WASHINGTON: After a fairly decent week thus far, Wall Street is back to its most recent pattern. Traders freak out over the latest news headlines, consistently believing the negative while ignoring any possibility of positive developments. Spending Thursday morning in the red and a bit out of sorts, Mr. Market suddenly tanked over 100 points this afternoon. That sudden drop happened when Negotiator-in-Chief Trump doubted (publicly) whether anything good would come of the current trade negotiations between Beijing and Washington.
As with anything explicitly or implicitly negative for the Administration, CNBC jumped on this item before anyone else in the MSM bothered to notice.
“‘Will [the negotiations] be successful? I tend to doubt it,’ the president told reporters during an appearance with NATO Secretary-General Jens Stoltenberg. ‘The reason I doubt it is because China has become very spoiled. The European Union has become very spoiled. Other countries have become very spoiled, because they always got 100 percent of whatever they wanted from the United States.’
“‘But we can’t allow that to happen anymore,’ Trump added.”
Sure, that wasn’t exactly good news to those bullish traders who seemed ready to reignite January’s bout of irrational exuberance. But if you look past the extreme short term here, there’s a lot to like in Negotiator-in-Chief Trump’s latest “outrageous” fusillade. China hasbecome very spoiled. Other countries have become very spoiled. Everyone always gets 100 percent of whatever they wantfrom the U.S.
In short, we havebeen the world’s patsy pretty much every decade after the Marshall Plan concluded, as we’ve noted in our columns before. Trump, who tends to regard all manner of high-level negotiating like a new edition of WWE Smackdown. No holds barred, plenty of insults, real (or brilliantly faked) physical damage. You name it. Everything is EXTREME.
On one level, Trump figures – and correctly so, we think – that the short list of U.S. enemies involves some of the 21stCentury’s baddest thugs. Let’s see: Vlad “The Impaler” Putin; Xi “President for Life” Jinping; Nick “The Klepto” Maduro; Kimmie “Little Rocket Man” Jong-Un; Ali “The Mad Mullah” Khamenei”; the Havana cigar-chomping Castro Bros, living and dead; and, bringing up the rear, the latest strong contender for the Chief Thug belt,Recep “The Sultan” Erdoğan.
Hanging just outside the squared circle: various members of ISIS and the Taliban, disguised as civilians but ready to grab a folding chair or a pair of brass knucks, jump into a match and clobber any wrestler that’s not to their liking.
In taking on this colorful and violence-prone wrecking crew, in this corner, we have Negotiator-in-Chief Trump, who’s fully aware that the last negotiations won by the U.S.A. occurred on or around VE and VJ Days, well before most Boomers were born. We’ve been giving away taxpayer money to (alleged) friends and the usual thug suspects ever since, hoping to make “friends.”
Some friends. The President is right. We’ve been spoiling everyone. Except for our own citizens. But apparently, it’s okay for the rest of the world to rip them off. After all, they all have flatscreen TVs and Facebook accounts. Who could ask for anything more? Even the Pope would agree.
We could go on, but you get the picture. Negotiator-in-Chief Trump is getting seriously bad domestic and international press for finally stepping up to the plate and acting like the America First president I suspect we’ve all been looking for since Ike Eisenhower took his last Presidential bow.
So what? No pain, no gain. It’s not like our enemies and/or our fair weather friends are going to give up at least part of their absurd economic advantages against us without a fight. Why should they? It’s been a swell ride, particularly for the Euro-socialist cabal that always needs more money – preferably American dollars – to buy their way through their next election cycle. Should America’s current Negotiator-in-Chief Trump just cave on this issue like pretty much all his successors?
Negotiator-in-Chief Trump, market averages ready to wrap a negative Thursday close
Yes, Trump’s sometimes outrageous negotiating antics are going to roil the investing waters, short-term. But if he can even begin to extract us from nearly 80 years of failed international trading deals that leave the U.S. with massive trade deficits year after year, well, what in Hades is wrong with that?
Whatever the case, Wall Street didn’t like the president’s (real or fake) negative posturing Thursday, and the major stock averages this afternoon are a tell.
As of 3:30 p.m. Thursday afternoon, all three major averages – the Dow, the S&P 500 and the NASDAQ – are roughly 0.25 percent to the bad. The over all gloom is relieved only by the oil patch. Stocks in that group – E&P, drilling support, refining and even (to some extent) the sand mine companies that cater to frackers – have all been soaring. Ditto, alas, those per-barrel oil prices, a recent, intense phenomenon that most people are noticing at the gas pump.
We’ve been trying to get back into some of the oil and oil-related stocks we dumped, though we still have a couple of positions there. Yet that rally amidst the international trade gloom could peak out at any moment, so we’re not going to chase it. But we’re looking at some promising areas where we’d like to invest next. We’ll explore them with you in a bit more detail when we regain at least some of our investing confidence.
We’ll leave the rest to The Yankee Terror, Negotiator-in-Chief Donald John Trump.