Collapse of Soybeans

[errolanderson]

Trump imposed $24 billion of tariffs on Chinese imported goods this morning and threatens more.

Wonder what China will do with their U.S. bond holdings now?

Soybean collapse continues . . . this is a train wreck with all global commodities impacted

[farmaholic]

Errol, ultimately there will be no winners and many who suffer unnecessary collateral damage...

[ajl]

Trump imposed $24 billion of tariffs on Chinese imported goods this morning and threatens more.

Wonder what China will do with their U.S. bond holdings now?

Soybean collapse continues . . . this is a train wreck with all global commodities impacted

China has been steadily reducing US treasury holdings for some time. The big surprise is that rates are not higher. The 10 year is back under 3% again. Market has known this day was coming for some time. Again President Trump did not start the trade war, he has merely responded. The ROW will have to find ways of stimulating demand without counting on the US to absorb all of the worlds exports.

[errolanderson]

China announced almost immediately a retaliatory $34 billion in tariffs on U.S. goods including agriculture effective July 6th.

Of the $2 trillion China exports annually, the U.S. apparently only purchases between 20 to 25 percent accordind to CNBC. Also, China has many Asian markets to expand, plus they are the largest foreign holder of U.S. debt outside the U.S. Federal Reserve itself.

Does China not have a huge advantage in a trade war with the U.S. ??

Just asking . . .

Insane protectionism could trigger a deflationary spiral in commodity prices. Growers . . . Protect yourself. This is a for real risk, if the U.S. persists with aggressive protectism. The world market is far bigger than the U.S. economy.

Protection may also be the fuel to trigger the debt bomb which has been coddled by central bank policies since the financial crisis of 2008.

[AlbertaFarmer5]

Errol, with debt that large, doesn't that make it a bargaining chip for the issuer, not the holder?

[errolanderson]

Errol, with debt that large, doesn't that make it a bargaining chip for the issuer, not the holder?

good point . . . . Regardless of who has the advantage, the road markets are now going down is very rocky with unexpected twists and turns. If the debt bomb blows because of egos and tariffs, commodities will be on the front line.

[macdon02]

Trump said farmers would be compensated..... Think he'd take a long futures? If you look at the "other long" category in COT report someone wants to own corn...Not very pc but who gives a **** when your the president of the USA. The best part is the margin call gets sold off into the bond market at whatever term you so desire