The Big Business lobbyists for cheap labor have prioritized illegal immigrant amnesty legislation since 2014, when the Chamber dumped $50 million to protect border-jumpers from deportation and win them employment authorization documents. "Stripping DACA recipients of their ability to legally live and work in the country will harm them," the D.C. fat cats lamented this week. MICHELE MALKIN
Steven Malanga and Daniel DiSalvo join John Stossel to talk about America’s underfunded government-pension systems—the costs of which are consuming larger portions of state and city tax revenues, squeezing budgets, and limiting vital public services.
Stock bubble bigger than 2008 & coming crash far larger, warns Peter Schiff
Wall Street and the US economy are on the verge of recession, according to the CEO of Euro Pacific Capital, Peter Schiff, who has raised alarms after this week’s market selloff.
“This is a bubble not just in the stock market, but the entire economy,” he told Fox News. Schiff predicts a recession, accompanied by rising consumer prices, that will be “far more painful” than the 2007-2009 Great Recession.
Schiff added: “All bear markets start off as corrections. I think this one is probably a bear market. It’s long overdue. This is a bigger bubble than the one that blew up in 2008, and the crisis that is going to ensue is going to be far larger.”
THE OBAMA – CLINTON – GLOBALIST CONSPIRACY: Finish off the
middle-class and build a “cheap” labor Mex servant class.
entire crony capitalist system, Democrat and Republican alike, has become
a kleptocracy approaching par with third-world hell-holes. This
is the way a great country is raided by its elite.” ---- Karen
McQuillan THEAMERICAN THINKER.com
Obama Is Making You
Poorer—But Who’s Getting Rich?
Goldman Sachs, GE, Pfizer, the United Auto Workers—the same
“special interests” Barack Obama was supposed to chase from the temple—are
profiting handsomely from Obama’s Big Government policies that crush taxpayers,
small businesses, and consumers. In Obamanomics, investigative
reporter Timothy P. Carney digs up the dirt the mainstream media ignores and
the White House wishes you wouldn’t see. Rather than Hope and Change, Obama is
delivering corporate socialism to America, all while claiming he’s battling
corporate America. It’s corporate welfare and regulatory robbery—it’s
OBAMANOMICS TO SERVE THE RICH AND GLOBALIST BILLIONAIRES.
NEW YORK — In the midst of a public relations nightmare, former White
House Deputy National Security Adviser Dina Habib Powell took charge of Goldman
Sachs’s global charitable foundation, helping to resurrect the big bank’s
shattered image after it was implicated in practices that contributed to the
financial crisis of 2007-2008.
GOOGLE WORKED TO RIG ELECTION FOR
SWAMP EMPRESS HILLARY CLINTON TO KEEP THE FOREIGN INVADERS COMING!
THE INVITED INVADING HORDES: IT’S
ALL ABOUT KEEPING WAGES DEPRESSED!
"In the decade following the
financial crisis of 2007-2008, the capitalist class has delivered powerful
blows to the social position of the working class. As a result, the working
class in the US, the world’s “richest country,” faces levels of economic
hardship not seen since the 1930s."
"Inequality has reached
unprecedented levels: the wealth of America’s three richest people now
equals the net worth of the poorest half of the US population."
Another financial earthquake in the making
By Nick Beams 15 October 2018
The key issue to emerge
from the semiannual meeting of the International Monetary Fund (IMF) held in
Bali, Indonesia last week is that 10 years out from the 2008 global financial
crisis the conditions have been created for another economic and financial disaster.
And those in charge of the global economy have no means of preventing it, not
least because the very policies they have carried out over the past decade have
helped prepare it.
It was somewhat
symbolic that the meeting took place in the immediate aftermath of the
devastating earthquake and tsunami on the Indonesian island of Sulawesi, which
again underscored the extent to which the record growth of social inequality,
accelerating after 2008, has left hundreds of millions of impoverished people
the world over vulnerable to the impact of both natural and economic disasters.
The meeting also
coincided with another significant anniversary—20 years since the Asian
financial crisis that devastated the Indonesian economy, along with others in
And while the meeting
was being held, there were signs that another financial earthquake is in the
making, as Wall Street and global stock markets were shaken by the second major
sell-off this year after five years of relative stability.
Two reports prepared by
the IMF for the meeting pointed to the mounting problems of the global economy
and financial system.
Economic Outlook revised down the estimate of global growth issued by
the IMF in April and noted that the “synchronised” expansion of 2017 had come
to an end. While growth would continue, there would be no return to the growth
path that had prevailed prior to 2008. A review of the effects of the financial
crisis, which produced the biggest economic downturn in the post-war period,
drew out that, compared to the growth trajectory prior to the crisis, a large
number of economies had suffered a contraction ranging from 10 percent to as
high as 40 percent.
Financial Stability Report pointed to the impact of rising interest
rates in the US and elsewhere on “emerging markets” with high levels of
external debt and dollar-denominated loans. The higher rates have already
impacted Argentina—at present in receipt of a record bailout of $57 billion
from the IMF—and have hit a number of other countries, including Turkey,
Indonesia, India, Pakistan and South Africa, with signs that it will extend.
According to a report
in the Financial Times, the financial stress hitting emerging
market economies “dominated” discussions at the meeting, as IMF Managing
Director Christine Lagarde warned that the present situation had the potential
to lead to a withdrawal of capital from these countries as large as that which
took place after the 2008 financial crisis.
The other key issue was
the trade war initiated by the United States against China and other countries.
At its spring meeting in April, the IMF warned that these measures posed
significant risks to the world economy. Now those risks had materialised, with
Lagarde and World Trade Organisation head Roberto Azevedo both issuing calls
for “reform” of the WTO and for the international trading system to be
repaired, not wrecked.
But the US has already
stated it doubts that its objections to Chinese trade practices, including the
subsidisation of state-backed businesses and the alleged theft of intellectual
property, can be resolved within the WTO framework. Rather than seeking a
strengthening of the so-called “rules-based” international trading order, the
US, almost on a daily basis, is stepping up its attacks on China, regarding it
as the central threat to its global economic and military dominance.
While it is pushing for
a reduction of the Chinese trade surplus, Washington’s primary objective is to
break up global supply chains so that key manufacturing and high-tech
industries are brought back to the US to enhance its national military
capacities for war.
At the same time, it is
using standover tactics in relation to its “strategic allies,” above all the
European Union, Japan and Canada, threatening them with the imposition of auto
tariffs as high as 25 percent if they do not enter bilateral trade negotiations
with the US and join its actions against China.
In the middle of the
IMF meeting, as if the representatives of global capitalism needed to the
reminded of the fact that none of the underlying factors that produced the
crisis of 2008 has been resolved, Wall Street experienced a major two-day
As an article in Bloomberg noted:
“[W]hile this week wasn’t wholesale carnage, it’s more proof that a new era of
volatility is upon us, one that is likely to last. Bad days pile up, and it
gets harder to deny that five of the quietest years ever seen in equities are
Those “quiet years”
were the direct result of the lowering of interest rates to record lows and the
policies of quantitative easing by the US Federal Reserve and other major
central banks, which have pumped trillions of dollars into the financial system
and sent the US stock market to record heights. But now the Fed and other banks
are lifting interest rates and pulling back on easy money policies, not least
because they want to have some “ammunition” to meet the next major economic and
As a number of more
perceptive reports and comments have noted, the very measures adopted in the
wake of the 2008 crash have only created the conditions for another disaster.
Writing in the New York Times on September 18, Ruchir Sharma
explained that while central bankers and other authorities have sought to
contain the banks’ risky lending practices for home mortgages, new risks have
Sharma pointed out that
within the $290 trillion global financial market, “there are hundreds of new
risks, pools of potentially troubled debt” produced by the turn of corporate
borrowers to non-bank lenders.
“As bank lending dried
up, more and more companies began raising money by selling bonds, and many of
those bonds are now held by those non-bank lenders—mainly money managers such
as bond funds, pension funds or insurance companies.”
The result is that
among the corporations listed on Wall Street’s S&P 500 index, debt has
tripled since 2010 to one-and-a-half times annual earnings, near the peaks
reached in the recessions of the early 1990s and 2000s, with the debt load much
higher in some areas.
In the reports on the
global financial system from the IMF and other institutions, the claim is
regularly made that banks are in a much stronger position than they were in 2008
because of regulatory changes such as the Dodd-Frank Act in the US.
But as Carmen and
Vincent Reinhart point out in an article in Foreign Affairs, the
result has been the growth of so-called “shadow banking,” as borrowers for
homes turn to organisations such as Quicken Loans rather than to Wells Fargo.
“A majority of US mortgages are now created by such non-banking institutions,
also known as ‘shadow banks.’ The result is that financial vulnerability
remains but is harder to spot.”
The two authors point to
another major change in the global financial system. As a result of
quantitative easing, “the majority of government debt that is sold in the open
market in the United States, Japan and the euro zone is now owned by central
banks.” The concentration of government debt in official coffers makes the
private market for it less liquid, which could make it harder for governments
in advanced economies to borrow more in the future, they write.
A key feature of the
build-up to the crash of 2008 was the way in which credit rating agencies gave
their approval to the arcane financial instruments that proved to be worthless.
Those practices have continued in another form.
by Bloomberg published on Thursday points to what it calls a
“$1 trillion powder keg that threatens the corporate bond market.” The article
explains that faced with weak sales growth coupled with rock-bottom interest
rates, major companies felt that the way to growth was to borrow large amounts
of money to buy out competitors.
According to the
article, an investigation into 50 of the largest corporate acquisitions over
the past five years revealed that “by one key measure more than half of the
acquiring companies pushed their leverage to levels typical of junk-rated
peers. But those companies, which have almost $1 trillion of debt, have been
allowed to retain investment-grade ratings by Moody’s Investor Services and
S&P Global Ratings.”
The report states that
rating agencies simply accepted assurances from companies involved in the
takeover deals that they would be able to “cut costs and pay down borrowings
quickly, before the easy money ends.”
The investigation found
that there had been a surge in the lowest rungs of investment-grade bonds, most
of it driven by corporate acquisitions, with the result that there was now
$2.47 trillion worth of corporate debt rated at the lower investment grade,
more than triple the level at the end of 2008.
What these and other
reports make clear is that the very measures undertaken in the wake of the 2008
crash, far from overcoming the crisis, have simply created a new financial
house of cards, which is set to collapse with potential consequences even more
serious than the breakdown ten years ago. The sharp fall on Wall Street this
week, a result of fears of the consequences of interest rate rises, did not
lead to a meltdown, but the tremors it sent out signalled the approach of
Australian housing market slumps toward potential crash
By James Cogan 17 October 2018
Amid the growing global economic turmoil and uncertainty, statistics, studies and comments published in the financial press are drawing attention to the fragility of the Australian real estate market and the immense social and political implications of a severe slump.
After close to a decade of soaring house prices in the major cities, Australian households are among the most indebted in the world, with household debt compared to income close to 200 percent. Millions of families have been compelled to borrow staggering sums to achieve the so-called “Australian dream” of home ownership.
At the same time, speculators have gambled that the purchase and resale of real estate offered greater capital gains than stocks and other investments. The major Australian banks became among the most profitable in the world by facilitating a speculative frenzy, borrowing at near zero interest rates internationally and lending at higher margins in Australia.
By the end of 2017, housing in Sydney and Melbourne, the country’s largest cities and the focus of real estate speculation, was ranked as among the “least affordable” in the world. Sydney was ranked as the second worst after Hong Kong, with median house prices nearly 13 times median household income. Melbourne was the fifth worst internationally, with prices close to 10 times higher than what the median household earns in a year.
In August 2018, there were 613 suburbs nationally where the median house price was over $1 million—double the number just five years ago and overwhelmingly in Sydney and Melbourne.
Rampant profit-gouging is rife in the financial industry, some aspects of which were revealed during the recent Royal Commission. Between 2013 and 2015, for example, the banks doubled the amount they lent, mainly to speculative investors, on “interest only” repayment terms, meaning lenders did not have pay any of the principal on a loan for as long as seven years. More generally, bank assessors overestimated the income or underestimated the weekly expenses of applicants to justify extending huge loans to make home purchases or acquire small businesses.
A great deal of money has been made by the capitalist class and sections of the upper middle class at the direct expense of millions of workers, who have been effectively transformed into debt slaves to the banks and finance houses. Outstanding housing debt in Australia reached $1.762 trillion in May 2018—a historic high of 130 percent of Gross Domestic Product.
Under these conditions, a slump in the real estate market is now underway. The median home price has fallen 4.4 percent this year in Sydney and 4.6 percent in Melbourne. Auction clearances have dropped to barely 50 percent. The number of unsold properties on the market has soared by 19.5 percent in Sydney and 18.4 percent in Melbourne.
The developing crisis is partly due to oversupply, but also because the banks have taken belated and desperate steps to tighten credit and therefore their exposure to potential problem loans. Up to 40 percent of applications are now being rejected, compared with barely 5 percent in 2017. The number of new loans to investors has fallen 17.7 percent compared with 12 months ago. Even new loans for owner-occupier dwellings are down 3.6 percent.
The downturn is just beginning. Investment house Morgan Stanley predicted this month at least 10 to 15 percent will be slashed off property values over the next several years.
Other analysts are giving more dire estimates. Martin North, a researcher with Digital Finance Analytics, was widely criticised for predicting on the “60 Minutes” current affairs program that prices could crash by as much as 30 to 45 percent and plunge Australia into its worst economic conditions since the Great Depression.
North’s worst-case scenario, however, is based on significant and credible research. A major study this year by his company found that at least one in four mortgage-holding households—some 820,000—are already in financial stress, meaning they can only meet repayments by reducing other expenses such as food, health care and entertainment.
Digital Finance Analytics considered the implications if interest rates rise. While the Reserve Bank of Australia (RBA) has sought to keep rates at historic lows, its ability to continue to do so is in question due to the steady rise of official rates in the United States. The US Federal Reserve is expected to raise rates again in December and throughout 2019.
Each US rise puts downward pressure on the value of the Australian dollar, increasing the borrowing costs of the banks, which source anywhere up to 40 percent of their capital from overseas markets, especially Wall Street.
Even if the RBA did try to resist matching US increases, the major banks will raise their rates regardless. Their parasitic business model consists of borrowing internationally and lending within Australia at higher interest rates. As the cost of their borrowings increase, they are passing on the burden to Australian households.
Even small rate rises will cause staggering social distress. If rates rose just by 2 percent, back to the level in 2012, well over 50 percent of mortgaged households, some 1.6 million, would sink into financial stress due to their huge repayments.
In dozens of working class and middle class suburbs, between 60 and 100 percent of households would be affected. Many borrowers face the prospect of becoming so-called “mortgage prisoners,” condemned to paying off outstanding loans that are greater than the value of their homes. A wave of foreclosures would have to be expected, further aggravating the slump in property prices.
The Digital Finance Analytics study into the impact of interest rates did not consider the impact of a significant rise in unemployment. That is, it assumed that mortgage holders still had jobs and could struggle to meet their repayments.
Several factors are coming together, however, that threaten to plunge Australia into recession and cause a sharp increase in unemployment.
The construction industry and related real estate activity collectively employs 1.4 million people. As the property slump develops, tens, if not hundreds of thousands of workers in this sector may well lose their jobs.
The launch of open trade war by the United States against China, Australia’s largest export market and trading partner, as well as the general descent into dog-eat-dog competition between the major economic blocs, looms as the greatest threat.
On October 12, the RBA expressed guarded, but serious concerns in its latest “Financial Stability Review”. The central bank stated:
“Australia would be sensitive to a sharp contraction in global growth or dislocation in global financial markets because of the importance of trade and capital inflows. A worsening in external conditions could see a downturn in the domestic economy, reduced availability and higher cost of offshore funding and falls in asset prices, with a resulting deterioration in the performance of borrowers and lenders.”
The RBA continued: “In the current environment, a range of possible triggers could precipitate a global economic downturn. An escalation of trade protection could see a sharp fall in trade, business confidence and investment.”
The central bank issued pro forma reassurances about the “resilience” of the Australian financial system and the ability of households to continue to meet their debt obligations.
In the scenario of a property market crash,
however, the Australian capitalist class would
face the same situation as its counterparts in
the US and Europe after the 2008 financial
crisis. To save the banks from insolvency,
they would demand that the government step
in with massive multi-billion bail-outs and
impose savage austerity on the working class
to pay for them.
It is essential that the working class advance its own interests against the social disaster that the capitalist system has already produced and threatens to inflict. A mass political movement must be developed to fight for a workers’ government that will implement the most far-reaching socialist policies.
The socialist re-organisation of society would necessarily start with the expropriation of all banks and financial institutions which would be placed in public ownership, and an end to the subordination of the basic right to decent housing to the profit interests of a super-wealthy minority.
Housing Market Wobbles, Supporting Trump’s Case Against Fed Rate Hikes
U.S. homebuilding dropped more than expected in September and mortgage application volume for last week came 15 percent lower than a year ago, adding credence to President Donald Trump’s complaints that the Federal Reserve is raising interest rates too rapidly.
“My biggest threat is the Fed. Because the Fed is raising rates too fast. And it’s independent, so I don’t speak to them. But I’m not happy with what he’s [Powell’s] doing. Because it’s going too fast,” Trump said in an interview Tuesday with Trish Regan of the Fox Business Network.
Housing market data released Wednesday appear to support the president’s view that the Fed’s rate hikes are slamming the breaks in some areas of the economy. Refinancing applications, the most interest-rate-sensitive type of mortgage, fell 9 percent for the week. These are now 33.5 percent lower than a year ago. The average rate for 30-year fixed-rate mortgages climbed to 5.10 percent, up from 5.05 percent a week earlier. That is the highest rate since 2011.
“The numbers are tepid enough that you need to wait,” CNBC’s Jim Cramer said Wednesday morning. “If you are on the Fed and you are a rigorous thinker and you’re not anecdotal, you’d say, ‘Okay. Maybe we can do December. Maybe we shouldn’t [do more].”
The Fed is widely expected to hike its interest rate target by a quarter of a percentage point in December.
Cramer said he thought the president was “bashing the Fed unfairly” but addded that the Fed was “putting its head in the sand” by continuing to move rates upward despite signs of weakness in housing.
Higher rates make home-buying less affordable and mean fewer borrowers can benefit from refinancing.
Housing starts, which measure groundbreaking on new homes, declined 5.3 percent to a seasonally adjusted annual rate of 1.201 million units in September, the Commerce Department said on Wednesday. Data for August was revised down, showing the housing market had slowed by even more than previously reported.
Trump country has been especially hard hit by the higher rates. Starts in the South, the biggest market for homebuilding, crashed 13.7 percent last month. It’s likely that Hurricane Florence played a role in that steep decline.
But housing starts in the Midwest fell 14 percent, suggesting a broader weakness.
Housing starts in the Northeast and the West rose, with the Northeast posting a 29 percent gain.
Applications for permits were lower as well. In the Midwest, these fell nearly 19 percent. Nationwide, building permits fell 0.6 percent to a rate of 1.241 million units in September. Since permits are an indication of future building, this is a signal that homebuilding is likely to remain slow.
Home building pulls above its weight in the economy because construction is labor intensive and new home purchases often result in the subsidiary shopping, as homebuyers pick up new appliances, furniture, and even cars when they move in.
The housing market has been a weak spot in an otherwise strong economy, principally because of rising mortgage rates and already elevated home prices. Homebuilder sentiment, however, rebounded in October, suggesting that some of the worst fears for the housing market have eased.
Wall Street volatile as global economy becomes “fragile”
By Nick Beams 19 October 2018
Volatility has continued on Wall Street following two days of major falls last week. The Dow Jones index shot up by more than 500 points on Tuesday, followed by a more than 300-point decline during Wednesday before recovering to finish 80 points down.
Yesterday, after a global sell-off, the Dow finished down by 327 points, after dropping 470 points during the course of the day. In what was described as a “jittery session,” the S&P 500 was down 1.4 percent, its largest fall in a week, and has now experienced a decline in 10 out of the 14 trading sessions this month.
The immediate volatility is being driven by two conflicting tendencies. On the one hand, US markets are being pushed down by the further expected increases in the Federal Reserve’s base interest rate and the general tightening of monetary conditions expressed in the rise of the rate on the benchmark 10-year US Treasury bond, which is now hovering around 3.2 percent. Monetary conditions are also being made more restrictive by the Fed’s reduction of its assets holdings by $50 billion per month as part of its program to reduce its balance sheet. Its previous quantitative easing program saw Fed assets expand from less than $1 trillion to $4.5 trillion.
On the other hand, share prices are being boosted by the rise in profits being reported by banks and major companies. There is also an expectation that US growth will continue and that, while asset valuations may be “stretched,” there is still some way for the market to run and gains to be reaped.
The underlying instability and fears of a major sell-off were underscored by further comments by US President Donald Trump following his denunciation of the Fed’s interest rate rises as “crazy” and “loco” during last week’s sell-off. In an interview with the Fox Business News Network, he repeated his assertion that the Fed was raising interest rates too fast and described the central bank’s actions as “my biggest threat.”
Nominally adhering to the independence of the Fed, Trump said he had not spoken to its chairman Jerome Powell, whom he appointed last year. But he was “not happy” with what Powell was doing, “because it’s going too fast.” Powell, he asserted, was “being extremely conservative, to use a nice term.”
Former Fed chairwoman Janet Yellen weighed into the debate, saying she agreed with the Fed’s present policies and that there was a danger of the economy overheating. She said the present growth rate of 3 percent was “terrific” but cast doubt on whether it was sustainable in the longer term. The Fed would need to be “skilful and lucky” to achieve a soft landing after 2019.
It is a significant observation when a former Fed chief remarks that US growth needs “luck” to continue.
The minutes from the Fed’s interest-rate setting Open Market Committee of September 25-26, released on Wednesday, indicated that the central bank is still on course for another interest rate rise in December, with some participants wanting to tighten policy still further.
The minutes noted that some members thought it would be necessary to “temporarily raise the federal funds rate above their assessments of its longer-run level in order to reduce the risk of a sustained overshooting of the Committee’s two percent inflation objective or the risk posed by significant financial imbalances.”
The chief concern is not with inflation per se but whether the lowering of the unemployment rate and labour shortages lead to a significant push for increased wages, which the Fed is determined to suppress.
Market volatility is also being fuelled by the worsening global economic outlook resulting from the rise in US interest rates, the increasing value of the dollar, and the escalation of trade tensions between the US, China and other countries.
The dollar’s rising value has a major impact on emerging markets because it increases the real level of dollar-denominated loans, making the repayment of the interest and principal more expensive. The Financial Times has described the situation facing emerging markets as “ugly,” noting that the JPMorgan Chase EM currency index has fallen by 12 percent since April. Stock markets have also been hit, with the MSCI Emerging Markets Index down by more than 16 percent in the same period.
The elevated stock market values in the US stand in contrast to the rest of the world. While the S&P 500 index is up more than 4 percent for the year, the Stoxx Europe 600 index has experienced a 6.2 percent decline, Japan’s Nikkei 225 is down by 0.9 percent and the Shanghai Composite has fallen by 23 percent.
Trade tensions are continuing to rise. There was a sharp exchange at a World Trade Organisation (WTO) meeting on Tuesday between the US representative Dennis Shea and his Chinese counterpart Zhang Xiangchen.
Shea demanded that the WTO confront China’s alleged trade abuses and remove its rights as a developing economy. Zhang countered that “no one can be singled out” and that efforts to undermine the basic principles of the organisation had to be opposed. But Shea insisted that the world body target China.
“Adequately responding to the challenges of non-market economies is nothing less than an existential matter for this institution,” Shea said.
This is a thinly-veiled threat that unless the WTO takes action over what the US calls China’s “market-distorting” policies, including subsidies for state-backed industries and its alleged acquisition of high-tech knowledge through forced technology transfers or outright theft, it will withdraw from the body.
The US has already significantly undermined the WTO by blocking the appointment of members to its appellate body, which has the final say on trade disputes. The Trump administration has refused for more than a year to consider new appointments because it says former members went beyond their mandate and took an “activist approach” detrimental to the US. The administration’s actions have reduced the normally seven-member body to just three and if the present stand-off continues it will not be able to function past December next year.
As part of its trade war against China, the US has been seeking to bring its “strategic allies” into its camp by opening up negotiations with them on bilateral trade deals. These moves, including the recently-concluded US Mexico Canada Agreement (USMCA) and agreements with the European Union and Japan for one-on-one negotiations, have been accompanied by threats of auto tariffs of up to 25 percent.
In addition, the USMCA contained what the US side characterised as a “poison pill.” If either of the other partners entered a free trade agreement with a “non-market” economy, namely China, the US could withdraw. US trade officials have made it clear they want to see this provision included in other bilateral deals.
Negotiations with Europe, agreed on at a meeting between Trump and European Commission President Jean-Claude Junker in July, have already produced conflict.
In talks on Wednesday each side accused the other of undermining the July agreement. Commerce Secretary Wilbur Ross said of his EU counterpart Cecilia Malmstrom that it was “as though she was at a different meeting from the one that we attended.”
Ross said the purpose of the meeting was to get “near-term deliverables including both tariff relief and standards.” Trump’s “patience was not unlimited.”
Malmstrom said the EU had asked several times for a “scoping exercise”—the prelude to a full-scale trade deal—but the US had failed to respond. “So far,” she stated, “the US has not shown any big interest there, so the ball is in their court.”
Ross said the contention that the US was slowing things down was “simply inaccurate.” The US ambassador to the EU, Gordon Sondland, was even more blunt and implicitly raised the threat that auto tariffs could be put back on the agenda.
“If the president sees more quotes like the one that came out today his patience will come to an end,” Sondland said, attacking the “complete intransigence” of the EU and warning that any attempt to “wait out” Trump’s term as president was a “futile exercise.”
Warning that politics was putting the “skids under the bull market,” Financial Times economics commentator Martin Wolf wrote on Wednesday that, as the recent IMF meeting had made clear, reasons for concern “abound.” Above all, the “struggle between old and new superpowers” could “change everything.”
Wolf noted that the valuation of risky assets was “stretched” and just a small shift in global financial conditions could damage not only emerging markets. Wolf said the aggregate debt in countries “with systemically important financial sectors now stands at $167 trillion, or over 250 percent of aggregate gross domestic product,” compared with 210 percent in 2008.
The global economy and financial systems are “fragile,” Wolf concluded. “These are dangerous times—far more so than many now recognise. The IMF’s warnings are timely, but predictably understated. Our world is being turned upside down. The idea that the economy will motor on regardless while this happens is a fantasy.”
Hyundai Q3 profit plummets on slowing sales, currency swings
Hyundai Motor reported a 67 percent plunge in third-quarter net profit from the previous year after overseas sales slowed and currency swings hurt its bottom line in emerging markets.
Net profit for July to September was 306 billion won ($268.8 million), while operating profit plummeted 76 percent year-on-year to 288.9 billion won, the firm said in a statement.
"The third quarter was a difficult time due to slowing demand in major markets including the US and concerns over a global trade dispute," said Hyundai, which together with its subsidiary Kia is the world's fifth-largest automaker.
Weakening of the Brazilian and Russian currencies and slowing sales in China also took a toll on Hyundai's bottom line, it said, noting that the Brazilian real lost more than 20 percent against the won in the last 12 months.
The company sold 1.12 million cars worldwide in the third quarter, down 0.5 percent from the same period last year.
It has struggled to stay afloat in China -- the world's largest car market -- as it is increasingly sandwiched between high-end cars from Japan and Germany and cheaper vehicles from homegrown carmakers.
Sales were further hurt by the company's late foray into the Chinese market for sports utility vehicles (SUVs), which have risen in popularity among Chinese consumers.
Hyundai's share price plunged six percent on Thursday to close at 110,000 won on the Seoul stock market.