Council of Economic Advisers Chairman Kevin Hassett appears on Fox Business news to discuss the impact of the Federal Reserve’s interest rate hikes on the Main Street economy and the state of the Wall Street stocks.
The key metric is to accept what’s happening around us.  Fed rate hikes are hurting Wall Street (investment class).  However, Fed activity is not yet impacting Main Street.  This is because the two economic engines (Wall St. -vs- Main St.) are so far apart.

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Part Two of this interview (and expanded review) is below:
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A few days ago many critics were concerned over an announced pledge of U.S. State Department funding ($4.8 billion) for security and economic development in Mexico. However, CTH noted the approach was likely not what it seemed.
Those who followed the USMCA construct closely noted that U.S. President Trump (through Jared Kushner) and Mexican President Lopez-Obrador (through Jesus Seade) were doing something much bigger than a trade agreement; they were structuring an entirely new U.S-Mexico economic alliance.
With increased investment in central America by the Chinese government; and with Venezuela in a state of vulnerability to becoming a proxy therein; and with Brazil taking a more nationalistic approach; a completely new partnership which focused heavily on domestic security and economics was taking shape between the U.S. and Mexico. Throughout 2017 and 2018 the U.S. media was oblivious to it.
Then, two days ago, the U.S. State Department made public the principles of an economic alliance between the United States and Mexico. [See Here] The outline should be familiar: Economic Security is National Security.
Today Department of Homeland Security chief Kirstjen Nielsen told lawmakers that migrants heading to the southwest border to seek asylum in the United States will have to wait in Mexico until their claims are processed, under an agreement between the two countries:

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Much misplaced anger is visible.  President Trump wants the southern border wall; he is being opposed by every interest who doesn’t want it.  The people in DC who are opposed to border security, are the people who write the laws.  I’m not talking about congress; I’m talking about the real people who actually write the laws, the lobbyists.
Right now Majority Leader Mitch McConnell and Minority Leader Chuck Schumer are writing a short-term continuing resolution to fund government and avoid a shutdown.
They know President Trump is quite comfy with a shutdown.
Why would republican Mitch McConnell take such an action that puts the republican President in a position of opposition and compromise?
Because he wants to, that’s why.
President Trump said he wouldn’t sign another CR that didn’t fund the border wall.  Right now Mitch and Chuck are writing a CR that doesn’t fully fund the border wall.  Why would Mitch McConnell do that? Because he want’s to that’s why.  UniParty !
Mitch McConnell, Chuck Schumer, Nancy Pelosi and Paul Ryan are working to put a take it or leave it bill in front of the President and force him to accept it.  Republicans currently control the House and Senate.  Why would McConnell and Ryan put President Trump into that position?  Because they want to, that’s why.
That’s who you should be mad at, not President Trump.
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CEA Charman Kevin Hassett is a happy MAGAnomic warrior as he continues to explain the disconnect between the strength of the U.S. economy -vs- the world; and how the disconnect impacts the multinationals (Stock Market).

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The interview is in two segments. Part II is below:
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CTH has pointed, repeatedly, toward a very specific economic and financial dynamic  because President Trump is uniquely focused on Main Street’s “real economy“.
Everything happening in/around the financial markets is very predictable when you focus on understanding the principles of Main Street MAGAnomics and how those basic principles diverge from Wall Street’s “paper economy”.
President Trump is clawing back American wealth; inch by inch… bit by bit.  This is the full monty.  This is economic nationalism. This is for all the marbles.
This is it.
Everything is happening in a very predictable sequence. Few understand the MAGAnomic reset, and what was predicted to happen in the space between disconnecting a Wall Street economic engine (globalism and multinationals) and restarting a Main Street economic engine (nationalism/America-First).  In 2015, 2016, 2017, 2018 CTH explained where we would be today. With current Wall Street events, perhaps it is worthwhile remembering the dynamic.
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The CFO of Huawei has been released on bail pending her extradition hearing to the United States. Ms. Meng will have to wear and ankle monitor and travel with security agents until her next hearing on February 6th.

(Via NBC) A Vancouver judge set a $10 million CAD bail ($7.5 million U.S.) for Huawei Chief Financial Officer Meng Wanzhou Tuesday, capping a week of increasing trade tensions and strong market reactions around the dispute between the Department of Justice and one of China’s largest hardware companies.
The United States had asked the Vancouver court to deny bail for Meng, whose father is a billionaire and a founder of Huawei, calling her a flight risk. Canada has been expected to extradite Meng to the United States over charges that the company improperly took payments from Iran in violation of sanctions against the country.

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Early this morning China transmitted and interesting tweet position that was/is a transparent display of their panda mask. In essence the panda play was a call for team USA to drop the zero-sum outlook and seek a win/win. Given the historic nature of Chinese negotiations the tweet was rather funny. However, it does highlight the dance.
Additionally, a few hours later President Trump tweeted about ongoing U.S-China trade discussions and something to watch for:
Moments ago we received the first indications of Chairman Xi’s panda play:

(Via Wall Street Journal) China agreed to reduce tariffs on U.S. autos to 15%, down from 40% currently, during a phone call with U.S. officials that opened the latest round of trade talks aimed at settling a trade dispute festering between the world’s two largest economic powers, according to a person familiar with the matter.

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CTH has never hidden our disgust for the corrupt lobbying enterprise known as the U.S. Chamber of Commerce, and their President Tom Donohue.  No internal organization in modern history has done more to harm American workers and American industry than the U.S. Chamber of Commerce.  Their fraudulent and corrupt enterprise is a toxic threat to our economy.
Today the U.S. Chamber of Commerce issues a statement denouncing the trade strategy of the Trump administration and announcing their lobbying support for the USMCA trade agreement is contingent upon the removal of Steel and Aluminum tariffs.

As the Washington Times writes: “The Chamber had previously complained that the deal’s language limiting protections for investors and stiffening of the “rules of origin” for when autos can be duty-free were problematic.”  Put another way: Wall Street is angry their multinational constructs are not supported, and protecting U.S. workers from the predatory nature of global outsourcing is bad for their controlled market schemes.
Ultimately, Donohue’s biggest complaint -revealed by historic review- is that his organization didn’t get to write the USMCA trade agreement and were stopped from selling their special interest carve-outs to their corporate clients.
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I hope y’all are hanging in there with me today because each of these Sunday posts is essentially an audio-video chapter in one singular book.  A stunningly deep book that explains the entire purpose of Trump from his/our perspective.
Here is an absolutely perfect, and in many ways jaw-dropping, interview with the head of the International Monetary Fund Christine Legarde.   It would be easy to write 10,000 background words on this singular interview alone. Decades of advanced globalist monetary/trade policy -vs- the recent uprising in economic nationalism.  THAT is the significant backstory at work here.
As her homeland France erupts in turmoil, elitist Legarde represents the personification of why those flames are present.  Freedom -v- Serfdom, with messaging from a control agent of the cloistered class.  However, here’s the stunner… pay real close attention at 04:34 of this interview where Legarde outlines the analysis (IMF economic model) where the IMF is forecasting U.S. GDP growth….  what number does she share?  WATCH:

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Did you hear that?
3.7% GDP growth for the U.S. is projected by the international financial community [global bankers].   This is the head financial liberal for the global elitist class admitting Trump has more than doubled the growth rate of the U.S. economy in two years.   Remember, simultaneous to this, when adjusted for inflation, the rest of the world is stagnant to shrinking in the same measure.
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President Trump is the first U.S. President to confront Beijing directly -head on- and the Chinese respect him immensely for it. It is an inherently adversarial relationship; but it is also a conflict where opponents respect their enemy because the outcome is victory or death. Ultimately, this, from the perspective of China, is a zero-sum contest.
President Trump is also the first U.S. President to: (1) understand how the red dragon hides behind the panda mask; and (2) be willing to directly confront that dynamic. That’s where U.S. Trade Representative Robert Lighthizer comes in.

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Ambassador Lighthizer is willing to go to the mattresses because he knows that ultimately his kids future, and his bosses’ grand-kids future, are entirely dependent on victory.  Freedom or serfdom, those are the alternatives.  Yes, this is that big a deal.  The biggest of all big deals (pun intended) in the last century.
There is also no doubt in my mind that President Trump has a very well thought out long-term strategy regarding China.
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