Don’t worry gents, this is ‘the art’ of the deal.
Stocks dip to session lows after President Trump says he doubts that China trade negotiations will be successful https://t.co/564PIzX650 pic.twitter.com/Kswj0CAK79
— CNBC Now (@CNBCnow) May 17, 2018
If you cannot see the art, it is because you are not an artist, which is fine. Go back to your clay homes and make your family a giant pot of steamed rice and just wait for the artist to complete his picture. When he is ready, like magic, everything will be better.
In other news, Trump’s China hating guy, Peter Navarro, has been cursing out people left and right during talks. This is not art, but the stick that goes with the carrot. Trump tossing Navarro out there in the wild, with the Chinese, is like tossing a PTSD Vietnam vet into the jungles of Hanoi to discuss terms on a new private prison to be built for foreign nationals.
During one trade meeting at which Chinese officials talked at length about history and international relations, Navarro used an expletive in telling his Chinese counterparts he did not need a history lesson, according to a source briefed on the exchange.
However, another source with personal knowledge of the discussions said Navarro did not “curse out” Chinese officials and described the bilateral discussions as “cordial.” The person suggested that the story about Navarro started as part of a coordinated “shivving campaign” that points back to Mnuchin.
Navarro has problems with how Mnuchin has negotiated with Chinese officials, a source familiar with the discussions said. The person said Navarro took issue with Mnuchin canceling team trade discussions in Beijing and negotiating with the Chinese delegation himself. The trade advisor has also taken issue with the path of the talks, believing the Treasury secretary is not doing enough to protect U.S. intellectual property, the source said.
The Treasury Department did not immediately respond to a request for comment about the apparent tension between Navarro and Mnuchin.
The uncertainty over Navarro’s role clouds critical Washington trade talks between the U.S. and China, which follow a separate round of negotiations in Beijing earlier this month. The world’s two largest economies are looking to defuse escalating tensions that have prompted fears about heavy tariffs and a potential trade war.
In a statement Wednesday, the White House said Mnuchin would lead the talks, along with Commerce Secretary Wilbur Ross and United States Trade Representative Robert Lighthizer. The White House added that “additional senior administration officials” would attend, but did not name Navarro.
On Wednesday, a White House official told CNBC that “Peter is going to be participating in the event” and he is “part of the talks.”
Trump has long pledged to crack down on China for alleged unfair trade practices and theft of U.S. intellectual property by Chinese companies. But he seeks to do so without retaliatory measures from China that threatened to damage the U.S. agricultural industry.
According to a list obtained by CNBC, China’s delegation in Washington includes more than a dozen high-ranking government officials managing the country’s central bank, agricultural policy and telecommunications industry.
Axios also reported that Navarro cursed out Mnuchin too, all part of the pageantry of good cop, bad cop, being acted out for the Chinese. The way it works is very simple: unleash Peter on them in a room with no hope of Mnuchin. Negotiations will be sideways, after 30 minutes of Peter telling the Chinese how much he hates them. Then, like a white knight from an evil bond film, Mnuchin will appear and save the day. The Chinese will take less, fearing Navarro might get his way and give them nothing at all.
‘Tis, the art of the deal, folks.
Markets were down more than 100, now off by just 60 on news of this article being rumored to have been written.
If you enjoy the content at iBankCoin, please follow us on Twitter
Thoughts on FNMA? I bought some today…
Chillin’ on the ibc beanbag chair
Oct 2017: “BlackRock’s (CEO Larry) Fink Warns of Risk of Inverted Bond Yield Curve ”
Ater the yield spread gets cut in half (today): “Larry Fink: A flattening yield curve doesn’t worry me”
His explanation
“Fink explained that when you compare U.S. 10-year yields at 3.1% compared to German and Japanese 10-year yields — which were sitting at 0.63% and 0.06% as of Thursday, respectively — yields in the U.S. look quite attractive.
‘And so that’s keeping the yield curve flatter than normal,’ Fink said. ‘I don’t believe it has any indication of a recession. And I think it’s just the dynamism of global markets.’ ”
However, this explanation is a red herring: it explains why investors want US bonds instead of German or Japanese ones, but it does *not* expalin why they want 10Y US bonds instead of 2Y bonds – which is the significance of the yield curve.
If you buy the 10Y, and rates rise, your bonds will lose a lot of money, which is not a good trade-off for the 0.5% interest premium of the 2YT (interest rate cahnges do not affect the price of short-term bonds as much). Conclusion: UST investors must be expecting the 10Y rate to fall. Now what does that signify for the market?
You’d figure folks would be inclined to arb between German/Japanese 10 years (short) and go long US’ …figuring that pendulum will lose mo …but they are not confident as to timing …so they go out a bit. When it swings back, the dollar cracks.
Now China supposedly offering $200B reduction in trade deficit.
fun posts today, well done
Steve is a good guy, he stroked a $10k check a few months ago to the gal who rescued both of my dogs ….