$64 billion of the current annual trade deficit with Mexico stems from the auto sector alone.
For over a decade auto manufacturers have moved to Mexico in order to import parts from Asia, assemble and install them, and then ship the completed cars into the U.S. through NAFTA without duties (tariffs).
The U.S. auto ancillary business groups (parts suppliers) have been pushed out of competition in the auto sector by this corporate profit strategy.  Thousands of U.S. jobs have been lost in both the plant assembly and the ‘auto-parts’ manufacturing sector.
CTH has called attention to this bastardized supply chain for years.  Foreign auto-parts, made by foreign workers, assembled into U.S. owned manufacturing, and sold as U.S. automobiles. The weird supply chain and assembly process is essentially a multinational corporate scheme (in the auto sector) which exploits one of the loopholes in the 25-year-old NAFTA agreement.
If the assembly plant was on U.S. soil the foreign (mostly Asian) parts would be taxed as imported parts.  However, so long as the assembly is in Mexico (or Canada), the origin of the parts is currently irrelevant, and the finished automobile crosses the border into the U.S. avoiding the taxes using NAFTA.
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There is a notable intent to talk down the economy amid almost all financial news providers.  However, despite their negative tone the economic reality continues to surpass their Eeyore disposition.
October’s U.S. housing starts jumped +13.7% to 1.29 million units and now begins to catch up with the underlying economic data.
You’ll note CTH discussed how housing would be regionally specific as the larger Main Street MAGAnomic policies were implemented.
Capital expenditures by home builders and home purchasers are the biggest financial decisions for most American workers.
Due to the deliberate factors involved, home purchasing is the largest railroad car in the economic train; it is also positioned in the rear of the economic sequencing.  However, when home building takes off the entire economic train gains momentum.

(Via Reuters) […] The sharp rebound in home construction reported by the Commerce Department on Friday was also driven by robust gains in the Northeast and Midwest regions.
The broad recovery could ease concerns about the housing market, which has been a drag on economic growth since the second quarter. The report added to labor market, manufacturing and retail sales data that have pointed to strong economic momentum as the year winds down.

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No-where is Trump Derangement Syndrome more evident than in the position of activist Democrats now swearing allegiance to multinational trade deals.
It was only a short time ago when Democrat activists and liberal politicians demanded U.S. withdrawal from TPP and openly discussed how NAFTA was disastrous for the U.S. worker. Both Bernie Sanders and Hillary Clinton ran on pulling out of TPP etc.
Trump gets elected, actually fulfills a campaign promise and promptly pulls-out of TPP subsequently beginning to renegotiate NAFTA (with leveraged threats to withdraw); and suddenly, Democrats are joining arm-in-arm with corporate Republicans expressing their profound love for multinational trade deals. Go figure.

Round #5 of NAFTA renegotiation begins today in Mexico, absent any diplomatic trade ministers, and Canada announces their intent to use their access to congress as leverage over the executive branch in an attempt to work around President Trump:

OTTAWA (Reuters) – Canada will redouble its lobbying efforts in Congress to block any Trump administration move to pull the United States out of NAFTA, sources familiar with government strategy said, as talks to modernize the treaty run into trouble.
[…] Canadian officials say there is some considerable doubt as to whether Trump could pull out of NAFTA without approval from Congress, which makes lobbying its members so important.

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CTH has a strong sense that when the final analysis on Venezuela’s ongoing socialist struggle is written, some years from now, the geopolitical strategy used by the Trump administration will be taught in political science classes. [Backstory Here]
As a result of horrific socialist policies, primarily driven by using oil production to maintain it’s socialist governance, Venezuela is under massive debt and desperate for cash.  The United States was one of the few remaining cash purchasers of Venezuela oil before U.S. Secretary of Treasury  Mnuchin imposed sanctions.
Previously China and Russia purchased Maduro’s oil, however their current purchases are/were all made as offsets, repayments, for prior loans.  China and Russia already own 49% of Venezuela’s state oil company PDVSA. Venezuela repays China and Russia with oil, but Venezuela needs cash revenue. It doesn’t generate additional revenue for Maduro if China and Russia purchase more oil, it only pays down the Venezuelan debt.
Venezuela needs money.  However, if anyone engages in restructured debt or further loans or bond holdings to Maduro they run the risk of running afoul of Secretary Mnuchin’s sanctions which could have a downstream effect of freezing their own banks and international financial systems from engagement with U.S. banks.
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The headline says -2.6%, but that’s the median.  The actual 2019 economic predictive modeling for Mexico is up to a 4% contraction if the U.S. cancels NAFTA.  The next round of NAFTA negotiations is scheduled for November 17th.

Additionally, these models are based on current trade economics and do not factor in the ramifications of Mexico joining the Trans-Pacific Partnership; and signing up to manufacturing sector agreements with Asian nations who can easily undercut even the low wage rates in Mexico based on average wealth.
The predictive models are run by various analysts paid by multinational business interests (corporations) to give advanced forecasting.  The results of the forecasts are used by multinational financial systems to determine the inherent value of future investment within Mexico.
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United States Trade Representative Robert Lighthizer was interviewed by Fox News host Laura Ingraham ahead of his important participation in the Asia trip.
Within the interview Ambassador Lighthizer shows his wolverine attitude toward the ongoing trade deals and his role within the larger geopolitical strategy of the Trump Doctrine.  There’s solid, affirming and unwavering economic insight within this interview.
Interestingly Lighthizer mentions the national security aspects inherent within the administration’s economic trade strategy. He details how his role, within the larger policy, is to focus intensely on achieving the best ‘America-First‘ trade deal possible. “Killers”.
Secretary Wilbur Ross (commerce), Secretary Steven Mnuchin (treasury), Secretary Rex Tillerson (state) and Secretary James Mattis (defense) then collate the outcome and ultimately President Trump makes the final decision.  Working in concert, together they map how to use the leverage within the Lighthizer’s deals to achieve national security objectives.

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Earlier today President Donald Trump held a meeting with Treasury Secretary Mnuchin and all participants in the tax reform proposal.
Interestingly, and in a typically Trump power play dynamic, POTUS Trump invited U.S. Chamber of Commerce President Tom Donohue to the meeting and after finishing his prepared remarks put Donohue directly in the spotlight (Video 04:00).  The U.S. CoC is the biggest lobbyist for globalist economics. Donohue is essentially MAGA enemy #1.
You might remember Tom Donohue specifically targeting President Trump for personal criticism in the last round of NAFTA negotiations.  POTUS Trump positioned Donohue physically directly across from him at the table and it was obvious President Trump was planning to put Donohue on the spot.  The look on Gary Cohn’s face is priceless.

[Transcript] 11:41 A.M. EDT – THE PRESIDENT: Thank you very much for being here, for the incredible work you’re doing to help us pass the really historic tax cuts. There’s never been anything like this in the history of our country. It’s cuts and it’s relief and it’s also reform. And frankly, it’s also simplification. So we’re covering everything.
There has never been anything like it, and it’s so important. The economy is doing very well but it can do much better. A lot of jobs are going to come from this and a lot of companies are going to start pouring back into the United States. In fact, we’re going to be announcing one big one sometime very shortly — a very big one coming back into the United States.
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WASHINGTON — U.S. Customs and Border Protection (CBP) announced today that construction for prototypes of the Border Wall has concluded in San Diego.

The prototype construction phase is complete. CBP will now test and evaluate the finished products, provided by industry, to determine which wall design elements meets our needs. This testing and evaluation period will last 30 to 60 days.
“Border security contributes to our overall national security and relies on a combination of border infrastructure, technology, personnel, and partnerships,” said acting Deputy Commissioner Ron Vitiello.
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Well, well, well. In what can only be described as perfectly representative of the perspectives of Canada, Mexico and the U.S., the principals within NAFTA [Robert Lighthizer (U.S.), Chrystina Freeland (Can), Ildefonso Guajardo (Mex)] showcase their unique positions during a press conference at the conclusion of round #4.
U.S. Trade Representative Robert Lighthizer begins with the elements of a statement that all parties agree upon. Not much. (Transcript added)
Next comes the smug, self-righteous, and virtue signaling Canadian economic parasite Chrystina Freeland; with an over-the-top emotional plea about how military cemeteries should form the basis of multinational trade deals because trade sectors should be based on her feelings, or something. Mexican economic parasite Ildefonso Guarjardo joins the CanMex position decrying the insufferable demands of the economic host: “we must understand that we all have limits.”
Then comes the hammer. Lighthizer announces to both parasites their positions are fraught with hypocrisy and self-preservation; and the time to reset the imbalance is now. Pointing out how Canada and Mexico agreed to TPP text they are now rejecting in NAFTA, and specifically identifying how their companies have become reliant on special preferences, Lighthizer lets Canada and Mexico know that the time for their feasting on the host is OVER. Watch (transcript added below):

The distance between the parties is too significant and a diplomatic “cooling off” period of one month is agreed upon; prior to entry into round #5 which will take place in Mexico, mid-November. The goal of an agreement, if any agreement is possible, concluding by the end of the year is gone.
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NAFTA Round #4 negotiations have been ongoing and resulting in little progress on the serious issues surrounding the three nation trade pact.
Word from behind the scenes, and off-the-record, finds several insiders with the opinion that the decision by the U.S. Chamber of Commerce lobbying group to conflict with President Trump and the U.S. trade team has backfired.
U.S. CoC President Tom Donohue made the decision to align in common cause with Canada and Mexico, against the interests of the U.S., and go public with his attacks against the U.S. negotiating team, the administration and President Trump personally.
Following the confrontational approach by the largest DC lobbying group, the U.S. team asked Canada to take their protectionist trade restrictions off the Dairy and Poultry sectors.  Canada was adamant they will never leave their agriculture unprotected, and rejected any consideration of open trade discussion toward those sectors.
The U.S. is standing firm on three elements that Mexico and Canada are dead-set against:
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