Trader Warns – Treat The Trump Presser Like A Trending Market

In a few short hours we’ll be treated to the President-Elect’s much-anticipated first press conference. We’re not sure there’s been a more eagerly awaited event of its kind in memory. As Bloomberg’s Richard Breslow notes, global markets (ex-Mexico and Turkey) have ground to a halt. You can cut the anticipation with a knife.
Will the powerful trends we’ve seen for the last two months continue? Or reverse with a vengeance? All will be revealed. And investors will know exactly which the best trades to set up their year are.
Don’t get your hopes up. But who knows? It’s a must-listen in any case.
Investors will do their best to focus on comments and policy prescriptions specifically aimed at various sectors of the S&P 500. There will be a natural tendency to try to ignore as unpricable potential policies that affect massively important geopolitical and international economic issues. That might work in trading the S&P financials index this afternoon. But perhaps not so well for the Asia dollar index, where the countries comprising that measure are already being forced to speculate on what the acronym might be for a China-led economic and security pact.

This post was published at Zero Hedge on Jan 11, 2017.

Mexico protests: how gas prices lit the flame under a quietly smoldering rage

Marching with a boisterous but peaceful crowd through central Mexico City, Hctor Prez, a sales manager with an insurance company, rattled off a list of grievances to explain a wave of furious protests which erupted after a rise in the country’s government-set petrol price.
‘It’s not because we all have cars. When gasoline prices go up, everything else goes up: tortillas, public transportation, everything,’ said Prez.
Pressed a little harder, he voiced another set of reasons for his discontent: President Enrique Pea Nieto and his Institutional Revolutionary party (PRI) justified an agenda of structural reforms with the promise of growth for all – but have instead presided over a stagnating economy.
Meanwhile, a string of high-profile corruption scandals has heightened the perception that the while ordinary Mexicans have seen a gradual decline in spending power, the country’s politicians have grown rich.

This post was published at The Guardian

Trump Tweets – Peso Plunges

Trump tweets of taxes at the southern border and the Peso plunges. Mexico has abundant petroleum, cheap labor and a preeminent location for global companies to reach the largest consumption market in the world. Yet they struggle with slow growth and massive corruption. To add insult to their injurious system, Mexico’s worst nightmare has now been elected next door with a vow to tax Mexico, penalize potentially any factory that locates there and to reverse the tide of illegal immigration. Not surprisingly, the Bearish sentiment is rising over the plight of the Peso as Trump tweets promise to indirectly punish their currency further in 2017. Look for depreciation of the Mexican currency (MXN) down to 23 to 24.4 per dollar (.0435 – .041 dollar/peso) with resistance near 20.
Mexico is clearly one of the most affected followers of Trump Tweets as illustrated in the chart below.

This post was published at FinancialSense on 01/09/2017.

Hideous Constellation of Threats and Challenges Facing Mexico

The Risk of Contagion of a full-blown Mexican crisis is far greater today than it was during the Tequila Crisis 22 years ago. Things are rapidly going from bad to worse in Mexico. Hundreds of people were arrested and a handful of people killed over the past week as peaceful protests against the government’s hike of gasoline prices (by as much as 20% in some states) descended into widespread looting and rioting. The mood on the street was hardly helped when Mexico’s deeply unpopular president, Enrique Pea Nieto, tried to defend his actions by asking the public, ‘What would you have done?’
For a lot of people, the answer’s clear: a lot of things, very differently. Right at the top of the list would be launching an all-out war against the endemic culture of corruption plaguing virtually all levels of government. But now, time is fast running out as Mexico now faces a hideous constellation of threats and challenges, all at the same time.

This post was published at Wolf Street on Jan 8, 2017.

Mike Pence Thinks the “Free Market” Is Making You Poor

Vice President-elect Mike Pence has no idea what the term ‘free market’ means, or at least, that is what his most recent statement would suggest. Defending President-elect Trump’s $7 million deal with Carrier, Pence recently stated, ‘the free market has been sorting it out and America’s been losing.’
RELATED: “Countless Ordinary Americans Benefit When Companies Move to Mexico“
While there have been some libertarian arguments made in defense of this new deal with Carrier, which will keep 1,000 jobs in the United States instead of moving them to Mexico, blaming the free market for a loss of American jobs is far-fetched, to say the least.
RELATED: “In Defense of Trumps’ Deal with Carrier“
However, there is something even more disturbing about Pence’s belief that the free market has failed the American people: it shows a complete lack of understanding for what a free market really is. Surely, if Pence had a clear idea of what a free market economy actually entails, he would know that America, doesn’t actually have one.
While still faring better than many other nations, America has become somewhat of a beacon of crony capitalism. From corporate bailouts to giant subsidies given to American companies which do not actually need these handouts, the United States does not have a great track record when it comes to keeping the government, and taxpayer dollars, out of big business.

This post was published at Ludwig von Mises Institute on Dec 10, 2016.

Sarah Palin Slams Trump Carrier Deal As “Crony Capitalism”, “Corporate Welfare”

Former Gov. Sarah Palin has criticized President-elect Donald Trump’s deal with the Carrier, in which as reported previously the air conditioner company would not outsource 1,100 workers to Mexico in exchange for $7 million in tax incentives over 10 years, saying that it yet another example of “corporate welfare.” The harsh criticism of Trump’s economic policy comes as she is reportedly under consideration to serve as Trump’s secretary of Veterans Affairs.
Writing an op-ed in the Young Conservatives blog, Palin said that while he is excited for the Carrier employees whose jobs are staying in Indiana, saying the deal is “a relief for hundreds of workers… Merry Christmas Indiana!’, she then joins Bernie Sanders and other critics in vlasting the deal as ‘crony capitalism” and an example of the “hallmark of corruption” and “socialism“, adding the arrangement could set “inconsistent, unfair and illogical precedent.”
Suggesting that the Trump deal is a carryover from the Obama administration’s “crony” ways of doing business, Palin wrote that ‘when government steps in arbitrarily with individual subsidies, favoring one business over others, it sets inconsistent, unfair, illogical precedent. Then, special interests creep in and manipulate markets. Republicans oppose this, remember?’
‘Instead, we support competition on a level playing field, remember? Because we know special interest crony capitalism is on big fail.’
Palin then made a statement many conservatives and virtually all libertarians would agree with, saying that “however well meaning, burdensome federal government imposition is never the solution. Never. Not in our homes, not in our schools, not in churches, not in businesses.’

This post was published at Zero Hedge on Dec 3, 2016.

In Defense of Trump’s Deal with Carrier

Donald Trump hasn’t yet made the move from Trump Tower to America’s most expensive public housing, but he was able to come through with one campaign promise this week by announcing a deal with Indiana-based Carrier Air Conditioning that will keep almost 1,000 jobs in the state. As reported, the deal seems largely focused on the State of Indiana offering millions in tax breaks and an understanding that the Trump administration will push for regulatory and corporate tax relief at the Federal level.
While the jobs Carrier will be keeping in the US only makes up about a third of the jobs the company had planned to move to Mexico, the underlying deal seems to reflect a larger commitment to addressing the corporate tax and regulatory burdens that have long held back the American economy. While some have described Trump’s approach as crony capitalism, if the terms of the deal really are limited to tax relief, such claims are baseless. While it is true that tax breaks for specific companies are less ideal than across-the-board cuts (or outright abolishment) of business taxes, they should not be confused with taxpayer subsidies.
As Matthew McCaffrey wrote last year defending tax credits for video game companies:
Decades ago, economists like Mises and Rothbard were already arguing that tax breaks are not economically or ethically equivalent to receiving subsidies. Simply put, being permitted to keep your income is not the same as taking it from competitors. Exemptions and loopholes do not forcibly redistribute wealth; taxes and subsidies do, thereby benefiting some producers at the expense of others.

This post was published at Ludwig von Mises Institute on Dec 2, 2016.

Trump’s New Deal: ‘Hillary Offers A Welfare Check, I Will Produce Paychecks’

In terms of rhetoric, which has historically made major departures from actions, this campaign boils down the economic uncertainty that is enveloping this nation.
With millions of people out of work, worried about finding employment or facing grave doubts about a future transformed by technological labor, Trump is honing in on the most psychologically pressing issues on the minds of the real Americans in flyover country.
They are the ones who are feeling the hurt financially, not Wall Street.
It is they who must be convinced to support the government again.
The politics of Obama and Hillary have left large portions of the country feeling alienation, and angry at their government. That growing sense of dissatisfaction has been fueled by the unethical tactics of those in power. Lying and corruption has gone way too far.
It has affected them personally.
And whether Donald Trump will prove himself in hindsight or not, he is masterfully tapping into that sentiment in a way that Hillary Clinton cannot even pretend to attempt.
Trump’s speech in front of the Economic Club of New York highlighted the choice between a declining welfare state and an economy that is booming and providing good paychecks. How does that sound to Ford workers who just lost another factory to Mexico? Or to the thousands of other rust belt Americans who face a similar predicament?
As Real Clear Politics reported, :

This post was published at shtfplan on September 15th, 2016.

Detroit Didn’t Get The Donald’s Memo – – -Fiat Chrysler to End All US Car Production, Ford Sending Small Cars To Mexico

CEO Mark Fields told investors the move is part of plans to make production simpler and less expensive
Ford plans to eventually shift all North American small-car production from the U. S. to Mexico, CEO Mark Fields told investors Tuesday, even though the company’s production investments in Mexico have become a lightning rod for controversy in the presidential election.
‘Over the next two to three years, we will have migrated all of our small-car production to Mexico and out of the United States,’ Fields said at a daylong investor conference in Dearborn.
The news sparked a fresh round of criticism of Ford from Republican Presidential candidate Donald Trump, who was campaigning in Flint on Wednesday.
‘We shouldn’t allow it to happen. They’ll make their cars, they’ll employ thousands of people, not from this country, and they’ll sell their car across the border,’ Trump said during his visit. ‘When we send our jobs out of Michigan, we’re also sending our tax base.’
The impact on Ford’s U. S. employment will be minimal in the near-term. Ford already builds the Fiesta subcompact and the Fusion mid-size sedan in Mexico. There is an expectation that Ford will build a new Ranger mid-size pickup truck in Wayne and possibly a new Bronco compact sport-utility.

This post was published at David Stockmans Contra Corner on September 15, 2016.

Here Come The Bombshells – – Chinese Billionaire Linked to Giant Aluminum Stockpile in Mexican Desert

Two years ago, a California aluminum executive commissioned a pilot to fly over the Mexican town of San Jos Iturbide, at the foot of the Sierra Gorda mountains, and snap aerial photos of a remote desert factory.
He made a startling discovery. Nearly one million metric tons of aluminum sat neatly stacked behind a fortress of barbed-wire fences. The stockpile, worth some $2 billion and representing roughly 6% of the world’s total inventory – enough to churn out 2.2 million Ford F-150s or 77 billion beer cans – quickly became an obsession for the U. S. aluminum industry.
Now it is a new source of tension in U. S.-Chinese trade relations. U. S. executives contend that the mysterious cache was part of a brazen scheme by one of China’s richest men to game the global trade system.
Aluminum-industry representative Jeff Henderson says he is convinced that China Zhongwang Holdings Ltd., a Chinese aluminum giant controlled by billionaire Liu Zhongtian, tried to evade U. S. tariffs by routing aluminum through Mexico to disguise its origins, a tactic known as transshipping.
‘My Moby-Dick has been Zhongwang,’ says Mr. Henderson, president of the Aluminum Extruders Council, a U. S. trade group.
Mr. Liu, a member of China’s ruling Communist Party, denies any connection to the Mexican aluminum or transshipping. ‘These things have nothing to do with me,’ he said in a June interview at his company’s Liaoning, China, plant, where he lives in an apartment inside the factory. He said he wouldn’t know how to establish a business in Mexico, joking that ‘in that sort of place, there are a lot of killers with guns.’

This post was published at David Stockmans Contra Corner on September 9, 2016.

Captured ISIS Terrorist Confirms He Has “Jihadist Brothers” In Mexico; Obama Administration Denies It

An ISIS operative arrested and criminally charged in Ohio this month has confirmed that the terrorist group has cells in Mexico, according to federal authorities. Judicial Watch has reported this for years, documenting it in a series of articles as part of an ongoing investigation on the connection between drug cartels, corruption and terrorism on the southern border. In fact, last spring Judicial Watch broke a story about an ISIS camp just a few miles from El Paso, Texas in an area known as ‘Anapra’ situated just west of Ciudad Jurez in the Mexican state of Chihuahua.
Though a number of high-level law enforcement, intelligence and military sources on both sides of the border have provided Judicial Watch with evidence that Islamic terrorist cells are operating in Mexico, the Obama administration has publicly denied it, both to Judicial Watch and in mainstream media outlets.

This post was published at Zero Hedge on Aug 14, 2016.

Barbarians at the Gate: ISIS terrorist tells Fed officials he has jihadist brothers in Mexico

August 2016 – MEXICO – Earlier this year a top ranking Homeland Security official acknowledged that Mexican drug cartels were helping ISIS sneak across the southern border to scope out targets for terrorist attacks. ISIS operative Shaykh Mahmood Omar Khabir has reportedly been training militants near the US border near Ciudad Juarez for the past year.
Khabir actually brags in an Italian newspaper article published last week that the border region is so open that he ‘could get in with a handful of men, and kill thousands of people in Texas or in Arizona in the space of a few hours.’ Today Judicial Watch confirmed reports that ISIS is operating in Mexico. Judicial Watch reported, via Free Republic:
An ISIS operative arrested and criminally charged in Ohio this month has confirmed that the terrorist group has cells in Mexico, according to federal authorities. Judicial Watch has reported this for years, documenting it in a series of articles as part of an ongoing investigation on the connection between drug cartels, corruption and terrorism on the southern border. In fact, last spring Judicial Watch broke a story about an ISIS camp just a few miles from El Paso, Texas in an area known as ‘Anapra’ situated just west of Ciudad Jurez in the Mexican state of Chihuahua.

This post was published at UtopiatheCollapse on August 13, 2016.

As US Crude Exports Soars, Here Are The Biggest Foreign Buyers Of US Oil

Strange things are happening in a world continues to find itself with “low-priced” oil and an unprecedented gasoline glut, the latest of which is an unexpected boon for US fuel makers as Latin American refineries quietly go bust.
As Bloomberg writes, from Brazil’s Petroleo Brasileiro SA to Mexico’s Petroleos Mexicanos, state oil companies have failed to complete nine projects worth at least $36.4 billion that would have supplied 1.2 million barrels of gasoline and diesel daily. U. S. refiners have stepped up to help fill the gap, with exports almost doubling in the past six years, according to the U. S. Energy Information Administration. Falling oil prices, high levels of debt and failure to find partners to help finance the plants are among the reasons cited by Pemex, Costa Rica’s Refinadora Costarricense de Petroleo SA and Colombia’s Ecopetrol SA for postponing their plans. Brazil’s Petrobras has been slowed by the price drop as well as a corruption scandal.
‘Refinery investment plans in the region have really fizzled out over the past year or so,’ Mara Roberts, a BMI Research analyst based in New York, said in an e-mail. ‘Latin America is keen to take in growing U. S. supplies.’ As a result, US exports to the region have been rising steadily and reached a record 1.88 million barrels a day this year. Latin America now accounts for 42 percent of America’s fuel exports, up from 38 percent a decade ago. U. S. fuel output increased 4.1 percent over two years to a record 19.9 million barrels a day in 2015, EIA data show.

This post was published at Zero Hedge on Aug 12, 2016.

Fed Up With The Corruption: Mexico On Brink Of Revolution

The Mexican government’s deadly crackdown on a teacher’s union protest has rattled the nation in recent days, as 200,000 doctors on Wednesday joined the ongoing national strike against President Enrique Pea Nieto’s neoliberal reforms.
Anti-government sentiment is mounting after police forces opened fire on a teacher protest in Oaxaca on Sunday, killing at least eight.
Since then, two high level government officials from that state, Oaxaca Minister of Indigenous Affairs Adelfo Regino Montes and Secretary of Labor Daniel Gutierrez, have resigned in protest of the ‘authoritarian actions that repress and kill Oaxacan people who defend their rights and the government’s negligence to any possibility of dialogue,’ as Gutierrez put it.
On Wednesday, members of the medical organization Yo Soy Medico 17 from 32 states joined the ongoing strike, stating their opposition to Pea Nieto’s health reforms, which they say are a ‘disguised way of privatizing health in Mexico,’ according to TeleSUR.

This post was published at Zero Hedge on Jun 23, 2016.

Trump: ‘Only Dummies’ Believe Fed’s Unemployment Figures

Donald Trump, if elected president, will investigate the veracity of US economic statistics produced by Washington – including ‘the way they are reported.’
I caught up with Trump, the presumptive Republican nominee, by phone Tuesday morning, and we had a frank talk about the economy and what is making his campaign tick.
‘When you look at some of these [economic] numbers they give out and then you go out and see people dying to get a job all over the country, I mean, it’s not jibing with what’s really going on,’ Trump said.
The economy is not doing well,’ Trump said. ‘You know, John, I’m getting 20,000 to 25,000 people every time I make a speech, and they are not there just because of the border,’ he added, referring to his vow to build a wall between the US and Mexico.
‘They are there because – and you know – if you put out a job notice, you’ll get thousands of people showing up to pick up a job,’ Trump said.
As I’ve mentioned before, I first met Trump decades ago and we used to talk once in a while, but haven’t for many years.
Trump says he thinks the US unemployment rate is close to 20 percent and not the 5 percent reported by the Labor Department.

This post was published at David Stockmans Contra Corner By John Crudele, New York Post ‘ May 27, 2016.

Mind The Rebounding Dollar – – – There’s Much More To Come

The dollar’s three-week rally is just the beginning, according to Deutsche Bank AG.
A slump by the greenback earlier this year has ‘likely run its course,’ analysts at the world’s second-largest currency trader wrote in a note Friday. The bank favors buying the U. S. currency versus emerging markets – such as China, Mexico and South Korea – following a shakeout in speculative bets on the dollar, George Saravelos, co-head of global foreign-exchange research in London, wrote.
With policy makers from the Group-of-Seven economies meeting in Japan, the Federal Reserve this week gave the dollar a boost by signaling that it may raise interest rates as soon as June. That helped send the greenback to a seven-week high, providing relief to policy makers outside the U. S. who have watched with dismay as a weaker dollar eroded the stimulatory effect of interest-rate cuts and bond purchases.
‘The dollar still has some legs,’ said Sebastien Galy, a strategist at Deutsche Bank in New York. ‘The global dollar trend is probably far less appealing than it used to be, but there’s still some opportunity there.’ The Bloomberg Dollar Spot Index, which tracks the dollar versus 10 peers, added 0.8 percent this week. The greenback rose 0.8 percent to $1.1224 per euro and gained 1.4 percent to 110.15 yen.

This post was published at David Stockmans Contra Corner by Bloomberg Business ‘ May 22, 2016.

Crooked Hillary and the Rape of Honduras

Tens of thousands of Central Americans, many of them unaccompanied children and teenagers, have flooded into the US illegally in recent years: they are a growing part of a human tsunami that has hit the southern border and caused what many refer to as a humanitarian crisis, overwhelming the local and federal authorities – and becoming a major political issue.
On the one hand, we have immigration restrictionists like Donald Trump, who say that ‘we cannot be a country and have no borders,’ and who vow to build a Wall – ‘and make Mexico pay for it.’ On the other hand, we have Hillary Clinton, who says we should be ‘knocking down barriers, not building walls,’ and claims that Trump and his supporters are motivated by ‘bigotry.’
Like most partisan political debates, this one gives off plenty of heat without shedding much light. Because the real question is: why are hundreds of thousands of people suddenly abandoning their homes, their families, and their countries to make the long and dangerous trek through Mexico and into the United States? And where are these people coming from?
Contrary to what the Trumpistas seem to believe, the influx of Mexican illegal immigrants has tapered off. Increasingly, the floodtide consists of Central Americans, who are coming from El Salvador, Guatemala, and Honduras. And while the circumstances surrounding the Great Migration have particular causes in each of these countries, in general the causes are the same: a wave of criminality and chaos, which has its origins in decades of misgovernment and repression. Grinding poverty, the rule of a landed oligarchy, and the de facto dominance of brutal militaries – supported by the US – have stunted and deformed these resource-rich countries, forcing their citizens into what is surely one of the largest population transfers in recent history.

This post was published at David Stockmans Contra Corner on May 18, 2016.

How To Deconstruct Hillary – -Ignore The NeverTrump Crowd

As Donald Trump prepares for an epic battle with ‘First Enabler’ Hillary Clinton, the media is too focused on party unity and are oblivious to the fact that denunciation of Trump by failed elites like the Bush’s as well as the prevarications of Paul Ryan only fuel his rise, as did the opposition of Mexico’s ex-president, the Chinese Communists, the Pope, David Cameron, the Saudis, and Mitt Romney. The political class is discredited with voters hungry for change.
What they are missing are the millions of new voters and donors Trump has brought to the party, with the GOP contest drawing two million more voters than the rather boring Hillary v. Bernie bout. It is important to note that in 2012, a change in just 700,000 votes in five states would have changed the outcome of the election.
Analytics show there are 1 million unregistered Trump supporters. In Colorado, Iowa, Florida, Michigan, Nevada, New Jersey, Ohio, Virginia, Wisconsin, and Pennsylvania, Trump will have the resources to sign them up. This is where elections are won.
All successful Republican presidents – Lincoln, Teddy Roosevelt, Eisenhower, Nixon, and Reagan – remade the party in their image. Trump is snatching the party back from Wall Street and the special interests. His is street populism, far right on some issues but far left on others. Not a pure conservative by any means, he is the best choice for conservatives on the big four issues – the economy, terrorism, trade, and immigration. Those who worry about his views on eminent domain must realize that there will be no private property rights if we are incinerated by Islamic radicals.

This post was published at David Stockmans Contra Corner on May 11, 2016.

Saudi Arabia’s Oil-Bust Cash-Flow Debacle Begins to Bite

Hangover of oil dependence has only just begun.
By Don Quijones, Spain & Mexico, editor at WOLF STREET.
It was supposed to be the biggest, most ambitious, most lucrative infrastructure project Spain’s construction industry had ever undertaken on the Arabian Peninsula. Launched three years ago, the high-speed rail link project between Medina and Mecca was a dream come true worth some 6.7 billion, the perfect payoff of decades of patient lobbying of the House of Saud by Spain’s former King Juan Carlos I. But now it’s a rotting financial albatross around the necks of 12 large Spanish companies.
Even from the beginning, things were not easy. Within a year and a half, the project was suffering significant delays. And two months ago, the consortium asked the Saudi government for more funds – ‘an absolute minimum of 1.4 billion’ – to cover the Saudi Railways Organization’s ‘unforeseeable demands,’ such as, amazingly, keeping desert sand off the tracks.

This post was published at Wolf Street by Don Quijones ‘ May 7, 2016.

Big-Oil Sinkhole of Debt & Corruption Gets Taxpayer Bailout. Wall Street Thrilled

Taxpayers in Mexico Brace for a New Round of Plunder
How the mighty are fallen. Pemex, Mexico’s state-owned oil giant, once a goliath on the global energy scene, is now dependent on state aid to meet its day-to-day needs. Mexico’s Finance Ministry announced a series of measures aimed at loosening Pemex’s financial strains, giving the state-owned giant a decidedly short-term $4.2 billion liquidity boost.
That includes a capital injection of $1.5 billion, as well as a credit facility for a further 2.7 billion to pay down pension costs this year. The company will also receive tax breaks that will allow it to deduct more of its exploration and production costs.
But it’s a mere drop in the barrel compared to the $30.3 billion in losses the company racked up last year, its $90.5 billion in pension liabilities, and its debt which is expected to surpass $100 billion later this year.

This post was published at Wolf Street by Don Quijones ‘ April 16, 2016.