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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: Cogito Ergo Sum who wrote (140496)	4/7/2018 5:40:59 AM
From: TobagoJack	Read Replies (1) \| Respond to of 218447

(1) Gave the matter of macro a think, and to place in context, am re-arranged / re-categorised / marked-to-market at ... - 28% cash / near cash (cash / metals), - 8% equity, - 64% real estate (no debt), and - with ~13% non-margin / non-callable standby loan available for drawdown should such be required for 'opportunities', and given nature of loan, can be leveraged ~2-3X in trading account for that extra-conviction trade, which, if allocated to options, would ... etc etc iow, prepared for bears but am not short. (2) The only easy case I can make for equity rise is either and / or (2-i) Re-allocation of funds from debt to equity ala Marty Armstrong (2-ii) Dissolution of fiat currencies, and (2-iii) both can happen, concurrently. (3) The only easy case I can make for bonds rise is another round of QE due to some monetary / economic / financial debacle, and it can happen (4) I cannot make an easy case for real estate rise, and so real estate would probably rise, due to funds escaping from equity / bond arena (5) The markets have been quite resilient in view of whatever is happening on the diplomacy / trade front, as if the market does not believe trade matters. Very strange. (6) Team USA has not enunciated any objective for the trade war, or may have done so but I missed it. All I saw was a bunch of products tee-ed up for tariffs, to somehow reduce USA trade deficit, that which can only be if team USA stops buying. Seems to me stopping buys should be easy, just disallow anything to cross the border, or easier, declare USD illegal for offshore use. (7) Team China simply wants the way things were to be the way things shall be, and should any nation wish to opt out, go, rather than telling some other nations what to do. (8) At the worst of such a trade war with above objectives, I would imagine team China's desire for USD would decrease, and when so, USD rates rise, dollar up, even as domestic economic activities reduce, I guess. (9) China factories would not stop making stuff, and doubtful would lose competitive position against whatever set of competitors, and double-doubtful what stop making gains up the value-add ladder, for the weight of the China market ensures China production position. (10) Given above, cannot see much point in the trade war, but can see how its scripting can affect financial markets. (11) Trump and cohort are good negotiators under some set of circumstances (strong hand of cards), but I doubt all circumstances, and we are headed into a situation where either Trump and/or Jinping will get a bloody nose. We are not really tee-ed up to wager on the outcome, for whatever outcome, the market shall suffer somehow until conclusion and new equilibrium (at lower levels). (11-i) If only Trump gets a bloody nose, globalisation fails or continues w/ or w/o team USA participation, and and and (11-ii) If only Jinping gets a bloody nose, globalisation fails or continues w/ or w/o team USA participation, and and and (11-iii) If both Trump and Jinping bloodied, big problems triggered, for each would fight to the bitter end, unless ... (11-iv) Unclear to me why China needs to fight or negotiate or do anything at all except to respond to USA tick for tock ... for if the USA does not want to buy, don't. What could be simpler? (11-v) In other words, perhaps above explains why China noted no negotiations happening, and only tick for tock, to wait out Trump and cohort as they to and fro, zig and zag, fatiguing the enthusiasm for trade war. IOW, help by giving plenty of opportunities for Trump & Co to crash the ready primed market. (12) Watch, wait, and be ready.

To: Cogito Ergo Sum who wrote (140496)	4/7/2018 8:21:12 PM
From: TobagoJack	Read Replies (2) \| Respond to of 218447

just perusing and responding to e-mail traffic On 8 Apr 2018, at 8:11 AM, J wrote: Hello comrades M and R, One cannot stop free trade, that being an exchange between willing buyers and sellers, except by introducing frictional / transaction costing, or simply outlaw the movement of goods. As to pain tolerance, am guessing team China can tolerate much more pain than snowflakes of America. (1) Assuming for a moment that POTUS Trump is insistent to accelerate the global trend of equalisation of cost and therefore re-balancing of revenue, and hurt Joe6Pack more than already hobbled, starting by instituting a 25% tax on all things China, resulting in China slapping back w/ same on all items America, or as Mac reckoned, 25% on 115 B (0.7% of GDP) to China, and 25% on 462 B to China (4% of GDP), as way-point #1 (2) What China buys from the USA, including T-bills, are fungible items, be they grains, energy, and whatever civilian technology, and effect would be neutralised in short order due to fungibility (3) Unclear how quickly if at all USA can / would re-source China production, especially given the gap between ex-China price vs ex-Walmart value (1:8?), and when needed, adjusting for RMB depreciation (back to 8.3 rmb to the 100 cents?) (4) If tacked on w/ other easily available and highly unconventional counter-measures, the costs (ala acu-pressure) quickly escalates and hits the spots, lots and lots of spots, all at the same efficacious time (5) Let us say that at a follow-on way-point, many wastrel governments tack on 25% duties to cut themselves a slice of the action, but the true trading nations demure away from such foolishness relative to cooperating trading partners, what would we have? (6) Slightly more expensive for some goods, whether by way of tariff or re-pricing, and slightly less valuable other goods, be they by action of depreciation or lessening demand. America gets jacked up w/ higher costs, and China gets wrapped w/ cheaper capital, less valuable labour, and more alluring innovation. IOW, same regular programming already in play. (7) If 8.3 exchange rate did such wonders for China once, imagine what it would do today and going forward. And the printing power (unleashed by land reform ~250 Trillion) that equalises rural agricultural domain w/ urban industrial arena would be enhanced by way of higher food pricing, which should adjust downward the excess housing stock albeit ameliorated by upward replacement costing - an altogether win win win outcome (8) Question, can babyboomers Joe6Pack deal w/ the processing with as much equanimity as Wang2Cups? Is core comrade Jinping facing a mid-term election? Time shall tell, and even when told, China can ignore and let play out. (9) Here is a sample offer to EU: the entirety of China civilian aircraft market for 20 years in exchange for technology transfer in context of JV for worldwide distribution. and RMB drops to 8.3 rate to support such an enterprise w/ global market potential. Do we have a deal? On 8 Apr 2018, at 8:05 AM, R wrote: M, I don't think it is a competition between US and China, or anyone else. What matters is how much pain can we take regardless of what happens to China. Just go to Costco and watched a sample of Americans loading shopping carts with big screen TVs, giant packs of muffins, meats and whatever else, probably not a dime to their name before the end of the month. Americans simply can't handle any tough times. time.com The great recession was pretty bad but the next recession is likely going to be far worse. May be the trade war would trigger the reset. On Sat, Apr 7, 2018 at 4:12 PM, M wrote: I'd say the US has the advantage in any trade war with China. The reason? The country with the trade deficit has less to lose than the country with the trade surplus. 2016: Value of US exports to China: $115.6 Billion US GDP $18.6 Trillion Exports = 0.7% of GDP Value of US imports from China: $462.6 Billion China GDP: $11.2 Trillion Exports = 4.0% of GDP It seems that overall, China has more to lose. I think Trump wants to stop the technology theft by China and Chinese companies. But that horse has pretty much already left the barn - so why China really cares at this stage, I don't know. But China is determined to "not lose face." So I don't know how this will play out in the least.....probably not well for either side.

To: Cogito Ergo Sum who wrote (140496)	4/7/2018 8:47:59 PM
From: TobagoJack	Read Replies (1) \| Respond to of 218447

more e-mails On 8 Apr 2018, at 8:40 AM, J wrote: Comrade M, think about it for a few moments more. If you are the head of GE, GM, … etc etc, do you wish to engage w/ Trump on what Trump is passionately for, and risk being tee-up by Trump ? Or do you let Trump do damage to self and be leveraged by his domestic opponents at strategic moment for the kibosh? I think it is eerily quiet for USA companies to stay away from voicing support for Trump now that the rubber is being met by the road. In truth, the silence is very telling. You must realise had you ever worked for / with people of Trump’s personality(ies) that there is no working with or for Trump. On 8 Apr 2018, at 8:29 AM, M wrote: What has been interesting is the lack of pushback against Trump by corporations in the aggregate. Corporations and their CEOs have been the biggest proponent of "free trade" with China for decades. But the silence from them of late has been eerily quiet. I think they're tired of getting the short end of the stick as well. M