Markets were caught between Trump’s more optimistic pronouncements and his more threatening statements…
from Zero Hedge
Update 2: During President Trump’s speech on Tuesday, he laid out his economic message for the 2020 campaign: Under his administration, the US has experienced more than five years of uninterrupted growth, and record-low unemployment.
Trump said he reversed policies imposed by his predecessors that restrained the economy, blaming regulations and trade deals advanced by other presidents. He added that the “political class sold out American workers.”
The president reiterated his criticism of the Fed, which he has repeatedly bashed for not cutting interest rates sooner. Yet, this time he actually called for the central bank to consider cutting rates into negative territory like they have in Europe. When Trump’s praise of negative interest rates only evoked a brief burst of applause, Trump remarked that “only the smart people are clapping.”
Turning his attention to trade, markets were caught between Trump’s more optimistic pronouncements and his more threatening statements. He accused China and India of taking advantage of the US, while promising the audience that a trade deal with China is well within the US’s grasp.
Ultimately, it looks like Trump’s speech was a positive for markets.
* * *
Update: President Trump’s scheduled speech started a few minutes late, some of his prepared remarks have already hit the tape.
- TRUMP TO SAY AMERICAN MARKET IS MOST COVETED ON THE GLOBE
- TRUMP: THOSE WHO WANT ACCESS TO AMERICAN MARKET MUST OBEY RULES
- TRUMP SAYS FED FAR TOO SLOW IN CUTTING RATES
- TRUMP SAYS FED PUTS U.S. AT DISADVANTAGE VS OTHER COUNTRIES
- TRUMP SCOLDS FED, MAKES PLEA FOR NEGATIVE RATES
- TRUMP SAYS THINKS U.S. CAN BRING DOWN TAX RATES FURTHER
- TRUMP SAYS EU HAS HIGH TRADE BARRIERS
- TRUMP SAYS CHINA TRADE DEAL COULD HAPPEN SOON
- TRUMP: IF THERE IS NO DEAL, WE WILL RAISE TARIFFS
And a quote…
“The American Market is the most valuable and coveted market on the globe – those who want access must play by the rules, respect our laws, and treat our workers and businesses FAIRLY,” Trump said in excerpts released by the White House.
Trump started his remarks by referencing his last appearance before the club, which took place three years ago, when he was just a candidate for president. He characterized the economy back then as tepid and weak, and insisted that, since his election, the economy has come “thundering back at record speed.”
* * *
President Trump isn’t the most popular individual right now over at the Chamber of Commerce. That’s why a planned talk at the Economic Club of New York Tuesday afternoon could be really interesting.
The planned topic of Tuesday’s talk is US trade policy, and it’s a guarantee that markets will be hanging on every word.
With Trump’s trade war one of the biggest issues for markets, the audience at Tuesday’s speech certainly wouldn’t respond well to talk of more tariffs.
If he wants to bring the house down, Trump could announce some progress with China (though at this point everybody knows to take the administration’s trade-deal rhetoric with a grain of salt), or delay a decision on whether to slap tariffs on EU-made cars and auto parts.
One White House spokesman told Reuters that Trump will focus on how his policies, like tax cuts and deregulation, helped bolster one of the longest economic recoveries.
“You can expect the president to highlight how his policies of lower taxes, deregulation, and fair and reciprocal trade have supported the longest economic recovery in U.S history with record low unemployment, rising wages, and soaring consumer confidence,” White House spokesman Judd Deere said. He declined to give further details.
Even if Trump doesn’t say much about the partial “Phase 1” trade deal that the US and China are reportedly on the brink of signing, markets will be on the lookout for anything positive Trump has to say about the trade talks, even if he doesn’t offer much detail.
Watch his speech live below. He’s slated to begin around noon.