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    Update: No Interim Deal After Fake Bloomberg Story...Trump Returns China Favor, ECB Promises Stimulus

    September 12, 2019
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    Screenshot: YouTube

    UPDATE: Interim Trade Deal? NO, Says Trump Admin.

    Bloomberg announced that an interim trade deal may be in the works in advance of October trade talks with China. Markets ripped higher on the news. However, ZeroHedge just tweeted that the Trump Administration has denied the story, accusing Bloomberg of fake news. More to come...

    President Trump Displays Good Will

    Following a Chinese pledge to drop tariffs on 16 U.S. products yesterday, President Trump has returned the favor by delaying a 5% tariff hike on $250 billion of Chinese goods set to go into effect on October 1st. The new effective date is October 15th.

    The move is more than a two-week economic reprieve, it has symbolic value as well. The much-ballyhooed 70th anniversary of the Chinese Communist Party wresting control of the country falls on October 1st, the day the hike was set to go into effect. Such diplomacy will surely be appreciated in Beijing.

    ECB Props Up Economy, But Is Is Too Much?

    In what is likely Mario Draghi's last major act as president of the European Central Bank, he cut the ECB deposit rate by 10 basis points and declared that they would remain low. Draghi also promised to restart bond purchases at a rate of 20 billion euros a month.

    Further, he stated that the bond purchasing would "run for as long as necessary to reinforce the accommodative impact of its policy rates" and end before rates were raised. It's a bold pronouncement, given that bond purchasing is one of few measures the ECB has to stimulate the economy, and usually reserved for bleaker pictures than the one the eurozone currently faces.

    Christine Lagarde takes the ECB reins on November 1, and she will inherit Draghi's many parting promises.

    The argument against pulling out the big guns is that Europe's problem isn't solely from within, as Brexit worries have been a drain on momentum, but without: the U.S.-China trade war is an external factor that has created headwinds for eurozone economies.

    Market reactions have varied. Eurozone bonds rallied, and the Euro fell below $1.10. U.S. stocks opened flat to up, with the NASDAQ leading the charge, up 0.4%.



    CDM Staff

    The mission at Creative Destruction Media is to be the catalyst for the "process of industrial mutation that incessantly revolutionizes the economic structure from within, incessantly destroying the old one, incessantly creating a new one."
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