China

China

Here Are The Winners And Losers From Trump's "Border Tax Adjustment"

Potential Winners: Companies with a majority of their input costs contained within the U.S; Potentially lower tax rate of 20% on sales and full deduction for input costs; U.S. Exporters: as export revenues are not subject to U.S. tax.
Potential Losers:Products, services, and intangibles imported into the U.S.; Automakers, Oil and Gas, to Retailers can be impacted; U.S. Multinationals that have relied on aggressive tax planning to shift earning overseas.

Oil Erases Saudi Jawbone Gains Amid China Glut Concerns

Oil prices rallied the last couple of days on the heels of Saudi jawboning about just how much they cut production, after concerns on US shale production surging. However, prices are falling back as despite near-record imports of crude reported overnight in China, it appears that historical demand has 'glutted' refiners (who exported record product in 2016) leaving a slew of oil tankers stranded off the Chinese coast.

Futures Rise On Friday 13th Ahead Of Deluge Of Bank Earnings; Dollar Continues To Decline

European shares rose as Fiat rebounded on hopes concerns about parallel to Volkswagen are overblown, Asian stocks were little as Chinese shares fell to the lowest level of 2017 after poor export data, and U.S. equity-index futures rose ahead of a deluge of bank earnings. The dollar is headed for a weekly loss and gold trades at the highest price in almost two months.

China Daily: Tillerson's "Disastrous" Actions Would Set The Course For A "Devastating Confrontation"

"Tillerson's statements regarding the islands in the South China Sea are far from professional. If Trump's diplomatic team shapes future Sino-US ties as it is doing now, the two sides had better prepare for a military clash... Should he act on them in the real world, it would be disastrous... and would set a course for devastating confrontation between China and the US."

Just 3 Things

Importantly, with economic growth anemic, consumers stretched and an economy heading into one of the longest post-recessionary expansions on record, there is little room for a policy misstep at this juncture. Maybe Trump will be wildly successful and the economy will come roaring back. That is a possibility. But there is also the risk it won’t. Optimism is one thing. Your personal capital and financial health is quite another.

BofA Warns Of 'Icarus' Trade: "A Wobble Then A Melt-Up... Followed By A Melt-Down"

"After a Jan/Feb wobble, we believe stocks & commodities will have one last 10% meltup in H1," explains BofA's Michael Hartnett in his latest note, but, he adds, by the end of 2017 we will see a "meltdown." BofA awaits the endgame of the so-called "Icarus Trade" amid unambiguous signs of bullish investor Positioning, bullish Profit expectations & hawkish Policy from Fed/ECB, as well as outperformance from laggard risk assets; before calling for the Big Short.

Kellyanne Conways Discusses The "Trump Effect" On Economy

"First of all, you already see the Trump effect.  You see that manufacturing jobs are already coming back to the U.S., or staying here.  Plans to build factories in Mexico, to ship jobs over the border there, take them away from hardworking Americans have stopped.  That's the Trump effect.  You see that the stock market loves that fact that he was elected."

Gen. Mattis: "Russia Is The Principal Threat To US Security"

"The world order is under biggest attacks since WW2, from Russia, terrorist groups, and China’s actions in the South China Sea,” Gen. Mattis told John McCain, agreeing with the bellicose senator that Russia is trying to break up NATO, and adding that Russia is the "principal threat" to the United States's security.

'Protectionist' Obama Escalates Trade War, Slams China With Subsidized Aluminum Complaint

With all the partisan narrative defining Trump as a tariff-setting, anti-trade, economy-buster, we thought it ironic that free-trade-wunderkid Obama just escalated trade wars by bringing his administration's 16th trade-enforcement complaint against China with WTO, urging tariffs on subsidised Chinese aluminum, after accusing them of funneling artificially cheap loans from state-run banks to producers.