What’s Going On In Davos? Weak Dollar, Strong Dollar And Now Trump’s Makin’ A TPP Deal

From a weak dollar policy to a strong dollar policy in two days, and from axing the TPP last year to now embracing it, here’s what could be going on…

TPP is back on the table.

Forget the fact that President Trump signed an executive order officially withdrawing from the TPP on January 23, 2017.

President Trump was strongly opposed to the TPP and other trade “deals” as a candidate, and Candidate Trump saw them for what they are.

But not anymore.

Here it is straight from Stevie’s mouth, via CNBC in Davos:

The TPP is not the only thing that could cause a stir.

There has been serious flip-flopping and confusing messages about whether the U.S. wants a “strong dollar” or a “weak dollar”.

Here’s more from the same CNBC article (red bold added for emphasis):

The dollar earlier had hit a three-week low on comments Mnuchin made Wednesday that the soft greenback would be better for the United States. Since then, he and President Donald Trump have said those remarks were taken out of context. Mnuchin and Trump spoke as they attended the World Economic Forum in Davos.

WRONG. Here’s blatant MSM propaganda trying to rewrite history. In CNBC’s own coverage earlier, Stevie didn’t say Wednesday a “soft greenback”, he said “weaker dollar”. This has very serious implications in the foreign currency markets and, arguably, in the entire economy. To simply brush it off like that is a disservice to financial analysis.


“I made the comment two days ago in a press gaggle in the morning. What I said was actually very even-handed and consistent with what I said before,” Mnuchin said Friday in an interview on CNBC’s “Squawk Box.” He added a strong “long-term dollar” is in the country’s best interests.

However, comments from the president and Treasury secretary did little to boost the dollar. In early trading, the currency was down about 0.4 percent against a basket of its global competitors, though it was off the lows of the session.

Mnuchin’s comments were nothing terribly new from the administration. Trump himself has said in the past that he prefers a weak greenback.

For his part, the Treasury secretary repeated that he is not trying to influence the currency markets.

Ding, Ding, Ding, Ding. Alarm bells should be ringing anytime there is talk about “influencing” the markets. In fact, it is the stated policy of the Treasury Department, working under the authority of the Exchange Stabilization Fund, to do just that. Here it is word-for-word from the Treasury Department’s website:

The Exchange Stabilization Fund (ESF) consists of three types of assets:  U.S. dollars, foreign currencies, and Special Drawing Rights (SDRs), which is an international reserve asset created by the International Monetary Fund.  The financial statement of the ESF can be accessed at “Reports” or “Finances and Operations.”

The ESF can be used to purchase or sell foreign currencies, to hold U.S. foreign exchange and Special Drawing Rights (SDR) assets, and to provide financing to foreign governments. All operations of the ESF require the explicit authorization of the Secretary of the Treasury (“the Secretary”).

The Secretary is responsible for the formulation and implementation of U.S. international monetary and financial policy, including exchange market intervention policy. The ESF helps the Secretary to carry out these responsibilities. By law, the Secretary has considerable discretion in the use of ESF resources.

The legal basis of the ESF is the Gold Reserve Act of 1934. As amended in the late 1970s, the Act provides in part that “the Department of the Treasury has a stabilization fund …Consistent with the obligations of the Government in the International Monetary Fund (IMF) on orderly exchange arrangements and an orderly system of exchange rates, the Secretary …, with the approval of the President, may deal in gold, foreign exchange, and other instruments of credit and securities.

After Steve Mnuchin made his “weaker dollar” statement, the dollar tanked and gold spiked.

On Thursday we asked who would be paraded on TV to talk the markets if needed.

Apparently, the “weak dollar ” statement was so shocking that none other than President Trump was summoned to talk the markets and stop the dollar bleeding:

So let’s see here: We’ve had a weak dollar, a strong dollar, and are wheelin’ and dealin’ our way to a new TPP, all in the same week!

If one thing is a solid take-away from the President and his entourage’s trip to Davos it’s this: Uncertainty.

Which brings to mind some questions:

What exactly is the preferred policy of the dollar?

A weak dollar policy? Even though we have no manufacturing and are now embroiled in a Trade War with China?

A strong dollar policy? Even though the entire world is moving away from it anyway?

Are we now going full TPP, when President Trump was so outspoken about it and even signed an executive order on January 23, 2017 officially withdrawing us from TPP Negotiations?

The more I listen to things like our President’s grand finale Davos speech and Stevie’s ramblings of nothingness, the more I believe that President Trump is trying to bluff the rest of the world into thinking that the economy in the United States is booming.

Between the language barriers and the C.I.A. controlled MSM, both here, but more importantly in the case of a bluff, C.I.A. controlled MSM abroad, there is a chance the bluff may work.

All this does is buy the dollar, which is already on life support, a littler more ventilator time, and all it does is delay the inevitable: The coming fiat currency crisis, US Dollar collapse, and if that wasn’t bad enough, the coming global economic collapse.

Gold and silver have responded as they should this week in the face of uncertainty: Prices up on the week (we’ll see where the metals close later today).

And when the world and the U.S. digest what just went down in Davos, next week could be even more uncertain than this one.

Stack accordingly…

– Half Dollar


About the Author

U.S. Army Iraq War Combat Veteran Paul “Half Dollar” Eberhart has an AS in Information Systems and Security from Western Technical College and a BA in Spanish from The University of North Carolina at Chapel Hill. Paul dived into gold & silver in 2009 as a natural progression from the prepper community. He is self-studied in the field of economics, an active amateur trader, and a Silver Bug at heart.

Paul’s free book Gold & Silver 2.0: Tales from the Crypto can be found in the usual places like Amazon, Apple iBooks & Google Play, or online at PaulEberhart.com. Paul’s Twitter is @Paul_Eberhart.