E Markets Calm Down On Brexit And China Trade News

Two of the things terrifying markets looked somewhat more hopeful Friday. Brexit booster Boris Johnson gave way to Leo Varadkar over where the border between Eire and Northern Ireland will go after Britain withdraws from the European Union. Varadkar said the deal would let Britain leave “in an orderly manner.” There will be no border between the two after Brexit so both will remain in the EU customs area. Johnson risks trouble with his coalition partners but he already has lost his parliamentary majority. Donald Tusk, President of the EU council, called the chances of a deal “promising.”

Then China indicated that it would accept a partial trade deal, which would not address the real issues like intellectual property theft and requirements that companies investing in China take on local partners, both of which cause great harm to firms seeking access to the country. Instead, the two countries can paper over their differences and do a deal cutting tariffs which are hurting both countries. President Trump may just accept a “mini-agreement” as good for his re-election chances and, in the short term, for trade, now that his tax returns will be given to House Democrats working to impeach him. Trump tweeted “They want to make a deal but do I?”

The Fed will buy short-term US Treasury notes to the tune of $60 billion per month to feed liquidity into the banking system. It will go on until next year.

Even the depressed price of oil rose 2% when reports hit that an Iranian tanker had been hit by missile fire near Jiddah, Saudi Arabia.

The US may have thrown the Kurds under the bus but we are sending 2,000 more troops to Saudi. Asia Times reported that our President has admitted to a conflict of interest with Turkey, telling Breitbart News in December 2015 that “I have a major building in Istanbul. It's called Trump Towers-two towers instead of one.” It is a multipurpose retail, office, and residential building which Trump said was “tremendously successful”, wrote Alison Tahmizian Meuse from Beirut.

HSBC did a report on Indian equities in which it warned that “the corporate tax cut may not drive a meaningful near-term economic turnaround amid weak external and domestic demand conditions. Aside from passing on some benefit to consumers, companies could use tax savings for de-leveraging and share buybacks rather than invest aggressively near-term. Cyclical and structural growth headwinds (problems with non-bank financial companies; weaker household balance sheets, and global uncertainties) will not be addressed by policy stimulus. Near-term risks to earnings remain.

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