Trump Says "Trade War Could be Over Quickly" - Why Should Anyone Believe Him?

-edited

Alternating bullsheet: Deals are coming soon, not soon, and sooner.

The indexes got a small reprieve on Friday after President Donald Trump said the ongoing trade war could be over quickly.

“The growing worries around a US/China elongated trade battle and its implications on the tech space are heavily weighing on the minds of both investors and the companies themselves caught in the cross hairs,” Dan Ives, analyst at Wedbush Securities, wrote in a note to clients. “The ‘poster child’ for the US/China trade wars continue to be Apple with the stock under heavy pressure as many competitors are yelling fire in a crowded theater around the potential China impact to Cupertino if this situation worsens.

Over Quickly?

The only way the trade war will be over quickly is if Trump caves in and reduces demands on China.

Let's chalk up another lie.

Apple Faces Another Blow

Bloomberg reports Apple’s China Business Faces Another Blow From Trump’s Huawei Ban.

The U.S. crackdown on Huawei Technologies Co. could make Apple Inc.’s already troubled business in China even more difficult, hobbling iPhone sales in the world’s biggest smartphone market and disrupting the company’s supply chain, according to analysts.

Last week, U.S. President Donald Trump effectively banned U.S. companies from working with Huawei. That’s sparked concern on Wall Street about potential retaliation by China, where iPhones are assembled and where Apple gets about a fifth of its revenue.

"There is a potential for a boycott" of Apple products, said Shannon Cross of Cross Research. "There could be a movement in China to support national champions."

Apple could lose nearly a third of its profit if China retaliated by banning its products, Goldman Sachs analysts estimated this week.

Trump's Trade Hypocrisy

Security Threat and No Threat

Amusingly, Huawei is and isn't a Security Threat.

Trump banned Huawei on grounds it's a major security threat.

Yet, Trump announced that the company could be part of a trade agreement that once again may be just around the corner.

Since when does the US bargain away genuine security threats?

Campaign Issues

Trump handed the Democrats huge campaign issues on a silver platter.

Yet, all the Democrats want to talk about is impeachment and absurd Russiagate claims now thoroughly discredited.

Barring recession, Trump has a very good chance of returning to the White House.

Unfortunately, for Republicans, (fortunately, for Democrats) a recession is very likely.

Drown Your Sorrows

The election losers will drown their sorrows. But that will be more expensive, thanks to Trump: The Beer Industry Blames Trump's Tariffs for Loss of 40K Jobs.

A report by two trade groups showed U.S. beer-industry jobs dropped 40,000 since 2016 as metal tariffs boosted aluminum-can costs, leading to a drop in investment.

“Aluminum tariffs are increasing brewers’ costs and are an anchor on a vibrant industry,” Jim McGreevy, the chief executive officer of the Beer Institute in Washington, said in an emailed statement. “Each brewer is deciding for themselves how to absorb that expense, whether it’s raising prices, laying off workers or delaying innovation and expansion.”

The shipping and logistics charge for delivering aluminum to the U.S. Midwest, known as the “premium,” more than doubled as Trump slapped a 10% tariff on imports of the metal. Molson Coors Brewing Co. estimated last year that the levies would create a $40 million hit to its bottom line.

Tariffs are likely not the primary reason people are drinking less beer. But Tariffs are to blame for shrinking profits.

Soon and Very Soon Tribute

I am sure there will be a trade deal soon and very by the self-proclaimed deal-making king himself.

In fact, I can guarantee it.

Of course, the king gets to set the meaning of soon.

Mike "Mish" Shedlock

Comments (29)
No. 1-11
Matt3
Matt3

A lie? A little unhinged today? A couple years ago, I read on this site, that we could be in recession in a few months. Was that a lie? Lighten up Francis!

RonJ
RonJ

"Yesterday: TRUMP SAYS HE'LL SEE CHINA'S XI AT G-20 MEETING Today: NO OFFICIAL TALKS ABOUT XI, TRUMP MEETING: CHINA ENVOY"

i think there was some international confab where Trump was not scheduled to have a meeting with Putin. Trump and Putin had some sort of chat, regardless.

themonosynaptic
themonosynaptic

"Yet, all the Democrats want to talk about is impeachment and absurd Russiagate claims now thoroughly discredited."

Democrats have already passed bills to reform our elections, secure our election system from foreign attack, improve healthcare and bring down the cost of prescription drugs, protect patients with pre-existing conditions, and support women's rights by standing up for equal pay and against violence against women. Democrats have addressed many other important issues with good legislation -- too many to list here, in fact -- while Republicans are so terrified of getting on the wrong side of Trump that they refuse to even consider any bills at all.

The only policy that Trump has is "build a wall" which is not only ludicrous on it own right, but a complete non-starter. Yet another "infrastructure week" got blown up by Trump's hissy fit as Nancy goaded him into acting like a brat in public (the prior "Best Disaster Award for Infrastructure Week" was Trump's "good people on both sides" speech).

Casual_Observer
Casual_Observer

Mish it would be good to see a post on how much of the stock market runup since Trump has been based on buybacks that were actually loans. I believe David Rosenberg had a slide on this at the Mauldin investor conference. At some point this is destined to blow up in everyone's face. The stock market would likely be much lower if not for loans buying back shares. Rosenberg showed it wasnt even thr tax cut. Corporations don't spend their own money anymore.

thimk
thimk

Trumps keeping the stock market buoyant

Sechel
Sechel

Correct. Can't believe anything Trump says. The other day he said he saw no need for additional troops going to the middle east to deal with Iran than 24 hours later sends 1500

Menaquinone
Menaquinone

The Trump negotiation team have written the agreement and delivered it to Xi for his signature. The trade war could be over instantly. Otherwise ever increasing tariffs will crush the Chinese economy.

CzarChasm-Reigns
CzarChasm-Reigns

"Of course, the king gets to set the meaning of soon."

The meaning of words spoken by King Chaos are at best transient. And most often, worthless.

Deal? There can NOT be a "meeting of the minds"...if one is a "no show".

Menaquinone
Menaquinone

The trade war has been going for fifty years of Chinese wins. The next fifty years get interesting. So far only 25% of Chinese wheat is infested with fusarium. Only 40% of the Chinese meat supply has been slaughtered for African swine fever. Only 25% of Chinese crops are infested with autumn cut worm. Tariffs are only 25%. China still has dollars left, but crypto currencies are fixing that. Currency manipulation tariffs have not cut in yet.

thimk
thimk

@Menaquinone the chinese set Trump up for a fall to make him look bad. there will be no trade deal. Trump needs some Dale Carnegie.

themonosynaptic
themonosynaptic

The Chinese have patriotic songs going viral about how they need to stand together against Trump trying to oppress them (but they like regular Americans).

I definitely think they are missing the forest for the trees, but it doesn't really matter what I think.