In the background of lessons being learned from the COVID-19 pandemic, stay tuned for a new MAGA-minded small farm program in the agricultural industry similar in construct to how President Trump and Secretary Mnuchin created the parallel banking system using community banks and credit unions.  Domestic food security is national security.

Today President Trump and Agriculture Secretary Sonny Perdue revealed a $19 billion U.S. farm relief program which includes the Dept. of Agriculture purchasing $3 billion in farm products from the fresh supply chain to support those impacted by the collapse of the restaurant, hotel, school and cafeteria demand (food away from home).   WATCH:

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If you’ve been following our outlines on the food supply-chain issues, you’ll be well aware of what is causing the current farm crisis. {Go Deep} Secretary Perdue is stepping in to mitigate that impact and provide relief to farmers severely impacted by the supply chain disruption.

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Though the U.S. and Canada are not part of the “OPEC Plus” group, President Trump has  been leading negotiations between Saudi Arabia and Russia to broker a deal and stop their price war.  Today President Trump announces an agreement between the major petroleum exporting countries to curb oil production by approximately 10 million barrels per day:

Additionally, there was a loggerhead within the negotiations as Mexico did not want to cut their production by the requested amount of 400,000 barrels daily.  Mexico relies on oil as a large part of their economy. AMLO stated his economy could not withstand such a significant drop in state revenue.  Economic security is, after all, national security.

President Trump broke the OPEC+ stalemate by agreeing to decrease U.S. production by 300k/barrels allowing Mexico to drop a more manageable 100k/barrels.  Trump and AMLO reached an undisclosed agreement where Mexico will reimburse the U.S. later on.

I suspect the “reimbursement” will be more, well, strategically geopolitical than financial.  [*nudge-nudge*, *wink-wink*, *say-no-more/say-no-more*]  President Trump has an uncanny knack of collecting leverage for later, more strategic, purposes.  Just sayin’.

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…there had to be a point where the value of the Wall St economy surpassed the value of the Main St economy… Part I Here

We now look forward, and consider the question: How would the multinational underwriters, the multinational financial systems, reset all transactional tables (the bookkeeping systems underneath the valuation) if the U.S. stock market was ever forced to re-value economic nationalism over multinational globalism?

To first answer the “how” question, we must visit the “why” question. Why would the multinational financial underwriters want to reset their valuations?

Obviously, the global financial system does not act altruistically. What would motivate the global wealth valuation authority (various market investment indexes) to want, or need, a reset.

The answer to the “why” question might not be as challenging as it appears.

First, there has been a seismic shift in how the world looks at the economic exploitation of multinational systems, or globalism.  See Bernie Sanders?  See those yellow vests in France?  See what happened with the U.K. Brexit referendum?  See the shrinking EU influence?  See the open/public confrontation and push-back against China? See Trump? All examples are consequences of the rise of economic nationalism.

Secondly, the original Wall Street corporate motive (during decades of mergers and acquisitions) to shift product manufacturing to Southeast Asia (ASEAN nations) was driven by a lower cost of overall business, higher profit margins and greed.

As a direct outcome economic wealth was shifted from the U.S. to ASEAN nations, and particularly China. Low wages, low regulation, cheap operational costs, incentives and subsidies from Asia equals cheap TV’s, sneakers, furniture and durable goods.

Even with high fuel prices and overseas shipping costs, there was a big difference between U.S. and ASEAN manufacturing costs.  As hundreds of U.S. Wall Street multinationals chased profits the rust-belt was created.

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A very big picture discussion requires a considerable baseline.

The stock market is not the U.S. economy; the stock market is an investment instrument that determines valuations of economic activity company by company. The valuation is considerably arbitrary, based on the determinations of the arbiters (investors). This is empirically true.

However, that said, how would the multinational underwriters, the multinational financial systems, reset all transactional tables (the bookkeeping systems underneath the valuation) …if the U.S. stock market was every forced to re-value economic nationalism over multinational globalism?    Enter “Coronavirus”.

Four years ago CTH first explained a new way to look at the U.S. economic system and how Main Street was/is disconnected from Wall Street.  We presented a metaphor to explain. Before going deeper into the discussion of tomorrow; and at the request of several people who now accept the era of “deglobalization” is upon us,  I first present that prior reference & then will use this as the baseline to describe what could come next.

There is a key phrase at the fulcrum of everything past:

…there had to be a point where the value of the second economy (Wall Street) surpassed the value of the first economy (Main Street).

What we are going to outline in part II is the possibility what happens when this natural truism is reversed.  The objective is to answer: How, specifically would Wall Street reset its evaluative systems if Main Street once again emerged as the priority?

But first, a baseline revisit is needed.

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Canada completes the North American cycle with their ratification of the USMCA to replace NAFTA. Mexico and the U.S. ratified the new trade agreement last year and January respectively.  The Canadian parliament did so yesterday.

CANADA – Canada on Friday formally approved the United States-Mexico-Canada Agreement (USMCA), taking the last legislative step to implementation of the deal to replace the 25-year-old North American Free Trade Agreement (NAFTA).

The trade deal, ratified by the Mexican legislature last June and by Congress in January, was formally ratified by the Canadian Senate Friday, and shortly thereafter received royal assent, the Canadian governor general’s approval.

The deal was passed through the legislature before Parliament shut down for five weeks in response to the coronavirus pandemic.

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7:30pm – THE PRESIDENT participates in a working dinner with the President of the Federative Republic of Brazil

White House – President Donald J. Trump will meet President Jair Bolsonaro of Brazil at Mar-a-Lago on Saturday, March 7, 2020. President Trump and President Bolsonaro will discuss opportunities to build a more prosperous, secure, and democratic world.

As leaders of the Hemisphere’s two largest economies, they will also discuss opportunities for restoring democracy in Venezuela, bringing peace to the Middle East, implementing pro-growth trade policies, and investing in infrastructure. The President will use this meeting as an opportunity to thank Brazil for its strong alliance with the United States. (link)

The potential for supply chain disruption as a result of China dealing with the Coronavirus, and almost a complete shutdown of their manufacturing economy, is looming heavy upon Wall Street multinationals invested in China.
However, tangentially related, as a result of USMCA we are now seeing signs of shifted investment into North America and increases in forecasts for U.S. manufacturing.

(Via CNBC) […] Early in the week, New York’s Empire State Manufacturing Survey for general business conditions posted a reading of 12.9, up 8 points from January and its best level since May. New orders surged to 22.1, the highest since September 2017, and shipments rose to 18.9, the best since November 2018.
On Thursday, the Philadelphia survey exploded 20 points higher to 36.7, the highest since February 2017. New orders hit their highest since May 2018. (more)

The Philadelphia FED tracks factory orders in eastern Pennsylvania, Southern New Jersey, and Delaware.  New orders in that region soared far higher than all expectations, reflecting a strong consumer-driven economy with ongoing purchases of durable goods.
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National Economic Council Director Larry Kudlow appears on Fox Business to discuss the excellent January jobs report.  Job gains and wage increases are all going in the right direction…. And Stuart Varney immediately asks: “do we need more immigration”?

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BLS Wage growth chart below [Table B3].
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As we start to head deeper into the 2020 presidential election year, there is some very good news for President Trump about how Americans rate their satisfaction; and some very bad news for Democrats who are trying to impeach this success.
According to the latest data from Gallup: “Americans’ average satisfaction rating for the 27 issues Gallup has tracked consistently since 2001 is now 47%. This is up three points from a year ago and is the highest since the January 2005 poll.”
In the measures of satisfaction covering the first three years of President Trump in office there are some remarkable increases in key measures:

(data link)

As President Trump prepares to deliver his State of the Union speech to congress, these results will likely provide some measurable data for him to highlight.  Satisfaction with the U.S. economy has jumped a whopping 22 percent since President Trump took office.
As noted above, the economy, national security, military and state of race relations all provide double-digit increases in American satisfaction during President Trump’s first three years in office.
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Earlier today President Trump traveled to Dana Incorporated, a manufacturing facility for axel housings and machined products in Warren, Michigan, to celebrate the signing of the USMCA trade agreement with American workers.  [Video and Transcript Below]

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[Transcript] – THE PRESIDENT: Okay, let’s get back to work. Come on. (Applause.) I love that song, but every once in a while, we have to get back to work. (Laughter.)

So I am very honored to be at Dana Incorporated, a tremendous company, a plant in Warren, Michigan. We’re very proud of Michigan. (Applause.) Dana has been around — I also like it because we happened to win here, so I was very happy with that. (Applause.) Very happy with that.

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