President Trump took all the ‘dragon slayers’ with him to Argentina likely anticipating a rapid Chinese evolution from Panda to Dragon.  Trump’s delegation selection sends exactly that message.  If cunning Chairman Xi exhibits wounded sensibilities, well, tough.
China deployed the panda mask for over a year in an effort to wait-out President Trump, fair enough; however, that strategy has a severe downside.
If lack of engagement is part of Beijing’s economic defense mechanism, ie. retaining the status quo,  you can expect President Trump to provoke the confrontation.
Does Xi feel rucky?

SHANGHAI (Reuters) – China and the United States can reach a trade agreement at the G20 meeting in Argentina this week, the state-run China Daily newspaper said in an editorial on Friday, but Washington must be “fair minded” if it wants to defuse spiraling tensions.
“Beijing wants a deal, just as Washington does. And it is willing to cooperate with Washington in dealing with concerns about trade if they are fair-minded,” the paper said.

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The New York Post has an article today, surrounding an interview with President Trump, where the topic of declassifying the evidence behind ‘Spygate’ surfaced.
To say there is a massive schism amid supporters of the President on this issue would be an understatement.

On one hand the declassification would potentially, and finally, outline the scale of the FBI/DOJ politicization and weaponization of intelligence against the President – exposing the entire ‘spygate’ scandal in all its glory.  On the other hand that potential is also seen as political leverage against the schemes of DC and all the characters.
Here’s the quotes that matter:

(New York Post) […]  “If they go down the presidential harassment track, if they want go and harass the president and the administration, I think that would be the best thing that would happen to me. I’m a counter-puncher and I will hit them so hard they’d never been hit like that.”
“I think that would help my campaign. If they want to play tough, I will do it. They will see how devastating those pages are.”

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The issue is basic to the construct of the USMCA (NAFTA replacement).
BMW made a multi-billion-dollar investment in Mexico in anticipation of exploiting the NAFTA loophole.  President Trump has closed the loophole.  The new USMCA agreement requires 75% of automobile parts made in North America; and 45% must come from plants with minimum labor costs ($16/hr), or face tariffs upon export to the U.S.
As a result BMW is now considering opening those higher-wage component supply operations in the U.S.

LOS ANGELES (Reuters) – BMW (BMWG.DE) is considering a second U.S. manufacturing plant that could produce engines and transmissions, Chief Executive Harald Krueger said on Tuesday, shortly after a report that U.S. President Donald Trump would impose tariffs on imported cars from next week
[…] BMW is considering changes to U.S. operations as sales in the region grow, Krueger said. BMW has a U.S. vehicle assembly plant, in South Carolina, is planning to open a Mexico factory next year, and is considering changes to its current scheme of importing engines and transmissions.

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A small but interesting development in the relationship between the U.S. and Mexico highlights a backstory CTH suspected several months ago {Go Deep}. August 25th:

As USTR Robert Lighthizer was working with the trade officials representing outgoing Mexican President Peña Nieto, White House adviser/emissary Jared Kushner was quietly working behind the scenes with AMLO trade adviser Jesus Seade and outlining the possibilities if they partnered with strategic economic objectives in mind.
As a result of Kusher’s dogged efforts to bring an entirely new dual-nationalist ‘focus’ within the trade construct, removing the historic globalist baseline, the outcome of the trade deal is excellent for both the U.S. and Mexico.  So today:

MEXICO – […] Kushner will receive the prize “for his contributions to achieve the negotiation of the new United States-Mexico-Canada Agreement (USMCA),” according to a statement by Mexico’s Foreign Relations Secretariat.
Peña Nieto will present Kushner, President Trump’s son-in-law, with the award on Thursday at the Group of 20 summit in Argentina, according to the Reforma newspaper.

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Press Secretary Sarah Sanders, National Security adviser John Bolton and National Economic Council Chairman Larry Kudlow hold a very important press briefing from the White House.
Chairman Kudlow discusses current economic issues, and the upcoming possible trade discussions with China at the G20 meeting in Buenos Aries, Argentina. At 19:00 minutes NSA John Bolton takes over to discuss the scheduling details of the G20.  [Interesting trilateral mentioned: Trump, Modi and Abe] At 30:00 minutes Sarah Sanders takes over.

Secretary Kirstjen Nielsen provided the following statement regarding the recent crisis on our southern border.

“Given the activities of the last 24 hours at the San Ysidro Port of Entry, I want to provide an update on what occurred and attempt to dispel many of the rumors and much of the misinformation circulating.
“First, the violence we saw at the border was entirely predictable. This caravan, unlike previous caravans, had already entered #Mexico violently and attacked border police in two other countries. I refuse to believe that anyone honestly maintains that attacking law enforcement with rocks and projectiles is acceptable. It is shocking that I have to explain this, but officers can be seriously or fatally injured in such attacks. Self-defense isn’t debatable for most law-abiding Americans.
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GM Chevy Cruze, built at Lordstown, OH: (Sales -27% through September 2018). GM Chevy Impala, built at Oshawa, Canada and Hamtramck Michigan: (sales -13%). GM Buick LaCrosse (-14%); and Cadillac CT6 (sales -11%) both built at Hamtramck Michigan.
Following major drops in the sedan sector of the U.S. automotive market, General Motors CEO Mary Barra announced plans to halt production next year at three assembly plants: Lordstown, Ohio; Hamtramck, Michigan; and Oshawa, Ontario. GM will fully stop production on several models assembled at those plants: Chevrolet Cruze, Cadillac CT6 and the Buick LaCrosse.
These cuts could lead to approximately 6,000 to 8,000 lost jobs.

DETROIT/WASHINGTON (Reuters) – General Motors Co said on Monday it will cut production of slow-selling models and slash its North American workforce in the face of a declining market for traditional gas-powered sedans, shifting more investment to electric and autonomous vehicles.

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Canadian media are reporting that General Motors plans to shut down operation in Oshawa, Canada.   This is quite possibly an outcome that portends the sign of things to come…

CANADA – Numerous sources have told CTV Toronto that General Motors is planning to close all operations in Oshawa, Ont., affecting thousands of high-paying jobs.
The announcement is expected to be made on Monday, in the city of about 159,000 people located roughly 60 kilometres east of Toronto.  Sources said they believe the Oshawa closures are part of a global restructuring. (read more)

GM holds considerable risk exposure within the current state of international trade and economics as it relates to the auto industry.  As a result of the ongoing U.S-China trade confrontation, GM holds risk as a result of heavy investment in China.  Add to that exposure the very significant financial impacts about to start for heavy manufacturing operations inside countries aligned with the Paris Climate Treaty, and the risk increases.
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The Washington Times is reporting on a possible agreement between U.S. and Mexico officials to keep all Central American asylum seekers outside the U.S. during the process to evaluate their asylum claims.
The important backdrop here is the new Mexican President, Andrés Manuel López Obrador (AMLO), taking office on December 1st.  If the reporting is correct, there may be an agreement in the works between President Trump’s administration and AMLO’s team.
Reading between the lines, the mutually beneficial structure of such an agreement is likely based within prior economic (trade) discussions. [CTH sees Jared Kushner’s diplomatic fingerprints at work]  Friends with benefits….

(Via Washington Times) Immigrants seeking asylum in the United States by entering through Mexico could be required to wait south of the border while U.S. courts assess their cases, a member of the incoming Mexican government said in an interview published Saturday.
Andrés Manuel López Obrador, Mexico’s president-elect, plans to implement a policy known as “Remain in Mexico” after taking office next month, his top domestic policy official told The Washington Post.

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In June 2018 President Trump instructed U.S. Trade Representative Robert Lighthizer to initiate a 10% tariff on $200 billion of Chinese goods (Round #1).  After two months of China refusing to negotiate renewed trade deals in good faith President Trump instructed Lighthizer to increase the tariff rate to 25% in August (Round #2).  There is a third tranche of tariffs scheduled for January 1st, 2019.

With a full quarter of trade data to analyze the impacts, the results are now measurable.  A multinational group studying the outcome (full pdf below), identified that approximately 4.5% of the tariff is being carried by American consumers.  The overwhelming cost of the tariff is being paid (20.5% absorbed) by Chinese producers.

(Via Bloomberg) President Donald Trump is succeeding in making China pay most of the cost of his trade war.
That’s the conclusion of a new paper from EconPol Europe, a network of researchers in the European Union. U.S. companies and consumers will only pay 4.5 percent more after the nation imposed 25 percent tariffs on $250 billion of Chinese goods, and the other 20.5 percent toll will fall on Chinese producers, according to authors Benedikt Zoller-Rydzek and Gabriel Felbermayr.

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