White House Trade and Manufacturing Advisor Peter Navarro appears on Fox Business to discuss the purpose and intent of the USMCA and the ongoing China trade discussions.
What Navarro skims upon is the heart of the economic purpose behind the USMCA as requested by President Trump and constructed by USTR Lighthizer. The USMCA establishes an internal North American manufacturing system; this provides the alternative for Asian manufacturing of goods for the U.S. market.
This manufacturing system is why Mexico is “all-in” to support the USMCA. Additionally, the economic benefits within the system as constructed is exactly why Mexican President Lopez-Obrador is willing to pressure House democrats to ratify and also back-up President Trump on other geopolitical issues (immigration controls etc).

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On the Stock Market dynamic. Currently there is a great deal of investment capital waiting to see where the money should be placed. Investment in China has dropped dramatically; investment in Southeast Asia shifted, but new investment is pending this outcome. Multinationals are calculating the TCP (Total Cost of Production), and if the new USMCA is passed there will be a triggering effect of North American investment because the uncertainty will be eliminated.
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White House manufacturing policy advisor Peter Navarro discusses the lack of action from Speaker Pelosi on ratification of the USMCA.
As CTH has outlined since the July 2019 alliance meeting between Pelosi and Canadian Prime Minister Justin Trudeau, the strongest likelihood is the House will table the ratification vote until after the 2020 election. It is a strategic political decision.

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UPDATE – RESULTS: Everyone Declared Victory.

Justin Trudeau celebrated an overwhelming victory following the results of the Canadian election – SEE RESULTS HERE –  The Liberal party lost 21 seats but remained the majority parliamentary winner albeit without a majority. Prime Minister Justin Trudeau announced a “solid mandate from the election results.”  The Conservative party gained 27 seats and the most national votes, but remain the losing party.  The New Democrat Party lost 15 seats and declared the 2019 election a major success for their agenda.
It’s all weird.
During their post election speeches the Liberals (Trudeau), Conservatives (Sheer), New Democrat Party (Singh) and the Green Party (May), all declared victory.  It seemed like a hot mess of political messaging; but hey, that’s Canada.
Congratulations, I guess.
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Leftists love to trot out Christine Lagarde as the pontificating elite to defend their multinational interests.  Recently the former IMF leader was elected to take control of the European Central Bank.   As a direct result, Ms. Lagarde is now taking an adverse position toward a strong U.S. economy and decrying the ‘America-First’ policies of President Trump that have removed the tentacles of global financial control.
If you follow trade, finance and the interests of the multinationals, this is actually quite funny.  In this first brief interview segment Ms. Lagarde, has the elitist audacity to warn President Trump that lowering U.S. interest rates defeats the agenda of the EU.  She doesn’t put it in those terms, but watch and we’ll explain:

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Notice how Lagarde magnanimously claims that lowering interest rates when the U.S. economy is strong, and the U.S. unemployment rate is at historic lows, could lead to rising prices inside the U.S.  Too damned funny; how very kind of the EU to be worried about U.S. consumers… (pro tip: they ain’t).
What she’s really worried about is the dynamic that President Trump has created that is crushing the globalists. Let’s expand.
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Speaker Nancy Pelosi has a plan, at least the collective ideology behind her has a plan.  Her recent trip to Jordan and Afghanistan are part of that plan; everything is essentially connected.    Pelosi will do whatever is needed to hamper the U.S. economy in an effort to weaken President Trump’s relection bid.  Blocking the USMCA is part of that aspect.
The visit to Jordan and Afghanistan was purposeful ground work in preparing to seed the narrative that President Trump’s withdrawal from mid-east conflict is evidence of dangerous foreign policy.  Again, just like the USMCA stall, the larger goal is to weaken the President in advance of 2020.  Everything is connected.
National Economic Council Director Larry Kudlow appears to be realizing the Democrat’s hatred for ‘America-First’, which weakens their personal financial position, is their driving ideology.

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Commerce Secretary Wilbur Ross discusses the negotiations with China and the possibility of agreement on ‘Phase-1’ aspects prior to December.  Secretary Ross is not necessarily optimistic the agreement will be made based on Beijing’s outlook toward the enforcement mechanisms and forced compliance. Ross also discusses Brexit from the position of mutual benefit.
On the subject of USMCA Secretary Ross outlines the only reason for Democrats to hold back ratification is Pelosi’s politics. [Only 20 legislative days left in 2019] Mr. Ross discusses the options if Pelosi refuses to take up ratification.  On this subject the commerce secretary does not sound optimistic.

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Trying to find the details within the U.K-EU Brexit deal is more difficult than finding evidence of a Yeti.  The negotiating team secrecy is inherent to the way the elites within the European systems work. Essentially the “betters” rule the proles by hiding the details and relying upon the electorate to “trust” the outlined framework of their elected superiors.
Hiding details is a feature within the European system and the way the government looks at their role.
That said, tomorrow British members of parliament will begin debating the deal for the UK to exit the EU.  The deal was modified by Boris Johnson.  A backgrounder:

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Farage is concerned, rightly, about how the framework of the EU customs union is constructed to influence the UK after Brexit.  From what can be determined there’s a triggering mechanism where the UK and EU begin a lengthy process to construct a UK trade agreement with the EU after Brexit takes place.
Within that post-Brexit automatic trade-framework is where the European Union is seeking to retain their influence over the United Kingdom. However, it is not accurate to overlay EU influence too heavily, and here’s why….
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A big FUBAR happened in Culiacan Mexico yesterday as Mexican police and narcotics officers captured Ovidio Guzman, aka “Chapito”, the heir of drug kingpin El Chappo and current head of the Sinaloa cartel.
We watched via social media yesterday as a war broke out in Culiacan between the police/military and the cartel.  After authorities captured Chapito, hundreds of Sinaloa cartel members came down from the mountains and cut off the city.  The cartel began executing and capturing anyone who was assisting the arrest.  The city shut down.

To save themselves, the surrounded Mexican officials released Chapito back to the cartels and now the world has more evidence that Mexican President Lopez-Obrador has no control over the peace and security of Mexico.  The cartels are in charge.

MEXICO CITY (Reuters) – Mexican officials on Friday admitted they had bungled the arrest of kingpin Joaquin “El Chapo” Guzman’s son, who they let go during shootouts with drug gangs in the streets of a major city, but the president insisted his security strategy was working.

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Office for Trade and Manufacturing Policy’s Peter Navarro discusses the China trade negotiations, the UAW General Motors strike, U.S. tariffs in European goods, and USMCA.
On the U.S-China ‘Phase-1’ construct the key issue is going to be the enforcement mechanism to ensure any agreement has strength.  On U.S. placing tariffs on the EU due to the Airbus ruling Navarro reminds everyone the WTO ruling does not permit the EU to place tariffs on U.S. productions.  On USMCA everyone avoids telling the truth; that is  Nancy Pelosi is waiting to see what happens in the Canadian election in three days.  If Trudeau wins re-election, the USMCA will likely be scrapped (tabled) by Pelosi.

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{*Note* We are holding-back on BREXIT-EU deal outlines until we complete reading the majority of the 2,000+ pages of UK-EU legal agreement construct.}
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Earlier today Nancy Pelosi was questioned about why the House was not voting to pass the USMCA trade agreement.  Speaker Pelosi immediately fell back upon her talking point: “we are working toward yes.”   This is complete hogwash.  There are no discussions. Pelosi is doing what Pelosi does best, politicizing anything positive for the U.S. economy in a concerted effort to undermine Trump in 2020.
Here’s what is going on.
Nancy Pelosi and her far-left ideologues entered an agreement with their Canadian liberal allies and Justin Trudeau to stall the USMCA passage.
Trudeau’s government ideologues agreed not to call the USMCA up for a vote in the Canadian parliament.
Speaker Pelosi is waiting to see if Trudeau can win re-election.  If Canada re-elects Trudeau on October 21st, Pelosi will announce the labor provisions are not strong enough within the USMCA deal; discussions with the Trump administration are not resolving the issues; the U.S. workers are not protected enough, and she is tabling any vote.
Speaker Pelosi will then wait until after the 2020 election.  The purpose is political.
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