Archive for September, 2018

President Trump at the U.N.

Posted: September 27, 2018 in Uncategorized

President Trump went at the UN and they laughed at him.

 

Actually there is nothing to laugh. He made clear his “America First” idea, chose us of them kind of politics and refusal of international rules.

He also mostly praised regimes with an authoritarian bent (Saudi Arabia, Israel, Poland etc) and kind of avoided mentioning more democratic regimes like France and Germany.

It all had of a kind of flavor of Germany and Italy early 1930 (rise of the fascism).

Even the tariff war with China is slightly developing in a more military war. The US sanctioned the Chinese military as they bought Russian jet fighters and the Chinese forbid the USS Wasp from making a stop in Hong Kong.

Thucydides, a old Greece historian, said about the Peloponnese wars, quoting

“it was the rise of Athens and the fear that it instilled in Sparta that made the war inevitableā€.

A lesson from 2400 years ago eerily sound familiar. For the record, Sparta, the old power, won at great cost.

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Tariffs getting serious

Posted: September 18, 2018 in Uncategorized

President Trump unleashed another round of tariffs hitting even AmericanĀ  people. China has been answering quite softly – kind of wait and see approach for the US Congress (if Democrats wins the House, President Trump would be blocked).

But I would imagine that China patience is wearing thin – especially as Trump keep on saying….their market is a disaster, while ours is near the top.

Also statistically the US market loses before US Congress elections and then more than recover after the election.

So – time to be alert.

US election – Congress

Posted: September 10, 2018 in Uncategorized

The all -important US Congress election are at the door.

 

My most likely outcome scenarios are

  1. Senate stay Republican and House goes Democrat. At current standing this scenario has 50% chances of happening. It is a positive scenario for stocks.
  2. Both Senate and House goes Democratic – this will be temporarily negative for the S market/bond/dollar. Apart hating Trump the Dems are not united on anything….so the backlash should be temporary. This scenario stands at 35%
  3. Both House and Senate stays Republican. This is an unlikely scenario (15-20%) that would favor Republican sectors (banking, defence etc) vs Dem stocks (Auto, infrastructure, hospitals)

I am not pro President Trump – but I am neutral – trying to stand by the facts.

Notwithstanding the media and the consequences President Trump is correct in attacking China whatever the consequences.

An unofficial document has been leaked from China, known has the Green Book. The Green Book details the underlying goals of the Made in China 2025 plan (which does not have goals) . The goals, if achieved, would virtually annihilate any tech and new technology competition in China. The goals is to achieve 56% of the world market of integrated circuits (so all technology) by 2025 and 80% of the entire domestic market by 2030.

This would bring a destruction (wipe-out level) of industries and jobs like it happened in steel and solar. Chinese companies backed by government subsidies, cheap funding from State Owned Enterprise and sometime dodgy behavior would wipe out the Western economies and Western jobs.

Unfortunately, the President is more right than President Obama and all the other leaders. It is a fight to the death.