China’s Communist Chairman Xi Jinping delivered a prepared speech to the Chinese People’s Political Consultative Conference on Saturday and stayed far away from mentioning the challenge of a U.S. -vs- China trade reset.

Those who follow China’s historic patterns will note careful and intentional inferences within Chairman Xi’s remarks as shared by SCMP media:

[…] While the Belt and Road Initiative has faced an increasing international pushback amid fears it is saddling poorer countries with unsustainable debts, Xi’s speech steered clear of this and other sensitive topics.

Instead he praised the initiative for helping to improve international ties, adding: “Our circle of friends is expanding.”

“Circle of friends” defined as those political suckers (selfish and corrupt political parasites willing to sell out their countries’ best interest) who accept the smiling panda face and completely ignore the cunning dragon behind the mask maneuvering to enslave the locals.
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This is a little on the economic wonky side of things; but well worth watching if you are a trade follower.  The Canadian Broadcasting Company (CBC) attempts to construct a pro-TPP narrative by discussing possible 2019 benefits to Canada.  However, if you listen closely, each time the question of  Canadian consumer benefit it raised you’ll note there aren’t any.

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Corporate globalism, via international trade agreements, is a scam. By design it is intended to exfiltrate the wealth of a targeted (host) nation, and allow corporations full control over the domestic pricing of commodity goods.  There are parts of that interview when the lobbyist/punditry accidentally admits the scheme.
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Earlier today President Trump tweeted out the possibility of closing the Southern U.S. border if congress cannot find a solution to funding border security.  Sounds good….

I’m not sure if even President Trump realizes how much support there would be for this approach.  Mexico would be lighting up the switchboards in DC if that happened.  The Mexican economy is entirely dependent on access.

The investment instruments created by Wall Street billionaire hedgefund managers and institutional multinational banking interests; operated by robotic algorithmic data networks, while programmed to twitch and flitter with coded signals only decipherable by the hired engineers; are wildly swinging amid their detachment from Main Street.
This fluctuating Wall Street process is likely to continue; actually, it’s going to get a hell of a lot worse; because the invisible data driving the activity behind the swings is based on investment bets, derivatives that are entirely disconnected from actual Main Street financial results.  Chairman Hassett discusses:

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Full Spectrum: “The Main Street-Wall Street demarcation has been fortuitously blurred, all to Wall Street’s benefit. Recall the mass migration over the last few decades from defined pension plans to self-directed IRAs and 401ks. This was Wall Street impregnating Main Street with Wall Street’s sweatless ethics. Main Street is very much ‘in the market’. Trumponomics desperately needs a tutorial to the American people explaining the rockiness of the transition and all that’s at stake.”…

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According to a report in Bloomberg News the U.S. is sending a trade negotiation team to Beijing on January 7th, 2019.  If accurate this would be the first face-to-face delegation since President Trump and Chairman Xi outlined the structure for strategic trade discussions during the G20 meeting in Buenos Aires.

(Via Bloomberg) A U.S. government delegation will travel to Beijing in the week of Jan. 7 to hold trade talks with Chinese officials, two people familiar with the matter said.
Deputy U.S. Trade Representative Jeffrey Gerrish will lead the Trump administration’s team, which will also include Treasury Under Secretary for International Affairs David Malpass, according to the people, who spoke on the condition of anonymity. Neither the USTR nor Treasury responded to requests for comment. (more)

When President Trump outlined the preliminary terms for negotiations between the U.S. and China, U.S Trade Representative Robert Lighthizer was assigned the lead position for the contacts.   Abassador Lighthizer has been very firm in pointing out the 90-day window for discussions, prior to enhanced tariff action, was not going to change.  The deadline is March 1st, 2019, for a principle agreement, or the next phase of tariffs is triggered.
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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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As CTH anticipated the first tabulated holiday sales report via Mastercard® shows the results of a very strong consumer confidence level.  The first report highlights a very strong 5.1% increase in holiday purchases:

“Wall Street is running around like a chicken with its head cut off, while Mr. and Mrs. Main Street are happy with their jobs, enjoying their best wage increases in a decade”…
~ Craig Johnson, president of Customer Growth Partners

(Via Wall Street Journal)  Shoppers delivered the strongest holiday sales increase for U.S. retailers in six years, according to early data.

Total U.S. retail sales, excluding automobiles, rose 5.1% between Nov. 1 and Dec. 24 from a year earlier, according to Mastercard SpendingPulse, which tracks both online and in-store spending with all forms of payment. Overall, U.S. consumers spent over $850 billion this holiday season, according to Mastercard.

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The announcement of The United States drawing down troop deployment from Northern Syria – with the United Arab Emirates, and Saudi Arabia sending in replacements to bolster the region, highlights a much larger backstory.

President Obama’s February ’09 Cairo speech began a sequence of events that led to what was called the “Arab Spring“; factually an extremist uprising.  Bolstered by the resulting chaos the Muslim Brotherhood rose to power in Egypt behind Mohammed Morsi.
However, a majority of the Egyptian people rejected President Morsi’s sharia governance, and asked a well respected General Fattah al-Sisi to step in.  Accepting the request of a desperate people Sisi removed Morsi, disbanded the Muslim Brotherhood and went on to win a landslide election in 2014.   The leadership of the Brotherhood fled to Qatar.
President Obama and his policy team was not happy with this outcome.  Obama supported Morsi, not al-Sisi.  Another person who was not happy, was Turkish President Recep Erdogan, who also supported Morsi and the Muslim Brotherhood.
Undeterred, and understanding the need for urgency, Egyptian President al-Sisi then began a long process of confronting extremism.  Sisi destroyed the Hamas terror tunnels on the border between Egypt and Israel; and, despite the anxiety expressed by U.S. Secretary of State John Kerry, Sisi brokered an interim peace agreement between the Palestinian Authority and Israelis.
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Jobs, jobs, jobs.  Stunning jobs data provided today by the Bureau of Labor Statistics (BLS) [see here] all 50 states had significant job gains through November 2018.  Not a single state had a negative job growth number.
Total 2018 growth in U.S. jobs through November is:  2,617,000 new jobs.
Eighteen states had significant jobless rate decreases from a year earlier; and with the national unemployment rate at 3.7 percent 32 states (and DC) had little or no change.

(Data Link)

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President Trump has been executing a foreign policy, a clear doctrine of sorts, where national security is achieved by leveraging U.S. economic power. It is a fundamental shift in approaching both allies and adversaries; summarized within the oft repeated phrase: “economic security is national security.”
Initially, given the nature of multiple military entanglements, a traditional military approach could not easily be reversed or dispatched.  Defense Secretary James Mattis was the bridge to a path forward. President Trump removed military constraints, allowed rules of engagement that were much stronger, and let Mattis work on confronting and stamping out terror threats. In essence, an aggressive “let’s get this over with” approach.
However, that strong-arm military approach cannot continue indefinitely because it will never end. James Mattis was/is one voice who doesn’t want it to end. Hammers are useless without nails. War and intervention have a long history of unnecessarily expanding if not constrained. The war machine turns into a military business.
Candidate Trump, now President Trump, campaigned on a desire to bring U.S. troops  home from all the “stupid wars”, in part because they are also “expensive wars.”  And as a direct consequence the time for Defense Secretary Mattis was sure to come to an end.

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