E Skinny Deal: Whose World View Is Currently Winning?

Trump concluded a skinny deal with China. He called it phase one; "skinny deal" is more of an accurate description.

Before the deal was struck, early in the morning Pacific time Ron Paul and Jim Cramer were on CNBC discussing the way forward in trade. I am not often a fan of Ron Paul. But as the Republicans and Democrats scurry to look tougher regarding China trade, Paul looks like the voice of reason.

As I say, Jim Cramer and Ron Paul were on Squawk, but they were saying two different things. Ron Paul took a more responsible tack saying we don't need to be adding tariffs and hurting our citizens. He opposes socialism in America but says we should not be telling trading partners what to do.

For Ron Paul, tariffs are socialism. However, communist China wants free trade. Free trade is more an expression of capitalism. The US is deviating from capitalism under Trump. China is embracing capitalism. 

Cramer, on the other hand, said Trump has the Chinese right where he wants them. Cramer thinks a Skinny Deal means we are winning. Cramer has swallowed the anti-capitalist populism of the Donald, making it his own. 

Skinny, Skinny Deal

The deal cut by the White House clearly was a Skinny Deal, not lifting the December 15 tariffs, not rolling back any previous tariffs. All that was agreed to was a delay in the October 15th tariffs. Reporters covering the meeting between the Chinese vice premier and POTUS clearly pointed out that there was no deal regarding intellectual property at all. Sure, tech transfers will not be required for financial firms locating to China, but that was already old news. 

AFP reports that tech transfers will be allowed under serious and unexpected compromise:

Trump said the talks had "made very good progress on technology transfer" -- a key point of friction.
Without giving further details, he said an agreement could be reached soon, with US companies sharing their know-how in exchange for access to Chinese markets.
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Disclosure: I have no financial interest in any companies or industries mentioned. I am not an investment counselor nor am I an attorney so my views are not to be considered investment ...

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Gary Anderson 1 month ago Author's comment

Update 9: Big oil told Trump that they could not produce enough to satisfy what Trump required from China in phase 1. Trump is a fraud.

Gary Anderson 1 month ago Author's comment

Update 8: Phase One will be weakened by the Coronavirus. Previous doubts about China's ability to satisfy US quotas for agriculture have intensified.

Gary Anderson 3 months ago Author's comment

Update 7: Trump is putting off December tariffs but nothing will be signed til after the first of the year. Trump wants strong stocks for reelection. After that, all bets are off. He may hate China more than he loves stocks!

Gary Anderson 3 months ago Author's comment

Update 6: Wall Street was greeted by Trump saying he wants to wait until after the election for a trade deal. He is tariff man. Wall Street never did grasp this truth about Trump.

Gary Anderson 3 months ago Author's comment

Update 5: Trump signed Hong Kong sanctions bills. It is possible that will derail even a skinny deal.

Gary Anderson 4 months ago Author's comment

Update 4: If Trump waits to sign phase one at the end of impeachment proceedings, Xi will have massive leverage over POTUS45. He will likely want tariffs rolled back or no deal.

Gary Anderson 4 months ago Author's comment

Update 3: Navarro says no rollback of tariffs. China says no signing without the rollbacks. Trump fools Wall Street yet again?

Gary Anderson 4 months ago Author's comment

Update 2: China believes Trump is indeed made up of Bannonite in his DNA and the USA is abandoning pragmatism. No deal will be ever be permanent according to the Chinese.

Gary Anderson 5 months ago Author's comment

Update: Oops. Bloomberg reports that China will only buy the massive 50 billion in farm products if Trump rolls back more tariffs. China is playing with Trump, and frankly he deserves it.