China will not make a trade deal with the Trump White House. When the market realizes this reality, we will finally see a 20% correction; ie, a bear market. However, it won’t last long, as President Trump’s policies are setting up the U.S. economy for another American century of explosive economic growth.
Beijing has learned a lot in the last year. Finally confronted with an American president who actually cared about his people, the communists in China are at a loss of what to do. So, they will do what they have always done — lie, delay, try to steal, manipulate, and in the end, respond with force (Hong Kong will be the next Tiananmen massacre).
The problem for China is that their economy is a house of cards, and will collapse, leading to social unrest, and possibly to loss of power for the Chicoms. When the people realize they have been fed a lie, in exchange for the complete loss of societal freedom, even brutal repression, they will revolt. However, that scenario is for another column.
For now we will stick to what will happen when the market senses China is lying about wanting a deal.
I believe the entire world trade system is up for a re-engineering over the next 6 years, especially after Trump’s re-election.
This will be a positive for America, not a negative.
The return of American manufacturing and the explosion of the energy revolution in-country, combined with Trump’s sound economic policies, will light the fires of the American economy like nothing we have see before.
When the correction happens — as they say on Wall Street — back the truck up. What happens next will simply be astounding for those with the courage to see and act when the time is right.
Bill Clinton and the Bushes enjoyed the fruits of the Reagan economic revolution for decades.
Future American presidents will have the same opportunity, only on steroids.
This is not to be considered investment advice, but simply to stimulate ideas. Please consult your financial advisor before making any investments.