In 2015 we discussed candidate Trump’s economic positions and how they would impact the economy.  CTH anticipated that MAGAnomics would be reversing three decades of federal reserve fiscal policy. After about a year of analysis and discussion, in 2016 CTH presented a theory: “A new Dimension in Modern Economics“.
CTH shared a possibility of what could happen if Trump Economic Policy was shifted to favor Main Street over Wall Street.  One aspect we presented was how Federal Reserve monetary policy would be oddly disconnected from its ability to influence inflation.
Washington Times today:

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While the issues inherent within economic influences can be riddled with complexity, we remain optimistic that MAGAnomics will be very very successful.
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Recently there has been a great deal of opinion on Chief Economic Advisor to President Trump and his recent critique of President Trump’s comments surrounding the events in Charlottesville, Virginia.  For many people the latest Cohn -vs- Trump scenario is just more proof that President Trump is succumbing to influence/pressure from the wrong side of the ideological spectrum.
This outline is intended to directly speak toward those concerns.  However, to understand the dynamics of Gary Cohn -vs- Donald Trump it is first necessary to understand the perspective of Gary Cohn and President Trump.

Few people have an appropriate understanding of the scale, scope and seismic shift President Trump is delivering to the world of geopolitical financial influence.  A recent comment by someone who appears to understand the dynamic reads thus:

Enjoy this because we will never see this again. You’ll never see your president shift the pendulum the way Donald Trump is. The international market of high-pressure real estate development and financing incorporates every facet of business activity known to humanity and no President we have ever had has been more prepared to do what needs to be done then President Donald J Trump. In addition to trying to right the ship he has to navigate waters filled with landmines and torpedoes and those firing the torpedoes claim to be Americans. God bless this man.  ~ FromSeaToShiningSea

That’s a good a place as any to elevate the discussion, review the historic nature of the participants, and comprehend the dynamics behind: Manhattan -vs- Queens; Global finance -vs- National interests; Wall Street -vs- Main Street; and ultimately Gary Cohn -vs- Donald Trump.
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Being on the leading edge of history as it unfolds is a great deal of fun.  Everything is proceeding according to plan.  This is The Trump Doctrine playing out on the geopolitical stage and we all have references to smile about. Swimmingly.
Remember, when President Trump gave truthful, and rightful, ownership of the Muslim Brotherhood’s extremism to the Arab Gulf States? Their first response was to refute the position. Quickly they accepted reality; and now the GCC, led by Saudi Arabia, is confronting MB’s enabler, Qatar.
Remember, when President Trump gave truthful, and rightful, ownership of North Korea’s nuclear ambitions to China? The first response was Beijing refuting the position. Eventually they accepted reality; that process is ongoing.

On Monday President Trump gave truthful ownership of the Taliban to Pakistan. Well:

KARACHI, Pakistan (Reuters) – Pakistan has rejected U.S. criticism of its efforts to fight terrorism, saying it should not be made a scapegoat for the failure of the U.S. military to win the war in Afghanistan.
U.S. President Donald Trump unveiled his policy for Afghanistan on Monday, stepping up the military campaign against Taliban insurgents and singling out Pakistan for harboring them.

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At the end of the first round of NAFTA renegotiations, Sunday, I shared a confidence level of “3” on a 10 point scale; as to whether a deal was likely. [Explained Here]
On Monday Commerce Secretary Wilbur Ross and U.S Trade Representative Robert Lighthizer debriefed President Trump the on the results of the first round (5 days).   USTR Lighthizer and Secretary Ross were both at the White House during the eclipse viewing.
On Tuesday, following that briefing, President Trump shares his opinion on NAFTA. WATCH:

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Remember, this statement follows the discussions with Ross and Lighthizer a day earlier.  It would appear that President Trump did not like the information they shared.  Knowing that POTUS Trump isn’t going to accept or compromise on an economic deal that doesn’t fix the issues; and knowing he’s wanted to walk away from NAFTA in favor of bilateral trade deals from the outset; I might need to lower my confidence to a “1” or lower…
Super-Mega-MAGA-Winning! (more…)

Hot off The Presses.  Round One of scheduled NAFTA renegotiations has concluded today and a trilateral statement has just been released. [My thoughts follow press release]:

Washington, DC – On August 16, 2017, United States Trade Representative Robert Lighthizer, Canadian Foreign Affairs Minister Chrystia Freeland and Mexican Secretary of the Economy Ildefonso Guajardo launched the renegotiation and modernization of the North American Free Trade Agreement (NAFTA) in Washington, DC.

This began five full days of meetings by a team of subject matter experts covering more than two dozen different negotiation topics.  Detailed conceptual presentations were made by the United States, Mexico and Canada across the scope of the agreement, and negotiating groups began work to advance text and agreed to provide additional text, comments or alternate proposals during the next two weeks.

The scope and volume of proposals during the first round of the negotiation reflects a commitment from all three countries to an ambitious outcome and reaffirms the importance of updating the rules governing the world’s largest free trade area.

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NAFTA negotiations enter day #4 today.  The final Round 1 summary day is tomorrow, Sunday.   Information as to specifics is hard to find.  Much of the ongoing negotiation is clouded in secrecy.
However, that said, one of CTH mouses (with wolverine teeth) shares a negotiation aspect that drew a great deal of conseternation from the Mexico and Canada side.
The issue revolves around government contracts, specifically U.S. federal contracts for goods and services.  President Trump has initiated a “Buy American, Hire American” policy for government contracts; meaning if the U.S. government has to spend money for a product or service, it should be spent on acquisition of American products made by American workers.
Mexico and Canada want access to these lucrative contracts.  President Trump’s “America First” procurement process is against their interest.  Canada is especially upset about this dynamic.  Canada wants to be able to bid on U.S. Federal Government contracts; and Canada’s Foreign Affairs Minister Chrystia Freeland referred to the buy-local rules as “poor public policy.”
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Day two of Round One NAFTA negotiations continued today.
Round one is scheduled to run through Sunday August 20th.   Generally speaking the key negotiators are not presenting too much public information as the larger objectives of the first round are structured around the bigger issues of the agreement itself, and not the individual economic sectors which follow.
The potential for an agreement still appears around a level “3” on a ten point scale.
On the positive side for those who follow the U.S. Trade Team, you might enjoy hearing that the crony-capitalistic lobbying group, The U.S. Chamber of Commerce, has been significantly reduced.  U.S. CoC President Tom Donohue attempts to put his best face forward amid his diminished ability to influence actual policy:
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The ‘big ugly’ is inevitable. We all know it.  The only thing yet to be determined is the timing.  My spidey hunch tells me there are multiple possible detonation moments depending on sequencing.
Today, President Trump violates Mitch McConnell and Chuck Schumer’s golden rule regarding incumbent Senators.  President Trump tweeted support for a challenger:

Think about it.  President Trump has quietly placed triggering policy around the base of several UniParty issues:

♦China Trade Imbalance and North Korea Denuclearization; ♦the ongoing NAFTA renegotiations and future trade deals; ♦the fiscal year 2018 budget and associated MAGAnomic policy; ♦the southern border wall and immigration enforcement; ♦infrastructure and prioritization of spending; ♦no more stupid wars; ♦the repeal of ObamaCare and tax reform to benefit the middle-class workforce. 

These are not Bannonisms, these are core and central issues important to President Trump on an inherently personal and intrinsic level.
With some nuanced adjustments to reflect the current international challenges (ie. adding DPRK to the China objectives), these are essentially the fundamental reasons why candidate Trump came down the escalator in 2015.
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Based entirely on what can be pulled from Government Accounts and media interviews of the participants involved in NAFTA negotiations, I’m going to try and summarize each day as it can be determined through those sources.
Additionally, for those who might be interested in a perspective I’m going to give a rating of my confidence that a tri-national agreement is possible.
On a scale of zero to 10 – where zero is NAFTA will dissolve and parties will be at irreconcilable differences, and 10 is confidence an agreement will be reached, at the end of Day #1, today, I’d asses the likelihood of an agreement at “3”.
Outlook not too good.
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I find it interesting that Chinese TV is more interested in NAFTA renegotiation than most U.S., Canada or Mexico media.  Against the backdrop of China exploiting NAFTA as a backdoor into the U.S. market we accept this disparate level of interest is not accidental. China is specifically the “third party dumper” mentioned by Robert Lighthizer.
The negotiations can have as many as six rounds; each round lasting 5 days; two rounds in each nation, over the course of three months, with each round tackling a different economic sector.
It is also entirely possible they could also end sooner, much sooner.
The introductory remarks by Trade representatives from Canada, Mexico and the U.S. can be considerably enlightening for those who review the transparent political agendas behind the trade discussions.  I have a spidey sense these first round negotiations might not even make it to Sunday.
In the video below it is interesting to watch Canadian Foreign Affairs Minister Chrystia Freeland, outline her priorities (also here in more detail).  Ms. Freeland gives her remarks in English, Spanish and French.  If you can watch Freeland without A.) Laughing hysterically, or B.) punching your TV/Computer screen, well, you’re Job.
Through Ms. Freedlan’s leadership – Canada is focused on ensuring a “progressive trade agenda”.  She is demanding a focus on LGBTQ, and specifically transgender rights in the trade deal, in addition to cultural sensitivity aspects, and climate change. Go figure.
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