as the U.S. economy slides toward recession. A true political / central banker mess now in-progress . . . .

[ajl]

A little tempest in the teapot this morning. I have been trying to lift my short position in the US market but every time I put in a sell order (inverse ETF) the market rallies. Chinese action has very little effect on the US as China needs the US far more that the other way around. Professional traders like this so they can make money off those that can't seem to learn that. In the longer term, I do see the US economy struggling this year so US market gains will be limited and also there may be another rate increase in the US but that will be it. Mind you that will be impressive performance will you consider the fact that the rest of the world (ROW) including Canuckistan remains in continuous real economic recession. If stimulus measures where discontinued here, GDP would be contracting 5% per year and that would be true in all other western countries as well.

[errolanderson]

China is America’s banker . . . Not sure the U.S. has control of this trade war.

[Hopalong]

Still have hopes that Republican Party supporters will come to their senses and turn their backs on Trump through Congressional action.
Major and sustained stock market loss would likely help that happen.

[agstar77]

Trump impeachment would really rally the market. The emperor has no clothes. Reality is Trump is a snake oil salesman and not a very good one.

[grassfarmer]

Or as Gordon Ritchie, former Canadian trade ambassador who negotiated Canada's first trade agreement with the US put it - "...we're talking about an administration led by a president who really is so far out of his depth, you can't see the surface of the water. He has no understanding of international economics. It beggars belief."

[ajl]

China is America’s banker . . . Not sure the U.S. has control of this trade war.

China has just over 2T in treasuries, but as somewhat less product flow in from China, the dollars stay home and these are invested in treasuries. As the stock market gets more wobbly and interest rates rise, more dollars are available from within the US to buy up treasuries. China has been reducing purchases of US treasuries for some time now because it needs the money to stimulate the economy at home as well as service USD denominated domestic debt. We are already seeing the 10 year yield drop somewhat so there is no immediate financing crisis on the horizon. Bottom line is China has to export to keep its economy from sinking so it will come out the loser here. Surprise no increase to soybean tariff. Gotta feed those hogs. US markets rallied into the close so will open up tomorrow.

[errolanderson]

Trump-led protectionism and brewing trade war may now be turning upside-down (IMO). This must be a concern for the U.S. as economic prosperity may now have a new threat in the form of misguided protectionism.

As the U.S. President stated; 'trade wars are easy to win' . . . this attitude toward global trade comes with a heightened risk of throwing the U.S. economy into recession before year end (IMO). This situation is now 'high stakes poker'.

In reality, no one wins a trade war and certainly not with China. And when it comes to global trade and economics . . . I'm a firm believer of what comes around, eventually goes around.

[agstar77]

Trump lies every time he opens his mouth, causing harm to the world economy. Lock him up! Lock him up!

[errolanderson]

China strikes back overnight . . . .

China added an additional 106 products to their U.S. tariff hit list including soybeans, cars, even whiskey.
Trump has now guaranteed a U.S. recession (IMO).

Gonna be ugly markets globally . . . .

[farming101]

2016:
China exports to USA 386 Billion
US exports to China 135 Billion

Some sources state the trade in China's favour is more like 366 Billion.
What would happen to the world economy if China had a depression?