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…)

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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President Donald Trump has cancelled the Manufacturers Council and the Strategic Economic Advisory Board.  There are trillions of dollars at stake.  The members of the boards, and their representative companies, were being targeted by left-wing groups like Move-On.Org with boycotts and opposition.

There are massive international corporate and financial interests who are inherently at risk from President Trump’s “America-First” economic and trade platform.  Believe it or not, President Trump is up against an entire world economic establishment.
I will outline how it works below; and when you understand how it works in the modern era you will understand why the agents within the system are so adamantly opposed to U.S. President Trump.
The biggest lie in modern economics, willingly spread and maintained by corporate media, is that a system of global markets still exists.
It doesn’t.
Every element of global economic trade is controlled and exploited by massive institutions, multinational banks and multinational corporations.  Institutions like the World Trade Organization (WTO) and World Bank control trillions of dollars in economic activity.  Underneath that economic activity there are people who hold the reigns of power over the outcomes.  These individuals and groups are the stakeholders in direct opposition to principles of national economics.
The modern financial constructs of these entities have been established over the course of the past three decades.  When you understand how they manipulate the economic system of individual nations you begin to understand understand why they are so fundamentally opposed to President Trump.
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Forget the social chaff and political countermeasures being promoted in the media. It is all manufactured distraction.  It’s MONEY that matters to the powerful interests in the upper suites of the corporate media apparatus.

Everything, e.v.e.r.y.t.h.i.n.g, every story, is circling the upcoming economic and financial trade confrontations.  There are trillions at stake and President Donald Trump is facing off against the international “BIG CLUB”.  The purchased multinational political entities who operate within the massive and institutional multinational corporate and financial networks behind the World Bank and World Trade Organization.
NAFTA re-negotiations are set to begin in Washington DC this coming Wednesday. President Trump is meeting with Trade Team U.S.A tonight.

♦ Last week Mexico’s Economic Minister Ildefonso Guajardo threatened to flood the U.S. with illegal aliens, South American gangs and massive illegal drugs shipments if the U.S. doesn’t keep favor with Mexico in the trilateral trade deal. –LINK–

♦ Now today, Canadian Foreign Minister Chrystia Freeland states that Canada will walk away from re-negotiated NAFTA if Chapter 19 trade dispute resolutions are not retained. –LINK–

What Canada seeks to keep is a dispute mechanism that specifically politicizes the NAFTA trade resolution process.  Chapter 19 establishes a bi-national panel who make binding decisions on complaints about illegal subsidies, dumping, manipulation of trade and possible countervailing duties.
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During an afternoon announcement with Commerce Secretary Wilbur Ross, Treasury Secretary Steven Mnuchin and U.S. Trade Representative Robert Lighthizer, President Trump announced the launch of section 301 trade investigations into China’s business practices for theft of U.S. technology and violations of U.S. intellectual property rights.
Perhaps the most overlooked portion of the remarks from President Trump happened as he sat down to sign the Presidential Memorandum authorizing the official investigation:

…This is only the beginning folks. This is only the beginning…

For approximately 30 years China has been engaged in a unidirectional trade war against the United States of America; facilitated and enabled by both Democrats and Republicans who have been purchased by multinational and corporate lobbyists to block any effort to defend our U.S. interests.  The biggest victims have been U.S. middle-class workers.
Today, for the first time in modern U.S. history, a singular President stood up and began what will be an arduous process of fighting back, defending the U.S. economy and balancing the rights of U.S. workers and companies with “fair” and “reciprocal” trade.

Section 301 of the Trade Act of 1974 provides the United States with the authority to enforce trade agreements, resolve trade disputes, and open foreign markets to U.S. goods and services. It is the principal statutory authority under which the United States may impose trade sanctions on foreign countries that either violate trade agreements or engage in other unfair trade practices. When negotiations to remove the offending trade practice fail, the United States may take action to raise import duties on the foreign country’s products as a means to rebalance lost concessions. (LINK)

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Asian policy specialist Gordon Chang interviewed by Maria Bartiromo on her Sunday talk show and accurately outlines the key to a denuclearized North Korea is an economically defeated China.  It appears Mr. Chang fully understands the Trump policy of using economics to achieve national security.
As we have continued to outline, China, specifically the old guard communist control agents within Beijing, use Kim Jong-un as a foil against the west, specifically against the United States.  The long-term objective in using the DPRK is retention of China’s economic strategy, and blockage of President Trump from upending their goals.  Watch:

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As we have outlined extensively, President Trump holds all of the cards in this economic and trade standoff.  The U.S. is China’s customer and there’s a $500 billion trade deficit.
However, President Trump cannot be completely open with the strategy because part of the long-term plan is to allow China to save face by giving up North Korea’s nuclear ambitions. It would be against Trump’s interests if the entire global and geopolitical community understood what was happening.
So they question becomes, how will we know when President Trump has won in the economic and national security challenge?
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President Trump uses economic leverage as a national security policy; and to understand who opposes President Trump specifically because of the economic leverage he creates, it becomes important to understand the objectives of the global and financial elite who run and operate the institutions.  The Big Club.
Understanding how trillions of trade dollars influence geopolitical policy we begin to understand the three-decade global financial construct they seek to protect.
That is: global financial exploitation of national markets:

♦Multinational corporations purchase controlling interests in various national elements of developed industrial western nations.
♦The Multinational Corporations making the purchases are underwritten by massive global financial institutions, multinational banks.

♦The Multinational Banks and the Multinational Corporations then utilize lobbying interests to manipulate the internal political policy of the targeted nation state(s).
♦With control over the targeted national industry or interest, the multinationals then leverage export of the national asset (exfiltration) through trade agreements structured to the benefit of lesser developed nation states – where they have previously established a proactive financial footprint.

Against the backdrop of President Trump confronting China (tomorrow), and against the backdrop of NAFTA being renegotiated starting Wednesday, revisiting the economic influences within the import/export dynamic will help conceptualize the issues at the heart of the matter.  There are a myriad of interests within each trade sector that make specific explanation very challenging; however, here’s the basic outline.
For three decades economic “globalism” has advanced, quickly. Everyone accepts this statement, yet few actually stop to ask who and what are behind this – and why?
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There have been multiple media reports in the last six hours that President Trump is going to announce trade investigation/sanctions against China during a press conference scheduled for Monday.
It makes sense the previously postponed 301 trade investigation against China for violations of intellectual property rights might be announced.

Section 301 of the Trade Act of 1974 provides the United States with the authority to enforce trade agreements, resolve trade disputes, and open foreign markets to U.S. goods and services. It is the principal statutory authority under which the United States may impose trade sanctions on foreign countries that either violate trade agreements or engage in other unfair trade practices. When negotiations to remove the offending trade practice fail, the United States may take action to raise import duties on the foreign country’s products as a means to rebalance lost concessions. (LINK)

However, a note of caution. Substantive trade negotiations, the kind which involve economics and national security, are always fluid and subject to pause, postponement or changes in direction based on compliance – or expressions of a willingness to comply.
Remember, this is Trump.  Looking out for U.S. economic interests is the baseline for trade “leverage”, a tactic and skill uniquely evident in this administration’s trade team.  Section 301 is a tool, actually a massive atomic sledgehammer, to force compliance.
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The PPI is the Producer Price Index.  The CPI is the Consumer Price Index.  The PPI reflects the price product producers are getting for their goods and services.  The CPI reflects the price consumers are paying for their goods and services.  They generally run together as lower production prices usually mean lower consumer prices.
Here again today, the fed is perplexed.  With a growing economy, and with labor market tightening, the people who control the monetary policy have continued to anticipate inflation, rises in the PPI and CPI.  However, as we have outlined, it’s not happening.
It’s a little wonky, but basically prices are NOT going up.  The Fed is perplexed.  We predicted this:

[…] The Labor Department said its producer price index for final demand slipped 0.1 percent last month, weighed by decreasing costs for services. That was the largest decline since August 2016 and reversed June’s 0.1 percent gain.
In the 12 months through July, the PPI increased 1.9 percent after rising 2.0 percent in the year through June. Economists had forecast the PPI to tick up 0.1 percent last month and 2.2 percent from a year ago. (read more)

Neither the PPI nor the CPI measure changes in food or energy costs.  Those high consumption sectors have always been removed from Fed measures.
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Well, many of us were waiting for this – and we have discovered exactly what most CTH readers anticipated, China is a paper tiger.
Last night China finally delivered the official communist government position outlining their perceived leverage over the U.S. and President Trump’s economic diplomacy and economic security platform.
China has always used The Global Times to communicate their official communist state positions.  Last night China delivered their warning; oh, you’re gonna love this:

“US needs correct logic in dealing with North Korea”.

[…] The US asks China for help when it cannot solve its problems with North Korea. Some US elites even want to urge China to claim full responsibility for the issue or they will threaten to retaliate. Under this logic, isn’t it reasonable for North Korea to attack its southern neighbor when it is under military threat from the US?
Moreover, those US elites may not have considered the leverage China has over the US. What if China restricts the usage of iPhones and the number of Chinese students to the US, or imports fewer US agricultural products? (link for more)

Now, it is critical to emphasize this is the official outlook of the Chinese Communist regime and what they perceive as their leverage over the United States.  This is the official outlook of the party apparatus behind Xi Jinping.
So let’s look at their position in sequence.
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