The Impact of Credit and Trade on Monetary Systems

Sound Money Vs. Fiat Currency: Trade and Credit Are the Wild CardsCharles Hugh Smith – Our convictions about money are quasi-religious: heretics are burned at the stake. I’m not sure which stake I’ll be tied to, because all the conventional choices–fiat currency, sound money (gold, Bitcoin) or debt-free currency (a.k.a. MMT)–are all fatally flawed.

To understand why, consider the wild cards in any monetary system: global trade and credit. Let’s start with credit, which as David Graeber explained in his book Debt: The First 5,000 Years, has been an integral component of monetary arrangements since the dawn of civilization. Continue reading

U.S. Closing in on NAFTA Agreement With Mexico – Meanwhile, Canada is Useless…

tradeSundance – For those following the nuance within ongoing U.S. trade discussions you have likely noted Commerce Secretary Wilbur Ross and U.S. Trade Representative Robert Lighthizer speaking optimistically about a potential for a U.S. Mexico trade agreement. However, simultaneously the U.S. trade team is not optimistic about any deal with Canada.

Mexico’s President-Elect Lopez Obrador (AMLO) has changed the trade dynamic internally within NAFTA for two reasons: #1) because the agriculture sector is much more critical to Mexico than it is to Canada; and #2) AMLO acknowledges and accepts the NAFTA fatal flaw; his manufacturing economy is based on the assembly of imported parts – like Canada, Mexico doesn’t actually manufacture much (ex. no aluminum smelters).

In the big picture AMLO wants to advance the Mexican manufacturing base; expand the aggregate economic base; and also stop the corporate exploitation of the Mexican farm worker. In these objectives U.S. President Trump is more than willing to be a partner with President Lopez Obrador. Heck, President Trump would actually love to assist AMLO on that agenda; it is mutually beneficial. Continue reading

Maria Bartiromo Interviews President Donald Trump… [Video]

Donald TrumpSundance – Maria Bartiromo continues to distance herself from all Sunday talk-show competition with some of the best and most insightful interviews and topics available.  Today Mrs. Bartiromo interviews President Donald Trump.  The substantive content is excellent.

From a position of understanding Trump policy, and expanding/predicting how each policy will carry forward, this really is one of the best interviews to date.  Bartiromo hits on most topics of interest and expands on the topics of greatest consequence.  Anyone who seeks to understand where the administration is going with economics and trade only needs to keep revisiting this one interview – it’s all there.

https://youtu.be/sg6q9OI8las

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Trump-China Trade Negotiations

tradeConservative Zone – Trade with China. It was big during the campaigns, and it remains an important issue. Trump has finally had the chance to take official steps on that path, and the first results look good.

While juggling an entrenched battle for healthcare, federal budgeting, tax reform and heightened tensions in the Middle East and North Korea, Trump has still found the time and resources to take on China. Trade negotiations are fully under way, so let’s see what they look like and how they will affect you.

The Visit

In early April, China’s President Xi Jinping visited Trump in Florida. It was the first chance for the two to have a real discussion about trade and other issues between the two countries, and it went well. While the single visit wasn’t sufficient to bring dramatic resolution to trade issues, there were open discussions of grievances and goals, and both presidents signed a resolution to have a new trade agreement in 100 days.

Once again, Trump overwhelmingly shuts down his critics. While they screamed of devastating trade wars and complete economic ruin, the president once again showed grace in leadership and garnered fast momentum towards progress. Another of his primary campaign goals is seeing positive action within Trump’s first quarter. Continue reading

Japan And Russia Issue Joint Statement About Kuriles After Onsen …

japaneseJoseph P Farrell – Last Thursday in my News and Views from the Nefarium I talked about the Onsen summit in Japan between Prime Minister Shinzo Abe and Russian Federation President Vladimir Putin. As I put it then, one should not expect many breakthroughs from the summit on the issue of the Kuril islands, those northern islands seized from Japan by the Soviet Union at the end of World War Two.

Neither nation has, since then, been willing to renounce those claims. Instead, I suggested that one has to look forward to a long process of negotiations on a whole host of issues. But the central geopolitical issue is, Russia needs Japanese financing and expertise to develop Siberian infrastructure, and as a counter-balance to growing Chinese influence in the region, and Japan needs a close, and secure, supply of energy that cannot be interdicted by China.

This geopolitical convergence, I’ve been arguing, is a much stronger gravitational pull than anything else keeping the two Asia powerhouses apart, including American pressure on Japan, and including the stormy relationships between the two countries that began in the Russo-Japanese war, when Japanese land and naval forces easily and handily defeated the Tsar, and seized several key Russian outposts in the far East, including Port Arthur.

Back then, both powers sought a “neutral negotiating power” to conclude a peace, which was Teddy Roosevelt’s USA. Notably, neither power is now paying all that much attention to the USA, although Mr. Abe’s government carefully avoided giving the impression that Mr. Putin’s visit was a state visit, for he did not meet with Emperor Akihito.

However, I think we can safely chalk up my prediction of “no breakthroughs” at the summit in the “big miss” column. Here’s why: Continue reading