23Aug2019 Market Close: Wall Street Slides Precipitously, DOW Closes Down 623 Points, US Dollar Showing Weakness At 97.62, Nasdaq Down 3%

Trump calls on U.S. firms to exit China as trade war escalates

President Donald Trump on Friday pressured U.S. companies to leave China after Beijing unveiled retaliatory tariffs on $75 billion in U.S. goods, stoking fears their escalating trade war will tip the global economy into recession.

China tariffs on U.S. oil to pressure exports, Gulf Coast prices: traders

China’s threat on Friday to slap a 5% tariff on U.S. oil imports could further soften demand for physical crude at hubs along the U.S. Gulf Coast, where exporters already have taken to shipping crude overseas without firm buyers, traders said.

Responding to Trump, UPS and FedEx say they already fight illegal drug shipments

FedEx Corp and United Parcel Service Inc said on Friday they already work closely with law enforcement to stop illegal shipments from entering the country after U.S. President Donald Trump ordered delivery firms to refuse packages of the powerful painkiller fentanyl from China.

On-off trade tariffs wreak havoc on U.S. company planning

Win Cramer thought his company was out of the firing line in the escalating Sino-U.S. trade war after his “Made-in-China” wireless headphones, speakers and earbuds were taken off Washington’s tariff list a year ago.

Oil spills into U.S.-China trade war, prices slump

China on Friday said it would impose tariffs on U.S. crude oil imports for the first time, sending prices down nearly 4% to two-week lows as the escalating bilateral trade war fed worries over a slowdown in global oil demand.

Fed’s commitment to act upstaged by Trump’s furor

Federal Reserve Chair Jerome Powell said the central bank would “act as appropriate” to keep the U.S. economy healthy, stopping short of committing to rapid-fire rate cuts and drawing fire from President Donald Trump.

Stocks and oil fall, yen rallies as Trump threatens to further escalate China trade war

Stocks and oil prices fell sharply on Friday while traditional safe havens rose after U.S. President Donald Trump threatened to further escalate his trade war with China “this afternoon,” following a new round of retaliatory tariffs from Beijing.

Oil prices slide as U.S.-China trade war escalates

Oil prices fell on Friday after China unveiled retaliatory tariffs against about $75 billion worth of U.S. goods including crude oil, another escalation of a protracted trade dispute between the world’s two largest economies.

World needs to end risky reliance on U.S. dollar: BoE’s Carney

Bank of England Governor Mark Carney took aim at the U.S. dollar’s “destabilizing” role in the world economy on Friday and said central banks might need to join together to create their own replacement reserve currency.

In Unprecedented, Shocking Proposal, BOE’s Mark Carney Urges Replacing Dollar With Libra-Like Reserve Currency

After Jerome Powell’s neutral-to-slightly-dovish-but-mostly-boring speech on Friday morning, investors could be forgiven for suspecting that this year’s Fed-sponsored gathering in Jackson Hole might be disappointingly dull (especially with all that’s going on in Trump’s twitter feed, the escalating trade war and escalating geopolitical unrest).

Then along came former Goldman banker and current (outgoing) BOE governor, Mark Carney, who in his lunchtime address laid out a shocking, radical proposal – perhaps the most stunning thing to ever be unveiled at Jackson Hole – urging to replace the US Dollar with a “Libra-like” reserve currency in a dramatic revamp of the global monetary, financial and economic order.

Stocks, Dollar, Yields Crash; Gold Explodes As Stunned Traders React To Series Of Surreal Events

Jerome Powell’s Jackson Hole speech was supposed to be the most important even of an otherwise sleepy, August day day, after which traders could quietly exit for the rest of the day and commence drinking. It did not quite work out that way.

Not only did Powell’s speech barely make the top 3 most important events, but Friday ended up being an exercise in surreal market newsflow, and one of the biggest drops of 2019 to boot.

With a few hours left before Jackson Hole, as traders were getting ready to trade Powell’s Jackson Hole speech which was a big dud, and did not reveal anything new (as even Trump figured out when he blasted the Fed chief slamming “As usual, the Fed did NOTHING!” and asking “who is our bigger enemy, Jay Powell or Chairman Xi?”), China shocked the market by unveiling that it would retaliate by slapping 10% tariffs on another $75BN in US imports, which sent stocks sharply lower at first. Then, Powell’s remarks managed to somewhat stabilize sentiment, and the S&P almost regained all losses… before all hell broke loose and in a vicious tirade, Trump first slammed Powell, effectively calling him an enemy of the state”, and then warned he would retaliate to China soon, while ordering US companies (can a US president dictate to companies what they can and can not do?) to find an “alternative” to China.

The result was a violent slam lower in risk assets, with the S&P tumbling over 70 points, the Dow plunging over 500 point, its 3rd such drop in the month of August, which has emerged as the worst month for stocks since December 2018…

DoJ: 64% Of All Federal Arrests In 2018 Were Non-Citizens

Authored by Ivan Pentchoukov via The Epoch Times,

Non-citizens accounted for 64 percent of all federal arrests in 2018, according to new data released on Aug. 22 by the Justice Department. The surge was driven largely by immigration-crime arrests, which have soared to the highest level in at least two decades.

Goldman: Trump’s Decision To Delay Tariffs Was Seen As Weakness By China, And Escalated The Trade War

Ten days ago, we reported that in the aftermath of Trump’s unexpected concession when the US unilaterally decided to delay the imposition of tariffs on Chinese consumer products from September 1 to December 15, China mocked Trump’s act as “proof he is losing the trade war.”

Today, Goldman confirms as much, and points out that in a paradoxical twist, it was Trump’s delay that may have made trade war with China even more complicated. In a note discussing China’s retaliatory tariffs, the bank’s China economist Yu Song writes that “the recent US decision to delay some tariffs could even paradoxically prolong the trade war since it has been seen as a sign of weakness, at least by some in China, and could make the Chinese government less willing to soften its stance to reach a compromise.”

Of course, this is a two way street, because as we said on August 13,” what is likely is that any widespread shift in sentiment that Trump retreated and waved a white flag of surrender, could very quickly undo the tariff delay as the last thing Trump wants, is to be seen as weak and ineffectual, or his trade war strategy as inefficient, not by his base, and certainly not by his opponent, China.”

Today, all these concerns came true. And while we doubt that Trump will accelerate the delayed tariffs – after all he doesn’t want an inflationary spike just in time for Christmas as Chinese consumer good import prices soar – the hope of any trade deal before the November 2020 election is now dead and buried.

Here is the full Goldman note:

China retaliates by imposing additional tariffs on US imports

Ministry of Finance in China announced Friday evening that it will (1) resume the import duties on US automobile components which have been paused since Dec …

Is Sitharaman’s ‘Mini Budget’ enough to revive a slowing India?

Is Sitharaman’s ‘Mini Budget’ enough to revive a slowing India?If a fiscal stimulus is off the table, FinMin has to keep tweaking rules to make things easier for businesses.

Reeling Motown gets stuck in a tax tangle

Reeling Motown gets stuck in a tax tangleCarmakers now have to pay 28% GST on imported plastic goods such as ashtrays and floormats instead of 18%.

Air India owes Rs 5,000 cr. That’s just for fuel

Air India owes Rs 5,000 cr. That’s just for fuelAir India has not been making payments and the credit period has now extended to 230 days.

Market Extra: Why Anthony Scaramucci is waging a media war on President Donald Trump

A friendship between President Donald Trump and one of his most vocal advocates has taken an almost-Shakespearean twist.

Bond Report: Treasury yield curve inverts after China tariff pledge, Powell speech, and Trump trade tweets

U.S. Treasury yields slump Friday after China announces more tariffs on imports of U.S. goods, Federal Reserve chair Powell indicates that lower interest rates were possible, and President Trump orders American companies home, creating even more uncertainty for business planning.

Market Snapshot: Dow drops 600 points after Trump says U.S. companies must look for ‘alternative to China’

U.S. stocks fall sharply Friday as President Donald Trump says he’s “ordering” U.S. companies to start looking for “an alternative to China” after Beijing imposed more retaliatory tariffs on U.S. goods.