Posts Tagged ‘free trade’

Rogoff: Beware of Wounded Lions

Rogoff: Beware of Wounded Lions

Courtesy of Mark Thoma, Economist’s View

Kenneth Rogoff says the rest of the world should not ignore the recent threats of protectionist measures coming from the US:

Beware of Wounded Lions, by Kenneth Rogoff, Commentary, Project Syndicate:  G-20 leaders who scoff at the United States’ proposal for numerical trade-balance limits should know that they are playing with fire. … 

According to a recent … report…, fully 25% of the rise in unemployment since 2007, totaling 30 million people worldwide, has occurred in the US. If this situation persists, as I have long warned it might, it will lay the foundations for huge global trade frictions. The voter anger expressed in the US mid-term elections could prove to be only the tip of the iceberg…, the ground for populist economics is becoming more fertile by the day. …

True, today’s trade imbalances are partly a manifestation of broader long-term economic trends, such as Germany’s aging population, China’s weak social safety net, and legitimate concerns in the Middle East over eventual loss of oil revenues. And, to be sure, it would very difficult for countries to cap their trade surpluses in practice: there are simply too many macroeconomic and measurement uncertainties.

Moreover, it is hard to see how anyone – even the IMF, as the US proposal envisions – could enforce caps on trade surpluses. The Fund has little leverage over the big countries that are at the heart of the problem.

Still,… world leaders … must recognize the pain that the US is suffering in the name of free trade. Somehow, they must find ways to help the US expand its exports. Fortunately, emerging markets have a great deal of scope for action.

India, Brazil, and China, for example, continue to exploit World Trade Organization rules that allow long phase-in periods for fully opening up their domestic markets to developed-country imports… A determined effort by emerging-market countries that have external surpluses to expand imports from the US (and Europe) would do far more to address the global trade imbalances … than changes to their exchange rates or fiscal policies. …

American hegemony over the global economy is perhaps in its final decades. China, India, Brazil, and other emerging markets are in ascendancy. Will the transition will go smoothly and lead to a global economy that is both fairer and more prosperous?

However much we


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11 Long-Term Trends That Are Absolutely Destroying The U.S. Economy

11 Long-Term Trends That Are Absolutely Destroying The U.S. Economy

trends destroying economyCourtesy of Michael Snyder at Economic Collapse 

The U.S. economy is being slowly but surely destroyed and many Americans have no idea that it is happening.  That is at least partially due to the fact that most financial news is entirely focused on the short-term.  Whenever a key economic statistic goes up the financial markets surge and analysts rejoice.  Whenever a key economic statistic goes down the financial markets decline and analysts speak of the potential for a "double-dip" recession.  You could literally get whiplash as you watch the financial ping pong ball bounce back and forth between good news and bad news.  But focusing on short-term statistics is not the correct way to analyze the U.S. economy.  It is the long-term trends that reveal the truth.  The reality is that there are certain underlying foundational problems that are destroying the U.S. economy a little bit more every single day.

11 of those foundational problems are discussed below.  They are undeniable and they are constantly getting worse.  If they are not corrected (and there is no indication that they will be) they will destroy not only our economy but also our entire way of life.  The sad truth is that it would be hard to understate just how desperate the situation is for the U.S. economy. 

Long-Term Trend #1: The Deindustrialization Of America

The United States is being deindustrialized at a pace that is almost impossible to believe.  But now that millions upon millions of people have lost their jobs, more Americans than ever are starting to wake up and believe it.

A recent NBC News/Wall Street Journal poll found that 69 percent of Americans now believe that free trade agreements have cost America jobs.  Ten years ago the majority of Americans had great faith in the new "global economy" that we were all being merged into, but now the tide has turned.…
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The Marriage of Mercantilism and Corporatism: When Free Trade Is Not ‘Free’

The Marriage of Mercantilism and Corporatism: When Free Trade Is Not ‘Free’

Courtesy of JESSE’S CAFÉ AMÉRICAIN

"The consequences of this policy are also stark and simple: in effect, China is taxing imports while subsidizing exports, feeding a huge trade surplus. You may see claims that China’s trade surplus has nothing to do with its currency policy; if so, that would be a first in world economic history. An undervalued currency always promotes trade surpluses, and China is no different." Paul Krugman

And he is exactly right. As regular readers know this matter of Chinese mercantilism and its toleration and acceptance by the West has been a key observation and objection here since 2000. Any economist who does not understand that devaluing and then maintaining an artificially low currency peg with a trading partner distorts the nature of that trade should review their knowledge of algebra.

And yet it was in 1994 during the Clinton Administration that China was permitted to obtain full trading partner "Most Favored Nation" status, while vaguely promising to float their recently devalued currency some day, and address the human rights issues that were endogenous to their non-democratic, totalitarian government.

"From 1981 to 1993 there were six major devaluations in China. Their amounts ranged from 9.6 percent to 44.9 percent, and the official exchange rate went from 2.8 yuan per U.S. dollar to 5.32 yuan per U.S. dollar. On January 1, 1994, China unified the two-tier exchange rates by devaluing the official rate to the prevailing swap rate of 8.7 yuan per U.S. dollar." Sonia Wong, China’s Export Growth

This served Mr. Clinton’s constituents in Bentonville quite well, and has some interesting implications for the Chinese campaign contributions scandals. It supported the Rubin doctrine of a ‘strong dollar’ while facilitating the financialization of the US economy and the continuing decline of the middle class wage earners, under pressue to surrender a standard of living achieved at great cost. "How I Learned to Stop Worrying and Love the Currency Collapse." and China’s Mercantilism: Selling Them the Rope

Not to limit this, George W. ratified the arrangement when he took office, and so it has gone on for almost fifteen years…
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10 Reasons Why Conservatives Should Be Against Unfair Trade With China And 10 Reasons Why Liberals Should Be Against Unfair Trade With China

Michael Snyder makes arguments appealing to both right and left against our free trade relationship with China. Some of these arguments are better than others, but as a whole, he makes good points on each side. - Ilene 

10 Reasons Why Conservatives Should Be Against Unfair Trade With China And 10 Reasons Why Liberals Should Be Against Unfair Trade With China

Courtesy of Michael Snyder

There are very few things that the top politicians in both political parties agree on these days, but one of the things that that they do agree on is that free trade with China is a good thing.  George W. Bush, Dick Cheney, John McCain, Barack Obama, Nancy Pelosi and Harry Reid have all fully supported our trade relationship with China.  In this day and age, virtually anyone who even dares to question how fair our "free trade" is with China is immediately labeled as a "protectionist" and is dismissed as a loon.  But when you sit down and really analyze it, there are a whole lot of very good reasons why both conservatives and liberals should be fundamentally against our unfair trade relationship with China.  But you won’t hear these reasons being talked about on CNN, MSNBC or Fox News.  You won’t hear many members of Congress get up and give speeches about how trade with China is bleeding our economy dry.  Both major political parties have completely and totally bought into "the benefits" of globalism and free trade and there isn’t even much of a national debate about our trade policies anymore. 

But there should be a national debate.  Unfortunately, most conservatives are just going to accept whatever their leaders tell them to believe.  Conservatives have been convinced that to be against unfair trade is to be "anti-business" and no conservative ever wants to be anti-business.

Similarly, most liberals blindly follow whatever Obama, Pelosi and Reid tell them to believe.  Millions of hard working Democrat voters have lost their jobs due to our nightmarish trade relationship with China, but they are still convinced that Obama is their savior and that they must not ever say anything that he does is wrong.…
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The Grand Chinese Fraud

Here’s Karl Denninger on China,…

The Grand Chinese Fraud

Wen JaibaoWen "cats in the kettle" Jaibao spouted:

“I don’t think the renminbi is undervalued,” Wen said yesterday at a press conference in Beijing marking the end of China’s annual parliamentary meetings, using another term for the yuan. “We oppose countries pointing fingers at each other and even forcing a country to appreciate its currency.”

Oh really?

It’s time that we stop the the BS here with regard to China.

The entire premise of so-called "Free Trade" with the Chinese was predicated on the belief that if we opened our borders to their products on a "no tariff" basis that we would, over time, change their political system.  That is, we would import cheap Chinese plastic junk and export democracy.  More or less.

Well, we got all the cheap DVD players but they didn’t get any democracy.  Quite to the contrary.  There have been no meaningful improvements in areas of environmental protection, workers rights and wages or political freedom.  Indeed, the recent dust-up with Google just underlines the reality in China:Their government is a band of murderous brigands and thugs.

Disagree with them inside their nation, refuse to censor The Internet, for example, so that people can’t read about Falun Gong and China will be happy to arrest the executives of your firm inside the nation and provide this as "corrective influence" to your head:

Oh, they send the 50 cent bill for it to your family too.  Isn’t that special?

At least in this country they don’t shoot people for talking about the evil-doing that both private parties and government…
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Phil's Favorites

A Big Swirling Italian Mess

 

A Big Swirling Italian Mess

Courtesy of John Mauldin, Mauldin Economics

“Move to Italy. They know about living in debt: They don’t care.”

– John Lydon

“Italians were eating with a knife and fork when the French were still eating each other.”

– Mario Batali

Italians are headed to the polls this Sunday (and thus this letter is reaching you a little earlier than usual) – but no one is quite sure what is on the ballot. On the surface, the voters are considering whether to approve constitutional reforms that should make the government operate more effectively (or not, depending on your point of view). But many people think t...



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Zero Hedge

Official Washington's "Info-Wars"

Courtesy of ZeroHedge. View original post here.

Authored by William Blum, originally posted at Strategic-Culture.org,

On November 16, at a State Department press briefing, department spokesperson John Kirby was having one of his frequent adversarial dialogues with Gayane Chichakyan, a reporter for RT (Russia Today); this time concerning U.S. charges of Russia bombing hospitals in Syria and blocking the U.N. from delivering aid to the trapped population.

When Chichakyan asked for some detail about these charges, Kirby replied: “Why don’t...



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ValueWalk

$5 Off $15+ Books From Amazon! Exp: 12/4 at 11:59pm EST

By Jacob Wolinsky. Originally published at ValueWalk.

Amazon Books   H/T DansDeals

Use code (Exp: 12/4 at 11:59pm EST): GIFTBOOK

Valid 1 time per account.

The books must be shipped and sold by Amazon.com, not a 3rd party.

Here are some ideas for books that will work with the $5 off $15 code that have been bestsellers among DansDeals readers. Be sure to add $15 worth of books to your cart for the code to work:

Here are some of our readers favorite books

...

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Market News

News You Can Use From Phil's Stock World

 

Financial Markets and Economy

Ten Good Pieces of Economic Data From All Around the World (Bloomberg)

It's been a big week for bullish economic data across the globe, from South Korean exports to European manufacturing figures. 

The most important number of the week comes tomorrow: November's U.S. jobs report.

Why 2016 May Be the Year of 'Peak Housing' for Can...



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Kimble Charting Solutions

Interest rates could peak here, says Joe Friday

Courtesy of Chris Kimble.

The talk over the past couple of months has been, interest rates are rising and the Fed will raise rates very soon. Joe Friday feels a big test is in play, before one can say the “rate trend has changed!”

Below looks at the yield on the 10-year note, over the past 20-years.

CLICK HERE TO ENLARGE

The yield on the 10-year note has remained inside of falling channel (1), creating lower highs and lower lows, for the majority of the past 20-years. The top of the channel is bein...



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Chart School

Semiconductors Hit Hard

Courtesy of Declan.

Internet troubles have limited me tonight, but the one chart I want to show is the near 5% loss in the Semiconductor Index.  Having escaped relatively unscathed from recent day's selling it was a whirlwind of action for the index today.


This had obvious consequences on the Nasdaq. The Nasdaq did relatively well to suffer just over a 1% loss.  However, there were 'sell' triggers for On-Balance-Volume and Directional Index. There was also an acceleration in the relative underperformance of the index to the S&P. ...

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Members' Corner

Second Hand Stink?

Courtesy of Nattering Naybob.

In what seems to be a recurring scatological humor theme, aka our "Toilet Thursday's" or "Thursday's in the Loo" of the past few weeks, we follow up on The Story of Poo-Pourri.

In Second Hand Stink?, men are not so subtlety reminded that an odiferous fog wafting from the bedroom loo, can indeed kill the moment. 

...

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OpTrader

Swing trading portfolio - week of November 28th, 2016

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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Digital Currencies

Largest US Bitcoin Exchange Is "Extremely Concerned" With IRS Crackdown Targeting Its Users

Courtesy of ZeroHedge. View original post here.

Last Thursday we reported that in a startling development seeking to breach the privacy veil of users of America's largest bitcoin exchange, the IRS filed court papers seeking a judicial order to serve a so-called “John Doe” summons on the San Francisco-based Bitcoin platform Coinbase.

The government’s request is part of a bitcoin tax-evasion probe, and se...



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Mapping The Market

The Most Overlooked Trait of Investing Success

Via Jean-Luc

Good article on investing success:

The Most Overlooked Trait of Investing Success

By Morgan Housel

There is a reason no Berkshire Hathaway investor chides Buffett when the company has a bad quarter. It’s because Buffett has so thoroughly convinced his investors that it’s pointless to try to navigate around 90-day intervals. He’s done that by writing incredibly lucid letters to investors for the last 50 years, communicating in easy-to-understand language at annual meetings, and speaking on TV in ways that someone with no investing experience can grasp.

Yes, Buffett runs an amazing investment company. But he also runs an amazing investor company. One of the most underappreciated part of his s...



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Biotech

Epizyme - A Waiting Game

Reminder: Pharmboy is available to chat with Members, comments are found below each post.

Epizyme was founded in 2007, and trying to create drugs to treat patient's cancer by focusing on genetically-linked differences between normal and cancer cells. Cancer areas of focus include leukemia, Non-Hodgkin's lymphoma and breast cancer.  One of the Epizme cofounders, H. Robert Horvitz, won the Nobel Prize in Medicine in 2002 for "discoveries concerning genetic regulation of organ development and programmed cell death."

Before discussing the drug targets of Epizyme, understanding epigenetics is crucial to comprehend the company's goals.  

Genetic components are the DNA sequences that are 'inherited.'  Some of these genes are stronger than others in their expression (e.g., eye color).  Yet, some genes turn on or off due to external factors (environmental), and it is und...



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All About Trends

Mid-Day Update

Reminder: Harlan is available to chat with Members, comments are found below each post.

Click here for the full report.




To learn more, sign up for David's free newsletter and receive the free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. - Ilene...

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Promotions

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We know you love coming here for our Stocks & Options education, strategy and trade ideas, and for Phil's daily commentary which you can't live without, but there's more!

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News: If you missed it, you can probably find it in our Market News section. We sift through piles of news so you don't have to.   

If you are looking for non-mainstream, provocatively-narrated news and opinion pieces which promise to make you think -- we feature Zero Hedge, ...



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